UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
X
__
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended July 28, 2018
or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _______ to _______
Commission File Number: 001-15723
UNITED NATURAL FOODS, INC.
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of
incorporation or organization)
05-0376157
(I.R.S. Employer
Identification No.)
313 Iron Horse Way, Providence, RI 0290 8
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (401) 528-8634
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Common Stock, par value $0.01 per share
Name of each exchange on which registered
The NASDAQ Stock Market
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes X No __
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes __ No X
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No __
Indicate by check mark whether the registrant has submitted electronically, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter
period that the registrant was required to submit such files). Yes X No __
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K X
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated
filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large Accelerated Filer X
Non-accelerated Filer __
Emerging growth company __
Accelerated Filer __
Smaller Reporting Company __
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to
Section 13(a) of the Exchange Act. __
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes __ No X
The aggregate market value of the common stock held by non-affiliates of the registrant was approximately $2.5 billion based upon the closing price of the registrant's common stock on the Nasdaq Global Select Market® on
January 26, 2018 . The number of shares of the registrant's common stock, par value $0.01 per share, outstanding as of September 14, 2018 was 50,423,689 .
Portions of the registrant's definitive Proxy Statement for the Annual Meeting of Stockholders to be held on December 18, 2018 are incorporated herein by reference into Part III of this Annual Report on Form 10-K.
DOCUMENTS INCORPORATED BY REFERENCE
UNITED NATURAL FOODS, INC.
FORM 10-K
TABLE OF CONTENTS
Section
Part I
Item 1.
Business
Item 1A.
Risk Factors
Item 1B.
Unresolved Staff Comments
Item 2.
Item 3.
Item 4.
Part II
Item 5.
Item 6.
Item 7.
Properties
Legal Proceedings
Mine Safety Disclosures
Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
Selected Financial Data
Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 7A.
Quantitative and Qualitative Disclosures About Market Risk
Item 8.
Item 9.
Financial Statements and Supplementary Data
Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
Item 9A.
Controls and Procedures
Item 9B.
Other Information
Part III
Item 10.
Item 11.
Item 12.
Item 13.
Item 14.
Part IV
Item 15.
Item 16.
Directors, Executive Officers and Corporate Governance
Executive Compensation
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
Certain Relationships and Related Transactions, and Director Independence
Principal Accountant Fees and Services
Exhibits and Financial Statement Schedules
Form 10-K Summary
Signatures
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ITEM 1. BUSINESS
PART I.
Unless otherwise specified, references to "United Natural Foods," "UNFI," "we," "us," "our" or "the Company" in this Annual Report on Form 10-K ("Annual
Report" or "Report") mean United Natural Foods, Inc. and all entities included in our consolidated financial statements. See the consolidated financial statements
and notes thereto included in "Item 8. Financial Statements and Supplementary Data" of this Report for information regarding our financial performance.
Overview
We are a Delaware corporation based in Providence, Rhode Island, and we conduct business through our various wholly owned subsidiaries. We are a leading
distributor based on sales of natural, organic and specialty foods and non-food products in the United States and Canada. We believe that our thirty-three
distribution centers, representing approximately 8.8 million square feet of warehouse space, provide us with the largest capacity of any North American-based
distributor principally focused on the natural, organic and specialty products industry. The Company has two principal operating divisions: the wholesale division
which is comprised of several business units aggregated under the wholesale segment, which is the Company's only reportable segment; and the manufacturing and
branded products division.
Since the formation of our predecessor in 1976, we have grown our business both organically and through acquisitions which have expanded our distribution
network, product selection and customer base.
Acquisitions
In July 2014, we completed the acquisition of all of the outstanding capital stock of Tony's Fine Foods ("Tony's"), through our wholly-owned subsidiary UNFI
West, Inc. ("UNFI West"). With the completion of the transaction, Tony's became a wholly-owned subsidiary and continues to operate as Tony's Fine Foods.
Tony's is headquartered in West Sacramento, California and is a leading distributor of perishable food products, including a wide array of specialty protein, cheese,
deli, food service and bakery goods to retail and specialty grocers, food service customers and other distribution companies principally located throughout the
Western United States, as well as Alaska and Hawaii.
During fiscal 2015, we began shipping customers both center of the store products and an enhanced selection of fresh, perishable products typically located in the
perimeter of the store. Our customers utilized both UNFI’s broadline and Tony's perishable offerings, including grocery, refrigerated, protein, specialty cheese and
prepared foods. Our customers seek a full spectrum of offerings and we believe that there is significant value in UNFI's position as a leading provider of logistics,
distribution and category management for both center store and perimeter products.
In March 2016, the Company acquired certain assets of Global Organic/Specialty Source, Inc. and related affiliates (collectively "Global Organic") through our
wholly owned subsidiary Albert's Organics, Inc. ("Albert's"), in a cash transaction for approximately $20.6 million . Global Organic is a distributor of organic
fruits, vegetables, juices, milk, eggs, nuts, and coffee located in Sarasota, Florida serving customer locations across the Southeastern United States. Global
Organic's operations have been fully integrated into the existing Albert's business in the Southeastern United States.
In March 2016, the Company acquired all of the outstanding equity securities of Nor-Cal Produce, Inc. ("Nor-Cal") and an affiliated entity as well as certain real
estate, in a cash transaction for approximately $67.8 million . Nor-Cal is a distributor of conventional and organic produce and other fresh products primarily to
independent retailers in Northern California, with primary operations located in West Sacramento, California. Our acquisition of Nor-Cal has aided in our efforts to
expand our fresh offering, particularly with conventional produce. Nor-Cal's operations have been combined with the existing Albert's business.
In May 2016, the Company acquired all outstanding equity securities of Haddon House Food Products Inc. ("Haddon") and certain affiliated entities and real estate
for total cash consideration of approximately $217.5 million . Haddon is a distributor and merchandiser of natural and organic and gourmet ethnic products
throughout the Eastern United States. Haddon has a diverse, multi-channel customer base including supermarkets, gourmet food stores and independent retailers.
Our acquisition of Haddon has expanded our gourmet and ethnic product and service offering which we expect to play an important role in our ongoing strategy to
build out these product categories. Haddon's operations have been combined with the Company's existing broadline natural, organic and specialty distribution
business in the United States.
In August 2016, the Company acquired all of the outstanding equity securities of Gourmet Guru Inc. ("Gourmet Guru") in a cash transaction for approximately
$10.0 million. Gourmet Guru is a distributor and merchandiser of fresh and organic food focusing on new and emerging brands. We believe that our acquisition of
Gourmet Guru enhances our strength in finding and cultivating
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emerging fresh and organic brands and further expands our presence in key urban markets. Gourmet Guru's operations have been combined with the Company's
existing broadline natural, organic and specialty distribution business in the United States.
The ability to distribute specialty food items (including ethnic, kosher and gourmet products) has accelerated our expansion into a number of high-growth business
markets and allowed us to establish immediate market share in the fast-growing specialty foods market. We have now integrated specialty food products and
natural and organic specialty non-food items into all of our broadline distribution centers across the United States and Canada. Due to our expansion into specialty
foods, over the past several fiscal years we have been awarded new business with a number of supermarkets. We believe our acquisition of Haddon has expanded
our capabilities in the specialty category and we have expanded our offerings of specialty products to include those products distributed by Haddon that we did not
previously distribute to our customers. We believe that the distribution of these products enhanced our supermarket business channel and that our complementary
product lines continue to present opportunities for cross-selling.
On July 25, 2018, the Company entered into an Agreement and Plan of Merger (the "Merger Agreement") pursuant to which we have agreed to acquire all of the
outstanding equity securities of SUPERVALU INC. (“SUPERVALU”) for an aggregate purchase price of approximately $2.9 billion (the "Merger"), including the
assumption of outstanding debt and liabilities. The transaction has been approved by the boards of directors of both companies and is subject to antitrust approvals,
SUPERVALU shareholder approval and other customary closing conditions, and is expected to close in the fourth quarter of calendar year 2018. The proposed
acquisition of SUPERVALU is expected to expand the Company’s customer base and exposure across channels, add high-growth perimeter categories such as
meat and produce to the Company’s natural and organic products, provide the Company a wider geographic reach and greater scale, and increase efficiencies.
Our Operating Structure
Our operations are generally comprised of two principal operating divisions. These operating divisions are:
•
our wholesale division , which includes:
◦
◦
◦
◦
◦
our broadline natural, organic and specialty distribution business in the United States;
Tony's, which distributes a wide array of specialty protein, cheese, deli, foodservice and bakery goods, principally throughout the Western
United States;
Albert's, which distributes organically grown produce and non-produce perishable items within the United States, and includes the operations of
Nor-Cal, a distributor of organic and conventional produce and non-produce perishable items principally in Northern California;
UNFI Canada, Inc. ("UNFI Canada"), which is our natural, organic and specialty distribution business in Canada; and
Select Nutrition, which distributes vitamins, minerals and supplements; and
•
our manufacturing and branded products division , consisting of:
◦ Woodstock Farms Manufacturing, which specializes in importing, roasting, packaging and the distribution of nuts, dried fruit, seeds, trail mixes,
granola, natural and organic snack items and confections; and
our Blue Marble Brands branded product lines.
◦
We disposed of our retail business, Earth Origins Market ("Earth Origins"), during fiscal 2018. Beginning in fiscal 2019, the Select Nutrition business will be
combined with our broadline operations.
Wholesale Division
In August 2016, we launched an initiative to reorganize our sales structure in the United States. This new structure is regional and our broadline distribution
business is now organized into three sales regions— our Atlantic Region, Central Region and Pacific Region. Each region has a president responsible for all our
products and services within the territory, including fresh, grocery, wellness, e-commerce, food services, and ethnic gourmet. Territory managers in these regions
now sell across our complete lines of products. This change brings us to our customers more frequently with all of our service offerings and we anticipate
identifying and taking advantage of sales opportunities that result from our customers having a single point of contact for all of our products and services.
As of our 2018 fiscal year end, our Atlantic Region operated ten distribution centers, our Central Region operated six distribution centers, and our Pacific Region
operated twelve distribution centers. Beginning in fiscal 2019, the Company realigned two of its distributions centers previously included in the Atlantic Region to
the Pacific Region.
Certain of our distribution centers are shared by multiple operations within our wholesale division.
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Tony's operates out of four distribution centers located in California and Washington. In addition to the four Tony's facilities, the Company distributes Tony's
perishable products from certain of its other broadline distribution centers, including our Aurora, Colorado facility.
Albert's operates out of four distribution centers located throughout the United States.
UNFI Canada distributes natural, organic and specialty products in all of our product categories to all of our customers in Canada. As of our 2018 fiscal year end,
UNFI Canada operated four distribution centers.
Through Select Nutrition, we distribute more than 14,000 health and beauty aids, vitamins, minerals and supplements from distribution centers in Pennsylvania and
California.
Manufacturing and Branded Products Division
Our subsidiary doing business as Woodstock Farms Manufacturing specializes in importing, roasting, packaging and the distribution of nuts, dried fruit, seeds, trail
mixes, granola, natural and organic snack items and confections for our customers and in the Company's branded products. Woodstock Farms Manufacturing sells
items manufactured in bulk and through private label packaging arrangements with large health food, supermarket and convenience store chains and independent
retailers.
We operate an organic (United States Department of Agriculture ("USDA") and Quality Assurance International ("QAI")) and kosher (Circle K) certified
packaging, roasting, and processing facility in New Jersey that is SQF (Safety Quality Food) level 2 certified.
Our Blue Marble Brands portfolio is a collection of 17 organic, non-GMO, clean and specialty food brands representing more than 750 unique retail and food
service products sourced from over 30 countries around the globe. Blue Marble Brands defines clean ingredients to be minimally processed foods, using only
essential ingredients that contain no artificial colors or flavors. Our Blue Marble Brands products are sold through our wholesale division, third-party distributors
and directly to retailers. Our Field Day® brand is primarily sold to customers in our independent channel and is meant to serve as a private label brand for retailers
to allow them to compete with supermarket and supernatural chains which often have their own private label store brands.
To maintain our market position and improve our operating efficiencies, we seek to continually:
•
•
•
•
•
•
•
•
•
expand our marketing and customer service programs across regions;
expand our national purchasing opportunities;
offer a broader product selection than our competitors;
offer operational excellence with high service levels and a higher percentage of on-time deliveries than our competitors;
centralize general and administrative functions to reduce expenses;
consolidate systems applications among physical locations and regions;
increase our investment in people, facilities, equipment and technology;
integrate administrative and accounting functions; and
reduce the geographic overlap between regions.
Our continued growth has allowed us to expand our existing facilities and open new facilities in an effort to achieve increasing operating efficiencies.
Our Customers
We serve more than 40,000 customer locations primarily located across the United States and Canada which we classify into four channels:
•
•
•
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supernatural , which consists of chain accounts that are national in scope and carry greater than 90% natural products, and at this time currently consists
solely of Whole Foods Market;
supermarkets , which include accounts that also carry conventional products, and at this time currently include chain accounts, supermarket independents,
and gourmet and ethnic specialty stores;
independents , which include single store and chain accounts (excluding supernatural, as defined above), which carry more than 90% natural products and
buying clubs of consumer groups joined to buy products; and
other , which includes foodservice, e-commerce and international customers outside of Canada, as well as sales to Amazon.com, Inc.
We maintain long-standing customer relationships with customers in our supernatural, supermarket and independent channels.
The following were included among our wholesale customers for fiscal 2018 :
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• Whole Foods Market, the largest supernatural chain in the United States and Canada; and
•
Other customers, including Natural Grocers, Wegmans, Kroger, Earth Fare, Sprouts Farmers Market, Giant-Carlisle, Stop & Shop, Giant-Landover, Giant
Eagle, Hannaford, Harris Teeter, The Fresh Market, Market Basket, Shop-Rite, Publix, Raley's, Lucky's, and Loblaws.
We have been the primary distributor to Whole Foods Market for more than twenty years. Under the terms of our agreement with Whole Foods Market, we serve
as the primary distributor to Whole Foods Market in all of its regions in the United States. Our agreement with Whole Foods Market expires on September 28,
2025. Whole Foods M arket is our only customer that represented more than 10% of total net sales in fiscal 2018 , and accounted for approximately 37% of our net
sales.
During fiscal 2017, our net sales by channel were adjusted to reflect changes in the classification of customer types from acquisitions we consummated in the third
and fourth quarters of fiscal 2016 and the first quarter of fiscal 2017. There was no financial statement impact as a result of revising the classification of customer
types. The following table lists the percentage of net sales by customer type for the fiscal years ended July 28, 2018 , July 29, 2017 and July 30, 2016 :
Customer Type
Supernatural
Supermarkets
Independents
Other
Percentage of Net Sales
2018
2017
2016
37%
28%
25%
10%
33%
30%
26%
11%
35%
27%
27%
11%
We distribute natural, organic and specialty foods and non-food products to customers located in the United States and Canada, as well as to customers located in
other foreign countries. Our total international net sales, including those by UNFI Canada, represented approximately three percent of our net sales in fiscal 2018
and four percent in both fiscal 2017 and fiscal 2016 . We believe that our sales outside the United States will expand as we seek to continue to grow our Canadian
operations and our foodservice and e-commerce businesses, both of which include customers based outside of the United States.
Our Marketing Services
We offer a variety of marketing services designed to increase sales for our customers and suppliers, including consumer and trade marketing programs, as well as
programs to support suppliers in understanding our markets. Trade and consumer marketing programs are supplier-sponsored programs that cater to a broad range
of retail formats. These programs are designed to educate consumers, profile suppliers and increase sales for retailers, many of which do not have the resources
necessary to conduct such marketing programs independently.
Consumer Marketing Programs
• Monthly, region-specific, consumer circular programs, with the participating retailers’ imprint featuring products sold by the retailer to its customers. The
monthly circular programs are structured to pass through the benefit of our negotiated discounts and advertising allowances to the retailer, and also
provide retailers with a physical flyer and shelf tags corresponding to each month's promotions. We also offer a web-based tool which retailers can use to
produce highly customized circulars and other marketing materials for their stores called the Customized Marketing Program.
Truck advertising program that allows our suppliers to purchase advertising space on the sides of our hundreds of trailers traveling throughout the United
States and Canada, increasing brand exposure to consumers.
•
Trade Marketing Programs
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New item introduction programs showcase a supplier's new items to retailers through trial and discounts.
Customer Portal Advertising that allows our suppliers to advertise directly to retailers using the portal that many retailers use to order product and/or
gather product information.
Foodservice options designed to support accounts in that category.
•
• Monthly Specials Catalogs that highlight promotions and new product introductions.
•
Specialized catalogs for holiday and seasonal products.
Supplier Marketing Programs
•
ClearVue®, an information sharing program offered to a select group of suppliers designed to improve the transparency of information and drive
efficiency within the supply chain. With the availability of in-depth data and tailored reporting tools, participants are able to reduce inventory balances
while improving service levels.
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•
•
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Supply Chain by ClearVue®, an information sharing program designed to provide heightened transparency to suppliers through demand planning,
forecasting and procurement insights. This program offers weekly and monthly reporting enabling suppliers to identify areas of sales growth while
pinpointing specific opportunities for achieving greater profits.
Supplier-In-Site (SIS), an information-sharing website that helps our suppliers better understand the independents channel in order to generate mutually
beneficial incremental sales in an efficient manner.
Growth incentive programs, supplier-focused high-level sales and marketing support for selected brands, which foster our partnership by building
incremental, mutually profitable sales for suppliers and us.
Periodically, we conduct focus group sessions with certain key retailers and suppliers to ascertain their needs and allow us to better service them. We also provide
our customers with:
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trends reports in the natural and organic industry;
product data information such as best seller lists, store usage reports and catalogs;
assistance with store layout designs; new store design and equipment procurement;
planogramming, shelf and category management support;
in-store signage and promotional materials assistance with planning and setting up product displays;
shelf tags for products; and
a robust customer portal with product information, search and ordering capabilities, reports and publications.
Our Products
Our extensive selection of natural, organic and specialty foods and non-food products enables us to provide a primary source of supply to a diverse base of
customers whose product needs vary significantly. We offer more than 110,000 natural, organic and specialty foods and non-food products, consisting of national,
regional and private label brands grouped into six product categories: grocery and general merchandise, produce, perishables and frozen foods, nutritional
supplements and sports nutrition, bulk and foodservice products and personal care items. Our branded product lines address certain needs of our customers,
including providing a lower-cost label known as Field Day®.
We maintain a comprehensive quality assurance program. All of the products we sell that are represented as "organic" are required to be certified as such by an
independent third-party agency. We maintain current certification affidavits on most organic commodities and produce in order to verify the authenticity of the
product. Most potential suppliers of organic products are required to provide such third-party certifications to us before they are approved as suppliers.
Organic Certification
Our “Certified Organic Distributor” certification covers all of our broadline distribution centers in the United States, except for facilities acquired in connection
with the acquisitions of Tony’s, Haddon, and Nor-Cal. Although not designated as a “Certified Organic Distributor” by QAI, the three Tony’s California locations
are certified as Organic by the State of California Department of Public Health Food and Drug Branch, and Nor-Cal is currently registered with the California
Department of Food and Agriculture Organic Program as an organic handler. In addition, our Canadian distribution centers in British Columbia and Ontario both
hold one of the following organic distributor certifications: QAI, EcoCert Canada or ProCert Canada.
Working Capital
Normal operating fluctuations in working capital balances can result in changes to cash flow from operations presented in our consolidated statements of cash
flows that are not necessarily indicative of long-term operating trends. Our working capital needs are generally greater during the months leading up to high sales
periods, such as the build up in inventory during the time period leading to the calendar year-end holidays. We typically finance these working capital needs with
funds provided by operating activities and available credit through our amended and restated revolving credit facility (the “Existing ABL Facility”) pursuant to our
Third Amended and Restated Loan and Security Agreement, dated as of April 29, 2016, by and among the Company, Bank of America, N.A., as administrative
agent and the other borrowers, agents and lenders party thereto (the “Existing ABL Loan Agreement”).
Our Suppliers
We purchase our products from more than 9,000 suppliers. The majority of our suppliers are based in the United States and Canada, but we also source products
from suppliers throughout Europe, Asia, Central America, South America, Africa and Australia. We believe suppliers of natural and organic products seek to
distribute their products through us because we provide access to a large customer base across the United States and Canada, distribute the majority of the
suppliers' products and offer a wide variety of marketing programs to our customers to help sell the suppliers' products. Substantially all product categories that we
distribute are available from a number of suppliers and, therefore, we are not dependent on any single source of supply for any product
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category. In addition, although we have exclusive distribution arrangements and support programs with several suppliers, none of our suppliers account for more
than 5% of our total purchases in fiscal 2018 .
We have positioned ourselves as one of the largest purchasers of organically grown bulk products in the natural and organic products industry by centralizing our
purchase of nuts, seeds, grains, flours and dried foods. As a result, we are able to negotiate purchases from suppliers on the basis of volume and other
considerations that may include discounted pricing or prompt payment discounts. Furthermore, some of our purchase arrangements include the right of return to the
supplier with respect to products that we do not sell in a certain period of time. Each region is responsible for placing its own orders and can select the products that
it believes will most appeal to its customers, although each region is able to participate in our company-wide purchasing programs. Our outstanding commitments
for the purchase of inventory were approximately $15.9 million as of July 28, 2018 .
Our Distribution System
The sites for our distribution centers are chosen to provide direct access to our regional markets. This proximity allows us to reduce our transportation costs relative
to those of our competitors that seek to service these customers from locations that are often several hundred miles away. We believe that we incur lower inbound
freight expense than our regional competitors because our scale allows us to buy full and partial truckloads of products. Products are delivered to our distribution
centers primarily by our fleet of leased trucks, contract carriers and the suppliers themselves. When financially advantageous, we pick up product from suppliers or
satellite staging facilities and return it to our distribution centers using our own trucks. Additionally, we generally can redistribute overstocks and inventory
imbalances between our distribution centers if needed, which helps to reduce out of stocks and to sell perishable products prior to their expiration date.
The majority of our trucks are leased from a variety of national banks and are maintained by third party national leasing companies such as Ryder Truck Leasing
and Penske Truck Leasing, which in some cases maintain facilities on our premises for the maintenance and service of these vehicles as well as facilities where we
run our own maintenance shops.
We ship certain orders for supplements or for items that are destined for areas outside of regular delivery routes through United States Postal Service, the United
Parcel Service and other independent carriers. Deliveries to areas outside the continental United States and Canada are typically shipped by ocean-going containers
on a weekly basis.
Our Focus on Technology
We have made significant investments in distribution, financial, information and warehouse management systems. We continually evaluate and upgrade our
management information systems at our regional operations in an effort to make the systems more efficient, cost-effective and responsive to customer needs. These
systems include functionality in radio frequency inventory control, pick-to-voice systems, pick-to-light systems, computer-assisted order processing and slot
locater/retrieval assignment systems. At most of our receiving docks, warehouse associates attach computer-generated, preprinted locater tags to inbound products.
These tags contain the expiration date, locations, quantity, lot number and other information about the products in bar code format. Customer returns are processed
by scanning the UPC bar codes. We also employ a management information system that enables us to lower our inbound transportation costs by making optimum
use of our own fleet of trucks or by consolidating deliveries into full truckloads. Orders from multiple suppliers and multiple distribution centers are consolidated
into single truckloads for efficient use of available vehicle capacity. In addition, we utilize route efficiency software that assists us in developing the most efficient
routes for our outbound trucks. As part of our “one company” approach, we are in the process of rolling out a national warehouse management and procurement
system to convert our existing facilities into a single warehouse management and supply chain platform ("WMS"). WMS supports our effort to integrate and
nationalize processes across the organization and we have successfully implemented the WMS system at fifteen of our facilities. In light of the proposed
acquisition of SUPERVALU, we are reevaluating our warehouse management system strategy. However, we continue to be focused on the automation of our new
or expanded distribution centers that are at different stages of construction.
Intellectual Property
We do not own or have the right to use any patent, trademark, trade name, license, franchise, or concession, the loss of which would have a material adverse effect
on our results of operations or financial condition.
Competition
Our largest competition comes from direct distribution, whereby a customer reaches a product volume level that justifies distribution directly from the
manufacturer in order to obtain a lower price. Our major wholesale distribution competitor in both the United States and Canada is KeHE Distributors, LLC
("Kehe"). In addition to its natural and organic products, Kehe distributes specialty food products and markets its own private label program. We also compete in
the United States and Canada with numerous smaller regional and local distributors of natural, organic, ethnic, kosher, gourmet and other specialty foods that focus
on niche or regional markets, and with national, regional and local distributors of conventional groceries who have significantly expanded their natural
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and organic product offerings in recent years and companies that distribute to their own retail facilities. Our customers also compete with online retailers and
distributors of natural and organic products that seek to sell products directly to customers.
We believe that distributors in the natural and specialty products industries primarily compete on distribution service levels, product quality, depth of inventory
selection, price and quality of customer service. We believe that we currently compete effectively with respect to each of these factors.
Government Regulation
Our operations and many of the products that we distribute in the United States are subject to regulation by state and local health departments, the USDA and the
United States Food and Drug Administration (the "FDA"), which generally impose standards for product quality and sanitation and are responsible for the
administration of bioterrorism legislation. In the United States, our facilities generally are inspected at least once annually by state or federal authorities. For certain
product lines, we are also subject to the Federal Meat Inspection Act, the Poultry Products Inspection Act, the Perishable Agricultural Commodities Act, the
Packers and Stockyard Act and regulations promulgated by the USDA to interpret and implement these statutory provisions. The USDA imposes standards for
product safety, quality and sanitation through the federal meat and poultry inspection program.
The FDA Food Safety Modernization Act ("FSMA"), represents a significant expansion of food safety requirements and FDA food safety authorities and, among
other things, requires that the FDA impose comprehensive, prevention-based controls across the food supply chain, further regulates food products imported into
the United States, and provides the FDA with mandatory recall authority. The FSMA requires the FDA to undertake numerous rulemakings and to issue numerous
guidance documents, as well as reports, plans, standards, notices, and other tasks.
The Surface Transportation Board and the Federal Highway Administration regulate our trucking operations. In addition, interstate motor carrier operations are
subject to safety requirements prescribed by the United States Department of Transportation and other relevant federal and state agencies. Such matters as weight
and dimension of equipment are also subject to federal and state regulations.
Many of our facilities in the U.S. and in Canada are subject to various environmental protection statutes and regulations, including those relating to the use of water
resources and the discharge of wastewater. Further, many of our distribution facilities have ammonia-based refrigeration systems and tanks for the storage of
diesel fuel, hydrogen fuel and other petroleum products which are subject to laws regulating such systems and storage tanks. Moreover, in some of our facilities
we, or third parties with whom we contract, perform vehicle maintenance. Our policy is to comply with all applicable environmental and safety legal
requirements. We are subject to other federal, state, provincial and local provisions relating to the protection of the environment or the discharge of materials;
however, these provisions do not materially impact the use or operation of our facilities.
Employees
As of July 28, 2018 , we had approximately 10,000 full and part-time employees, 725 of whom (approximately 7.3% ) are covered by collective bargaining
agreements. The following are the facilities which have collective bargaining agreements and the respective expiration dates of those agreements: Moreno Valley,
California (March 2019), Edison, New Jersey (March 2019), Dayville, Connecticut (July 2019), West Sacramento, California (May 2020), Hudson Valley, New
York (July 2020), Auburn, Washington (February 2021), Iowa City, Iowa (July 2021) and Concord, Ontario (March 2022). We have in the past been the focus of
union-organizing efforts, and we believe it is likely that we will be the focus of similar efforts in the future.
In January 2018, the National Labor Relations Board certified the election results of our driver employees in Gilroy, California to be represented by the Teamsters
union. We are in the process of negotiating a collective bargaining agreement with these employees.
Seasonality
Generally, we do not experience any material seasonality. However, our sales and operating results may vary significantly from quarter to quarter due to factors
such as changes in our operating expenses, management's ability to execute our operating and growth strategies, personnel changes, demand for our products,
supply shortages and general economic conditions.
Available Information
Our internet address is http://www.unfi.com. The contents of our website are not part of this Annual Report, and our internet address is included in this document
as an inactive textual reference only. We make our Annual Report, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and all amendments to those
reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act") available free of charge
through our website as soon as reasonably practicable after we file such reports with, or furnish such reports to, the Securities and Exchange Commission.
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ITEM 1A. RISK FACTORS
Our business, financial condition and results of operations are subject to various risks and uncertainties, including those described below and elsewhere in this
Annual Report. This section discusses factors that, individually or in the aggregate, we think could cause our actual results to differ materially from expected and
historical results. If any of the events described below occurs, our business, financial condition or results of operations could be materially adversely affected and
our stock price could decline.
We provide these factors for investors as permitted by the Private Securities Litigation Reform Act of 1995. You should understand that it is not possible to predict
or identify all such factors. Consequently, you should not consider the following to be a complete discussion of all potential risks or uncertainties applicable to our
business. See "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations—Forward-Looking Statements."
We depend heavily on our principal customers and our success is heavily dependent on our principal customers' ability to grow their business.
Whole Foods Market accounted for approximately 37% of our net sales in fiscal 2018 . We serve as the primary distributor of natural, organic and specialty non-
perishable products, and also distribute certain specialty protein, cheese, deli items and products from health, beauty and supplement categories to Whole Foods
Market in all of its regions in the United States under the terms of our distribution agreement which expires on September 28, 2025. Our ability to maintain a close,
mutually beneficial relationship with Whole Foods Market, which was acquired by Amazon.com, Inc. in August 2017, is an important element to our continued
growth.
The loss or cancellation of business from Whole Foods Market, including from increased self distribution to its own facilities, closures of its stores, reductions in
the amount of products that Whole Foods Market sells to its customers, or our failure to comply with the terms of our distribution agreement with Whole Foods
Market could materially and adversely affect our business, financial condition or results of operations. Similarly, if Whole Foods Market is not able to grow its
business, including as a result of a reduction in the level of discretionary spending by its customers or competition from other retailers or if Whole Foods Market
diverts purchases from us beyond minimum amounts it is required to purchase under our distribution agreement, our business, financial condition or results of
operations may be materially and adversely affected. Additionally, given the growth acceleration we have experienced in fiscal 2018, if Whole Foods Market were
to only purchase the minimum purchase amounts, it would negatively impact our financials results.
In addition to our dependence on Whole Foods Market, we are also dependent upon sales to our supermarket customers. Net sales to these customers accounted for
approximately 28% of our total net sales in fiscal 2018 . To the extent that customers in this group make decisions to utilize alternative sources of products,
whether through other distributors or through self distribution, our business, financial condition or results of operations may be materially and adversely affected.
Our business is a low margin business and our profit margins may decrease due to consolidation in the grocery industry and our focus on sales to the
supermarkets channel.
The grocery distribution industry generally is characterized by relatively high volume of sales with relatively low profit margins. The continuing consolidation of
retailers in the natural products industry and the growth of supernatural chains may reduce our profit margins in the future as more customers qualify for greater
volume discounts, and we experience pricing pressures from suppliers and retailers. Sales to customers within our supernatural and supermarkets channels generate
a lower gross margin than do sales to our independents channel customers. Many of these customers, including our largest customer, have agreements with us that
include volume discounts. As the amounts these customers purchase from us increase, the price that they pay for the products they purchase is reduced, putting
downward pressure on our gross margins on these sales. To compensate for these lower gross margins, we must increase the amount of products we sell or reduce
the expenses we incur to service these customers. If we are unable to reduce our expenses as a percentage of net sales, including our expenses related to servicing
this lower gross margin business, our business, financial condition or results of operations could be materially and adversely impacted.
We may have difficulty managing our growth.
The growth in the size of our business and operations has placed, and is expected to continue to place, a significant strain on our management. Our future growth
may be limited by strong growth by certain of our largest customers or our inability to retain existing customers, make acquisitions, successfully integrate acquired
entities or significant new customers, implement information systems initiatives, acquire or timely construct new distribution centers, expand our existing
distribution centers, or adequately manage our personnel. Our future growth is limited in part by the size and location of our distribution centers. As we near
maximum utilization of a given facility or maximize our processing capacity, operations may be constrained and inefficiencies have been and may be created,
which could adversely affect our business, financial condition or results of operations unless the facility is expanded, volume is shifted to another facility or
additional processing capacity is added. Conversely, if we add additional facilities, expand existing operations or facilities, or fail to retain existing business, excess
capacity may be created. Any excess capacity
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may also create inefficiencies and adversely affect our business, financial condition or results of operations, including as a result of incurring additional operating
costs for these facilities before demand for products to be supplied from these facilities rises to a level sufficient to cover these additional costs. We cannot assure
you that we will be able to successfully expand our existing distribution centers or open new distribution centers in new or existing markets if needed to
accommodate or facilitate growth. Even if we are able to expand our distribution network, our ability to compete effectively and to manage future growth, if any,
will depend on our ability to continue to implement and improve operational, financial and management information systems, including our warehouse
management systems, on a timely basis and to expand, train, motivate and manage our work force. We cannot assure you that our existing personnel, systems,
procedures and controls will be adequate to support the future growth of our operations. Our inability to manage our growth effectively could have a material
adverse effect on our business, financial condition or results of operations.
Our customers generally are not obligated to continue purchasing products from us and larger customers that do have multiyear contracts with us may terminate
these contracts early in certain situations or choose not to renew or extend the contract at its expiration.
Many of our customers buy from us under purchase orders, and we generally do not have written agreements with or long-term commitments from these customers
for the purchase of products. We cannot assure you that these customers will maintain or increase their sales volumes or orders for the products supplied by us or
that we will be able to maintain or add to our existing customer base. Decreases in our volumes or orders for products supplied by us for these customers with
whom we do not have a long-term contract may have a material adverse effect on our business, financial condition or results of operations.
We may have contracts with certain of our customers (as is the case with many of our conventional supermarket customers and our supernatural chain customer)
that obligate the customer to buy products from us for a particular period of time. Even in this case, the contracts may not require the customer to purchase a
minimum amount of products from us or the contracts may afford the customer better pricing in the event that the volume of the customer’s purchases exceeds
certain levels. If these customers were to terminate these contracts prior to their scheduled termination, or if we or the customer elected not to renew or extend the
term of the contract at its expiration at historical purchase levels, it may have a material adverse effect on our business, financial condition or results of operations,
including additional operational expenses to transition out of the business or to adjust our staffing levels to account for the reduction in net sales.
Our operating results are subject to significant fluctuations.
Our operating results may vary significantly from period to period due to:
demand for our products, including fluctuations as a result of calendar year-end holidays;
changes in our operating expenses, including fuel and insurance expenses;
•
•
• management's ability to execute our business and growth strategies;
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•
•
•
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changes in customer preferences, including levels of enthusiasm for health, fitness and environmental issues;
public perception of the benefits of natural and organic products when compared to similar conventional products;
fluctuation of natural product prices due to competitive pressures;
the addition or loss of significant customers;
personnel changes;
general economic conditions, including inflation;
supply shortages, including a lack of an adequate supply of high-quality livestock or agricultural products due to poor growing conditions, water
shortages, natural disasters or otherwise;
volatility in prices of high-quality livestock or agricultural products resulting from poor growing conditions, water shortages, weather, natural disasters or
otherwise;
contractual adjustments, disputes, or modifications with our suppliers or customers;
shortage of qualified labor which could potentially increase labor costs, reduce profitability or decrease our ability to effectively serve customers; and
future acquisitions, particularly in periods immediately following the consummation of such acquisition transactions while the operations of the acquired
businesses are being integrated into our operations.
•
•
•
•
Due to the foregoing factors, we believe that period-to-period comparisons of our operating results may not necessarily be meaningful and that such comparisons
cannot be relied upon as indicators of future performance.
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We have significant competition from a variety of sources.
We operate in competitive markets and our future success will be largely dependent on our ability to provide quality products and services at competitive prices.
Bidding for contracts or arrangements with customers, particularly within the supernatural and supermarkets channels, is highly competitive and we may market
our services to a particular customer over a long period of time before we are invited to bid. Our competition comes from a variety of sources, including other
distributors of natural products as well as specialty grocery and mass market grocery distributors and retail customers that have their own distribution channels.
Mass market grocery distributors in recent years have increased their emphasis on natural and organic products and are now competing more directly with us. In
addition, many supermarket chains have increased self-distribution of particular items that we sell or have increased their purchases of particular items that we sell
directly from suppliers. New competitors are also entering our markets as barriers to entry for new competitors are relatively low. For instance, more natural and
organic products are being sold in convenience stores and other mass market retailers than was the case a few years ago and many of these customers are being
serviced by conventional distributors or are self-distributing. Some of the mass market grocery distributors with whom we compete may have been in business
longer than we have, may have substantially greater financial and other resources than we have and may be better established in their markets. We also face
indirect competition as a result of the fact that our customers with physical locations face competition from online retailers and distributors that seek to sell certain
of the type of products we sell to our customers directly to consumers. We cannot assure you that our current or potential competitors will not provide products or
services comparable or superior to those provided by us or adapt more quickly than we do to evolving industry trends or changing market requirements. It is also
possible that alliances among competitors may develop and that competitors may rapidly acquire significant market share or that certain of our customers will
increase distribution to their own retail facilities. Increased competition may result in price reductions, reduced gross margins, lost business and loss of market
share, any of which could materially and adversely affect our business, financial condition or results of operations.
We cannot provide assurance that we will be able to compete effectively against current and future competitors.
We may not realize the anticipated benefits from our acquisitions, including, in particular, our proposed acquisition of SUPERVALU.
We cannot assure you that our prior acquisitions or our proposed acquisition of SUPERVALU or any future acquisitions will enhance our financial performance.
Our ability to achieve the expected benefits of these acquisitions will depend on, among other things, our ability to effectively translate our business strategies into
a new set of products, our ability to retain and assimilate the acquired businesses' employees, our ability to retain customers and suppliers on terms similar to those
in place with the acquired businesses, our ability to expand the products we offer in many of our markets to include the products distributed by these businesses,
our ability to expand into new markets to include markets of the acquired business, the adequacy of our implementation plans, our ability to maintain our financial
and internal controls and systems as we expand our operations, the ability of our management to oversee and operate effectively the combined operations and our
ability to achieve desired operating efficiencies and sales goals. The integration of the businesses that we acquired might also cause us to incur unforeseen costs,
which would lower our future earnings and would prevent us from realizing the expected benefits of these acquisitions. Failure to achieve these anticipated benefits
could result in decreases in the amount of expected revenues and diversion of management’s time and energy and could materially and adversely impact our
business, financial condition and operating results including, ultimately, a reduction in our stock price.
Our investment in information technology may not result in the anticipated benefits.
In our attempt to reduce operating expenses and increase operating efficiencies, we have invested in the development and implementation of new information
technology. We are in the process of rolling out a national warehouse management and procurement system to convert our existing facilities into a single
warehouse management and supply chain platform and have completed conversions at fifteen of our facilities. In light of the proposed acquisition of
SUPERVALU, we are reevaluating our warehouse management system strategy. However, we currently plan to remain focused on the automation of our new or
expanded distribution centers that are at different stages of construction. We may not be able to implement these technological changes in the time frame that we
have planned and delays in implementation could negatively impact our business, financial condition or results of operations. In addition, the costs to make these
changes may exceed our estimates and will exceed the benefits during the early stages of implementation. Even if we are able to implement the changes in
accordance with our current plans, and within our current cost estimates, we may not be able to achieve the expected efficiencies and cost savings from this
investment, which could have a material adverse effect on our business, financial condition or results of operations. Moreover, as we implement information
technology enhancements, disruptions in our business may be created (including disruption with our customers) which may have a material adverse effect on our
business, financial condition or results of operations.
Our business strategy of increasing our sales of fresh, perishable items, which we accelerated with our acquisitions of Tony’s, Global Organic and Nor-Cal, may
not produce the results that we expect.
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A key element of our current growth strategy is to increase the amount of fresh, perishable products that we distribute. We believe that the ability to distribute these
products that are typically found in the perimeter of our customers’ stores, in addition to the products we have historically distributed, will differentiate us from our
competitors and increase demand for our products. We accelerated this strategy with our acquisitions of Tony’s, Global Organic and Nor-Cal. If we are unable to
grow this portion of our business and manage that growth effectively, our business, financial condition and results of operations may be materially and adversely
affected.
Failure by us to develop and operate a reliable technology platform could negatively impact our business.
Our ability to decrease costs and increase profits, as well as our ability to serve customers most effectively, depends on the reliability of our technology platform.
We use software and other technology systems, among other things, to generate and select orders, to load and route trucks and to monitor and manage our business
on a day-to-day basis. Failure to have adequate computer systems across the enterprise and any disruption to these computer systems could adversely impact our
customer service, decrease the volume of our business and result in increased costs negatively affecting our business, financial condition or results of operations.
We have experienced losses due to the uncollectability of accounts receivable in the past and could experience increases in such losses in the future if our
customers are unable to timely pay their debts to us.
Certain of our customers have from time to time experienced bankruptcy, insolvency and/or an inability to pay their debts to us as they come due. If our customers
suffer significant financial difficulty, they may be unable to pay their debts to us timely or at all, which could have a material adverse effect on our business,
financial condition or results of operations. It is possible that customers may reject their contractual obligations to us under bankruptcy laws or otherwise.
Significant customer bankruptcies could further adversely affect our revenues and increase our operating expenses by requiring larger provisions for bad debt. In
addition, even when our contracts with these customers are not rejected, if customers are unable to meet their obligations on a timely basis, it could adversely affect
our ability to collect receivables. Further, we may have to negotiate significant discounts and/or extended financing terms with these customers in such a situation,
each of which could have a material adverse effect on our business, financial condition or results of operations. During periods of economic weakness, small to
medium-sized businesses, like many of our independents channel customers, may be impacted more severely and more quickly than larger businesses. Similarly,
these smaller businesses may be more likely to be more severely impacted by events outside of their control, like significant weather events. Consequently, the
ability of such businesses to repay their obligations to us may deteriorate, and in some cases this deterioration may occur quickly, which could materially and
adversely impact our business, financial condition or results of operations.
Our acquisition strategy may adversely affect our business.
A portion of our past growth has been achieved through acquisitions of, or mergers with, other distributors of natural, organic and specialty products. We also
continually evaluate opportunities to acquire other companies. We believe that there are risks related to acquiring companies, including an inability to successfully
identify suitable acquisition candidates or consummate such potential acquisitions. To the extent that our future growth includes acquisitions, we cannot assure you
that we will not overpay for acquisitions, lose key employees of acquired companies, or fail to achieve potential synergies or expansion into new markets as a result
of our acquisitions. Therefore, future acquisitions, if any, may have a material adverse effect on our business, financial condition or results of operations,
particularly in periods immediately following the consummation of those transactions while the operations of the acquired business are being integrated with our
operations. Achieving the benefits of acquisitions depends on timely, efficient and successful execution of a number of post-acquisition events, including, among
other things:
• maintaining the customer and supplier base;
•
•
•
optimizing delivery routes;
coordinating administrative, distribution and finance functions; and
integrating management information systems and personnel.
The integration process could divert the attention of management. Any difficulties or problems encountered in the transition process could have a material adverse
effect on our business, financial condition or results of operations. In particular, the integration process may temporarily redirect resources previously focused on
reducing product cost and operating expenses, resulting in lower gross profits in relation to sales. In addition, the process of combining companies could cause the
interruption of, or a loss of momentum and operating profits in, the activities of the respective businesses, which could have an adverse effect on their combined
operations.
In connection with acquisitions of businesses in the future, if any, we may decide to consolidate the operations of any acquired businesses with our existing
operations or make other changes with respect to the acquired businesses, which could result in special charges or other expenses. Our results of operations also
may be adversely affected by expenses we incur in making acquisitions, by amortization of acquisition-related intangible assets with definite lives and by
additional depreciation and amortization attributable to acquired assets. Any of the businesses we acquire may also have liabilities or adverse operating issues,
including
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some that we fail to discover before the acquisition, and our indemnity for such liabilities may also be limited. Additionally, our ability to make any future
acquisitions may depend upon obtaining additional financing. We may not be able to obtain additional financing on acceptable terms or at all. To the extent that we
seek to acquire other businesses in exchange for our common stock, fluctuations in our stock price could have a material adverse effect on our ability to complete
acquisitions.
Impairment charges for goodwill or other long-lived assets could adversely affect the Company’s financial condition and results of operations.
We monitor the recoverability of our long-lived assets, such as buildings and equipment, and evaluate their carrying value for impairment whenever events or
changes in circumstances indicate that the carrying amount of such assets may not be fully recoverable. We annually review goodwill to determine if impairment
has occurred. Additionally, interim reviews are performed whenever events or changes in circumstances indicate that impairment may have occurred. If the testing
performed indicates that impairment has occurred, we are required to record a non-cash impairment charge for the difference between the carrying value and fair
value of the long-lived assets or the carrying value and fair value of the reporting unit, in the period the determination is made. The testing of long-lived assets and
goodwill for impairment requires us to make estimates that are subject to significant assumptions about our future revenue, profitability, cash flows, fair value of
assets and liabilities, weighted average cost of capital, as well as other assumptions. Changes in these estimates, or changes in actual performance compared with
these estimates, may affect the fair value of long-lived assets or reporting unit, which may result in an impairment charge.
We cannot accurately predict the amount or timing of any impairment of assets. Should the value of long-lived assets or goodwill become impaired, our financial
condition and results of operations may be adversely affected.
Our operations are sensitive to economic downturns.
The grocery industry is sensitive to national and regional economic conditions and the demand for the products that we distribute, particularly our specialty
products, may be adversely affected from time to time by economic downturns that impact consumer spending, including discretionary spending. Future economic
conditions such as employment levels, business conditions, housing starts, interest rates, inflation rates, energy and fuel costs and tax rates could reduce consumer
spending or change consumer purchasing habits. Among these changes could be a reduction in the number of natural and organic products that consumers purchase
where there are non-organic, which we refer to as conventional, alternatives, given that many natural and organic products, and particularly natural and organic
foods, often have higher retail prices than do their conventional counterparts.
Our business may be sensitive to inflationary and deflationary pressures.
Many of our sales are at prices that are based on our product cost plus a percentage markup. As a result, volatile food costs have a direct impact upon our
profitability. Prolonged periods of product cost inflation and periods of rapidly increasing inflation may have a negative impact on our profit margins and results of
operations to the extent that we are unable to pass on all or a portion of such product cost increases to our customers. In addition, product cost inflation may
negatively impact the consumer discretionary spending trends of our customers' customers, which could adversely affect our sales. Conversely, because many of
our sales are at prices that are based upon product cost plus a percentage markup, our profit levels may be negatively impacted during periods of product cost
deflation even though our gross profit as a percentage of net sales may remain relatively constant. To compensate for lower gross margins, we, in turn, must reduce
expenses that we incur to service our customers. If we are unable to reduce our expenses as a percentage of net sales, our business, financial condition or results of
operations could be materially and adversely impacted.
Product liability claims could have an adverse effect on our business.
We face an inherent risk of exposure to product liability claims if the products we manufacture or sell cause injury or illness. In addition, meat, seafood, cheese,
poultry and other products that we distribute could be subject to recall because they are, or are alleged to be, contaminated, spoiled or inappropriately labeled. Our
meat and poultry products may be subject to contamination by disease-producing organisms, or pathogens, such as Listeria monocytogenes , Salmonella and
generic E.coli . These pathogens are generally found in the environment, and as a result, there is a risk that they, as a result of food processing, could be present in
the meat and poultry products we distribute. These pathogens can also be introduced as a result of improper handling at the consumer level. These risks may be
controlled, although not eliminated, by adherence to good manufacturing practices and finished product testing. We have little, if any, control over proper handling
before we receive the product or once the product has been shipped to our customers. We may be subject to liability, which could be substantial, because of actual
or alleged contamination in products manufactured or sold by us, including products sold by companies before we acquired them. In addition, if we were to
manufacture or distribute foods that are or are perceived to be contaminated, any resulting product recalls could have an adverse effect on our business, financial
condition, or results of operations. We have, and the companies we have acquired have had, liability insurance with respect to product liability claims. This
insurance may not continue to be available at a reasonable cost or at all, and may not be adequate to cover product liability claims against us or against companies
we have acquired. We generally
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seek contractual indemnification from manufacturers, but any such indemnification is limited, as a practical matter, to the creditworthiness of the indemnifying
party. If we or any of our acquired companies do not have adequate insurance or contractual indemnification available, product liability claims and costs associated
with product recalls, including a loss of business, could have a material adverse effect on our business, financial condition or results of operations.
Changes in consumer eating habits could materially and adversely affect our business, financial condition, or results of operations.
Changes in consumer eating habits away from natural, organic or specialty products could reduce demand for our products. Consumer eating habits could be
affected by a number of factors, including changes in attitudes regarding benefits of natural and organic products when compared to similar conventional products
or new information regarding the health effects of consuming certain foods. Although there is a growing consumer preference for sustainable, organic and locally
grown products, there can be no assurance that such trend will continue. Changing consumer eating habits also occur due to generational shifts. Millennials, the
largest demographic group in the U.S. in terms of spend, seek new and different as well as more ethnic menu options and menu innovation, however there can be
no assurance that such trend will continue. If consumer eating habits change significantly, we may be required to modify or discontinue sales of certain items in our
product portfolio, and we may experience higher costs associated with the implementation of those changes. Additionally if we are not able to effectively respond
to changes in consumer perceptions or adapt our product offerings to trends in eating habits, our business, financial condition or results of operations could suffer.
Increased fuel costs may adversely affect our results of operations.
Increased fuel costs may have a negative impact on our results of operations. The high cost of diesel fuel can increase the price we pay for products as well as the
costs we incur to deliver products to our customers. These factors, in turn, may negatively impact our net sales, margins, operating expenses and operating results.
To manage this risk, we have in the past periodically entered, and may in the future periodically enter, into heating oil derivative contracts to hedge a portion of our
projected diesel fuel requirements. Heating crude oil prices have a highly correlated relationship to diesel fuel prices, making these derivatives effective in
offsetting changes in the cost of diesel fuel. We are not party to any commodity swap agreements and, as a result, our exposure to volatility in the price of diesel
fuel has increased relative to our exposure to volatility in prior periods in which we had outstanding heating oil derivative contracts. We do not enter into fuel
hedge contracts for speculative purposes. We have in the past, and may in the future, periodically enter into forward purchase commitments for a portion of our
projected monthly diesel fuel requirements at fixed prices. As of July 28, 2018 , we had no forward diesel fuel commitments. We also maintain a fuel surcharge
program which allows us to pass some of our higher fuel costs through to our customers. We cannot guarantee that we will continue to be able to pass a comparable
proportion or any of our higher fuel costs to our customers in the future, which may adversely affect our business, financial condition or results of operations.
Disruption of our distribution network or to the operations of our customers could adversely affect our business.
Damage or disruption to our distribution capabilities due to weather, natural disaster, fire, terrorism, pandemic, strikes, the financial and/or operational instability
of key suppliers, or other reasons could impair our ability to distribute our products. To the extent that we are unable, or it is not financially feasible, to mitigate the
likelihood or potential impact of such events, or to manage effectively such events if they occur, there could be an adverse effect on our business, financial
condition or results of operations.
In addition, such disruptions may reduce the number of consumers who visit our customers’ facilities in any affected areas. Furthermore, such disruption may
interrupt or impede access to our customers’ facilities, all of which could have a material adverse effect on our business, financial condition, or results of
operations.
The cost of the capital available to us and limitations on our ability to access additional capital may have a material adverse effect on our business, financial
condition or results of operations.
Historically, acquisitions and capital expenditures have been a large component of our growth. We anticipate that acquisitions and capital expenditures will
continue to be important to our growth in the future. As a result, increases in the cost of capital available to us, which could result from us not being in compliance
with fixed charge coverage ratio covenants or other restrictive covenants under our debt agreements, including our Existing ABL Loan Agreement, our Existing
Term Loan Agreement (as defined below) and the debt agreements we expect to enter into in connection with the SUPERVALU acquisition, or our inability to
access additional capital to finance acquisitions and capital expenditures through borrowed funds could restrict our ability to grow our business organically or
through acquisitions, which could have a material adverse effect on our business, financial condition or results of operations.
In addition, our profit margins depend on strategic investment buying initiatives, such as discounted bulk purchases, which require spending significant amounts of
working capital up-front to purchase products that we then sell over a multi-month time period. Therefore, increases in the cost of capital available to us or our
inability to access additional capital through borrowed funds could
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restrict our ability to engage in strategic investment buying initiatives, which could reduce our profit margins and have a material adverse effect on our business,
financial condition or results of operations.
We expect to substantially increase our level of debt in connection with the proposed acquisition of SUPERVALU which will make us more sensitive to the effects
of economic downturns and could adversely affect our business.
In order to finance the proposed acquisition of SUPERVALU, we expect to incur up to $3.50 billion of additional indebtedness, including indebtedness to be
incurred to refinance SUPERVALU's existing debt. This increase in our leverage, and any further increase, could have important potential consequences,
including, but not limited to:
•
•
increasing our vulnerability to, and reducing our flexibility to plan for and respond to, general adverse economic and industry conditions and changes in
our business and the competitive environment;
requiring the dedication of a substantial portion of our cash flow from operations to the payment of principal of, and interest on, indebtedness, thereby
reducing the availability of such cash flow to fund working capital, capital expenditures, acquisitions, share repurchases or other corporate purposes;
increasing our vulnerability to a downgrade of our credit rating, which could adversely affect our cost of funds, liquidity and access to capital markets;
restricting us from making strategic acquisitions or causing us to make non-strategic divestitures;
increasing our exposure to the risk of increased interest rates insofar as current and future borrowings are subject to variable rates of interest;
•
•
•
• making it more difficult for us to repay, refinance or satisfy our obligations with respect to our debt;
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limiting our ability to borrow additional funds in the future and increasing the cost of any such borrowing;
placing us at a competitive disadvantage compared to competitors with less leverage or better access to capital resources, and
imposing restrictive covenants on our operations, which, if not complied with, could result in an event of default, which in turn, if not cured or waived,
could result in the acceleration of the applicable debt, and may result in the acceleration of any other debt to which a cross-acceleration or cross-default
provision applies.
There is no assurance that we will generate cash flow from operations or that future debt or equity financings will be available to us to enable us to pay our
indebtedness or to fund other needs. As a result, we may need to refinance all or a portion of our indebtedness on or before maturity. There is no assurance that we
will be able to refinance any of our indebtedness on favorable terms, or at all. Any inability to generate sufficient cash flow or refinance our indebtedness on
favorable terms could have a material adverse effect on our business, financial condition or results of operations.
Our debt agreements contain restrictive covenants that may limit our operating flexibility.
Our debt agreements, including our Existing ABL Loan Agreement and our Existing Term Loan Agreement (as defined below) contain, and the debt agreements
we expect to enter into in connection with the SUPERVALU acquisition will contain, financial covenants and other restrictions that limit our operating flexibility,
limit our flexibility in planning for or reacting to changes in our business. These restrictions may prevent us from taking actions that we believe would be in the
best interest of our business, and may make it difficult for us to successfully execute our business strategy or effectively compete with companies that are not
similarly restricted.
In addition, our Existing ABL Loan Agreement and Existing Term Loan Agreement each require, and the debt agreements we expect to enter into in connection
with the SUPERVALU acquisition will require, that we comply with various financial tests and impose certain restrictions on us, including among other things,
restrictions on our ability to incur additional indebtedness, create liens on assets, make loans or investments or pay dividends. Failure to comply with these
covenants could have a material adverse effect on our business, financial condition or results of operations.
Conditions beyond our control can interrupt our supplies and alter our product costs.
The majority of our suppliers are based in the United States and Canada, but we also source products from suppliers throughout Europe, Asia, Central America,
South America, Africa and Australia. For the most part, we do not have long-term contracts with our suppliers committing them to provide products to us.
Although our purchasing volume can provide benefits when dealing with suppliers, suppliers may not provide the products needed by us in the quantities and at the
prices requested. We are also subject to delays caused by interruption in production and increases in product costs based on conditions outside of our control. These
conditions include work slowdowns, work interruptions, strikes or other job actions by employees of suppliers, short-term weather conditions or more prolonged
climate change, crop conditions, product recalls, water shortages, transportation interruptions, unavailability of fuel or increases in fuel costs, competitive demands,
raw material shortages and natural disasters or other catastrophic events (including, but not limited to food-borne illnesses). As demand for natural and organic
products has increased and the distribution channels into which these products are sold have expanded, we have continued to experience higher levels of
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manufacturer out-of-stocks. These shortages have caused us to incur higher operating expenses due to the cost of moving products around and between our
distribution facilities in order to keep our service level high. We cannot be sure when this trend will end or whether it will recur during future years. As the
consumer demand for natural and organic products has increased, certain retailers and other producers have entered the market and attempted to buy certain raw
materials directly, limiting their availability to be used in certain supplier products. Further, increased frequency or duration of extreme weather conditions could
also impair production capabilities, disrupt our supply chain or impact demand for our products, including the specialty protein and cheese products sold by Tony's.
For example, until the last two years, weather patterns had resulted in lower than normal levels of precipitation in key agricultural states such as California,
impacting the price of water and corresponding prices of food products grown in states facing drought conditions. The impact of sustained droughts is uncertain
and could result in volatile input costs. Input costs could increase at any point in time for a large portion of the products that we sell for a prolonged period.
Conversely, in years where rainfall levels are abundant product costs, particularly in our perishable and produce businesses, may decline and the results of this
product cost deflation could negatively impact our results of operations. Our inability to obtain adequate products as a result of any of the foregoing factors or
otherwise could prevent us from fulfilling our obligations to customers, and customers may turn to other distributors. In that case, our business, financial condition
or results of operations could be materially and adversely affected.
Changes in relationships with our suppliers may adversely affect our profitability.
We cooperatively engage in a variety of promotional programs with our suppliers. We manage these programs to maintain or improve our margins and increase
sales. A reduction or change in promotional spending by our suppliers (including as a result of increased demand for natural and organic products) could have a
significant impact on our profitability. We depend heavily on our ability to purchase merchandise in sufficient quantities at competitive prices. We have no
assurances of continued supply, pricing, or access to new products and any supplier could at any time change the terms upon which it sells to us or discontinue
selling to us.
We are subject to significant governmental regulation.
Our business is highly regulated at the federal, state and local levels and our products and distribution operations require various licenses, permits and approvals. In
particular:
•
•
•
the products that we distribute in the United States are subject to inspection by the FDA;
our warehouse and distribution centers are subject to inspection by the USDA and state health authorities; and
the United States Department of Transportation and the United States Federal Highway Administration regulate our United States trucking operations.
Our Canadian operations are similarly subject to extensive regulation, including the English and French dual labeling requirements applicable to products that we
distribute in Canada. The loss or revocation of any existing licenses, permits or approvals or the failure to obtain any additional licenses, permits or approvals in
new jurisdictions where we intend to do business could have a material adverse effect on our business, financial condition or results of operations. In addition, as a
distributor and manufacturer of natural, organic, and specialty foods, we are subject to increasing governmental scrutiny of and public awareness regarding food
safety and the sale, packaging and marketing of natural and organic products. Compliance with these laws may impose a significant burden on our operations.
Additionally, concern over climate change, including the impact of global warming, has led to significant United States and international legislative and regulatory
efforts to limit greenhouse gas emissions. Increased regulation regarding greenhouse gas emissions, especially diesel engine emissions, could impose substantial
costs on us. These costs include an increase in the cost of the fuel and other energy we purchase and capital costs associated with updating or replacing our vehicles
prematurely. Until the timing, scope and extent of such regulation becomes known, we cannot predict its effect on our results of operations. It is reasonably
possible, however, that it could impose material costs on us which we may be unable to pass on to our customers.
The failure to comply with applicable regulatory requirements, including those referred to above and in Item 1. Business—Government Regulation, could result in,
among other things, administrative, civil, or criminal penalties or fines, mandatory or voluntary product recalls, warning or other letters, cease and desist orders
against operations that are not in compliance, closure of facilities or operations, the loss, revocation, or modification of any existing licenses, permits, registrations,
or approvals, or the failure to obtain additional licenses, permits, registrations, or approvals in new jurisdictions where we intend to do business, any of which could
have a material adverse effect on our business, financial condition, or results of operations. These laws and regulations may change in the future and we may incur
material costs in our efforts to comply with current or future laws and regulations or due to any required product recalls.
In addition, if we fail to comply with applicable laws and regulations or encounter disagreements with respect to our contracts subject to governmental regulations,
including those referred to above, we may be subject to investigations, criminal sanctions or civil remedies, including fines, injunctions, prohibitions on exporting,
seizures, or debarments from contracting with the U.S. or
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Canadian governments. The cost of compliance or the consequences of non-compliance, including debarments, could have a material adverse effect on our
business, financial condition or results of operations. In addition, governmental units may make changes in the regulatory frameworks within which we operate
that may require either the corporation as a whole or individual businesses to incur substantial increases in costs in order to comply with such laws and regulations.
A cybersecurity incident and other technology disruptions could negatively impact our business and our relationships with customers .
We use computers in substantially all aspects of our business operations. We also use mobile devices, social networking and other online activities to connect with
our employees, suppliers, business partners and our customers. Such uses give rise to cybersecurity risks, including security breach, espionage, system disruption,
theft and inadvertent release of information. Our business involves the storage and transmission of numerous classes of sensitive and/or confidential information
and intellectual property, including customers’ and suppliers' personal information, private information about employees, and financial and strategic information
about the Company and its business partners. Further, as we pursue our strategy to grow through acquisitions and to pursue new initiatives that improve our
operations and cost structure, we are also expanding and improving our information technologies, resulting in a larger technological presence and corresponding
exposure to cybersecurity risk. If we fail to assess and identify cybersecurity risks associated with acquisitions and new initiatives, we may become increasingly
vulnerable to such risks. Additionally, while we have implemented measures to prevent security breaches and cyber incidents, our preventative measures and
incident response efforts may not be entirely effective. The theft, destruction, loss, misappropriation, or release of sensitive and/or confidential information or
intellectual property, or interference with our information technology systems or the technology systems of third parties on which we rely, could result in business
disruption, negative publicity, brand damage, violation of privacy laws, loss of customers, potential liability and competitive disadvantage all of which could have
a material adverse effect on our business, financial condition or results of operations.
We face risks related to labor relations.
As of July 28, 2018 , approximately 7.3% of our employees were covered by collective bargaining agreements which expire between March 2019 and March 2022.
See "Item 1. Business—Employees" for further detail. If we are not able to renew these agreements or are required to make significant changes to these
agreements, our relationship with these employees may become fractured, work stoppages could occur or we may incur additional expenses which could have a
material adverse effect on our business, financial condition, or results of operations. We have in the past been the focus of union-organizing efforts, and we believe
it is likely that we will be the focus of similar efforts in the future.
As we increase our employee base and broaden our distribution operations to new geographic markets, our increased visibility could result in increased or
expanded union-organizing efforts. In the event we are unable to negotiate contract renewals with our union associates, we could be subject to work stoppages. In
that event, it would be necessary for us to hire replacement workers to continue to meet our obligations to our customers. The costs to hire replacement workers and
employ effective security measures could negatively impact the profitability of any affected facility. Depending on the length of time that we are required to
employ replacement workers and security measures these costs could be significant and could have a material adverse effect on our business, financial condition or
results of operations.
In January 2018, the National Labor Relations Board certified the election results of our driver employees in Gilroy, California to be represented by the Teamsters
union. We are in the process of negotiating a collective bargaining agreement with these employees. The terms of this agreement could cause our expenses at this
facility to increase, negatively impacting the results of operations at this facility.
We may fail to establish sufficient insurance reserves and adequately estimate for future workers' compensation and automobile liabilities.
We are primarily self-insured for workers' compensation and general and automobile liability insurance. We believe that our workers' compensation and
automobile insurance coverage is customary for businesses of our size and type. However, there are types of losses we may incur that cannot be insured against or
that we believe are not commercially reasonable to insure. These losses, should they occur, could have a material adverse effect on our business, financial condition
or results of operations. In addition, the cost of workers' compensation insurance and automobile insurance fluctuates based upon our historical trends, market
conditions and availability.
Any projection of losses concerning workers' compensation and automobile insurance is subject to a considerable degree of variability. Among the causes of this
variability are unpredictable external factors affecting litigation trends, benefit level changes and claim settlement patterns. If actual losses incurred are greater than
those anticipated, our reserves may be insufficient and additional costs could be recorded in our consolidated financial statements. If we suffer a substantial loss
that is not covered by
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our self-insurance reserves, the loss and attendant expenses could harm our business, financial condition or results of operations. We have purchased stop loss
coverage from third parties, which limits our exposure above the amounts we have self-insured.
Adverse judgments or settlements resulting from legal proceedings in which we may be involved in the normal course of our business could reduce our profits or
limit our ability to operate our business.
In the normal course of our business, we are involved in various legal proceedings. The outcome of these proceedings cannot be predicted. If any of these
proceedings were to be determined adversely to us or a settlement involving a payment of a material sum of money were to occur, it could materially and adversely
affect our results of operations or ability to operate our business. Additionally, we could become the subject of future claims by third parties, including our
employees, our investors, or regulators. Any significant adverse judgments or settlements would reduce our profits and could limit our ability to operate our
business. Further, we may incur costs related to claims for which we have appropriate third-party indemnity, but such third parties fail to fulfill their contractual
obligations.
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
ITEM 2. PROPERTIES
We maintained thirty-three distribution centers at July 28, 2018 which were utilized by our wholesale segment. These facilities, including offsite storage space,
consisted of an aggregate of approximately 8.8 million square feet of storage space, which we believe represents the largest capacity of any distributor within the
United States that is principally engaged in the distribution of natural, organic and specialty products.
Set forth below for each of our distribution centers is its location and the expiration of leases as of July 28, 2018 for those distribution centers that we do not own.
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Location
Atlanta, Georgia*
Auburn, California*
Auburn, Washington
Aurora, Colorado
Burnaby, British Columbia
Charlotte, North Carolina
Chesterfield, New Hampshire*
Dayville, Connecticut*
Gilroy, California
Greenwood, Indiana*
Howell Township, New Jersey
Hudson Valley, New York*
Iowa City, Iowa*
Lancaster, Texas
Logan Township, New Jersey
Montreal, Quebec
Moreno Valley, California
Philadelphia, Pennsylvania
Prescott, Wisconsin
Racine, Wisconsin*
Richburg, South Carolina
Richmond, British Columbia
Ridgefield, Washington
Ridgefield, Washington*
Rocklin, California*
Sarasota, Florida
Truckee, California
Vaughan, Ontario
Vernon, California*
West Sacramento, California
West Sacramento, California
York, Pennsylvania
Yuba City, California
Square Footage
(Approximate in thousands)
304
126
323
483
41
43
272
292
411
293
387
476
249
454
70
31
596
100
269
410
336
96
30
220
439
641
6
180
30
192
85
650
224
Lease Expiration
Owned
Owned
August 2019
October 2033
December 2022
September 2019
Owned
Owned
Owned
Owned
Owned
Owned
Owned
July 2020
March 2028
July 2019
July 2023
January 2020
Owned
Owned
Owned
August 2022
September 2019
Owned
Owned
July 2022
August 2020
November 2021
Owned
Owned
Owned
May 2020
September 2021
*The properties noted above are mortgaged under and encumbered by our Existing Term Loan Agreement initially entered into on August 14, 2014.
During fiscal 2018, we disposed of our Earth Origins retail business. We operate one retail store at our Corporate headquarters in Providence, Rhode Island. We
also lease a processing and manufacturing facility in Edison, New Jersey for our manufacturing and branded products division with a lease expiration date of
July 31, 2023.
We lease office space in San Francisco, California; Santa Cruz, California; Chesterfield, New Hampshire; Uniondale, New York; Brooklyn, New York; Richmond,
Virginia; Wayne, Pennsylvania; Lincoln, Rhode Island, the site of our shared services center; and Providence, Rhode Island, the site of our corporate headquarters.
Our leases have been entered into upon terms that we believe to be reasonable and customary.
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ITEM 3. LEGAL PROCEEDINGS
From time to time, we are involved in routine litigation or other legal proceedings that arise in the ordinary course of our business. There are no pending material
legal proceedings to which we are a party or to which our property is subject.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
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PART II.
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF
EQUITY SECURITIES
Our common stock is traded on the Nasdaq Global Select Market® under the symbol "UNFI."
The following table sets forth, for the fiscal periods indicated, the high and low sale prices per share of our common stock on the Nasdaq Global Select Market®:
Fiscal 2018
First Quarter
Second Quarter
Third Quarter
Fourth Quarter
Fiscal 2017
First Quarter
Second Quarter
Third Quarter
Fourth Quarter
$
$
High
Low
44.94 $
52.69
49.81
47.73
50.06 $
49.39
45.99
42.38
32.52
38.04
40.88
32.03
38.55
40.81
39.47
34.60
On July 28, 2018 , we had 74 stockholders of record. The number of record holders is not representative of the number of beneficial holders of our common stock
because depositories, brokers or other nominees hold many shares.
We have never declared or paid any cash dividends on our capital stock. We anticipate that all of our earnings in the foreseeable future will be retained to finance
the continued growth and development of our business, and we have no current intention to pay cash dividends. Our future dividend policy will depend on our
earnings, capital requirements and financial condition, requirements of the financing agreements to which we are then a party and other factors considered relevant
by our Board of Directors. Additionally, our Existing ABL Loan Agreement and Existing Term Loan Agreement contain, and the debt agreements we expect to
enter into in connection with the SUPERVALU acquisition will contain, terms that restrict us from making any cash dividends unless certain conditions and
financial tests are met.
Comparative Stock Performance
The graph below compares the cumulative total stockholder return on our common stock for the last five fiscal years with the cumulative total return on (i) an
index of Food Distributors and Wholesalers and (ii) The NASDAQ Composite Index. The comparison assumes the investment of $100 on August 3, 2013 in our
common stock and in each of the indices and, in each case, assumes reinvestment of all dividends. The stock price performance shown below is not necessarily
indicative of future performance.
The index of Food Distributors and Wholesalers includes SUPERVALU, Inc. and SYSCO Corporation.
This performance graph shall not be deemed "soliciting material" or be deemed to be "filed" for purposes of Section 18 of the Exchange Act or otherwise subject to
the liabilities under that Section and shall not be deemed to be incorporated by reference into any of our filings under the Securities Act of 1933, as amended (the
"Securities Act"), or the Exchange Act.
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COMPARISION OF 5 YEAR CUMULATIVE TOTAL RETURN*
Among United Natural Foods, Inc., the NASDAQ Composite Index,
and Index of Food Distributors and Wholesalers
* $100 invested on 8/3/13 in UNFI common stock or 8/3/13 in the relevant index, including reinvestment of dividends. Index
calculated on a month-end basis.
ITEM 6. SELECTED FINANCIAL DATA
The selected consolidated financial data presented below are derived from our consolidated financial statements, which have been audited by KPMG LLP, our
independent registered public accounting firm. The historical results are not necessarily indicative of results to be expected for any future period. The following
selected consolidated financial data should be read in conjunction with and is qualified by reference to "Item 7. Management's Discussion and Analysis of
Financial Condition and Results of Operations" and our Consolidated Financial Statements and Notes thereto included elsewhere in this Annual Report.
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Consolidated Statement of Income Data: (1) (2)
July 28,
2018
July 29,
2017
July 30,
2016
August 1,
2015
August 2,
2014
Net sales
Cost of sales
Gross profit
Total operating expenses
Operating income
Income before income taxes
Provision for income taxes
Net income
Basic per share data:
Net income
Diluted per share data:
Net income
Consolidated Balance Sheet Data: (2) (3)
Working capital
Total assets
Total long-term debt and capital leases, excluding
current portion
$
10,226,683 $
9,274,471 $
8,470,286 $
8,184,978 $
(In thousands, except per share data)
8,703,916
1,522,767
1,295,542
227,225
7,845,550
1,428,921
1,202,896
226,025
7,190,935
1,279,351
1,055,242
224,109
6,924,463
1,260,515
1,018,558
241,957
212,745
47,075
214,423
84,268
208,222
82,456
229,769
91,035
165,670 $
130,155 $
125,766 $
138,734 $
3.28 $
2.57 $
2.50 $
2.77 $
3.26 $
2.56 $
2.50 $
2.76 $
$
$
$
$
1,089,690 $
958,683 $
991,468 $
1,018,437 $
2,964,472
2,886,563
2,852,155
2,540,994
6,794,447
5,666,802
1,127,645
916,857
210,788
207,408
81,926
125,482
2.53
2.52
850,006
2,284,446
137,709
149,863
161,739
172,949
32,510
Total stockholders' equity
$
1,845,955 $
1,681,921 $
1,519,504 $
1,381,088 $
1,238,919
(1)
Includes the effect of acquisitions from the respective dates of acquisition.
(2) Periods prior to the year ended July 30, 2016 have been restated for immaterial corrections for identified errors in accounting for early payment discounts
on inventory purchases.
(3) Amounts have been adjusted for the reclassification of debt issuance costs resulting from the Company's early adoption of Accounting Standards Update
No. 2015-03, Interest- Imputation of Interest (Subtopic 835-30) , in the fourth quarter of fiscal 2016.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The
following
discussion
and
analysis
should
be
read
in
conjunction
with
our
consolidated
financial
statements
and
the
notes
thereto
appearing
elsewhere
in
this
Annual
Report.
Forward-Looking Statements
This Annual Report and the documents incorporated by reference in this Annual Report contain forward-looking statements within the meaning of Section 27A of
the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), that
involve substantial risks and uncertainties. In some cases you can identify these statements by forward-looking words such as "anticipate," "believe," "could,"
"estimate," "expect," "intend," "may," "plans," "planned," "seek," "should," "will," and "would," or similar words. Statements that contain these words and other
statements that are forward-looking in nature should be read carefully because they discuss future expectations, contain projections of future results of operations
or of financial positions or state other "forward-looking" information.
Forward-looking statements involve inherent uncertainty and may ultimately prove to be incorrect or false. You are cautioned not to place undue reliance on
forward-looking statements. Except as otherwise may be required by law, we undertake no obligation to update or revise forward-looking statements to reflect
changed assumptions, the occurrence of unanticipated events or actual operating results. Our actual results could differ materially from those anticipated in these
forward-looking statements as a result of various factors, including, but not limited to:
•
our dependence on principal customers;
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•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
our ability to effectively manage operational expenses due to higher volumes from our single supernatural customer and from supermarkets in light of
lower margins from those customers;
the relatively low margins and economic sensitivity of our business;
changes in disposable income levels and consumer spending trends;
our reliance on the continued growth in sales of natural and organic foods and non-food products in comparison to conventional products;
increased competition in our industry as a result of increased distribution of natural, organic and specialty products by conventional grocery distributors
and direct distribution of those products by large retailers and online distributors;
the ability to identify and successfully complete acquisitions, including our ability to complete the acquisition of SUPERVALU and to recognize the
anticipated benefits of the business combination with SUPERVALU;
our ability to timely and successfully deploy our warehouse management system throughout our distribution centers and our transportation management
system across the Company and to achieve the expected efficiencies and cost savings from these efforts;
the addition or loss of significant customers or material changes to our relationships with these customers;
our sensitivity to general economic conditions, including the current economic environment;
our sensitivity to inflationary and deflationary pressures;
volatility in fuel costs;
volatility in foreign exchange rates;
the potential for disruptions in our supply chain by circumstances beyond our control;
the risk of interruption of supplies due to lack of long-term contracts, severe weather, work stoppages or otherwise;
consumer demand for natural and organic products outpacing suppliers’ ability to produce those products and challenges we may experience in obtaining
sufficient amounts of products to meet our customers' demands;
union-organizing activities that could cause labor relations difficulties and increased costs;
• moderated supplier promotional activity, including decreased forward buying opportunities;
•
• management's allocation of capital and the timing of capital expenditures; and
•
changes in interpretations, assumptions and expectations regarding the Tax Cuts and Jobs Act ("TCJA"), including additional guidance that may be issued
by federal and state taxing authorities.
This list of risks and uncertainties, however, is only a summary of some of the most important factors that could cause our actual results to differ materially from
those anticipated in forward-looking statements and is not intended to be exhaustive. You should carefully review the risks described under "Part I. Item 1A. Risk
Factors," as well as any other cautionary language in this Annual Report, as the occurrence of any of these events could have an adverse effect, which may be
material, on our business, financial condition or results of operations.
This Annual Report contains forward-looking non-GAAP financial measures associated with the pending SUPERVALU acquisition. These non-GAAP financial
measures are not intended to be considered in isolation or as a substitute for any measure prepared in accordance with GAAP. The Company believes that
presenting non-GAAP financial measures aids in making period-to-period comparisons and is a meaningful indication of its actual and estimated operating
performance. In addition, the Company's management believes that the forward-looking non-GAAP financial measures provide guidance to investors about our pro
forma financial expectations for the pending SUPERVALU acquisition. The Company's management utilizes and plans to utilize this non-GAAP financial
information to compare the Company's operating performance to comparable periods and to internally prepared projections. We are not able to reconcile these
metrics to their most directly comparable forward-looking GAAP financial measures without unreasonable efforts because we are unable to predict with a
reasonable degree of certainty the actual impact of purchase accounting, divestitures and restructuring actions. The unavailable information could have a significant
impact on our GAAP financial results.
Overview
We are a leading distributor based on sales of natural, organic and specialty foods and non-food products in the United States and Canada. We offer more than
110,000 natural, organic and specialty foods and non-food products, consisting of national, regional and private label brands grouped into six product categories:
grocery and general merchandise, produce, perishables and frozen foods, nutritional supplements and sports nutrition, bulk and food service products and personal
care items. We serve more than 40,000 customer locations primarily located across the United States and Canada which we classify into one of the following four
categories: independents, which include buying clubs; supernatural, which consists solely of Whole Foods Market; supermarkets, which include mass market
chains; and other which includes e-commerce, foodservice and international customers outside of Canada, as well as sales to Amazon.com, Inc.
Our operations are generally comprised of two principal operating divisions. These operating divisions are:
•
our wholesale division , which includes:
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◦
◦
◦
◦
◦
our broadline natural, organic and specialty distribution business in the United States;
Tony's, which distributes a wide array of specialty protein, cheese, deli, foodservice and bakery goods, principally throughout the Western
United States;
Albert's, which distributes organically grown produce and non-produce perishable items within the United States, and includes the operations of
Nor-Cal, a distributor of organic and conventional produce and non-produce perishable items principally in Northern California;
UNFI Canada, Inc. ("UNFI Canada"), which is our natural, organic and specialty distribution business in Canada; and
Select Nutrition, which distributes vitamins, minerals and supplements; and
•
our manufacturing and branded products division , consisting of:
◦ Woodstock Farms Manufacturing, which specializes in importing, roasting, packaging and the distribution of nuts, dried fruit, seeds, trail mixes,
granola, natural and organic snack items and confections; and
our Blue Marble Brands branded product lines.
◦
During fiscal 2018, we disposed of our retail business, Earth Origins, and recorded restructuring and asset impairment expenses, which includes a loss on the
disposition of assets, of approximately $16.1 million during the fiscal year ended July 28, 2018 .
Our net sales consist primarily of sales of natural, organic and specialty products to retailers, adjusted for customer volume discounts, returns and allowances. Net
sales also consist of amounts charged by us to customers for shipping and handling and fuel surcharges. The principal components of our cost of sales include the
amounts paid to suppliers for product sold, plus the cost of transportation necessary to bring the product to, or move product between, our various distribution
centers, offset by consideration received from suppliers in connection with the purchase or promotion of the suppliers' products. Cost of sales also includes
amounts incurred by us at our manufacturing subsidiary, Woodstock Farms Manufacturing, for inbound transportation costs offset by consideration received from
suppliers in connection with the purchase or promotion of the suppliers’ products. Our gross margin may not be comparable to other similar companies within our
industry that may include all costs related to their distribution network in their costs of sales rather than as operating expenses. We include purchasing, receiving,
selecting and outbound transportation expenses within our operating expenses rather than in our cost of sales. Total operating expenses include salaries and wages,
employee benefits, warehousing and delivery, selling, occupancy, insurance, administrative, share-based compensation, depreciation and amortization expense.
Other expenses (income) include interest on our outstanding indebtedness, including the financing obligation related to our Aurora, Colorado distribution center
and the lease for office space for our corporate headquarters in Providence, Rhode Island, interest income and miscellaneous income and expenses.
In recent years, our sales to existing and new customers have increased through the continued growth of the natural and organic products industry in general;
increased market share as a result of our high quality service and a broader product selection, including specialty products; the acquisition of, or merger with,
natural and specialty products distributors, the expansion of our existing distribution centers; the construction of new distribution centers; the introduction of new
products and the development of our own line of natural and organic branded products. Through these efforts, we believe that we have been able to broaden our
geographic penetration, expand our customer base, enhance and diversify our product selections and increase our market share. Our strategic plan is focused on
increasing the type of products we distribute to our customers, including perishable products and conventional produce to “build out the store” and cover center of
the store, as well as perimeter offerings. As part of our “one company” approach, we are in the process of rolling out a national warehouse management and
procurement system to convert our existing facilities into a single warehouse management and supply chain platform ("WMS"). WMS supports our effort to
integrate and nationalize processes across the organization. We have successfully implemented the WMS system at fifteen of our facilities. In light of the proposed
acquisition of SUPERVALU, we are reevaluating our warehouse management system strategy. However, we continue to be focused on the automation of our new
or expanded distribution centers that are at different stages of construction. These steps and others are intended to promote operational efficiencies and improve
operating expenses as a percentage of net sales as we attempt to offset the lower gross margins we expect to generate by increased sales to the supernatural and
supermarkets channels and as a result of additional competition in our business.
We have been the primary distributor to Whole Foods Market for more than twenty years. We continue to serve as the primary distributor to Whole Foods Market
in all of its regions in the United States pursuant to a distribution agreement that expires on September 28, 2025. Following the acquisition of Whole Foods Market
by Amazon.com, Inc. in August 2017, our sales to Whole Foods Market increased resulting in year-over-year growth in net sales to this customer in fiscal 2018 of
21.4% compared to fiscal 2017 . Whole Foods Market accounted for approximately 37% and 33% of our net sales for the years ended July 28, 2018 and July 29,
2017 , respectively.
Our net sales increased from $9.27 billion in fiscal 2017 to $10.23 billion in fiscal 2018 . Net income increased from $130.2 million in fiscal 2017 to $165.7
million in fiscal 2018 .
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With favorable trends in consumer confidence and the unemployment rate, we expect continued growth in sales of natural and organic foods and non-food products
in fiscal 2019 and positive Company net sales growth of 8.6% to 10.5% . For fiscal 2019, the Company anticipates year-over-year sales growth to continue in the
supernatural channel driven primarily by continued demand for better for you products. In addition, barring additional increases in freight or fuel rates, we expect
inbound freight headwinds to dissipate in the first half of fiscal 2019 which would result in improved profitability, as reflected in our guidance. We are beginning
to see this inbound freight improvement in the first month of fiscal 2019. Finally, the pending SUPERVALU acquisition is expected to have a positive impact on
sales in fiscal 2019 as it accelerates the Company’s “build out the store” strategy. The pending SUPERVALU acquisition will also broaden our universe of
customers and suppliers, reducing our dependence on any one customer.
In the first full year after the acquisition closes (“Year One”), we expect combined net sales, excluding retail and discontinued operations, to be approximately
$24.2 billion to $24.8 billion. Year One Adjusted EBITDA is expected to be $655 million to $675 million. Year One Adjusted EBITDA excludes
SUPERVALU’s retail business, impact from discontinued operations, one-time costs and the impact of purchase accounting. In addition, the Year One Adjusted
EBITDA projection excludes the benefit of SUPERVALU’s net pension and other post-retirement benefits valued at $38 million for SUPERVALU’s fiscal year
2019.
The projection includes the following items: (1) the winding down of SUPERVALU’s Albertson transition services agreement; (2) share based compensation for
the Company and SUPERVALU; (3) retail and other stranded costs; and (4) the additional expense related to SUPERVALU’s recent sale leaseback initiative. In
addition, the projection reflects Year One cost synergies, benefits from SUPERVALU’s acquisitions of Unified Grocers, Inc. and Associated Grocers of Florida,
Inc, and growth assumptions for the underlying Company and SUPERVALU businesses.
Cost synergies are the primary value driver in this combination. We expect to achieve more than $175 million in cost synergies in the third year after the
acquisition closes (“Year Three”) and $185 million in the fourth year after the acquisition closes (“Year Four”). These assumptions exclude growth synergies. Cost
synergies will be derived from two primary categories: overhead efficiencies and operational optimization. Our expectation is to achieve 25% of the synergies in
Year One, 65% in the following year and 95% by Year Three and 100% by Year Four. As far as costs associated with the transaction and with achieving the
synergies, we expect to incur the bulk of these costs in the first two years following the close of the acquisition. We expect approximately $95 million of costs in
Year One and $110 million in years two through five, following the closing of the transaction. Lastly, we expect a low double-digit percentage accretion in
Adjusted EPS in Year One, excluding one-time costs to achieve synergies and the impact of purchase accounting.
Results of Operations
The following table presents, for the periods indicated, certain income and expense items expressed as a percentage of net sales:
Net sales
Cost of sales
Gross profit
Operating expenses
Restructuring and asset impairment expenses
Total operating expenses
Operating income
Other expense (income):
Interest expense
Interest income
Other, net
Total other expense, net
Income before income taxes
Provision for income taxes
Net income
July 28,
2018
Fiscal year ended
July 29,
2017
July 30,
2016
100.0 %
100.0 %
100.0 %
85.1 %
14.9 %
12.5 %
0.2 %
12.7 %
2.2 %
0.2 %
— %
— %
0.1 % *
2.1 %
0.5 %
1.6 %
84.6 %
15.4 %
12.9 %
0.1 %
13.0 %
2.4 %
0.2 %
— %
(0.1)%
0.1 %
2.3 %
0.9 %
1.4 %
84.9 %
15.1 %
12.4 %
0.1 %
12.5 %
2.6 %
0.2 %
— %
— %
0.2 %
2.5 % *
1.0 %
1.5 %
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* Reflects rounding
Fiscal year ended July 28, 2018 compared to fiscal year ended July 29, 2017
Net Sales
Our net sales for the fiscal year ended July 28, 2018 increased approximately 10.3% , or $952.2 million , to $10.23 billion from $9.27 billion for the fiscal year
ended July 29, 2017 . Our net sales by customer type for the fiscal years ended July 28, 2018 and July 29, 2017 were as follows (in millions):
Customer Type
Supernatural
Supermarkets
Independents
Other
Total
* Total reflects rounding
2018
Net Sales
% of Total
Net Sales
2017
Net Sales
% of Total
Net Sales
$
3,758
2,856
2,573
1,039
37% $
28%
25%
10%
$
10,227
*
100%
$
3,096
2,747
2,427
1,004
9,274
33%
30%
26%
11%
100%
During fiscal 2017, our net sales by channel were adjusted to reflect changes in the classification of customer types from acquisitions we consummated in the third
and fourth quarters of fiscal 2016 and the first quarter of fiscal 2017. There was no financial statement impact as a result of revising the classification of customer
types. As a result of this adjustment, net sales to our supermarkets and other channels for the fiscal year ended July 29, 2017 increased approximately $50 million
and $2 million, respectively, compared to the previously reported amounts, while net sales to the independents channel for the fiscal year ended July 29, 2017
decreased approximately $52 million compared to the previously reported amounts.
Whole Foods Market is our only supernatural customer, and net sales to Whole Foods Market for the fiscal year ended July 28, 2018 increased by approximately
$662 million , or 21.4% , over the prior year and accounted for approximately 37% and 33% of our total net sales for the fiscal years ended July 28, 2018 and
July 29, 2017 , respectively. The increase in net sales to Whole Foods Market is primarily due to an increase in same store sales following its acquisition by
Amazon.com, Inc. in August 2017 coupled with growth in new product categories, most notably the health, beauty and supplement categories. Net sales within our
supernatural channel do not include net sales to Amazon.com, Inc. in either the current period or the prior period, as these net sales are reported in our other
channel.
Net sales to our supermarkets channel for the fiscal year ended July 28, 2018 increased by approximately $109 million , or 4.0% , from fiscal 2017 and represented
approximately 28% and 30% of total net sales in fiscal 2018 and fiscal 2017 , respectively. The increase in net sales to supermarkets was primarily driven by
growth in our wholesale division, which includes our broadline distribution business.
Net sales to our independents channel increased by approximately $146 million , or 6.0% , during the fiscal year ended July 28, 2018 compared to the fiscal year
ended July 29, 2017 , and accounted for 25% and 26% of our total net sales in fiscal 2018 and fiscal 2017 , respectively. The increase in net sales in this channel is
primarily due to growth in our wholesale division, which includes our broadline distribution business.
Other net sales, which include sales to foodservice customers and sales from the United States to other countries, as well as sales through our e-commerce business,
branded product lines, retail division, manufacturing division, and our brokerage business, increased by approximately $35 million , or 3.5% , for the fiscal year
ended July 28, 2018 over the prior fiscal year and accounted for approximately 10% and 11% of total net sales in fiscal 2018 and fiscal 2017 , respectively. The
increase in other net sales was primarily driven by growth in our e-commerce business.
Cost of Sales and Gross Profit
Our gross profit increased approximately 6.6% , or $93.8 million , to $1.52 billion for the fiscal year ended July 28, 2018 , from $1.43 billion for the fiscal year
ended July 29, 2017 . Our gross profit as a percentage of net sales was 14.9% for the fiscal year ended July 28, 2018 and 15.4% for the fiscal year ended July 29,
2017 . The decrease in gross profit as a percentage of net sales was primarily driven by a shift in customer mix where net sales growth of our largest customer
outpaced growth of other customers with higher margin and by an increase in inbound freight costs.
Operating Expenses
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Our total operating expenses increased approximately 7.7% , or $92.6 million , to $1.30 billion for the fiscal year ended July 28, 2018 , from $1.20 billion for the
fiscal year ended July 29, 2017 . As a percentage of net sales, total operating expenses decreased to approximately 12.7% for the fiscal year ended July 28, 2018 ,
from approximately 13.0% for the fiscal year ended July 29, 2017 . The decrease in operating expenses as a percentage of net sales was primarily driven by
leveraging of fixed costs on increased net sales. This was partially offset by $16.1 million of restructuring and impairment charges, which includes a $2.7 million
loss on the disposition of assets, recorded for our Earth Origins retail business, which was disposed in the fourth quarter of fiscal 2018, increased costs incurred to
fulfill the increased demand for our products and approximately $5.0 million of acquisition related costs associated with the pending SUPERVALU acquisition.
Total operating expenses also included share-based compensation expense of $25.8 million and $25.7 million for fiscal 2018 and 2017 , respectively. For more
information, refer to Note 3. "Equity Plans" to our Consolidated Financial Statements included in "Item 8. Financial Statements and Supplementary Data" of this
Annual Report.
Operating Income
Reflecting the factors described above, operating income increased approximately 0.5% , or $1.2 million , to $227.2 million for the fiscal year ended July 28, 2018
, from $226.0 million for the fiscal year ended July 29, 2017 . As a percentage of net sales, operating income was 2.2% and 2.4% for the fiscal years ended July 28,
2018 and July 29, 2017 , respectively.
Other Expense (Income)
Other expense, net increased $2.9 million to $14.5 million for the fiscal year ended July 28, 2018 , from $11.6 million for the fiscal year ended July 29, 2017 .
Interest expense for the fiscal year ended July 28, 2018 decreased to $16.5 million from $17.1 million for the fiscal year ended July 29, 2017 . The decrease in
interest expense was primarily due to a reduction in outstanding debt year-over-year. Interest income was $0.4 million for the fiscal years ended July 28, 2018 and
July 29, 2017 . Other income for the fiscal year ended July 28, 2018 was $1.5 million , compared to other income of $5.2 million for the fiscal year ended July 29,
2017 . Other income for fiscal 2018 was primarily related to positive returns on the Company's equity method investment. Other income for fiscal 2017 was
primarily related to a $6.1 million gain recorded during the fourth quarter of fiscal 2017 related to the sale of the Company's stake in Kicking Horse Coffee.
Provision for Income Taxes
Our effective income tax rate was 22.1% and 39.3% for the fiscal years ended July 28, 2018 and July 29, 2017 , respectively. The decrease in the effective income
tax rate for the fiscal year ended July 28, 2018 was driven by a $15.5 million tax benefit which was recorded as result of the new lower federal tax rate, as well as a
net tax benefit of approximately $21.7 million as a result of the impact of the re-measurement of U.S. net deferred tax liabilities at the new lower corporate income
tax rate resulting from the Tax Cuts and Jobs Act of 2017 ("TCJA").
Net Income
Reflecting the factors described in more detail above, net income increased $35.5 million to $165.7 million , or $3.26 per diluted share, for the fiscal year ended
July 28, 2018 , compared to $130.2 million , or $2.56 per diluted share for the fiscal year ended July 29, 2017 .
Fiscal year ended July 29, 2017 compared to fiscal year ended July 30, 2016
Net Sales
Our net sales for the fiscal year ended July 29, 2017 increased approximately 9.5% , or $804.2 million , to $9.27 billion from $8.47 billion for the fiscal year ended
July 30, 2016 . The year-over-year increase in net sales was primarily due to growth in our wholesale segment of $815.0 million . Net sales for fiscal 2017 were
positively impacted by acquisitions we consummated in the third and fourth quarters of fiscal 2016 and the first quarter of fiscal 2017 but were negatively impacted
by broad based food retail softness, the rationalization of business in conjunction with margin enhancement initiatives and a lack of inflation. Our net sales for the
fiscal year ended July 29, 2017 were favorably impacted by moderate price inflation of approximately 1% during the year.
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Our net sales by customer type for the fiscal years ended July 29, 2017 and July 30, 2016 were as follows (in millions):
Customer Type
Supernatural
Supermarkets
Independents
Other
Total
2017
Net Sales
% of Total
Net Sales
2016
Net Sales
% of Total
Net Sales
$
$
3,096
2,747
2,427
1,004
9,274
33% $
30%
26%
11%
100%
$
2,951
2,288
2,291
940
8,470
35%
27%
27%
11%
100%
During fiscal 2017, our net sales by channel were adjusted to reflect changes in the classification of customer types from acquisitions we consummated in the third
and fourth quarters of fiscal 2016 and the first quarter of fiscal 2017. There was no financial statement impact as a result of revising the classification of customer
types. As a result of this adjustment, net sales to our supermarkets and other channels for the fiscal year ended July 30, 2016 increased approximately $29 million
and $6 million, respectively, compared to the previously reported amounts, while net sales to the independents channel for the fiscal year ended July 30, 2016
decreased approximately $35 million compared to the previously reported amounts.
Whole Foods Market is our only supernatural customer, and net sales to Whole Foods Market for the fiscal year ended July 29, 2017 increased by approximately
$145 million or 4.9% over the prior year and accounted for approximately 33% and 35% of our total net sales for the fiscal years ended July 29, 2017 and July 30,
2016 , respectively. The increase in net sales to Whole Foods Market was primarily due to new store openings offset in part by lower year over year same store
sales at Whole Foods Market.
Net sales to our supermarkets channel for the fiscal year ended July 29, 2017 increased by approximately $459 million , or 20.1% from fiscal 2016 and represented
approximately 30% and 27% of total net sales in fiscal 2017 and fiscal 2016 , respectively. The increase in net sales to supermarkets was primarily driven by net
sales resulting from our acquisition of Haddon in the fourth quarter of fiscal 2016.
Net sales to our independents channel increased by approximately $136 million , or 5.9% during the fiscal year ended July 29, 2017 compared to the fiscal year
ended July 30, 2016 , and accounted for 26% and 27% of our total net sales in fiscal 2017 and fiscal 2016 , respectively. The increase in net sales in this channel
was primarily attributable to net sales from our acquisitions during fiscal 2016 and the first quarter of fiscal 2017 as well as growth in our wholesale division,
which includes our broadline distribution business.
Other net sales, which included sales to foodservice customers and sales from the United States to other countries, as well as sales through our e-commerce
business, branded product lines, retail division, manufacturing division, and our brokerage business, increased by approximately $64 million or 6.8% during the
fiscal year ended July 29, 2017 over the prior fiscal year and accounted for approximately 11% of total net sales in both fiscal 2017 and fiscal 2016 . The increase
in other net sales was attributable to expanded sales to our new and existing foodservice partners and growth in our e-commerce business, as well as net sales
resulting from our acquisition of Haddon in the fourth quarter of fiscal 2016.
Cost of Sales and Gross Profit
Our gross profit increased approximately 11.7% , or $149.6 million , to $1.43 billion for the fiscal year ended July 29, 2017 , from $1.28 billion for the fiscal year
ended July 30, 2016 . Our gross profit as a percentage of net sales was 15.4% for the fiscal year ended July 29, 2017 and 15.1% for the fiscal year ended July 30,
2016 . The increase in gross profit as a percentage of net sales was primarily driven by margin enhancement initiatives and the favorable impact of acquisitions,
partially offset by a lack of inflation and competitive pricing pressure.
Operating Expenses
Our total operating expenses increased approximately 14.0% , or $147.7 million , to $1.20 billion for the fiscal year ended July 29, 2017 , from $1.06 billion for the
fiscal year ended July 30, 2016 . As a percentage of net sales, total operating expenses increased to approximately 13.0% for the fiscal year ended July 29, 2017 ,
from approximately 12.5% for the fiscal year ended July 30, 2016 . The increase in total operating expenses was primarily attributable to the acquired businesses,
which generally have a higher cost to serve their customers. Additionally, the increase was driven by $6.9 million of restructuring expenses as well as higher
depreciation and amortization and incentive and stock-based compensation expense, which was partially offset by costs incurred in fiscal 2016 that did not recur in
fiscal 2017, including $1.8 million of bad debt expense related to outstanding receivables for a customer who declared bankruptcy in the first quarter of fiscal
2016, $2.2 million of acquisition related costs and $2.5 million of startup costs related to the Company's Gilroy, California facility. Operating expenses for fiscal
2016 also included $5.6 million in restructuring and asset impairment expense.
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Total operating expenses for fiscal 2017 include share-based compensation expense of $25.7 million , compared to $15.3 million in fiscal 2016 . This increase was
primarily due to an increase in performance-based compensation expense related to our long-term incentive plan for members of our executive leadership team.
The Company did not record share-based compensation expense related to performance-based share awards in fiscal 2016, as a result of performance measures not
being attained at the end of the fiscal year and the resulting forfeiture of these awards.
Operating Income
Operating income increased approximately 0.9% , or $1.9 million , to $226.0 million for the fiscal year ended July 29, 2017 , from $224.1 million for the fiscal
year ended July 30, 2016 . As a percentage of net sales, operating income was 2.4% and 2.6% for the fiscal years ended July 29, 2017 and July 30, 2016 ,
respectively.
Other Expense (Income)
Other expense, net decreased $4.3 million to $11.6 million for the fiscal year ended July 29, 2017 , from $15.9 million for the fiscal year ended July 30, 2016 .
Interest expense for the fiscal year ended July 29, 2017 increased to $17.1 million from $16.3 million for the fiscal year ended July 30, 2016 . The increase in
interest expense was primarily due to additional borrowings for acquisitions made in the second half of fiscal 2016. Interest income for the fiscal year ended
July 29, 2017 decreased to $0.4 million from $1.1 million for the fiscal year ended July 30, 2016 . Other income for the fiscal year ended July 29, 2017 was $5.2
million , compared to other expense of $0.7 million for the fiscal year ended July 30, 2016 . The increase in other income was primarily driven by a $6.1 million
gain recorded during the fourth quarter of fiscal 2017 related to the sale of the Company's stake in Kicking Horse Coffee.
Provision for Income Taxes
Our effective income tax rate was 39.3% and 39.6% for the fiscal years ended July 29, 2017 and July 30, 2016 , respectively. The decrease in the effective income
tax rate for the fiscal year ended July 29, 2017 was primarily due to the claiming of solar and research and development tax credits that were not available in the
prior year.
Net Income
Reflecting the factors described in more detail above, net income increased $4.4 million to $130.2 million , or $2.56 per diluted share, for the fiscal year ended
July 29, 2017 , compared to $125.8 million , or $2.50 per diluted share for the fiscal year ended July 30, 2016 .
Liquidity and Capital Resources
We finance our day to day operations and growth primarily with cash flows from operations, borrowings under our Existing ABL Loan Agreement, operating
leases, a capital lease, a finance lease, trade payables and bank indebtedness. In addition, from time to time, we may issue debt securities to finance our operations
and acquisitions. During the fiscal quarter ended October 28, 2017, we announced our intent to repurchase up to $200.0 million of shares of our common stock.
Purchases under this program will be financed with cash generated from our operations and borrowings under our Existing ABL Loan Agreement.
The Company has estimated an immaterial impact of the mandatory repatriation provision under the TCJA on earnings due to the foreign tax credits available to
the Company. The Company has not recorded a tax provision for U.S. tax purposes on UNFI Canada’s profits as it has no assessable profits arising in or derived
from the United States and still intends to indefinitely reinvest accumulated earnings in the UNFI Canada operations.
ABL Credit Facility
On April 29, 2016, we entered into the Third Amended and Restated Loan and Security Agreement (the “Existing ABL Loan Agreement”) amending and restating
certain terms and provisions of our revolving credit facility (the “Existing ABL Facility”), which increased the maximum borrowings under the Existing ABL
Facility and extended the maturity date to April 29, 2021. Up to $850.0 million is available to our U.S. subsidiaries and up to $50.0 million is available to UNFI
Canada. After giving effect to the Existing ABL Loan Agreement, the Existing ABL Facility provides an option to increase the U.S. or Canadian revolving
commitments by up to an additional $600.0 million in the aggregate (but in not less than $10.0 million increments) subject to certain customary conditions and the
lenders committing to provide the increase in funding.
The borrowings of the U.S. portion of the Existing ABL Facility after giving effect to the Existing ABL Loan Agreement, accrued interest, at the base rate plus an
applicable margin of 0.25% or LIBOR rate plus an applicable margin of 1.25% for the twelve month period ended April 29, 2017. After this period, the interest on
the U.S. borrowings is accrued at the Company's option, at either (i) a base rate (generally defined as the highest of (x) the Bank of America Business Capital prime
rate, (y) the average overnight federal funds effective rate plus one-half percent (0.50%) per annum and (z) one-month LIBOR plus one percent (1%)
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per annum) plus an applicable margin that varies depending on daily average aggregate availability, or (ii) the LIBOR rate plus an applicable margin that varies
depending on daily average aggregate availability. The borrowings on the Canadian portion of the Existing ABL Facility accrued interest at the Canadian prime
rate plus an applicable margin of 0.25% or a bankers' acceptance equivalent rate plus an applicable margin of 1.25% for the twelve month period ended April 29,
2017. After this period, the borrowings on the Canadian portion of the Existing ABL Facility accrue interest, at the Company's option, at either (i) a Canadian
prime rate (generally defined as the highest of (x) 0.50% over 30-day Reuters Canadian Deposit Offering Rate ("CDOR") for bankers' acceptances, (y) the prime
rate of Bank of America, N.A.'s Canada branch, and (z) a bankers' acceptance equivalent rate for a one month interest period plus 1.00%) plus an applicable margin
that varies depending on daily average aggregate availability, or (ii) a bankers' acceptance equivalent rate of the rate of interest per annum equal to the annual rates
applicable to Canadian Dollar bankers' acceptances on the "CDOR Page" of Reuter Monitor Money Rates Service, plus five basis points, and an applicable margin
that varies depending on daily average aggregate availability. Unutilized commitments are subject to an annual fee in the amount of 0.30% if the total outstanding
borrowings are less than 25% of the aggregate commitments, or a per annum fee of 0.25% if such total outstanding borrowings are 25% or more of the aggregate
commitments. The Company is also required to pay a letter of credit fronting fee to each letter of credit issuer equal to 0.125% per annum of the stated amount of
each such letter of credit (or such other amount as may be mutually agreed by the borrowers under the facility and the applicable letter of credit issuer), as well as a
fee to all lenders equal to the applicable margin for LIBOR or bankers’ acceptance equivalent rate loans, as applicable, times the average daily stated amount of all
outstanding letters of credit.
As of July 28, 2018 , the Company's borrowing base, which is calculated based on eligible accounts receivable and inventory levels, net of $4.2 million of reserves,
was $884.5 million . As of July 28, 2018 , the Company had $210.0 million of borrowings outstanding under the Existing ABL Facility and $24.3 million in letter
of credit commitments which reduced the Company's available borrowing capacity under the Existing ABL Facility on a dollar for dollar basis. The Company's
resulting remaining availability was $650.2 million as of July 28, 2018 .
The Existing ABL Facility subjects us to a springing minimum fixed charge coverage ratio (as defined in the Existing ABL Loan Agreement) of 1.0 to 1.0
calculated at the end of each of our fiscal quarters on a rolling four quarter basis when the adjusted aggregate availability (as defined in the Existing ABL Loan
Agreement) is less than the greater of (i) $60.0 million and (ii) 10% of the aggregate borrowing base. We were not subject to the fixed charge coverage ratio
covenant under the Existing ABL Loan Agreement during the fiscal year ended July 28, 2018 .
The Company has pledged the majority of its and its subsidiaries' accounts receivable and inventory to secure its obligations under the Existing ABL Loan
Agreement.
In connection with the execution of the Merger Agreement with SUPERVALU, the Company obtained a debt financing commitment on the terms and subject to
the conditions set forth in a commitment letter dated July 25, 2018 (the “Commitment Letter”) from Goldman Sachs Bank USA and Goldman Sachs Lending
Partners LLC consisting of, among other things, (i) a senior secured asset-based revolving facility (the “New ABL Credit Facility”) in an aggregate principal
amount of $2,000 million that will be used to replace the Existing ABL Facility and (ii) a senior secured term loan credit facility (the “New Term Loan Facility”) in
an aggregate principal amount of $2,050 million. The Commitment Letter was amended and restated by the Amended and Restated Commitment Letter dated
August 7, 2018, from Goldman Sachs Bank USA, Bank of America, N.A. and Merrill Lynch, Pierce, Fenner & Smith Incorporated, and further amended and
restated by the Second Amended and Restated Commitment Letter dated August 8, 2018, from Goldman Sachs Bank USA, Bank of America, N.A., Merrill Lynch,
Pierce, Fenner & Smith Incorporated, Wells Fargo Bank, National Association, JPMorgan Chase Bank, N.A. and U.S. Bank National Association and as further
amended by Amendment No. 1 to Second Amended and Restated Commitment Letter dated September 21, 2018, (the “Amended Commitment Letter”).
On August 30, 2018 (the “Signing Date”), the Company, entered into a Loan Agreement (the “New ABL Loan Agreement”), by and among the Company and
United Natural Foods West, Inc. (together with the Company, the “U.S. Borrowers”) and UNFI Canada, Inc. (the “Canadian Borrower” and, together with the U.S.
Borrowers, the “Borrowers”), the financial institutions that are parties thereto as lenders (collectively, the “Lenders”), Bank of America, N.A. as administrative
agent for the Lenders (the “ABL Administrative Agent”), Bank of America, N.A. (acting through its Canada branch), as Canadian agent for the Lenders (the
“Canadian Agent”), and the other parties thereto. As of the Signing Date and as a result of the Company’s entry into the New ABL Loan Agreement, all of the
commitments under the Amended Commitment Letter with respect to the Existing ABL Loan Agreement have been terminated and permanently reduced to zero.
The commitment with respect to the New Term Loan Facility under the Amended Commitment Letter remain unchanged.
The New ABL Loan Agreement provides for the New ABL Credit Facility (the loans thereunder, the “Loans”), of which up to (i) $1,950.0 million is available to
the U.S. Borrowers and (ii) $50.0 million is available to the Canadian Borrower. The New ABL Loan Agreement also provides for (i) a $125.0 million sublimit of
availability for letters of credit of which there is a further $5.0 million sublimit for the Canadian Borrower and (ii) a $100.0 million sublimit for short-term
borrowings on a swingline basis of which there is a further $3.5 million sublimit for the Canadian Borrower. Under the New ABL Loan Agreement, the Borrowers
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may, at their option, increase the aggregate amount of the New ABL Credit Facility in an amount of up to $600.0 million (but in not less than $10.0 million
increments) without the consent of any Lenders not participating in such increase, subject to certain customary conditions and applicable lenders committing to
provide the increase in funding. There is no assurance that additional funding would be available.
The New ABL Credit Facility will be secured by (i) a first-priority lien on all of our and our domestic subsidiaries' accounts receivable, inventory and certain other
assets arising therefrom or related thereto (including, without limitation, substantially all of their deposit accounts, collectively, the "ABL Assets") and (ii) a
second-priority lien on all of our and our domestic subsidiaries' assets that do not constitute ABL Assets, in each case, subject to customary exceptions and
limitations on the date of consummation of the acquisition of SUPERVALU pursuant to the terms of the Merger Agreement (the “Closing Date”).
Availability under the New ABL Credit Facility is subject to a borrowing base (the “Borrowing Base”), which is based on 90% of eligible accounts receivable, plus
90% of eligible credit card receivable, plus 90% of the net orderly liquidation value of eligible inventory, plus 90% of eligible pharmacy receivables, plus certain
pharmacy scripts availability of the Borrowers, after adjusting for customary reserves that are subject to the ABL Administrative Agent’s discretion. The aggregate
amount of the Loans made and letters of credit issued under the New ABL Credit Facility shall at no time exceed the lesser of the aggregate commitments under
the New ABL Credit Facility (currently $2,000.0 million or, if increased at the Borrowers’ option as described above, up to $2,600 million) or the Borrowing Base.
To the extent that the Borrowers’ eligible accounts receivable, eligible credit card receivables, eligible inventory, eligible pharmacy receivables and pharmacy
scripts availability decline, the Borrowing Base will decrease, and the availability under the New ABL Credit Facility may decrease below $2,000.0 million;
provided that, on the Closing Date and until the ninetieth day after the Closing Date, regardless of the calculation of the Borrowing Base on the Closing Date, the
Borrowing Base shall be deemed to be no less than $1,500.0 million; provided , further , that if the ABL Administrative Agent receives certain field examinations
and appraisals prior to the Closing Date and if the Borrowing Base would, without giving effect to the foregoing proviso, be less than or equal to $1,500.0 million,
then the Borrowing Base shall be deemed to be the greater of (x) the Borrowing Base without giving effect to the foregoing proviso and (y) $1,300.0 million on the
Closing Date until the ninetieth day after the Closing Date.
The borrowings of the U.S. Borrowers under the New ABL Credit Facility bear interest at rates that, at the Company’s option, can be either: (i) a base rate
generally defined as the sum of (x) the highest of (a) the Administrative Agent’s prime rate, (b) the average overnight federal funds effective rate plus one-half
percent (0.50%) per annum and (c) one-month LIBOR plus one percent (1%) per annum and (y) an applicable margin or (ii) LIBOR rate generally defined as the
sum of (x) the London Interbank Offered Rate (as published on the applicable Reuters screen page, or other commercially available source) and (y) an applicable
margin. The initial applicable margin for base rate loans is 0.25%, and the initial applicable margin for LIBOR loans is 1.25%. Commencing on the first day of the
calendar month following the ABL Administrative Agent’s receipt of the Company’s financial statements for the fiscal quarter ending on or about October 27,
2018, and quarterly thereafter, the applicable margins for borrowings by the U.S. Borrowers will be subject to adjustment based upon the aggregate availability
under the New ABL Credit Facility. Interest on the U.S. Borrowers’ borrowings is payable monthly in arrears for base rate loans and at the end of each interest rate
period (but not less often than quarterly) for LIBOR loans. The borrowings of the Canadian Borrower under the New ABL Credit Facility bear interest at rates that,
at the Canadian Borrower’s option, can be either: (i) prime rate generally defined as the sum of (x) the highest of (a) 30-day Reuters Canadian Deposit Offering
Rate for Canadian dollar bankers’ acceptances plus one-half percent (0.50%) per annum, (b) the prime rate of Bank of America, N.A.’s Canada branch, and (c) a
Canadian dollar bankers’ acceptance equivalent rate for a one month interest period plus one percent (1%) per annum and (y) an applicable margin or (ii) a
Canadian dollar bankers’ acceptance equivalent rate generally defined as the sum of (x) the rate of interest per annum equal to the annual rates applicable to
Canadian Dollar bankers’ acceptances on the “CDOR Page” of Reuter Monitor Money Rates Service, and (y) an applicable margin. This is the exclusive method of
interest accrual for loans that are not Canadian swingline loans, Canadian overadvance loans or Canadian protective advances. The initial applicable margin for
prime rate loans is 0.25%, and the initial applicable margin for Canadian dollar bankers’ acceptance equivalent rate loans is 1.25%. Commencing on the first day of
the calendar month following the ABL Administrative Agent’s receipt of the Company’s financial statements for the fiscal quarter ending on or about October 27,
2018, and quarterly thereafter, the applicable margins for borrowings by the Canadian Borrower will be subject to adjustment based upon the aggregate availability
under the New ABL Credit Facility. Interest on the Canadian Borrower’s borrowings is payable monthly in arrears for prime rate loans and at the end of each
interest rate period (but not less often than quarterly) for bankers’ acceptance equivalent rate loans. Unutilized commitments under the New ABL Credit Facility
are subject to a per annum fee of (i) from and after the Closing Date through and including the first day of the calendar month that is three months following the
Closing Date, 0.375% and (ii) thereafter, (x) 0.375% if the total outstandings were less than 25% of the aggregate commitments, or (y) 0.25% if such total
outstandings were 25% or more of the aggregate commitments. The Borrowers are also required to pay a letter of credit fronting fee to each letter of credit issuer
equal to 0.125% per annum of the amount available to be drawn under each such letter of credit (or such other amount as may be mutually agreed by the Borrowers
and the applicable letter of credit issuer), as well as a fee to all lenders equal to the applicable margin for LIBOR or Canadian dollar bankers’ acceptance equivalent
rate loans, as applicable, times the average daily amount available to be drawn under all outstanding letters of credit.
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The obligations of the Lenders to provide Loans under the New ABL Loan Agreement on the Closing Date are subject to a number of customary conditions,
including, without limitation, the consummation of the Merger (which must occur by January 25, 2019, subject to extension in certain circumstances pursuant to
the terms of Merger Agreement) and execution and delivery by the Borrowers and the guarantors of definitive documentation consistent with the New ABL Loan
Agreement and the documentation standards specified therein.
The Company expects to fund its acquisition of SUPERVALU with, among other sources, borrowings under the New ABL Credit Facility. Pursuant to the
Amended Commitment Letter, the Company may use the entire amount of the proceeds of the New Term Loan Facility and up to $1,200.0 million (plus an amount
necessary to pay certain fees or original issues discount) of the proceeds from the New ABL Credit Facility to finance the Merger and the transaction costs. In
addition to funding the acquisition price to acquire SUPERVALU, the Company expects to refinance and repay substantially all of SUPERVALU's existing debt.
Term Loan Facility
On August 14, 2014, we and certain of our subsidiaries entered into a real estate backed term loan agreement as amended by the First Amendment Agreement,
dated April 29, 2016, and the Second Amendment Agreement, dated September 1, 2016, the "Existing Term Loan Agreement"). The total initial borrowings under
our term loan facility were $150.0 million. We are required to make $2.5 million principal payments quarterly. Under the Existing Term Loan Agreement, we at
our option may request the establishment of one or more new term loan commitments in increments of at least $10.0 million, but not to exceed $50.0 million in
total, subject to the approval of the Lenders electing to participate in such incremental loans and the satisfaction of the conditions required by the Existing Term
Loan Agreement. Proceeds from this Existing Term Loan Agreement were used to pay down borrowings under the Existing ABL Loan Agreement.
Borrowings under the Existing Term Loan Agreement bear interest at rates that, at the Company's option, can be either: (1) a base rate generally defined as the sum
of (i) the highest of (x) the administrative agent's prime rate, (y) the average overnight federal funds effective rate plus 0.50% and (z) one-month LIBOR plus one
percent (1%) per annum and (ii) a margin of 0.75%; or, (2) a LIBOR rate generally defined as the sum of (i) LIBOR (as published by Reuters or other
commercially available source) for one, two, three or six months or, if approved by all affected lenders, nine months (all as selected by the Company), and (ii) a
margin of 1.75%. Interest accrued on borrowings under the Existing Term Loan Agreement is payable in arrears. Interest accrued on any LIBOR loan is payable on
the last day of the interest period applicable to the loan and, with respect to any LIBOR loan of more than three (3) months, on the last day of every three (3)
months of such interest period. Interest accrued on base rate loans is payable on the first day of every month. The Company is also required to pay certain
customary fees to the administrative agent. The borrowers’ obligations under the Existing Term Loan Agreement are secured by certain parcels of the borrowers’
real property.
The Existing Term Loan Agreement includes financial covenants that require (i) the ratio of our consolidated EBITDA (as defined in the Existing Term Loan
Agreement) minus the unfinanced portion of Capital Expenditures (as defined in the Existing Term Loan Agreement) to our consolidated Fixed Charges (as
defined in the Existing Term Loan Agreement) to be at least 1.20 to 1.00 as of the end of any period of four fiscal quarters, (ii) the ratio of our Consolidated
Funded Debt (as defined in the Existing Term Loan Agreement) to our EBITDA for the four fiscal quarters most recently ended to be not more than 3.00 to 1.00 as
of the end of any fiscal quarter and (iii) the ratio, expressed as a percentage, of our outstanding principal balance under the Loans (as defined in the Existing Term
Loan Agreement), divided by the Mortgaged Property Value (as defined in the Existing Term Loan Agreement) to be not more than 75% at any time. As of
July 28, 2018 , the Company was in compliance with the financial covenants of the Existing Term Loan Agreement.
As of July 28, 2018 , the Company had borrowings of $108.8 million , net of debt issuance costs of $1.2 million , under the Existing Term Loan Agreement which
is included in “Long-term debt” in the consolidated balance sheet.
On August 22, 2018, the Company notified its lenders that it intends to prepay its borrowings outstanding under the Existing Term Loan Agreement on October 1,
2018, which were approximately $110.0 million as of July 28, 2018. The Existing Term Loan Agreement was previously scheduled to terminate on the earlier of
(a) August 14, 2022 and (b) the date that is ninety days prior to the termination date of the Existing ABL Loan Agreement. Concurrently with the prepayment of
borrowings outstanding under the Existing Term Loan Agreement, the Company intends to draw on its Existing ABL Loan Agreement in an amount equal to its
Existing Term Loan Agreement prepayment amount.
Pursuant to the terms of the Amended Commitment Letter, on the Closing Date, concurrently with the consummation of the Merger, the Company will enter into a
new term loan agreement (the “New Term Loan Agreement”) providing for the New Term Loan Facility. Under the terms of the Amended Commitment Letter, the
New Term Loan Facility will consist of a $2,050 million senior secured term loan facility. The New Term Loan Facility will have a term of seven years and will be
secured by (i) a first-priority lien on all of our and our domestic subsidiaries' assets that do not constitute ABL Assets (defined in the immediately succeeding
clause) and (ii) a second-priority lien on all of our and our domestic subsidiaries' accounts receivable, inventory and certain other
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assets arising therefrom or related thereto (including, without limitation, substantially all of their deposit accounts, collectively, the "ABL Assets"), in each case,
subject to customary exceptions and limitations on the Closing Date.
We expect that the New Term Loan Agreement will have customary affirmative and negative covenants and events of default that are generally consistent with our
New ABL Loan Agreement. The closing of the New Term Loan Facility will be subject to customary conditions precedent, including the negotiation and execution
of final documentation and consummation of the Merger.
Interest Swap Agreements
On January 23, 2015, the Company entered into a forward starting interest rate swap agreement with an effective date of August 3, 2015, which expires in August
2022 concurrent with the scheduled maturity of our Existing Term Loan Agreement. This interest rate swap agreement has a notional amount of $112.5 million and
provides for the Company to pay interest for a seven-year period at a fixed rate of 1.795% while receiving interest for the same period at the one-month LIBOR on
the same notional principal amount. The interest rate swap agreement has an amortizing notional amount which adjusts down on the dates payments are due on the
underlying term loan. The interest rate swap has been entered into as a hedge against LIBOR movements on $112.5 million of the variable rate indebtedness under
the Existing Term Loan Agreement at one-month LIBOR plus 1.00% and a margin of 1.50%, thereby fixing our effective rate on the notional amount at 4.295%.
The swap agreement qualifies as an “effective” hedge under Accounting Standard Codification ("ASC") 815 Derivatives and Hedging .
On June 7, 2016, the Company entered into two pay fixed and receive floating interest rate swap agreements to effectively fix the underlying variable rate debt on
the Existing ABL Loan Agreement. The first agreement has an effective date of June 9, 2016 and expires in June of 2019. This interest rate swap agreement has a
notional principal amount of $50.0 million and provides for the Company to pay interest for a three-year period at a fixed annual rate of 0.8725% while receiving
interest for the same period at one-month LIBOR on the same notional principal amount. This swap, in conjunction with the Existing ABL Loan Agreement,
effectively fixes the interest rate on the $50.0 million notional amount. The second agreement has an effective date of June 9, 2016 and expires concurrent with the
scheduled maturity of our Existing ABL Loan Agreement in April of 2021. This interest rate swap agreement has a notional principal amount of $25.0 million and
provides for the Company to pay interest for a five-year period at a fixed rate of 1.065% while receiving interest for the same period at one-month LIBOR on the
same notional principal amount. This swap, in conjunction with the Existing ABL Loan Agreement, effectively fixes the interest rate on the $25.0 million notional
amount. The swap agreement qualifies as an “effective” hedge under Accounting Standard Codification ("ASC") 815 Derivatives and Hedging .
On June 24, 2016, the Company entered into two additional pay fixed and receive floating interest rate swap agreements to effectively fix the underlying variable
rate debt on the Existing ABL Loan Agreement. The first agreement has an effective date of July 24, 2016 and expires in June of 2019. This interest rate swap
agreement has a notional principal amount of $50.0 million and provides for the Company to pay interest for a three year period at a fixed annual rate
of 0.7265% while receiving interest for the same period at one-month LIBOR on the same notional principal amount. This swap, in conjunction with the Existing
ABL Loan Agreement, effectively fixes the interest rate on the $50.0 million notional amount. The second agreement has an effective date of July 24, 2016 and
expires concurrent with the scheduled maturity of Existing ABL Loan Agreement in April of 2021. This interest rate swap agreement has a notional principal
amount of $25.0 million and provides for the Company to pay interest for a five year period at a fixed rate of 0.9260% while receiving interest for the same period
at one-month LIBOR on the same notional principal amount. This swap, in conjunction with the Existing ABL Loan Agreement, effectively fixes the interest rate
on the $25.0 million notional amount. The swap agreement qualifies as an “effective” hedge under Accounting Standard Codification ("ASC") 815 Derivatives and
Hedging .
Our capital expenditures for the 2018 fiscal year were $44.6 million , compared to $56.1 million for fiscal 2017 , a decrease of $11.5 million . Excluding the
SUPERVALU acquisition, capital expenditures are expected to be 1.5% to 1.7% of net sales, driven by capacity expansion projects. We are committed to these
particular capital projects with a strong financial return, with or without the impact of the pending SUPERVALU acquisition. On a combined basis with
SUPERVALU and over the long-term, we expect the combined company's capital expenditures, as a percentage of net sales, to be approximately 1.0% of net sales,
which excludes capital growth assumptions related to optimizing our capacity and IT spending going forward. We expect to finance requirements with cash
generated from operations and borrowings under our New ABL Credit Facility. Our planned capital projects for fiscal 2019 will be focused on the expansion of
distribution center capacity in certain geographies and integration efforts related to the pending acquisition of SUPERVALU. Future investments may be financed
through long-term debt or borrowings under our New ABL Credit Facility.
Other
Net cash provided by operations was $109.5 million for the fiscal year ended July 28, 2018 , a decrease of $171.3 million from the $280.8 million provided by
operations for the year ended July 29, 2017 . The primary reasons for the net cash provided by operating activities for fiscal 2018 were net income for the year of
$165.7 million , which included depreciation and amortization
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of $87.6 million , and share based compensation expense of $25.8 million , offset by increases in inventory and accounts receivable of $108.8 million and $67.3
million , respectively. Net cash provided by operations of $280.8 million for the year ended July 29, 2017 was primarily due to net income for the year of $130.2
million , which included depreciation and amortization of $86.1 million , and an increase in accounts payable of $90.2 million , offset by an increase in accounts
receivable of $38.8 million .
Days in inventory was 48 days at July 28, 2018 and July 29, 2017 . Days sales outstanding was 21 at July 28, 2018 and July 29, 2017 . Working capital increased
by $131.0 million , or 13.7% , to $1.09 billion at July 28, 2018 , compared to working capital of $958.7 million at July 29, 2017 . This increase was primarily as a
result of an increase in inventory to support increased demand for our products.
Net cash used in investing activities decreased approximately $13.0 million to $47.0 million for the fiscal year ended July 28, 2018 , compared to $60.0 million for
the fiscal year ended July 29, 2017 . This decrease was primarily due to a decrease in cash paid for acquisitions of $9.2 million and a $11.5 million decrease in
capital spending.
Net cash used in financing activities was $54.0 million for the fiscal year ended July 28, 2018 . The net cash used in financing activities was primarily due to
repayments of borrowings under our Existing ABL Facility of $569.7 million share repurchases of $24.2 million and repayments of long-term debt of $12.1 million
, partially offset by proceeds from borrowings under our Existing ABL Facility of $556.1 million . Net cash used in financing activities was $224.6 million for the
fiscal year ended July 29, 2017 and was primarily due to repayments of borrowings under our Existing ABL Facility and long term debt of $418.7 million and
$11.5 million , respectively, partially offset by proceeds from borrowings under our Existing ABL Facility of $215.7 million .
From time-to-time we enter into fixed price fuel supply agreements. As of July 28, 2018 and July 29, 2017 , we were not a party to any such agreements. We were
party to a contract during fiscal 2017, which required us to purchase a total of approximately 6.1 million gallons of diesel fuel at prices ranging from $1.76 to $3.18
per gallon through December 2016 . All of these fixed price fuel agreements qualified and were accounted for under the "normal purchase" exception under ASC
815, Derivatives and Hedging as physical deliveries occurred rather than net settlements, and therefore the fuel purchases under these contracts have been expensed
as incurred and included within operating expenses.
Critical Accounting Policies and Estimates
The preparation of our consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues
and expenses, and the related disclosure of contingent assets and liabilities. The Securities and Exchange Commission has defined critical accounting policies as
those that are both most important to the portrayal of our financial condition and results and require our most difficult, complex or subjective judgments or
estimates. Based on this definition, we believe our critical accounting policies are: (i) determining our reserves for the self-insured portions of our workers'
compensation and automobile liabilities, (ii) valuing assets and liabilities acquired in business combinations; (iii) valuing goodwill and intangible assets; and (iv)
income taxes. For all financial statement periods presented, there have been no material modifications to the application of these critical accounting policies.
Insurance reserves
We are primarily self-insured for workers' compensation and general and automobile liability insurance. It is our policy to record the self-insured portions of our
workers' compensation and automobile liabilities based upon actuarial methods of estimating the future cost of claims and related expenses that have been reported
but not settled, and that have been incurred but not yet reported. Any projection of losses concerning workers' compensation and automobile liability is subject to a
considerable degree of variability. Among the causes of this variability are unpredictable external factors affecting litigation trends, benefit level changes and claim
settlement patterns. If actual claims incurred are greater than those anticipated, our reserves may be insufficient and additional costs could be recorded in our
consolidated financial statements. Accruals for workers' compensation and automobile liabilities totaled $25.0 million and $22.8 million as of July 28, 2018 and
July 29, 2017 , respectively.
Valuation of assets and liabilities acquired in a business combination
We account for acquired businesses using the purchase method of accounting which requires that the assets acquired and liabilities assumed be recorded at the date
of the acquisition at their respective estimated fair values. Goodwill represents the excess of cost over the fair value of net assets acquired in a business
combination. The judgments made in determining the estimated fair value assigned to each class of assets acquired, as well as the estimated useful life of each
asset, can materially impact the net income of the periods subsequent to the acquisition through depreciation and amortization, and in certain instances through
impairment charges, if the asset becomes impaired in the future. In determining the estimated fair value for intangible assets, we typically utilize the income
approach, which discounts the projected future net cash flow using an appropriate discount rate that reflects the risks associated with such projected future cash
flow.
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Determining the useful life of an intangible asset also requires judgment, as different types of intangible assets will have different useful lives and certain assets
may even be considered to have indefinite useful lives. Intangible assets determined to have an indefinite useful life are reassessed periodically based on the
expected use of the asset by us, legal or contractual provisions that may affect the useful life or renewal or extension of the asset’s contractual life without
substantial cost, and the effects of demand, competition and other economic factors .
Valuation of goodwill and intangible assets
We are required to test goodwill for impairment at least annually, and between annual tests if events occur or circumstances change that would more likely than not
reduce the fair value of a reporting unit below its carrying amount. We have elected to perform our annual tests for indications of goodwill impairment as of the
first day of the fourth quarter of each fiscal year. We test for goodwill impairment at the reporting unit level, which is at or one level below the operating segment
level. As of July 28, 2018 , approximately 97.2% of our goodwill is within our wholesale reporting segment. Total goodwill as of July 28, 2018 and July 29, 2017
was $362.5 million and $371.3 million , respectively.
In accordance with Accounting Standards Update ("ASU") No. 2011-08, Testing Goodwill for Impairment , ("ASU 2011-08"), the Company is allowed to perform
a qualitative assessment for goodwill impairment unless it believes it is more likely than not that a reporting unit's fair value is less than the carrying value. The
thresholds used by the Company for this determination in fiscal 2018 were for any reporting units that (1) have passed their previous quantitative test with a margin
of calculated fair value versus carrying value of at least 20% , (2) have had a quantitative test within the past five years, (3) have had no significant changes to their
working capital structure, (4) have current year income which is at least 85% of prior year amounts, and (5) present no other factors to be considered as outlined in
ASU 2011-08. The Company's reporting units are at or one level below the operating segment level.
For reporting units which do not meet this exclusion, the quantitative goodwill impairment analysis is performed in accordance with ASU No. 2017-04,
Intangibles, Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment , (“ASU- 2017-04”), which the Company early adopted as part of its
fiscal 2017 annual goodwill impairment test. This analysis involves comparing each reporting unit's estimated fair value to its carrying value, including goodwill.
Each reporting unit regularly prepares discrete operating forecasts and uses these forecasts as the basis for the assumptions used in the discounted cash flow
analysis. If the estimated fair value of a reporting unit exceeds its carrying value, goodwill is considered not to be impaired and no further testing is required.
During fiscal 2018 the Company recorded a total impairment charge of $7.9 million to goodwill related to its Earth Origins retail business. Refer to Note 1,
"Significant Accounting Policies", and Note 5, "Restructuring Activities", to our Consolidated Financial Statements included in "Item 8. Financial Statements and
Supplementary Data" of this Annual Report for further detail. The Company performed a qualitative test on its other reporting units during the fourth quarter of
fiscal 2018 based on the criteria noted above and determined that a quantitative test was not required.
Intangible assets and other long lived assets with finite lives are tested for impairment whenever events or changes in circumstances indicate that the carrying value
may not be recoverable. Cash flows expected to be generated by the related assets are estimated over the asset's useful life based on updated projections. If the
evaluation indicates that the carrying amount of the asset may not be recoverable, the potential impairment is measured based on a projected discounted cash flow
model. Impairment is measured as the difference between the fair value of the asset and its carrying value.
In accordance with ASU No. 2011-08, the Company is allowed to perform a qualitative assessment for indefinite lived intangible assets unless it believes it is more
likely than not that an intangible asset's fair value is less than the carrying value. The thresholds used by the Company for this determination in the fourth quarter of
fiscal 2018 were for any intangible assets (or groups of assets) that (1) have passed their previous quantitative test with a margin of calculated fair value versus
carrying value of at least 20% , (2) have had a quantitative test performed within the past five years, and (3) have current year income which is at least 85% of the
immediately preceding fiscal year's amounts.
As of July 28, 2018 , our annual assessment of each of our intangible assets with indefinite lives indicated that no impairment existed. Total indefinite lived
intangible assets as of July 28, 2018 and July 29, 2017 were $55.8 million and $55.8 million , respectively. Total finite-lived intangible assets as of July 28, 2018
and July 29, 2017 were $137.4 million and $152.5 million , respectively.
Income Taxes
The Company accounts for income taxes under the asset and liability method. Under the asset and liability method, deferred tax assets and liabilities are recognized
for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax
bases. Deferred tax assets and liabilities are measured
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using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on
deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.
The calculation of the Company's tax liabilities includes addressing uncertainties in the application of complex tax regulations and is based on the financial
statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Addressing these uncertainties requires judgment and
estimates; however, actual results could differ, and we may be exposed to losses or gains. Our effective tax rate in a given financial statement period could be
affected based on favorable or unfavorable tax settlements. Unfavorable tax settlements will generally require the use of cash and may result in an increase to our
effective tax rate in the period of resolution. Favorable tax settlements may be recognized as a reduction to our effective tax rate in the period of resolution.
On December 22, 2017, the U.S. government enacted comprehensive tax legislation under the TCJA. The TCJA makes broad and complex changes to the U.S. tax
code, including reducing the U.S. federal corporate tax rate from 35 percent to 21 percent, effective January 1, 2018. Shortly after the TCJA was enacted, the
Securities and Exchange Commission ("SEC") issued accounting guidance, which provides a one-year measurement period during which a company may complete
its accounting for the impacts of the TCJA. To the extent a company’s accounting for certain income tax effects of the TCJA is incomplete, the company may
determine a reasonable estimate for those effects and record a provisional estimate in its financial statements. See “Note 12 Income Taxes” for further effects of the
new tax legislation on the Company.
Commitments and Contingencies
The following schedule summarizes our contractual obligations and commercial commitments as of July 28, 2018 :
Total
Less than
One Year
Payments Due by Period
1–3
Years
(in thousands)
3–5
Years
Thereafter
Inventory purchase commitments
Notes payable (1)
Long-term debt (2)
Deferred compensation
Multi-employer plan withdrawal liability
Long-term non-capitalized leases
Total
$
$
15,873 $
15,873 $
— $
210,000
151,314
6,708
3,380
231,740
619,015 $
—
12,441
1,147
100
64,688
210,000
106,019
1,725
220
89,362
94,249 $
407,326 $
— $
—
7,618
1,487
251
46,804
56,160 $
—
—
25,236
2,349
2,809
30,886
61,280
(1) The notes payable obligations shown reflect the expiration of the Existing ABL Loan Agreement, not necessarily the underlying individual borrowings. Notes
payable does not include outstanding letters of credit of approximately $24.3 million at July 28, 2018 or approximately $13.0 million in interest payments
(including unused lines fees) projected to be due in future years (less than 1 year – $6.3 million ; 1-3 years – $5.5 million ; and 3-5 years – $1.2 million ) based on
the variable rates in effect at July 28, 2018 . Variable rates, as well as outstanding principal balances, could change in future periods. See "Liquidity and Capital
Resources" above and Note 7 "Notes Payable" to our Consolidated Financial Statements included in "Item 8. Financial Statements and Supplementary Data" of this
Annual Report for a discussion of our credit facility.
(2) Long-term debt does not include interest payments projected to be due in future years related to our capital lease obligations and the Existing Term Loan
Agreement, which amount to approximately $20.9 million and $10.8 million , respectively (less than 1 year - $6.7 million ; 1-3 years - $11.7 million ; 3-5 years -
$8.5 million ; thereafter - $4.8 million ). See Note 8 "Long-Term Debt" to our Consolidated Financial Statements included in "Item 8. Financial Statements and
Supplementary Data" of this Annual Report for a discussion of our long-term debt.
Included in other liabilities in the consolidated balance sheet at July 28, 2018 are uncertain tax positions including potential interest and penalties of $0.9 million
that have been taken or are expected to be taken in various income tax returns. The Company does not know the ultimate resolution of these uncertain tax positions
and as such, does not know the ultimate timing of payments related to this liability. Accordingly, these amounts are not included in the table above.
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Recently Issued Financial Accounting Standards
For a discussion of recently issued financial accounting standards, refer to Note 1, "Significant Accounting Policies ," to our Consolidated Financial Statements
included in "Item 8. Financial Statements and Supplementary Data" of this Annual Report on for further detail.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
We are exposed to interest rate fluctuations on our borrowings. As more fully described in Note 9 "Fair Value Measurements" to the Consolidated Financial
Statements included in "Item 8. Financial Statements and Supplementary Data" of this Annual Report, we have used interest rate swap agreements to modify
certain of our variable rate obligations to fixed rate obligations.
At July 28, 2018 , we had long-term floating rate debt under the Existing ABL Loan Agreement of $210.0 million and our Existing Term Loan Agreement of
$110.0 million , gross of deferred financing costs, and long-term fixed rate debt of $41.3 million , representing 88.6% and 11.4% , respectively, of our long-term
borrowings. At July 29, 2017 , we had long-term floating rate debt under the Existing ABL Loan Agreement of $223.6 million and our Existing Term Loan
Agreement of $120.0 million , gross of deferred financing costs, and long-term fixed rate debt of $43.4 million , representing 88.8% and 11.2% , respectively, of
our long-term borrowings. Holding other debt levels constant, a 25 basis point increase in interest rates would change the unrealized fair market value of our fixed
rate debt by approximately $0.5 million and $0.6 million for the fiscal years ended July 28, 2018 and July 29, 2017 , respectively.
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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The financial statements listed below are filed as part of this Annual Report.
INDEX TO FINANCIAL STATEMENTS
United Natural Foods, Inc. and Subsidiaries:
Report of Independent Registered Public Accounting Firm
Consolidated Balance Sheets
Consolidated Statements of Income
Consolidated Statements of Comprehensive Income
Consolidated Statements of Stockholders' Equity
Consolidated Statements of Cash Flows
Notes to Consolidated Financial Statements
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39
40
41
42
43
44
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The Stockholders and Board of Directors
United Natural Foods, Inc.:
Report of Independent Registered Public Accounting Firm
Opinions on the Consolidated Financial Statements and Internal Control Over Financial Reporting
We have audited the accompanying consolidated balance sheets of United Natural Foods, Inc. and subsidiaries (the Company) as of July 28, 2018 and July 29,
2017, the related consolidated statements of income, comprehensive income, stockholders’ equity, and cash flows for each of the years in the three-year period
ended July 28, 2018 and the related notes, (collectively the consolidated financial statements). We also have audited the Company’s internal control over financial
reporting as of July 28, 2018, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO).
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of July 28,
2018 and July 29, 2017, and the results of its operations and its cash flows for each of the years in the three-year period ended July 28, 2018, in conformity with
U.S. generally accepted accounting principles. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial
reporting as of July 28, 2018, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring
Organizations of the Treadway Commission.
Basis for Opinions
The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for
its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control
Over Financial Reporting. Our responsibility is to express an opinion on the Company’s consolidated financial statements and an opinion on the Company’s
internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board
(United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable
rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable
assurance about whether the consolidated financial statements are free of material misstatement and whether effective internal control over financial reporting was
maintained in all material respects. Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement
of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining,
on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting
principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of
internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness
exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such
other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial
reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of
financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in
accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of
unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with
the policies or procedures may deteriorate.
We have served as the Company’s auditor since 1993.
Providence, Rhode Island
September 24, 2018
39
Table of Contents
UNITED NATURAL FOODS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except per share data)
ASSETS
Current assets:
Cash and cash equivalents
Accounts receivable, net of allowance of $15,996 and $13,939, respectively
Inventories
Deferred income taxes
Prepaid expenses and other current assets
Total current assets
Property and equipment, net
Goodwill
Intangible assets, net of accumulated amortization of $64,438 and $49,926, respectively
Other assets
Total assets
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable
Accrued expenses and other current liabilities
Current portion of long-term debt
Total current liabilities
Notes payable
Deferred income taxes
Other long-term liabilities
Long-term debt, excluding current portion
Total liabilities
Commitments and contingencies (Note 10)
Stockholders' equity:
Preferred stock, $0.01 par value, authorized 5,000 shares; none issued or outstanding
Common stock, $0.01 par value, authorized 100,000 shares; 51,025 shares issued and 50,411 shares outstanding at
July 28, 2018; 50,622 issued and outstanding shares at July 29, 2017
Additional paid-in capital
Treasury stock at cost
Accumulated other comprehensive loss
Retained earnings
Total stockholders' equity
Total liabilities and stockholders' equity
See accompanying notes to consolidated financial statements.
40
July 28,
2018
July 29,
2017
$
23,315 $
579,702
1,135,775
—
50,122
15,414
525,636
1,031,690
40,635
49,295
$
$
1,788,914
1,662,670
571,146
362,495
193,209
48,708
602,090
371,259
208,289
42,255
2,964,472 $
2,886,563
517,125 $
169,658
12,441
699,224
210,000
44,384
27,200
137,709
534,616
157,243
12,128
703,987
223,612
98,833
28,347
149,863
1,118,517
1,204,642
—
510
483,623
(24,231)
(14,179)
1,400,232
1,845,955
$
2,964,472 $
—
506
460,011
—
(13,963)
1,235,367
1,681,921
2,886,563
Table of Contents
UNITED NATURAL FOODS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
Net sales
Cost of sales
Gross profit
Operating expenses
Restructuring and asset impairment expenses
Total operating expenses
Operating income
Other expense (income):
Interest expense
Interest income
Other, net
Total other expense, net
Income before income taxes
Provision for income taxes
Net income
Basic per share data:
Net income
Weighted average basic shares of common stock
Diluted per share data:
Net income
Weighted average diluted shares of common stock
Fiscal year ended
July 28,
2018
10,226,683 $
July 29,
2017
9,274,471 $
July 30,
2016
8,470,286
$
8,703,916
1,522,767
1,279,529
16,013
1,295,542
227,225
16,471
(446)
(1,545)
14,480
212,745
47,075
7,845,550
1,428,921
1,196,032
6,864
1,202,896
226,025
17,114
(360)
(5,152)
11,602
214,423
84,268
$
$
$
165,670 $
130,155 $
3.28
$
2.57
$
50,530
50,570
3.26 $
50,837
2.56 $
50,775
7,190,935
1,279,351
1,049,690
5,552
1,055,242
224,109
16,259
(1,115)
743
15,887
208,222
82,456
125,766
2.50
50,313
2.50
50,399
See accompanying notes to consolidated financial statements.
41
Table of Contents
UNITED NATURAL FOODS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In thousands)
Net income
Other comprehensive income (loss):
Foreign currency translation adjustments
Change in fair value of swap agreements, net of tax
Total other comprehensive (loss) income
Total comprehensive income
July 28,
2018
Fiscal year ended
July 29,
2017
July 30,
2016
165,670 $
130,155 $
125,766
(3,791)
3,575
(216)
3,537
4,879
8,416
205
(3,141)
(2,936)
165,454 $
138,571 $
122,830
$
$
See accompanying notes to consolidated financial statements.
42
Table of Contents
(In
thousands)
Balances at August 1, 2015
Stock option exercises and restricted stock
vestings, net
Share-based compensation
Share-based compensation / restructuring
costs
Tax deficit associated with stock plans
Fair value of swap agreement, net of tax
Foreign currency translation
Net income
Balances at July 30, 2016
Stock option exercises and restricted stock
vestings, net
Share-based compensation
Share-based compensation / restructuring
costs
Tax deficit associated with stock plans
Fair value of swap agreements, net of tax
Foreign currency translation
Net income
Balances at July 29, 2017
Cumulative effect of change in accounting
principle
Stock option exercises and restricted stock
vestings, net
Share-based compensation
Repurchase of common stock
Share-based compensation / restructuring
costs
Fair value of swap agreements, net of tax
Foreign currency translation
Net income
Balances at July 28, 2018
UNITED NATURAL FOODS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
Common Stock
Treasury Stock
Shares
50,096 $
287
Amount
Shares
Amount
501
3
— $
— $
Additional
Paid in
Capital
420,584 $
Accumulated Other
Comprehensive
(Loss) Income
Retained
Earnings
Total
Stockholders'
Equity
(19,443) $
979,446 $ 1,381,088
291
15,308
67
(83)
(3,141)
205
294
15,308
67
(83)
(3,141)
205
50,383 $
504
— $
— $
436,167 $
(22,379) $ 1,105,212 $ 1,519,504
125,766
125,766
239
2
(1,041)
25,675
530
(1,320)
4,879
3,537
(1,039)
25,675
530
(1,320)
4,879
3,537
50,622 $
506
— $
— $
460,011 $
(13,963) $ 1,235,367 $ 1,681,921
130,155
130,155
403
4
615
(24,231)
1,314
(3,592)
25,783
107
(805)
509
(3,588)
25,783
(24,231)
107
3,575
(3,791)
165,670
165,670
3,575
(3,791)
51,025 $
510
615 $
(24,231) $
483,623 $
(14,179) $ 1,400,232 $ 1,845,955
See accompanying notes to consolidated financial statements.
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Table of Contents
UNITED NATURAL FOODS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In
thousands)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income
Adjustments to reconcile net income to net cash provided by operating activities:
July 28,
2018
Fiscal year ended
July 29,
2017
July 30,
2016
$
165,670
$
130,155 $
125,766
Depreciation and amortization
Deferred income tax (benefit) expense
Share-based compensation
Excess tax deficit from share-based payment arrangements
Loss on disposition of assets
Restructuring and asset impairment
Goodwill impairment
Gain associated with disposal of investment
Change in accounting estimate
Provision for doubtful accounts
Non-cash interest expense (income)
Changes in assets and liabilities, net of acquired companies:
Accounts receivable
Inventories
Prepaid expenses and other assets
Accounts payable
Accrued expenses and other liabilities
Net cash provided by operating activities
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures
Purchases of acquired businesses, net of cash acquired
Long-term investment
Proceeds from disposal of investment
Payment of company owned life insurance premiums
Proceeds from disposition of assets
Net cash used in investing activities
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings under revolving credit line
Repayments of borrowings under revolving credit line
Repayments of long-term debt
Repurchase of common stock
(Decrease) increase in bank overdraft
Proceeds from exercise of stock options
Payment of employee restricted stock tax withholdings
Excess tax deficit from share-based payment arrangements
Capitalized debt issuance costs
Net cash (used in) provided by financing activities
Effect of exchange rate changes on cash and cash equivalents
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period
Supplemental disclosures of cash flow information:
Cash paid for interest
Cash paid for federal and state income taxes, net of refunds
87,631
(14,819)
25,783
—
2,820
3,370
7,872
(699)
(20,909)
12,006
275
(67,283)
(108,795)
4,473
4,395
7,682
109,472
(44,608)
(39)
(3,397)
756
—
283
86,051
(1,891)
25,675
1,320
943
640
—
(6,106)
—
5,728
175
(38,757)
(6,929)
(6,383)
90,217
(62)
280,776
(56,112)
(9,207)
(2,000)
9,192
(2,000)
168
71,006
12,480
15,308
83
458
758
—
—
—
6,426
(106)
29,417
2,113
5,381
14,379
13,140
296,609
(41,375)
(306,724)
—
—
(2,925)
109
(47,005)
(59,959)
(350,915)
556,061
(569,671)
(12,128)
(24,231)
(434)
975
(4,563)
—
—
(53,991)
(575)
7,901
15,414
23,315
16,471
64,042
$
$
$
215,662
(418,693)
(11,546)
—
(7,445)
274
(1,313)
(1,320)
(180)
(224,561)
565
(3,179)
18,593
15,414 $
17,115 $
78,984 $
709,972
(646,481)
(11,255)
—
6,063
2,011
(1,717)
(83)
(2,164)
56,346
(827)
1,213
17,380
18,593
16,696
67,028
$
$
$
See accompanying notes to consolidated financial statements.
44
Table of Contents
UNITED NATURAL FOODS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1.
SIGNIFICANT ACCOUNTING POLICIES
Nature of Business
United Natural Foods, Inc. and its subsidiaries (the "Company") is a leading distributor of natural, organic and specialty products. The Company sells its products
primarily throughout the United States and Canada.
Basis of Presentation
The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany
transactions and balances have been eliminated in consolidation. Certain prior year amounts have been reclassified to conform to the current year's presentation.
The fiscal year of the Company ends on the Saturday closest to July 31. Fiscal 2018 , 2017 and 2016 ended on July 28, 2018 , July 29, 2017 and July 30, 2016 ,
respectively. Fiscal 2018 , 2017 and 2016 contained 52 weeks. Each of the Company's interim quarters within fiscal 2018 and fiscal 2017 consisted of 13 weeks.
Net sales consist primarily of sales of natural, organic and specialty products to retailers, adjusted for customer volume discounts, returns and allowances. Net sales
also include amounts charged by the Company to customers for shipping and handling, and fuel surcharges. The principal components of cost of sales include the
amounts paid to suppliers for product sold, plus the cost of transportation necessary to bring the product to the Company's distribution facilities, offset by
consideration received from suppliers in connection with the purchase or promotion of the suppliers' products. Cost of sales also includes amounts incurred by the
Company's manufacturing subsidiary, United Natural Trading LLC, which does business as Woodstock Farms Manufacturing, for inbound transportation costs and
depreciation for manufacturing equipment, offset by consideration received from suppliers in connection with the purchase or promotion of the suppliers' products.
Operating expenses include salaries and wages, employee benefits, warehousing and delivery, selling, occupancy, insurance, administrative, share-based
compensation, depreciation, and amortization expense. The Company disposed of its retail division in fiscal 2018. Other expense (income) includes interest on
outstanding indebtedness, interest income and miscellaneous income and expenses.
Use of Estimates
The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect amounts reported therein. Due to the inherent uncertainty involved in making estimates, actual results
reported in future periods may be based on amounts that differ from those estimates.
During the first quarter of fiscal 2018, the Company opened its shared services center which established a centralized processing function for certain of its legal
entities. As a result of the growth in net sales and inventory in fiscal 2018, the changes in processing, and the resulting increase in the Company’s estimate of its
accrual for inventory purchases, the Company initiated a review of its supplier invoicing processes and undertook a review of its estimate of its accrual for
inventory purchases.
The Company typically generates purchase orders to initiate the procurement process for the products it sells, and orders are subsequently fulfilled by suppliers and
delivered to the Company. In certain situations, inventory purchased by the Company may be delivered to the Company prior to the supplier sending the Company
an associated invoice. When the Company receives inventory from a supplier before the supplier invoice is received, the Company customarily accrues for
liabilities associated with this received but not invoiced inventory as its accrual for inventory purchases. During the 13 and 39-week periods ended April 28, 2018
the Company experienced an increased volume in its accrual for inventory purchases. When the Company receives a supplier invoice subsequent to a period end,
the invoice is reconciled to the accrual for inventory purchases account. Due to the large volumes of orders and SKUs, and pricing and quantity differences
between the supplier invoice and the Company’s records, at times only a portion of the accrual for inventory purchases is able to be matched to the supplier
invoice. Historically, the Company relieved any unresolved and partially matched amounts in its accrual for inventory purchases when such amounts were
substantially matched or aged past twelve months as it was determined that a liability was no longer considered probable at that point.
In the third quarter of fiscal 2018, the Company finalized its analysis and review of its accrual for inventory purchases, including a historical data analysis of
unmatched and partially matched amounts that were aged greater than twelve months and the ultimate resolution of such aged accruals. Based on its analysis, the
Company determined that it could reasonably estimate the outcome of its partially matched supplier invoices upon receipt of such invoice rather than when the
amount was aged greater than twelve
45
Table of Contents
months and a liability was no longer considered probable. As a result of this change in estimate, accounts payable was reduced by $20.9 million , resulting in an
increase to net income of $13.9 million , or $0.27 per diluted share, for both the 13 and the 39-weeks ended April 28, 2018.
Cash Equivalents
Cash equivalents consist of highly liquid investments with original maturities of three months or less.
Inventories and Cost of Sales
Inventories consist primarily of finished goods and are stated at the lower of cost or market, with cost being determined using the first-in, first-out (FIFO) method.
Allowances received from suppliers are recorded as reductions in cost of sales upon the sale of the related products.
Property and Equipment
Property and equipment are stated at cost less accumulated depreciation and amortization. Equipment under capital leases is stated at the lower of the present value
of minimum lease payments at the inception of the lease or the fair value of the asset. Property and equipment includes the non-cash expenditures made by the
landlord for the Aurora, Colorado distribution center in addition to office space utilized as the Company's Corporate headquarters in Providence, Rhode Island as
the lease qualifies for capital lease treatment pursuant to Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 840, Leases
. Property and equipment also includes accumulated depreciation with respect to these items. Refer to Note 8, "Long-Term Debt", for additional information.
Applicable interest charges incurred during the construction of new facilities may be capitalized as one of the elements of cost and are amortized over the assets'
estimated useful lives. The Company capitalized $0.4 million of interest during the fiscal year ended July 30, 2016 related to the construction of the Company's
distribution center in Gilroy, California which began operations in February 2016. The Company did no t capitalize interest during the fiscal years ended July 28,
2018 and July 29, 2017 .
Property and equipment consisted of the following at July 28, 2018 and July 29, 2017 :
Land
Buildings and improvements
Leasehold improvements
Warehouse equipment
Office equipment
Computer software
Motor vehicles
Construction in progress
Less accumulated depreciation and amortization
Net property and equipment
Original
Estimated
Useful Lives
(Years)
2018
2017
(In thousands, except years)
$
52,929 $
20-40
5-20
3-30
3-10
3-7
3-7
446,665
106,014
185,669
85,734
155,329
4,884
22,105
1,059,329
488,183
$
571,146 $
52,989
396,733
138,466
173,591
95,794
147,647
4,657
17,968
1,027,845
425,755
602,090
Depreciation expense amounted to $71.5 million , $69.8 million and $61.1 million for the fiscal years ended July 28, 2018 , July 29, 2017 and July 30, 2016 ,
respectively.
Income Taxes
The Company accounts for income taxes under the asset and liability method. Under the asset and liability method, deferred tax assets and liabilities are recognized
for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax
bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences
are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes
the enactment date.
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Table of Contents
We record liabilities to address uncertain tax positions we have taken in previously filed tax returns or that we expect to take in a future tax return. The
determination for required liabilities is based upon an analysis of each individual tax position, taking into consideration whether it is more likely than not that our
tax position, based on technical merits, will be sustained upon examination. For those positions for which we conclude it is more likely than not it will be sustained,
we recognize the largest amount of tax benefit that is greater than 50% likely of being realized upon ultimate settlement with the taxing authority. The difference
between the amount recognized and the total tax position is recorded as a liability. The ultimate resolution of these tax positions may be greater or less than the
liabilities recorded.
Long-Lived Assets
Management reviews long-lived assets, including definite-lived intangible assets, for indicators of impairment whenever events or changes in circumstances
indicate that the carrying value of the assets may not be recoverable. Cash flows expected to be generated by the related assets are estimated over the assets' useful
lives based on updated projections. If the evaluation indicates that the carrying amount of an asset may not be recoverable, the potential impairment is measured
based on a fair value discounted cash flow model.
Goodwill and Intangible Assets
We account for acquired businesses using the purchase method of accounting which requires that the assets acquired and liabilities assumed be recorded at the date
of the acquisition at their respective estimated fair values. Goodwill represents the excess of cost over the fair value of net assets acquired in a business
combination. In determining the estimated fair value for intangible assets, we typically utilize the income approach, which discounts the projected future net cash
flow using an appropriate discount rate that reflects the risks associated with such projected future cash flow. Refer to Note 2, "Acquisitions" , for further detail on
the valuation of goodwill and intangible assets related to specific acquisitions.
Goodwill and other intangible assets with indefinite lives are not amortized. Intangible assets with definite lives are amortized on a straight-line basis over the
following lives:
Customer relationships
Non-competition agreements
Trademarks and tradenames
7-20 years
1-10 years
4-10 years
Goodwill is assigned to the reporting units that are expected to benefit from the synergies of the business combination that generated the goodwill. Approximately
97.2% of the Company's goodwill is within its wholesale reporting segment as of July 28, 2018 . The Company is required to test goodwill for impairment at least
annually, and between annual tests if events occur or circumstances change that would more likely than not reduce the fair value of a reporting unit below its
carrying amount. The Company has elected to perform its annual assessment for indications of goodwill impairment as of the first day of the fourth quarter of each
fiscal year.
In accordance with Accounting Standards Update ("ASU") No. 2011-08, Testing Goodwill for Impairment, ("ASU 2011-08") the Company is allowed to perform a
qualitative assessment for goodwill impairment unless it believes it is more likely than not that a reporting unit's fair value is less than the carrying value. The
thresholds used by the Company for this determination in fiscal 2018 were for any reporting units that (1) have passed their previous quantitative test with a margin
of calculated fair value versus carrying value of at least 20% , (2) have had a quantitative test within the past five years, (3) have had no significant changes to their
working capital structure, (4) have current year income which is at least 85% of prior year amounts, and (5) present no other factors to be considered as outlined in
ASU 2011-08. The Company's reporting units are at or one level below the operating segment level.
In accordance with accounting Standards Update (“ASU”) No. 2017-04, Intangibles, Goodwill and Other (Topic 350), Simplifying the Test for Goodwill
Impairment , (“ASU- 2017-04”), which the Company early adopted as part of its fiscal 2017 annual goodwill impairment test, the Company is no longer required to
perform a hypothetical purchase price allocation to measure goodwill impairment. Instead, impairment is measured using the difference between the carrying
amount and the fair value of the reporting unit.
During the second quarter of fiscal 2018, the Company made the decision to close three under-performing stores related to its Earth Origins Market ("Earth
Origins") retail business. This decision coupled with the decline in results in the first half of fiscal 2018 and the future outlook as a result of competitive pressure,
the Company determined that a goodwill impairment analysis should be performed based on the assertion that it was more likely than not that the fair value of the
reporting unit was below its
47
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carrying amount. As a result of the analysis, performed in accordance with ASU 2017-04, the Company recorded a total impairment charge of $7.9 million to
goodwill. Refer to Note 5, "Restructuring Activities", for additional information.
The Company performed a qualitative test on its other reporting units as of the first day of the fourth quarter of fiscal 2018 based on the criteria noted above and
determined that a quantitative test was not required.
Intangible assets with indefinite lives are tested for impairment at least annually as of the first day of the fourth fiscal quarter and if events occur or circumstances
change that would indicate that the value of the asset may be impaired. Impairment is measured as the difference between the fair value of the asset and its carrying
value.
In accordance with ASU No. 2011-08, the Company is allowed to perform a qualitative assessment for indefinite lived intangible assets unless it believes it is more
likely than not that an intangible asset's fair value is less than the carrying value. The thresholds used by the Company for this determination as of the first day of
the fourth quarter of fiscal 2018 were for any intangible assets (or groups of assets) that (1) have passed their previous quantitative test with a margin of calculated
fair value versus carrying value of at least 20% , (2) have had a quantitative test performed within the past five years, and (3) the component that the asset relates to
has current year income which is at least 85% of the immediately preceding fiscal year's amounts. The Company's indefinite lived intangible assets are comprised
of its branded product line asset group and a Tony's Fine Foods ("Tony's") tradename. During fiscal 2018 , the Company performed its annual qualitative
assessment of its indefinite lived intangible assets and based on the criteria noted above, it was determined that a quantitative analysis was required on its Tony's
tradename. Based on the results of its quantitative test performed, the Company determined that the carrying value was in excess of its fair value and no
impairment existed.
The changes in the carrying amount of goodwill and the amount allocated by reportable segment for the years presented are as follows (in thousands):
Goodwill as of July 30, 2016
Goodwill from prior fiscal year business combinations
Contingent consideration for prior year business combinations
Change in foreign exchange rates
Goodwill as of July 29, 2017
Impairment
Goodwill adjustment for prior fiscal year business combinations
Change in foreign exchange rates
Goodwill as of July 28, 2018
Wholesale
Other
Total
348,143 $
18,025 $
366,168
10,102
(6,093)
1,082
353,234 $
—
220
(1,112)
—
—
—
18,025 $
(7,872)
—
—
352,342 $
10,153 $
10,102
(6,093)
1,082
371,259
(7,872)
220
(1,112)
362,495
$
$
$
The following table presents the detail of the Company's other intangible assets (in thousands):
Amortizing intangible assets:
Customer relationships
Non-compete agreements
Trademarks and tradenames
Total amortizing intangible assets
Indefinite lived intangible assets:
Trademarks and tradenames
Gross Carrying
Amount
July 28, 2018
Accumulated
Amortization
Net
Gross Carrying
Amount
July 29, 2017
Accumulated
Amortization
Net
$
197,246 $
61,543 $
135,703 $
197,852 $
48,044 $
149,808
2,900
1,700
1,914
981
986
719
2,900
1,700
1,334
548
1,566
1,152
201,846
64,438
137,408
202,452
49,926
152,526
55,801
—
55,801
55,763
—
55,763
Total
$
257,647 $
64,438 $
193,209 $
258,215 $
49,926 $
208,289
Amortization expense was $15.0 million , $15.2 million and $8.9 million for the fiscal years ended July 28, 2018 , July 29, 2017 and July 30, 2016 , respectively.
The estimated future amortization expense for each of the next five fiscal years and thereafter on definite lived intangible assets existing as of July 28, 2018 is
shown below:
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Fiscal Year:
2019
2020
2021
2022
2023
2023 and thereafter
Investments
$
(In thousands)
15,147
14,520
13,622
12,337
12,845
68,937
$
137,408
The Company has long term investments in unconsolidated entities which it accounts for using either the cost method or the equity method of accounting.
Investments in which the Company cannot exercise significant influence over the operating and financial policies of the investee are recorded at their historical
cost. Investments where the Company has the ability to exercise significant influence over the investee are accounted for using the equity method, with income or
loss attributable to the Company from the investee adjusting the carrying value of the investment and recorded in the Company’s consolidated statements of
income. The Company's cost and equity method investments are evaluated for other than temporary impairment in accordance with ASC 320 Investments — Debt
and Equity Securities . The carrying values of both cost and equity method investments were not material as of July 28, 2018 and July 29, 2017 , either individually
or in the aggregate, and are included within "Other Assets" in the Company’s consolidated balance sheets. Income attributable to the Company from investments
accounted for using the equity method was not material for the fiscal years ended July 28, 2018 , July 29, 2017 and July 30, 2016 and is recorded in “Other, net,”
within "Other expense (income)," in the Company's consolidated statements of income.
On May 24, 2017, the Company sold its stake in Kicking Horse Coffee, a Canadian roaster and marketer of organic and fair trade coffee, which was accounted for
using the cost method of accounting. As a result of the sale, the Company recognized a pre-tax gain of $6.1 million , which is included in “Other, net” in the
consolidated statements of income.
Revenue Recognition and Concentration of Credit Risk
The Company records revenue upon delivery of products. Revenues are recorded net of applicable sales discounts and estimated sales returns. Sales incentives
provided to customers are accounted for as reductions in revenue as the related revenue is recorded. The Company's sales are primarily to customers located
throughout the United States and Canada.
Whole Foods Market, Inc. was the Company's largest customer in each fiscal year presented. Whole Foods Market, Inc. accounted for approximately 37% , 33%
and 35% of the Company's net sales for the fiscal years ended July 28, 2018 , July 29, 2017 and July 30, 2016 , respectively. There were no other customers that
individually generated 10% or more of the Company's net sales during those periods.
Accounts Receivable and Related Allowance for Doubtful Accounts
Accounts receivable primarily consist of trade receivables from customers and receivables from suppliers in connection with the purchase or promotion of the
suppliers' products. The Company analyzes customer creditworthiness, accounts receivable balances, payment history, payment terms and historical bad debt levels
when evaluating the adequacy of its allowance for doubtful accounts. In instances where a reserve has been recorded for a particular customer, future sales to the
customer are conducted using either cash-on-delivery terms, or the account is closely monitored so that as agreed upon payments are received, orders are released;
a failure to pay results in held or canceled orders.
Fair Value of Financial Instruments
The carrying amounts of the Company's financial instruments including cash and cash equivalents, accounts receivable, accounts payable and certain accrued
expenses approximate fair value due to the short-term nature of these instruments.
The following estimated fair value amounts have been determined by the Company using available market information and appropriate valuation methodologies.
Refer to Note 9, "Fair Value Measurements", for additional information regarding the fair value hierarchy. The fair value of notes payable and long-term debt are
based on the instruments' interest rate, terms, maturity date and collateral, if any, in comparison to the Company's incremental borrowing rate for similar financial
instruments. However, considerable judgment is required in interpreting market data to develop the estimates of fair value. Accordingly, the estimates presented
herein are not necessarily indicative of the amounts that the Company could realize in a current market exchange.
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Assets:
Cash and cash equivalents
Accounts receivable
Notes receivable
Liabilities:
Accounts payable
Notes payable
Long-term debt, including current portion
Share-Based Compensation
July 28, 2018
July 29, 2017
Carrying Value
Fair Value
Carrying Value
Fair Value
(In thousands)
$
23,315
$
23,315
$
15,414
$
579,702
1,930
517,125
210,000
150,150
579,702
1,930
517,125
210,000
155,317
525,636
2,359
534,616
223,612
161,991
15,414
525,636
2,359
534,616
223,612
169,058
The Company accounts for its share-based compensation in accordance with ASC 718, Stock Compensation . The Company has four share-based employee
compensation plans, which are described more fully in Note 3, "Equity Plans". Share-based compensation consists of stock options, restricted stock units and
performance units. The grant date closing price per share of the Company's stock is used to estimate the fair value of restricted stock units. Stock options are
granted at exercise prices equal to the fair market value of the Company's stock at the dates of grant. The Company recognizes share-based compensation expense
on a straight-line basis over the requisite service period of the individual grants. The Company's President, Chief Executive Officer and Chairman and its other
executive officers or members of senior management have been granted performance units which vest, when and if earned, in accordance with the terms of the
related performance unit award agreements. The Company recognizes share-based compensation expense based on the target number of shares of common stock
and the Company’s stock price on the date of grant and subsequently adjusts expense based on actual and forecasted performance compared to planned targets.
Earnings Per Share
Basic earnings per share is calculated by dividing net income by the weighted average number of common shares outstanding during the period. Diluted earnings
per share is calculated by adding the dilutive potential common shares to the weighted average number of common shares that were outstanding during the period.
For purposes of the diluted earnings per share calculation, outstanding stock options, restricted stock units and performance-based awards, if applicable, are
considered common stock equivalents, using the treasury stock method. A reconciliation of the weighted average number of shares outstanding used in the
computation of the basic and diluted earnings per share for all periods presented follows:
Basic weighted average shares outstanding
Net effect of dilutive common stock equivalents based upon the treasury stock method
Diluted weighted average shares outstanding
Potential anti-dilutive share-based payment awards excluded from the computation above
Net income
Basic earnings per share
Diluted earnings per share
Treasury Stock
July 28,
2018
Fiscal year ended
July 29,
2017
July 30,
2016
(In thousands, except per share data)
50,530
307
50,837
93
50,570
205
50,775
44
50,313
86
50,399
84
$
$
$
165,670 $
130,155 $
125,766
3.28 $
3.26 $
2.57 $
2.56 $
2.50
2.50
The Company records the repurchase of shares of common stock at cost based on the settlement date of the transaction. These shares are classified as treasury
stock, which is a reduction to stockholders’ equity. Treasury stock is included in authorized and issued shares but excluded from outstanding shares.
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On October 6, 2017, the Company announced that its Board of Directors authorized a share repurchase program for up to $200.0 million of the Company’s
outstanding common stock. The repurchase program is scheduled to expire upon the Company’s repurchase of shares of the Company’s common stock having an
aggregate purchase price of $200.0 million . The Company repurchased 614,660 shares of its common stock at an aggregate cost of $24.2 million in the fiscal year
ended July 28, 2018 .
Comprehensive Income (Loss)
Comprehensive income (loss) is reported in accordance with ASU No. 2013-02, and includes net income and the change in other comprehensive income (loss).
Other comprehensive income (loss) is comprised of the net change in fair value of derivative instruments designated as cash flow hedges, as well as foreign
currency translation related to the translation of UNFI Canada, Inc. ("UNFI Canada") from the functional currency of Canadian dollars to U.S. dollar reporting
currency. For all periods presented, the Company displays comprehensive income (loss) and its components in the consolidated statements of comprehensive
income.
Derivative Financial Instruments
The Company is exposed to market risks arising from changes in interest rates, fuel costs, and with the operation of UNFI Canada, foreign currency exchange rates.
The Company uses derivatives principally in the management of interest rate and fuel price exposure. From time to time the Company may use contracts to hedge
transactions in foreign currency. The Company does not utilize derivatives that contain leverage features. For derivative transactions accounted for as hedges, on
the date the Company enters into the derivative transaction, the exposure is identified. The Company formally documents all relationships between hedging
instruments and hedged items, as well as its risk-management objective and strategy for undertaking the hedge transaction. In this documentation, the Company
specifically identifies the asset, liability, firm commitment, forecasted transaction, or net investment that has been designated as the hedged item and states how the
hedging instrument is expected to reduce the risks related to the hedged item. The Company measures effectiveness of its hedging relationships both at hedge
inception and on an ongoing basis as needed.
Shipping and Handling Fees and Costs
The Company includes shipping and handling fees billed to customers in net sales. Shipping and handling costs associated with inbound freight are generally
recorded in cost of sales, whereas shipping and handling costs for selecting, quality assurance, and outbound transportation are recorded in operating expenses.
Outbound shipping and handling costs totaled $582.9 million , $517.2 million and $467.5 million for the fiscal years ended July 28, 2018 , July 29, 2017 and
July 30, 2016 , respectively.
Reserves for Self-Insurance
The Company is primarily self-insured for workers' compensation and general and automobile liability insurance. It is the Company's policy to record the self-
insured portion of workers' compensation and automobile liabilities based upon actuarial methods to estimate the future cost of claims and related expenses that
have been reported but not settled, and that have been incurred but not yet reported.
Operating Lease Expenses
The Company records lease expense via the straight-line method. For leases with step rent provisions whereby the rental payments increase over the life of the
lease, and for leases where the Company receives rent-free periods, the Company recognizes expense based on a straight-line basis based on the total minimum
lease payments to be made over the expected lease term.
Recently Issued Accounting Pronouncements
In June 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2018-07, Improvements to Nonemployee Share-
Based Payment Accounting, which more closely aligns the accounting for employee and nonemployee shared-based payments. This ASU is effective for public
business entities for annual and interim periods in fiscal years beginning after December 15, 2018, which for the Company will be the first quarter of the fiscal year
ending August 1, 2020, with early adoption permitted. The Company does not believe this guidance will have a material effect on its consolidated financial
statements.
In February 2018, the FASB issued ASU 2018-02, Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income, which allows a
reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act of 2017. This
ASU is effective for all entities for annual and interim periods in fiscal years beginning after December 15, 2018, which for the Company will be the first quarter of
the fiscal year ending August 1, 2020, with early adoption permitted. The Company is currently reviewing the provisions of the new standard and evaluating its
impact on the Company's consolidated financial statements.
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In December 2017, the United States ("U.S.") government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act of 2017 (the
“TCJA”). The Securities and Exchange Commission ("SEC ") staff issued Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cut
and Jobs Act ("SAB 118"), which provides guidance on accounting for the tax effects of the TCJA. Refer to Note 12, "Income Taxes", for disclosure regarding the
Company’s implementation of SAB 118.
In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities , which
changes the recognition and presentation requirements of hedge accounting, including eliminating the requirement to separately measure and report hedge
ineffectiveness and presenting all items that affect earnings in the same income statement line item as the hedged item. The ASU also provides new alternatives for
applying hedge accounting to additional hedging strategies, measuring the hedged item in fair value hedges of interest rate risk, reducing the cost and complexity of
applying hedge accounting by easing the requirements for effectiveness testing, hedge documentation and application of the critical terms match method and
reducing the risk of a material error correction if a company applies the shortcut method inappropriately. This ASU is effective for public companies in fiscal years
beginning after December 15, 2018, with early adoption permitted. The Company early adopted the guidance in this ASU in the fourth quarter of fiscal 2018, with
no impact to its financial position, results of operations, or cash flows. The Company’s hedging activities, which consist of its interest rate swaps designated as
cash flow hedges, are described in further detail in Note 9. "Fair Value Measurements".
In January 2017, the FASB issued ASU No. 2017-04, Intangibles, Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment . This ASU no
longer requires a hypothetical purchase price allocation to measure goodwill impairment. Instead, impairment is measured using the difference between the
carrying amount and fair value of the reporting unit. The ASU is effective for public companies with interim periods and fiscal years beginning after December 15,
2019, which for the Company is the first quarter of the fiscal year ending July 31, 2021, with early adoption permitted. The Company early adopted this ASU in
connection with its annual goodwill impairment test performed in the fourth quarter of fiscal 2017. Refer to "(i) Goodwill and Intangible Assets" in this note for
further information.
In October 2016, the FASB issued ASU No. 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory ("ASU 2016-16"), which
requires the recognition of the income tax consequences of an intra-entity transfer of an asset, other than inventory, when the transfer occurs. This ASU is required
for public companies with interim periods and fiscal years beginning after December 15, 2017 which for the Company will be the first quarter of the fiscal year
ending August 3, 2019. The Company does not believe this guidance will have a material effect on its consolidated financial statements.
In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments , to address
eight specific cash flow issues with the objective of reducing the existing diversity in practice. The eight specific issues are (1) Debt Prepayment or Debt
Extinguishment Costs; (2) Settlement of Zero-Coupon Debt Instruments or Other Debt Instruments with Coupon Interest Rates That Are Insignificant in Relation
to the Effective Interest Rate of the Borrowing; (3) Contingent Consideration Payments Made after a Businesses Combination; (4) Proceeds from the Settlement of
Insurance Claims; (5) Proceeds from the Settlement of Corporate-Owned Life Insurance Policies, including Bank-Owned Life Insurance Policies; (6) Distributions
Received from Equity Method Investees; (7) Beneficial Interests in Securitization Transactions; and (8) Separately Identifiable Cash and Application of the
Predominance Principle. The ASU is effective for public companies with interim and fiscal years beginning after December 15, 2018, which for the Company will
be the first quarter of the fiscal year ending August 1, 2020. The Company is in the process of evaluating the impact that this new guidance will have on the
Company's consolidated financial statements.
In March 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting ,
which is intended to improve the accounting for share-based payment transactions as part of the FASB's simplification initiative. This ASU has changed aspects of
accounting for share-based payment award transactions including accounting for income taxes, the classification of excess tax benefits and the classification of
employee taxes paid when shares are withheld for tax-withholding purposes on the consolidated statement of cash flows, forfeitures, and minimum statutory tax
withholding requirements. The Company adopted the new standard in the first quarter of fiscal 2018. Accordingly, the Company accounts for excess tax benefits or
tax deficiencies related to share-based payments in its provision for income taxes as opposed to additional paid-in capital. The Company recognized an income tax
expense related to tax deficiencies for share-based payments for the fiscal year ended July 28, 2018 of $1.1 million . For fiscal 2017 and 2016, the result would
have increased income tax expense by $1.3 million and $0.1 million , respectively. In addition, the Company elected to account for forfeitures as they occur and
recorded a cumulative adjustment to retained earnings and additional paid-in capital as of July 30, 2017, the first day of fiscal 2018, of approximately $0.8 million
and $1.3 million , respectively.
In February 2016, the FASB issued ASU No. 2016-2, Leases (Topic 842) . The objective of this ASU is to establish the principles that lessees and lessors shall
apply to report useful information to users of financial statements about the amount, timing, and
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uncertainty of cash flows arising from a lease. Lessees are permitted to make an accounting policy election to not recognize the asset and liability for leases with a
term of twelve months or less. In addition, this ASU expands the disclosure requirements of lease arrangements. This ASU will require the Company to recognize
most current operating lease obligations as right-of-use assets with a corresponding liability based on the present value of future operating leases, which the
Company believes will result in a significant impact to its consolidated balance sheets. Information about the amounts and timing of our undiscounted future lease
payments can be found in Note 10. "Commitments and Contingencies" in these consolidated financial statements. Lessees and lessors will use a modified
retrospective transition approach, which includes a number of practical expedients. The ASU is effective for public companies with interim and annual periods in
fiscal years beginning after December 15, 2018, which for the Company will be the first quarter of the fiscal year ending August 1, 2020, with early adoption
permitted. The Company expects to adopt this standard in the first quarter of fiscal 2020 and has begun an initial assessment plan to determine the impacts of this
ASU on the Company’s consolidated financial statements and any necessary changes to our systems, accounting policies, and processes and controls.
In November 2015, the FASB issued ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes , which requires entities with a classified balance sheet to
present all deferred tax assets and liabilities as noncurrent. The new pronouncement is effective for public companies with annual periods, and interim periods
within those periods, beginning after December 15, 2016, which for the Company was the first quarter of the fiscal 2018. Early adoption at the beginning of an
interim or annual period is permitted. The Company adopted this guidance on a prospective basis in the first quarter of fiscal 2018 and it resulted in a
reclassification from current deferred income tax assets to noncurrent deferred income tax liabilities of $40.6 million . All future adjustments will be reported as
noncurrent.
In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers, (Topic 606) , which has been updated by multiple amending ASUs and
supersedes existing revenue recognition requirements. The core principle of the new guidance is that an entity will recognize revenue to depict the transfer of
promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or
services. Additionally, the ASU requires new, enhanced quantitative and qualitative disclosures related to the nature, amount, timing and uncertainty of revenue
and cash flows arising from contracts with customers. The collective guidance is effective for public companies with annual periods, and interim periods within
those periods, beginning after December 15, 2017, which for the Company will be the first quarter of the fiscal year ending August 3, 2019. The new standard
permits either of the following adoption methods: (i) a full retrospective application with restatement of each period presented in the financial statements with the
option to elect certain practical expedients, or (ii) a retrospective application with the cumulative effect of adopting the guidance recognized as of the date of initial
application (“modified retrospective method”).
The Company completed its assessment of the new standard in the fourth quarter of fiscal 2018, and has adopted this new guidance in the first quarter of fiscal
2019 using the modified retrospective method, with no significant financial statement impact. The Company’s assessment work consisted of scoping of revenue
streams, reviewing contracts with customers, and documenting the accounting analysis and conclusions of the impacts of the ASU on the Company’s wholesale
distribution and other segments. The primary impact of adopting the new standard, contained within the wholesale distribution segment, is related to the sale of
certain private label products for which revenue will be recognized over time under the new standard as opposed to at a point in time under the Company’s current
policies. The effect of adopting this change resulted in an immaterial increase to Retained earnings, which was recorded in first quarter of fiscal 2019. Beginning in
the first quarter of fiscal 2019, the Company will comply with enhanced revenue disclosure requirements, which will include expanded disclosure of relevant
information about contracts with customers, disaggregated revenue, information on contract assets and liabilities, as well as other items requiring significant
judgment and estimates used to recognize revenue.
2.
ACQUISITIONS
Wholesale Segment - Wholesale Distribution Acquisitions
Global Organic/Specialty Source, Inc. On March 7, 2016, the Company acquired certain assets of Global Organic/Specialty Source Inc. and related affiliates
(collectively "Global Organic") through its wholly owned subsidiary Albert's Organics, Inc. ("Albert's"). Global Organic is a distributor of organic fruits,
vegetables, juices, milk, eggs, nuts, and coffee located in Sarasota, Florida serving customer locations across the Southeastern United States. Total cash
consideration related to this acquisition was approximately $20.6 million . The fair value of identifiable intangible assets acquired was determined by using an
income approach. The identifiable intangible asset recorded consisted of customer lists of $7.4 million , which are being amortized on a straight-line basis over an
estimated useful life of approximately ten years.
Nor-Cal Produce, Inc. On March 31, 2016 the Company acquired all of the outstanding stock of Nor-Cal Produce, Inc. ("Nor-Cal") and an affiliated entity as well
as certain real estate. Nor-Cal is a distributor of conventional and organic produce and other
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fresh products in Northern California, with primary operations located in West Sacramento, California. Total cash consideration related to this acquisition was
approximately $67.8 million .
The fair value of the identifiable intangible assets acquired was determined by using an income approach. The identifiable intangible assets include customer lists
of $30.3 million , a tradename with an estimated fair value of $1.0 million , and a non-compete with an estimated fair value of $0.5 million , which are being
amortized on a straight-line basis over estimated useful lives of approximately thirteen years , five years and five years , respectively. Significant assumptions
utilized in the income approach were based on company-specific information and projections, which are not observable in the market and are thus considered Level
3 measurements as defined by authoritative guidance. The goodwill of $36.5 million represents the future economic benefits expected to arise that could not be
individually identified and separately recognized. During the second quarter of fiscal 2017, the Company recorded a $2.9 million adjustment to the opening balance
sheet which decreased goodwill and deferred income tax liabilities. During the third quarter of fiscal 2017, the Company recorded a $0.1 million adjustment, which
decreased goodwill and liabilities, and completed the final net working capital adjustment resulting in cash received of $0.8 million by the Company, which also
decreased goodwill and the total purchase price. The Company finalized its purchase accounting during the third quarter of fiscal 2017. Net sales attributed to Nor-
Cal from the date of acquisition through the fiscal year ended July 29, 2017 were $51.4 million .
The following table summarizes the consideration paid for the acquisition and the amounts of assets acquired and liabilities assumed as of the acquisition date:
(in
thousands)
Accounts receivable
Inventories
Property and equipment
Other assets
Customer relationships
Tradename
Non-compete
Goodwill
Total assets
Liabilities
Total purchase price
Final Opening Balance
Sheet
$
$
$
8,483
1,902
10,029
125
30,300
1,000
500
36,517
88,856
21,073
67,783
Haddon House Food Products, Inc. On May 13, 2016 the Company acquired all outstanding equity securities of Haddon House Food Products, Inc. (“Haddon”)
and certain affiliated entities and real estate. Haddon is a distributor and merchandiser of natural and organic and gourmet ethnic products throughout the Eastern
United States. Haddon has a diverse, multi-channel customer base including supermarkets, gourmet food stores and independent retailers. Total cash consideration
related to this acquisition was approximately $217.5 million .
The value of the identifiable intangible assets acquired was determined by using an income approach. The identifiable intangible assets include customer
relationships with an estimated fair value of $62.7 million , the Haddon tradename with an estimated fair value of $0.7 million , non-compete agreements with an
estimated fair value of $0.7 million , and a trademark asset related to Haddon-owned branded product lines with an estimated fair value of $2.0 million . The
customer relationship intangible asset is currently being amortized on a straight-line basis over an estimated useful life of approximately thirteen years, the Haddon
tradename is being amortized over an estimated useful life of approximately three years, the non-compete agreements that the Company received from the owners
of Haddon are being amortized over the five -year term of the agreements, and the Haddon trademark asset associated with its branded product lines is estimated to
have an indefinite useful life. Significant assumptions utilized in the income approach were based on company-specific and market participant information and
projections, which are not observable in the market and are thus considered Level 3 measurements as defined by authoritative guidance. The goodwill of $43.6
million represents the future economic benefits expected to arise that could not be individually identified and separately recognized. Net sales attributed to Haddon
from the date of acquisition through the fiscal year ended July 29, 2017 were $100.4 million .
During the second quarter of fiscal 2017, the Company recorded a reduction to goodwill of approximately $1.6 million related to a net working capital adjustment.
During the fourth quarter of fiscal 2017, the Company finalized its purchase accounting related
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to the Haddon acquisition. The following table summarizes the consideration paid for the acquisition and the amounts of assets acquired and liabilities assumed as
of the acquisition date:
(in
thousands)
Accounts receivable
Other receivable
Inventories
Prepaid expenses and other current assets
Property and equipment
Other assets
Customer relationships
Tradename
Non-compete
Other intangible assets
Goodwill
Total assets
Liabilities
Total purchase price
Final Opening Balance
Sheet
$
$
$
40,134
3,621
46,440
1,744
54,501
280
62,700
700
700
2,000
43,585
256,405
38,910
217,495
Gourmet Guru, Inc. On August 10, 2016, the Company acquired all of the outstanding equity securities of Gourmet Guru, Inc. ("Gourmet Guru"). Gourmet Guru is
a distributor and merchandiser of fresh and organic food focusing on new and emerging brands. Total cash consideration related to this acquisition was
approximately $10.0 million , subject to certain customary post-closing adjustments. The fair value of identifiable intangible assets acquired was determined by
using an income approach. The identifiable intangible asset recorded based on a provisional valuation consisted of customer lists of $1.0 million , which are being
amortized on a straight-line basis over an estimated useful life of approximately 2 years . During the first quarter of fiscal 2018, in finalizing the purchase
accounting related to the Gourmet Guru acquisition, the Company recorded an increase to goodwill of approximately $0.2 million with a decrease to prepaid
expenses. The goodwill of $10.3 million represents the future economic benefits expected to arise that could not be individually identified and separately
recognized.
Cash paid for Global Organic, Nor-Cal, Haddon and Gourmet Guru was financed through borrowings under the Company’s Existing ABL Loan Agreement.
Acquisition costs have been expensed as incurred within "operating expenses" in the consolidated statements of income. Acquisition costs related to these
acquisitions were de minimis for the year ended July 29, 2017 and $2.1 million for the year ended July 30, 2016. The results of the acquired businesses' operations
have been included in the consolidated financial statements since the applicable date of acquisitions. Operations for these acquisitions have been combined with the
Company's existing wholesale distribution business and therefore results are not separable from the rest of the wholesale distribution business. The Company has
not furnished pro forma financial information relating to these acquisitions as such information is not material to the Company's financial results.
Acquisition of SUPERVALU, INC.
On July 25, 2018, the Company entered into an Agreement and Plan of Merger pursuant to which we have agreed to acquire all of the outstanding equity securities
of SUPERVALU INC. (“SUPERVALU”) for an aggregate purchase price of approximately $2.9 billion including the assumption of outstanding debt and
liabilities. The transaction has been approved by the boards of directors of both companies and is subject to antitrust approvals, SUPERVALU shareholder
approval and other customary closing conditions, and is expected to close in the fourth quarter of calendar year 2018. The proposed acquisition of SUPERVALU is
expected to expand the Company’s customer base and exposure across channels, add high-growth perimeter categories such as meat and produce to the Company’s
natural and organic products, provide the Company a wider geographic reach and greater scale, and increase efficiencies.
3.
EQUITY PLANS
The Company has three equity incentive plans: the 2002 Stock Incentive Plan (the "2002 Plan"), the 2004 Equity Incentive Plan, as amended (the "2004 Plan"), and
the 2012 Equity Incentive Plan, as amended and restated (the "2012 Plan") (collectively, the
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"Plans"). Prior to the expiration of the applicable plan, these shares may be used to issue stock options, restricted stock, restricted stock units or performance based
awards to employees, officers, directors and others. The maximum term of all incentive and non-statutory stock options or share awards granted under the Plans is
4 years . There were 2,800,000 shares authorized for grant under the 2002 Plan and 1,250,000 shares authorized for grant under the 2012 Plan, which was amended
in fiscal 2016 and further amended in fiscal 2018 to increase shares available for issuance by 2,000,000 and 1,800,000 shares, respectively. As of July 28, 2018 ,
2,676,949 shares were available for grant under the 2012 Plan. The authorization for new grants under the 2002 Plan and 2004 Plan has expired.
The Company recognized total share-based compensation expense of $25.8 million for the fiscal year ended July 28, 2018 , compared to $25.7 million and $15.3
million for the fiscal years ended July 29, 2017 and July 30, 2016 , respectively. The total income tax benefit for share-based compensation arrangements was $6.5
million , $10.0 million , and $6.1 million , for the fiscal years ended July 28, 2018 , July 29, 2017 and July 30, 2016 , respectively.
Share-based compensation expense related to performance-based share awards was $5.6 million and $9.0 million for the fiscal years ended July 28, 2018 and
July 29, 2017 , respectively. For the fiscal year ended July 30, 2016 , the Company did no t record share-based compensation expense related to performance-based
share awards, including compensation expense related to performance units with vestings tied to the Company's performance in fiscal 2016, as a result of
performance measures not being attained at the end of the fiscal year and the resulting forfeiture of these awards.
Vesting requirements for awards under the Plans are generally at the discretion of the Company's Board of Directors, or the Compensation Committee thereof, and
for time vesting awards are typically four equal annual installments for employees and two equal installments for non-employee directors with the first installment
on the date of grant and the second installment on the six month anniversary of the grant date. As of July 28, 2018 , there was $36.0 million of total unrecognized
compensation cost related to outstanding share-based compensation arrangements (including stock options, restricted stock units and performance-based restricted
stock units). This cost is expected to be recognized over a weighted-average period of 2.3 years.
Restricted Stock Units
The fair value of restricted stock units and performance share units are determined based on the number of units granted and the quoted price of the Company's
common stock as of the grant date. The following summary presents information regarding restricted stock units and performance units under the Plans as of
July 28, 2018 and changes during the fiscal year then ended:
Outstanding at July 29, 2017
Granted
Vested
Forfeited
Outstanding at July 28, 2018
Number
of Shares
Weighted Average
Grant-Date
Fair Value
1,270,111 $
716,952 $
(434,730) $
(207,731) $
1,344,602 $
44.56
40.06
47.24
41.38
41.78
The total intrinsic value of restricted stock units vested was $12.4 million , $10.5 million and $12.3 million during the fiscal years ended July 28, 2018 , July 29,
2017 and July 30, 2016 , respectively.
During fiscal 2018, the Company granted 109,100 performance share units to its executives (subject to the issuance of 109,100 additional shares if the Company's
performance exceeds specified targeted levels) with a weighted average grant-date fair value of $39.74 . All of the performance units are tied to the Company's
performance in the fiscal year ending August 3, 2019.
During fiscal 2017, the Company granted 397,242 performance share units to its executives (subject to the issuance of 221,242 additional shares if the Company's
performance exceeds specified targeted levels) with a weighted average grant-date fair value of $40.82 tied to the Company's performance in fiscal years 2017,
2018 and 2019. As of the fiscal year ended July 29, 2017, 150,396 of these performance share units vested, based on the Company's earnings per diluted share,
adjusted EBITDA, and adjusted ROIC with an estimated intrinsic value of approximately $5.7 million using the Company's stock price as of July 28, 2017. As of
the fiscal year ended July 28, 2018, 111,860 performance units vested based on the Company's earnings per diluted share, adjusted EBITDA, and adjusted ROIC
with an intrinsic value of approximately $3.6 million using the Company stock price as of July 27, 2018. As of July 28, 2018, there are 75,000 performance share
units outstanding that are tied to the Company's performance in the fiscal year ending August 3, 2019.
No performance share units vested during the fiscal year ended July 30, 2016 .
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Stock Options
The fair value of stock option grants was estimated at the date of grant using the Black-Scholes option pricing model. Black-Scholes utilizes assumptions related to
volatility, the risk-free interest rate, the dividend yield and expected life. Expected volatilities utilized in the model are based on the historical volatility of the
Company's stock price. The risk-free interest rate is derived from the U.S. Treasury yield curve in effect at the time of grant. The model incorporates exercise and
post-vesting forfeiture assumptions based on an analysis of historical data. The expected term is derived from historical information and other factors.
The Company did no t grant stock options in fiscal 2018 or 2017 . The following summary presents the weighted average assumptions used for stock options
granted in fiscal 2016 :
Expected volatility
Dividend yield
Risk free interest rate
Expected term (in years)
Fiscal year ended
July 30,
2016
27.5%
—%
1.3%
4.0
The following summary presents information regarding outstanding stock options as of July 28, 2018 and changes during the fiscal year then ended with regard to
options under the Plans:
Outstanding at beginning of year
Exercised
Outstanding at end of year
Exercisable at end of year
Number
of Options
328,689 $
(37,012) $
291,677 $
262,235 $
Weighted
Average
Exercise
Price
Weighted
Average
Remaining
Contractual
Term
Aggregate
Intrinsic
Value
49.52
26.34
52.46
51.92
4.4 years $
4.2 years $
200,391
200,391
The weighted average grant-date fair value of options granted during the fiscal year ended July 30, 2016 was $15.59 . The aggregate intrinsic value of options
exercised during the fiscal years ended July 28, 2018 , July 29, 2017 , and July 30, 2016 , was $0.7 million , $0.1 million and $2.6 million , respectively.
4.
ALLOWANCE FOR DOUBTFUL ACCOUNTS AND NOTES RECEIVABLE
The allowance for doubtful accounts and notes receivable consists of the following:
Balance at beginning of year
Additions charged to costs and expenses
Deductions
Balance at end of year
5.
RESTRUCTURING ACTIVITIES
Fiscal 2018 Earth Origins Market
July 28,
2018
Fiscal year ended
July 29,
2017
(In thousands)
July 30,
2016
$
$
14,509 $
11,230 $
12,006
(10,519)
5,728
(2,449)
15,996 $
14,509 $
8,493
6,426
(3,689)
11,230
During the fiscal year ended July 28, 2018, the Company recorded restructuring and asset impairment expenses of approximately $16.1 million , including a loss on
the disposition of assets of approximately $2.7 million , related to the Company's Earth Origins retail business. During the second quarter of fiscal 2018 the
Company made the decision to close three non-core, under-performing stores of its total twelve stores. Based on this decision, coupled with the decline in results in
the first half of fiscal 2018 and the future outlook as a result of competitive pressure, the Company determined that both a test for recoverability of long-lived assets
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and a goodwill impairment analysis should be performed. The determination of the need for a goodwill analysis was based on the assertion that it was more likely
than not that the fair value of the reporting unit was below its carrying amount. As a result of both these analyses, the Company recorded a total impairment charge
of $3.4 million on long-lived assets and $7.9 million to goodwill, respectively, during the second quarter of fiscal 2018. During the fourth quarter the Company
disposed of its retail business. The Company recorded restructuring costs of $2.2 million during fiscal 2018.
The following is a summary of the restructuring costs the Company recorded related to Earth Origins in fiscal 2018, the payments and other adjustments related to
these costs and the remaining liability as of July 28, 2018 (in thousands):
Severance and other employee separation and transition costs
Early lease termination and facility closing costs
Total
Restructuring Costs
Recorded in Fiscal
2018
Payments and
Other
Adjustments
Restructuring Cost
Liability as of July 28,
2018
$
$
819
1,400
(436)
$
(1,400)
2,219 $
(1,836)
$
383
—
383
Restructuring and impairment expenses recorded related to Earth Origins are reflected in the Company's "Other" segment.
Fiscal 2017 Cost Saving and Efficiency Initiatives.
During fiscal 2017, the Company announced a restructuring program in conjunction with various cost saving and efficiency initiatives, including the planned
opening of a shared services center. The Company recorded total restructuring costs of $6.9 million during the fiscal year ended July 29, 2017, of which $6.6
million was primarily related to severance and other employee separation and transition costs and $0.3 million was due to an early lease termination and facility
closing costs for its Gourmet Guru facility in Bronx, New York. During fiscal 2018 the Company performed an analysis on the remaining restructuring cost
liability and as a result, recorded a benefit of $0.1 million which is reflected in "payments and other adjustments" in the table below.
The following is a summary of the restructuring costs the Company recorded in fiscal 2017, as well as the remaining liability as of July 28, 2018 (in thousands):
Severance and other employee separation and transition costs
Early lease termination and facility closing costs
Total
Fiscal 2016 Cost-Saving Measures.
Restructuring Costs
Recorded in Fiscal
2017
Payments and
Other
Adjustments
Restructuring Cost
Liability as of July 28,
2018
$
$
6,606 $
258
6,864 $
(5,905)
$
(258)
(6,163)
$
701
—
701
During the fourth quarter of fiscal 2015, the Company announced that its contract as a distributor to Albertsons Companies, Inc., which includes the Albertsons,
Safeway and Eastern Supermarket chains, would terminate on September 20, 2015 rather than upon the original contract end date of July 31, 2016. During fiscal
2016, the Company implemented Company-wide cost-saving measures in response to this lost business which resulted in total restructuring costs of $4.4 million ,
all of which was recorded during the first half of fiscal 2016. There were no additional costs recorded related to these cost-savings initiatives in fiscal 2016. These
initiatives resulted in a reduction of employees across the Company, the majority of which were terminated during the first quarter of fiscal 2016. The total work-
force reduction charge of $3.4 million recorded during fiscal 2016 was primarily related to severance and fringe benefits. In addition to workforce reduction
charges, the Company recorded $0.9 million during fiscal 2016 for costs due to an early lease termination and facility closure and operational transfer costs
associated with these initiatives.
Earth Origins Market. During the fourth quarter of fiscal 2016, the Company recorded restructuring and impairment charges of $0.8 million related to the
Company's Earth Origins retail business. The Company made the decision during the fourth quarter of fiscal 2016 to close two of its stores, one store located in
Florida and the other located in Maryland, which resulted in restructuring costs of $0.5 million primarily related to severance and closure costs. The stores were
closed during the first quarter of fiscal 2017. In addition, the Company recorded a total impairment charge of $0.3 million during fiscal 2016 on long-lived assets.
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Canadian facility closure. During fiscal 2015, the Company ceased operations at its Canadian facility located in Scotstown, Quebec which was acquired in 2010. In
connection with this closure, the Company recognized an impairment of $0.6 million during the first quarter of fiscal 2015 representing the remaining unamortized
balance of an intangible asset. During the second quarter of fiscal 2015, the Company recognized a restructuring charge of $0.2 million in connection with this
closure. Additionally, during the second quarter of fiscal 2016, the Company recognized an additional impairment charge of $0.4 million related to the long lived
assets at the facility.
The following is a summary of the restructuring costs the Company recorded in fiscal 2016 related to the termination of its distribution arrangement with a large
customer, the closing of two of its Earth Origins stores and the closing of a Canadian facility. The remaining liability as of the fiscal year ended July 29, 2017 was
de minimis.
(in
thousands)
Cost saving measures:
Severance
Early lease termination and facility closing costs
Operational transfer costs
Earth Origins:
Severance
Store closing costs
Total
The following is a summary of the impairment costs the Company recorded in fiscal 2016:
(in
thousands)
Canadian facility closure
Earth Origins store
Total
6.
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES
Accrued expenses and other current liabilities as of July 28, 2018 and July 29, 2017 consisted of the following:
(in
thousands)
Accrued salaries and employee benefits
Workers' compensation and automobile liabilities
Interest rate swap liability
Other
Total accrued expenses and other current liabilities
7.
NOTES PAYABLE
Restructuring Costs
Recorded in Fiscal 2016
$
$
$
$
3,443
368
570
41
443
4,865
Impairment Costs
413
274
687
July 28,
2018
July 29,
2017
66,132 $
24,975
—
78,551
169,658 $
63,937
22,774
308
70,224
157,243
$
$
On April 29, 2016, the Company entered into the Third Amended and Restated Loan and Security Agreement (the "Existing ABL Loan Agreement") amending and
restating certain terms and provisions of its revolving credit facility (the "Existing ABL Facility") which increased the maximum borrowings under the Existing
ABL Facility and extended the maturity date to April 29, 2021. Up to $850.0 million is available to the Company's U.S. subsidiaries and up to $50.0 million is
available to UNFI Canada. After giving effect to the Existing ABL Loan Agreement, the Existing ABL Facility provides an option to increase the U.S. or Canadian
revolving commitments by up to an additional $600.0 million in the aggregate (but in not less than $10.0 million increments) subject to certain customary
conditions and the lenders committing to provide the increase in funding.
The borrowings of the U.S. portion of the Existing ABL Facility, after giving effect to the Existing ABL Loan Agreement, accrued interest, at the base rate plus an
applicable margin of 0.25% or LIBOR rate plus an applicable margin of 1.25% for the twelve month period ended April 29, 2017. After this period, the interest on
the U.S. borrowings is accrued at the Company's option, at
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either (i) a base rate (generally defined as the highest of (x) the Bank of America Business Capital prime rate, (y) the average overnight federal funds effective rate
plus one-half percent ( 0.50% ) per annum and (z) one-month LIBOR plus one percent ( 1% ) per annum) plus an applicable margin that varies depending on daily
average aggregate availability, or (ii) the LIBOR rate plus an applicable margin that varies depending on daily average aggregate availability. The borrowings on
the Canadian portion of the Existing ABL Facility accrued interest at the Canadian prime rate plus an applicable margin of 0.25% or a bankers' acceptance
equivalent rate plus an applicable margin of 1.25% for the twelve month period ended April 29, 2017. After this period, the borrowings on the Canadian portion of
the Existing ABL Facility accrue interest, at the Company's option, at either (i) a Canadian prime rate (generally defined as the highest of (x) 0.50% over 30-day
Reuters Canadian Deposit Offering Rate ("CDOR") for bankers' acceptances, (y) the prime rate of Bank of America, N.A.'s Canada branch, and (z) a bankers'
acceptance equivalent rate for a one month interest period plus 1.00% ) plus an applicable margin that varies depending on daily average aggregate availability, or
(ii) a bankers' acceptance equivalent rate of the rate of interest per annum equal to the annual rates applicable to Canadian Dollar bankers' acceptances on the
"CDOR Page" of Reuter Monitor Money Rates Service, plus five basis points, and an applicable margin that varies depending on daily average aggregate
availability. Unutilized commitments are subject to an annual fee in the amount of 0.30% if the total outstanding borrowings are less than 25% of the aggregate
commitments, or a per annum fee of 0.25% if such total outstanding borrowings are 25% or more of the aggregate commitments. The Company is also required to
pay a letter of credit fronting fee to each letter of credit issuer equal to 0.125% per annum of the stated amount of each such letter of credit (or such other amount as
may be mutually agreed by the borrowers under the Existing ABL Facility and the applicable letter of credit issuer), as well as a fee to all lenders equal to the
applicable margin for LIBOR or bankers’ acceptance equivalent rate loans, as applicable, times the average daily stated amount of all outstanding letters of credit.
As of July 28, 2018 , the Company's borrowing base, which is calculated based on eligible accounts receivable and inventory levels, net of $4.2 million of reserves,
was $884.5 million . As of July 28, 2018 , the Company had $210.0 million of borrowings outstanding under the Company's Existing ABL Facility and $24.3
million in letter of credit commitments which reduced the Company's available borrowing capacity under the Existing ABL Facility on a dollar for dollar basis.
The Company's resulting remaining availability was $650.2 million as of July 28, 2018 .
The Existing ABL Facility subjects the Company to a springing minimum fixed charge coverage ratio (as defined in the Existing ABL Loan Agreement) of 1.0 to
1.0 calculated at the end of each of our fiscal quarters on a rolling four quarter basis when the adjusted aggregate availability (as defined in the Existing ABL Loan
Agreement) is less than the greater of (i) $60.0 million and (ii) 10% of the aggregate borrowing base. The Company was not subject to the fixed charge coverage
ratio covenant under the Existing ABL Loan Agreement during the fiscal year ended July 28, 2018 .
The Company has pledged the majority of its and its subsidiaries' accounts receivable and inventory for its obligations under the Existing ABL Facility.
8.
LONG-TERM DEBT
On August 14, 2014, the Company and certain of its subsidiaries entered into a real estate backed term loan agreement (as amended by the First Amendment
Agreement, dated April 29, 2016, and the Second Amendment Agreement, dated September 1, 2016, the "Existing Term Loan Agreement"). The total initial
borrowings under our term loan facility were $150.0 million . The Company is required to make $2.5 million principal payments quarterly. Under the Existing
Term Loan Agreement, the Company at its option may request the establishment of one or more new term loan commitments in increments of at least $10.0 million
, but not to exceed $50.0 million in total, subject to the approval of the lenders electing to participate in such incremental loans and the satisfaction of the
conditions required by the Existing Term Loan Agreement. Proceeds from this Existing Term Loan Agreement were used to pay down borrowings under the
Existing ABL Loan Agreement.
Borrowings under the Existing Term Loan Agreement bear interest at rates that, at the Company's option, can be either: (1) a base rate generally defined as the sum
of (i) the highest of (x) the administrative agent's prime rate, (y) the average overnight federal funds effective rate plus 0.50% and (z) one-month LIBOR plus one
percent ( 1% ) per annum and (ii) a margin of 0.75% ; or, (2) a LIBOR rate generally defined as the sum of (i) LIBOR (as published by Reuters or other
commercially available sources) for one, two, three or six months or, if approved by all affected lenders, nine months (all as selected by the Company), and (ii) a
margin of 1.75% . Interest accrued on borrowings under the Existing Term Loan Agreement is payable in arrears. Interest accrued on any LIBOR loan is payable
on the last day of the interest period applicable to the loan and, with respect to any LIBOR loan of more than three (3) months, on the last day of every three (3)
months of such interest period. Interest accrued on base rate loans is payable on the first day of every month. The Company is also required to pay certain
customary fees to the administrative agent. The borrowers' obligations under the Existing Term Loan Agreement are secured by certain parcels of the borrowers'
real property.
The Existing Term Loan Agreement includes financial covenants that require (i) the ratio of the Company’s consolidated EBITDA (as defined in the Existing Term
Loan Agreement) minus the unfinanced portion of Capital Expenditures (as defined in the Existing Term Loan Agreement) to the Company’s consolidated Fixed
Charges (as defined in the Existing Term Loan Agreement) to be at least 1.20 to 1.00 as of the end of any period of four fiscal quarters, (ii) the ratio of the
Company’s Consolidated Funded Debt (as
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defined in the Existing Term Loan Agreement) to the Company’s EBITDA for the four fiscal quarters most recently ended to be not more than 3.00 to 1.00 as of
the end of any fiscal quarter and (iii) the ratio, expressed as a percentage, of the Company’s outstanding principal balance under the Loans (as defined in the
Existing Term Loan Agreement), divided by the Mortgaged Property Value (as defined in the Existing Term Loan Agreement) to be not more than 75% at any
time. As of July 28, 2018 , the Company was in compliance with the financial covenants of its Existing Term Loan Agreement.
On August 22, 2018, the Company notified its lenders that it intends to prepay its borrowings outstanding under its Existing Term Loan Agreement on October 1,
2018, which were approximately $110.0 million as of July 28, 2018. The Existing Term Loan Agreement was previously scheduled to terminate on the earlier of
(a) August 14, 2022 and (b) the date that is ninety days prior to the termination date of the Existing ABL Loan Agreement. Concurrently with the prepayment of
borrowings outstanding under the Existing Term Loan Agreement, the Company intends to draw on its Existing ABL Loan Agreement in an amount equal to its
Existing Term Loan Agreement prepayment amount.
During the fiscal year ended August 1, 2015, the Company entered into an amendment to an existing lease agreement for the office space utilized as the Company's
corporate headquarters in Providence, Rhode Island. The amendment provides for additional office space to be utilized by the Company and extends the lease term
for an additional 10 years. The lease qualifies for capital lease treatment pursuant to ASC 840, Leases, and the estimated fair value of the building was originally
recorded on the consolidated balance sheet with the capital lease obligation included in long-term debt. A portion of each lease payment reduces the amount of the
lease obligation, and a portion is recorded as interest expense at an effective rate of approximately 12.05% .
During the fiscal year ended July 28, 2012, the Company entered into a lease agreement for a new distribution facility in Aurora, Colorado. At the conclusion of the
fiscal year ended August 3, 2013, actual construction costs exceeded the construction allowance as defined by the lease agreement, and therefore, the Company
determined it met the criteria for continuing involvement pursuant to FASB ASC 840, Leases , and applied the financing method to account for this transaction
during the fourth quarter fiscal 2013. Under the financing method, the book value of the distribution facility and related accumulated depreciation remains on the
consolidated balance sheet. The construction allowance is recorded as a financing obligation in "Long-term debt." A portion of each lease payment reduces the
amount of the financing obligation, and a portion is recorded as interest expense at an effective rate of approximately 7.32% .
As of July 28, 2018 and July 29, 2017 , the Company's long-term debt consisted of the following:
Financing obligation, due monthly, and maturing in October 2028 at an effective interest rate of 7.32%
Capital lease, Providence, Rhode Island corporate headquarters, due monthly, and maturing in April 2025 at an
effective interest rate of 12.05%
Existing Term Loan Agreement, due quarterly (1)
Less: current installments
Long-term debt, excluding current installments
July 28,
2018
July 29,
2017
(In thousands)
29,118 $
30,368
12,196
108,836
150,150 $
12,441
137,709 $
13,074
118,549
161,991
12,128
149,863
$
$
$
(1) Existing Term Loan Agreement balance is shown net of debt issuance costs of $1.2 million and $1.5 million as of July 28, 2018 and July 29, 2017 ,
respectively, due to the Company's adoption of ASU No. 2015-03 in the fourth quarter of fiscal 2016.
Aggregate maturities of long-term debt for the next five years and thereafter are as follows at July 28, 2018 :
Year
2019
2020
2021
2022
2023
2024 and thereafter
(In thousands)
12,441
12,816
93,203
3,552
4,066
25,236
151,314
$
$
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9.
FAIR VALUE MEASUREMENTS
The Company utilizes ASC 820, Fair Value Measurements and Disclosures ("ASC 820"), for financial assets and liabilities and for non-financial assets and
liabilities that are recognized or disclosed at fair value on at least an annual basis. ASC 820 defines fair value as the price that would be received from selling an
asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements
for assets and liabilities required or permitted to be recorded at fair value, the Company considers the principal or most advantageous market in which it would
transact and considers assumptions that market participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of
nonperformance. ASC 820 establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable
inputs when measuring fair value. ASC 820 establishes three levels of inputs that may be used to measure fair value:
•
•
•
Level 1 Inputs—Unadjusted quoted prices in active markets for identical assets or liabilities.
Level 2 Inputs—Inputs other than quoted prices included in Level 1 that are either directly or indirectly observable through correlation with market data.
These include quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are
not active; and inputs to valuation models or other pricing methodologies that do not require significant judgment because the inputs used in the model,
such as interest rates and volatility, can be corroborated by readily observable market data.
Level 3 Inputs—One or more significant inputs that are unobservable and supported by little or no market activity, and that reflect the use of significant
management judgment. Level 3 assets and liabilities include those whose fair value measurements are determined using pricing models, discounted cash
flow methodologies or similar valuation techniques, and significant management judgment or estimation.
Hedging of Interest Rate Risk
The Company manages its debt portfolio with interest rate swaps to achieve an overall desired position of fixed and floating rates. Details of outstanding swap
agreements as of July 28, 2018 , which are all pay fixed and receive floating, are as follows:
Swap Maturity
Notional Value (in
millions)
Pay Fixed Rate
Receive Floating Rate
Floating Rate Reset
Terms
June 9, 2019
June 24, 2019
April 29, 2021
April 29, 2021
August 3, 2022
$
$
$
$
$
50.0
50.0
25.0
25.0
112.5
0.8725%
0.7265%
1.0650%
0.9260%
1.7950%
One-Month LIBOR
One-Month LIBOR
One-Month LIBOR
One-Month LIBOR
One-Month LIBOR
Monthly
Monthly
Monthly
Monthly
Monthly
Interest rate swap agreements are entered into for periods consistent with related underlying exposures and do not constitute positions independent of those
exposures. The Company’s interest rate swap agreements are designated as cash flow hedges at July 28, 2018 .
The Company performs an initial quantitative assessment of hedge effectiveness using the “Hypothetical Derivative Method” described in ASC 815 in the period in
which the hedging transaction is entered into. Under this method, the Company assesses the effectiveness of each hedging relationship by comparing the changes in
cash flows of the derivative hedging instrument with the changes in cash flows of the designated hedged transactions. In future reporting periods the Company
performs a qualitative analysis for quarterly prospective and retrospective assessments of hedge effectiveness. The Company also monitors the risk of counterparty
default on an ongoing basis and noted that the counterparties are reputable financial institutions. The entire change in the fair value of the derivative is initially
reported in other comprehensive income (outside of earnings) and subsequently reclassified to earnings in interest expense when the hedged transactions affect
earnings.
The location and amount of gains or losses recognized in the Consolidated Statements of Income for cash flow hedging relationships for each of the periods,
presented on a pretax basis, are as follows:
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(In thousands)
Total amounts of income and expense line items presented in the consolidated
results of operations in which the effects of cash flow hedges are recorded
$
Gain or (loss) on cash flow hedging relationships:
Fiscal Year Ended
July 28, 2018
July 29, 2017
July 30, 2016
Interest Expense
Interest Expense
Interest Expense
16,471 $
17,114 $
16,259
Gain or (loss) reclassified from Comprehensive Income into income
827
(1,462)
(2,082)
Financial Instruments
The following table provides the fair value hierarchy for financial assets and liabilities measured on a recurring basis as of July 28, 2018 and July 29, 2017 :
(In thousands)
Prepaid Expenses and Other Current Assets:
Interest Rate Swap
Other Assets:
Interest Rate Swap
Accrued Expenses and Other Current
Liabilities:
Interest Rate Swap
Fair Value at July 28, 2018
Fair Value at July 29, 2017
Level 1
Level 2
Level 3
Level 1
Level 2
Level 3
— $
1,459
—
—
—
—
5,860
— $
2,491
—
—
—
—
(308)
—
—
—
The fair value of the Company's other financial instruments including accounts receivable, notes receivable, accounts payable and certain accrued expenses are
derived using Level 2 inputs and approximate carrying amounts due to the short-term nature of these instruments. The fair value of notes payable approximate
carrying amounts as they are variable rate instruments. The carrying amount of notes payable approximates fair value as interest rates on the Existing ABL Facility
approximates current market rates (level 2 criteria).
The following estimated fair value amounts have been determined by the Company using available market information and appropriate valuation methodologies
taking into account the instruments' interest rate, terms, maturity date and collateral, if any, in comparison to the Company's incremental borrowing rate for similar
financial instruments and are therefore deemed Level 2 inputs. However, considerable judgment is required in interpreting market data to develop the estimates of
fair value. Accordingly, the estimates presented herein are not necessarily indicative of the amounts that the Company could realize in a current market exchange.
(In thousands)
Liabilities
July 28, 2018
July 29, 2017
Carrying Value
Fair Value
Carrying Value
Fair Value
Long term debt, including current portion
$
150,150 $
155,317 $
161,991 $
169,058
Fuel Supply Agreements
From time to time the Company is a party to fixed price fuel supply agreements. During the fiscal year ended July 28, 2018 , the Company did not enter in any such
agreements. During the fiscal year ended July 29, 2017 , the Company entered into several agreements which required it to purchase a portion of its diesel fuel each
month at fixed prices through December 2016 . These fixed price fuel agreements qualify for the "normal purchase" exception under ASC 815; therefore, the fuel
purchases under these contracts are expensed as incurred and included within operating expenses.
10. COMMITMENTS AND CONTINGENCIES
The Company leases various facilities and equipment under operating lease agreements with varying terms. Most of the leases contain renewal options and
purchase options at several specific dates throughout the terms of the leases.
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Rent and other lease expense for the fiscal years ended July 28, 2018 , July 29, 2017 and July 30, 2016 totaled approximately $80.0 million , $74.9 million and
$65.4 million , respectively.
Future minimum annual fixed payments required under non-cancelable operating leases having an original term of more than one year as of July 28, 2018 are as
follows:
Fiscal Year
2019
2020
2021
2022
2023
2024 and thereafter
(In thousands)
64,688
$
52,841
36,521
27,375
19,429
30,886
$
231,740
As of July 28, 2018 , outstanding commitments for the purchase of inventory were approximately $15.9 million . The Company had outstanding letters of credit of
approximately $24.3 million at July 28, 2018 . The Company did no t have any outstanding commitments for the purchase of diesel fuel as of July 28, 2018 .
As of July 28, 2018, the Company had a withdrawal liability related to one of its multi-employer plans of approximately $3.4 million .
The Company may from time to time be involved in various claims and legal actions arising in the ordinary course of business. In the opinion of management,
amounts accrued, as well as the total amount of reasonably possible losses with respect to such matters, individually and in the aggregate, are not deemed to be
material to the Company's consolidated financial position or results of operations. Legal expenses incurred in connection with claims and legal actions are
expensed as incurred.
11. RETIREMENT PLANS
Defined Contribution Retirement Plan
The Company has a defined contribution retirement plan under Section 401(k) of the Internal Revenue Code, the United Natural Foods, Inc. Retirement Plan (the
"Retirement Plan"). In order to become a participant in the Retirement Plan, employees must meet certain eligibility requirements as described in the Retirement
Plan document. In addition to amounts contributed to the Retirement Plan by employees, the Company makes contributions to the Retirement Plan on behalf of the
employees. The Company's contributions to its Retirement Plan were approximately $11.6 million , $10.1 million , and $7.3 million for the fiscal years ended
July 28, 2018 , July 29, 2017 and July 30, 2016 , respectively.
Multi-employer plans
The Company contributes to two multi-employer plans for certain of its associates that are represented by unions, none of which are individually significant to the
Company's consolidated financial statements. The Company made contributions of approximately $0.5 million during the fiscal year ended July 28, 2018 . As of
the fiscal year ended July 29, 2017, the Company had withdrawn from a third plan, the present value of which is reflected in the consolidated balance sheet. As of
July 28, 2018, the withdrawal liability was approximately $3.4 million . Withdrawal payments made during fiscal 2018 were de minimis.
Deferred Compensation and Supplemental Retirement Plans
The Company's non-employee directors and certain of its employees are eligible to participate in the United Natural Foods Deferred Compensation Plan and the
United Natural Foods Deferred Stock Plan (collectively the " Deferral Plans "). The Deferral Plans are nonqualified deferred compensation plans which are
administered by the Compensation Committee of the Company's Board of Directors. The Deferral Plans were established to provide participants with the
opportunity to defer the receipt of all or a portion of their compensation to a non-qualified retirement plan in amounts greater than the amount permitted to be
deferred under the Company's 401(k) Plan. The Company believes that this is an appropriate benefit because (i) it operates to place employees and non-employee
directors in the same position as other employees who are not affected by Internal Revenue Code limits placed on plans such as the Company's 401(k) Plan;
(ii) does not substantially increase the Company's financial obligations to its employees and directors (there are no employer matching contributions, only a
crediting of deemed earnings); and (iii) provides additional incentives to the Company's employees and directors, since amounts set aside by the employees and
directors are subject to the claims of the Company's creditors until paid. Under the Deferral Plans, only the payment of the compensation earned by the participant
is deferred and there is no deferral of the expense in the Company's consolidated financial statements related to the
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participants' earnings; the Company records the related compensation expense in the year in which the compensation is earned by the participants.
Under the Deferred Stock Plan, which was frozen to new deferrals effective January 1, 2007, each eligible participant could elect to defer between 0% and 100% of
restricted stock awards granted during the election calendar year. Effective January 1, 2007, each participant may elect to defer up to 100% of their restricted share
unit awards, performance shares and performance units under the Deferred Compensation Plan. Under the Deferred Compensation Plan, each participant may also
elect to defer a minimum of $1,000 and a maximum of 90% of base salary and 100% of director fees, employee bonuses and commissions, as applicable, earned by
the participants for the calendar year. Participants' cash-derived deferrals accrue earnings and appreciation based on the performance of mutual funds selected by
the participant. The value of equity-based awards deferred under the Deferral Plans are based upon the performance of the Company's common stock.
The Millbrook Deferred Compensation Plan and the Millbrook Supplemental Retirement Plan were assumed by the Company as part of an acquisition during fiscal
2008. Deferred compensation relates to a compensation arrangement implemented in 1984 by a predecessor of the acquired company in the form of a non-qualified
defined benefit plan and a supplemental retirement plan which permitted former officers and certain management employees, at the time, to defer portions of their
compensation to earn specified maximum benefits upon retirement. The future obligations, which are fixed in accordance with the plans, have been recorded at a
discount rate of 5.7% . These plans do not allow new participants, and there are no active employees subject to these plans.
At July 28, 2018 , total future obligations including interest, assuming commencement of payments at an individual's retirement age, as defined under the deferred
compensation arrangement, were as follows:
Fiscal Year
2019
2020
2021
2022
2023
2024 and thereafter
(In thousands)
1,147
940
785
766
721
2,349
6,708
$
$
In an effort to provide for the benefits associated with the Deferral Plans and the Millbrook Deferred Compensation Plan, the Company owns whole-life insurance
contracts on the plan participants. The cash surrender value of these policies included in "Other Assets" in the consolidated balance sheets was $22.9 million and
$21.5 million at July 28, 2018 and July 29, 2017 , respectively. The changes in the cash surrender value of these policies are recorded as a gain or loss in "Other,
net" within "Other expense (income)," in the Company's consolidated statements of income.
12.
INCOME TAXES
For the fiscal year ended July 28, 2018 , income (loss) before income taxes consists of $205.3 million from U.S. operations and $7.4 million from foreign
operations. For the fiscal year ended July 29, 2017 , income before income taxes consists of $211.5 million from U.S. operations and $2.9 million from foreign
operations. For the fiscal year ended July 30, 2016 , income before income taxes consists of $208.8 million from U.S. operations and ($0.6) million from foreign
operations.
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Total federal and state income tax (benefit) expense consists of the following:
Fiscal year ended July 28, 2018
U.S. Federal
State & Local
Foreign
Fiscal year ended July 29, 2017
U.S. Federal
State & Local
Foreign
Fiscal year ended July 30, 2016
U.S. Federal
State & Local
Foreign
Current
Deferred
(In thousands)
Total
$
$
$
$
$
$
46,210 $
(16,648) $
13,310
2,374
1,878
(49)
61,894 $
(14,819) $
70,669 $
(1,874) $
14,653
837
(82)
65
86,159 $
(1,891) $
57,157 $
11,383 $
12,718
101
1,310
(213)
69,976 $
12,480 $
29,562
15,188
2,325
47,075
68,795
14,571
902
84,268
68,540
14,028
(112)
82,456
Total income tax expense (benefit) was different than the amounts computed by applying the statutory federal income tax rate to income before income taxes
because of the following:
Computed "expected" tax expense
State and local income tax, net of Federal income tax benefit
Non-deductible expenses
Tax effect of share-based compensation
General business credits
Impacts related to the TCJA
Other, net
Total income tax expense
July 28,
2018
Fiscal year ended
July 29,
2017
(In thousands)
July 30,
2016
$
$
57,359 $
10,501
955
149
(552)
(21,719)
382
47,075 $
75,048 $
9,694
1,951
29
(915)
—
(1,539)
84,268 $
72,878
9,412
1,549
86
(135)
—
(1,334)
82,456
The income tax expense (benefit) for the years ended July 28, 2018 , July 29, 2017 and July 30, 2016 was allocated as follows:
Income tax expense
Stockholders' equity, difference between compensation expense for tax purposes and amounts
recognized for financial statement purposes
Other comprehensive income
66
July 28,
2018
July 29,
2017
(In thousands)
July 30,
2016
47,075 $
84,268 $
82,456
—
1,561
1,320
3,222
48,636 $
88,810 $
83
(2,050)
80,489
$
$
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The tax effects of temporary differences that give rise to significant portions of the net deferred tax assets and deferred tax liabilities at July 28, 2018 and July 29,
2017 are presented below:
July 28,
2018
July 29,
2017
(In thousands)
Deferred tax assets:
Inventories, principally due to additional costs inventoried for tax purposes
$
7,265 $
Compensation and benefits related
Accounts receivable, principally due to allowances for uncollectible accounts
Accrued expenses
Net operating loss carryforwards
Foreign tax credits
Other deferred tax assets
Total gross deferred tax assets
Less valuation allowance
Net deferred tax assets
Deferred tax liabilities:
Plant and equipment, principally due to differences in depreciation
Intangible assets
Interest rate swap agreements
Accrued expenses
Other
Total deferred tax liabilities
Net deferred tax liabilities
Current deferred income tax assets
Non-current deferred income tax liabilities
25,740
4,269
119
482
445
117
38,437
(445)
37,992 $
39,978 $
36,544
2,000
3,854
—
82,376
(44,384) $
— $
(44,384)
(44,384) $
$
$
$
$
$
9,416
35,482
5,639
4,466
940
—
—
55,943
—
55,943
59,414
53,633
876
—
218
114,141
(58,198)
40,635
(98,833)
(58,198)
New tax legislation, the TCJA, was enacted on December 22, 2017. ASC 740, Accounting for Income Taxes , requires companies to recognize the effect of tax law
changes in the period of enactment even though the effective date for most TCJA provisions is for tax years beginning after December 31, 2017.
Given the significance of the legislation, the SEC staff issued SAB 118, which allows registrants to record provisional amounts concerning TCJA impacts during a
one year “measurement period” similar to that used when accounting for business combinations. The measurement period is deemed to have ended earlier when the
registrant has obtained, prepared and analyzed the information necessary to finalize its accounting. During the measurement period, impacts of the law are expected
to be recorded at the time a reasonable estimate for all or a portion of the effects can be made, and provisional amounts can be recognized and adjusted as
information becomes available, prepared or analyzed.
SAB 118 summarizes a process to be applied at each reporting period to account for and qualitatively disclose: (1) the effects of the change in tax law for which
accounting is complete; (2) provisional amounts (or adjustments to provisional amounts) for the effects of the tax law where accounting is not complete, but that a
reasonable estimate has been determined; and (3) a reasonable estimate cannot yet be made and therefore taxes are reflected in accordance with the law prior to the
enactment of the TCJA.
Provisional estimates have been recorded for the estimated impact of the TCJA based on information that is currently available to the Company. These provisional
estimates are comprised of the one-time mandatory repatriation transition tax. The repatriation transition tax is expected to have an immaterial impact because of
foreign tax credits available to the Company. As the Company completes its analysis of the TCJA, changes may be made to provisional estimates, and such
changes will be reflected in the period in which the related adjustments are made.
In assessing the need to establish a valuation reserve for the recoverability of deferred tax assets, the Company considers whether it is more likely than not that
some portion or all of the deferred tax assets will not be realized. The Company considers relevant
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evidence, both positive and negative, to determine the need for a valuation allowance. Information evaluated includes the Company's financial position and results
of operations for the current and preceding years, the availability of deferred tax liabilities and tax carrybacks, as well as an evaluation of currently available
information about future years.
At July 28, 2018 , the Company had net operating loss carryforwards of approximately $2.3 million for federal income tax purposes. The federal carryforwards are
subject to an annual limitation of approximately $0.3 million under Internal Revenue Code Section 382. The carryforwards expire at various times between fiscal
years 2019 and 2027 . As of July 28, 2018 , the Company has sufficient taxable income in the federal carryback period and anticipates sufficient future taxable
income over the periods in which the net operating losses can be utilized. The Company also has the availability of future reversals of taxable temporary
differences that are expected to generate taxable income in the future. Therefore, the ultimate realization of net operating losses federal and state tax purposes
appears more likely than not at July 28, 2018 and correspondingly no valuation allowance has been established.
The retained earnings of the Company's non-U.S. subsidiary that are subject to deemed repatriation and taxation under the TCJA are $13.3 million at July 28, 2018
. The Company utilized U.S. foreign tax credits to offset the deemed repatriation tax of $2.1 million . Further, we have established a deferred tax asset for the
excess U.S. foreign tax credits of $0.4 million . Such credits are offset by a valuation allowance. The Company considers these unremitted earnings to be
indefinitely reinvested; therefore, we have not provided a deferred tax liability for any residual tax that may be due upon repatriation of these earnings.
The Company and its subsidiaries file income tax returns in the United States federal jurisdiction and in various state jurisdictions. UNFI Canada files income tax
returns in Canada and certain of its provinces. U.S. federal income tax examination years prior to fiscal 2015 have either statutorily or administratively been closed
with the Internal Revenue Service, and with limited exception, the fiscal tax years that remain subject to examination by state jurisdictions range from the
Company's fiscal 2014 to fiscal 2017.
The Company records interest and penalties related to unrecognized tax benefits as a component of income tax expense. The unrecognized tax benefit in the
consolidated statements of income was de minimis for the fiscal years ended July 28, 2018 , July 29, 2017 , and July 30, 2016 .
13. BUSINESS SEGMENTS
The Company has several business units within the wholesale segment, which is the Company's only reportable segment. These business units have similar
products and services, customer channels, distribution methods and historical margins. The wholesale segment is engaged in the distribution of natural, organic and
specialty foods, produce and related products in the United States and Canada. The Company has additional operating segments that do not meet the quantitative
thresholds for reportable segments and are therefore aggregated under the caption of "Other." "Other" includes a retail business, which was disposed in fiscal 2018,
which engaged in the sale of natural foods and related products to the general public through retail storefronts on the east coast of the United States, a
manufacturing business, which engages in importing, roasting, packaging and distributing of nuts, dried fruit, seeds, trail mixes, granola, natural and organic snack
items and confections, the Company's branded product lines, and the Company's brokerage business, which markets various products on behalf of food suppliers
directly and exclusively to the Company's customers. "Other" also includes certain corporate operating expenses that are not allocated to business units, which
include, among other expenses, stock based compensation, and salaries, retainers, and other related expenses of certain officers and all directors. Non-operating
expenses that are not allocated to the business units are under the caption of "Unallocated Expenses." The Company does not record its revenues for financial
reporting purposes by product group, and it is therefore impracticable for the Company to report them accordingly. The Company has long-lived assets of $25.0
million held in Canada as of July 28, 2018.
The following table reflects business segment information for the periods indicated (in thousands):
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Table of Contents
Fiscal year ended July 28, 2018
Net sales
$
10,169,840 $
228,465 $
(171,622) $
— $
10,226,683
Wholesale
Other
Eliminations
(In thousands)
Unallocated (Income)/
Expenses
Consolidated
Restructuring and asset impairment expenses
Operating income (loss)
Interest expense
Interest income
Other, net
Income before income taxes
Depreciation and amortization
Capital expenditures
Goodwill
Total assets
Fiscal year ended July 29, 2017
Net sales
Restructuring and asset impairment expenses
Operating income (loss)
Interest expense
Interest income
Other, net
Income before income taxes
Depreciation and amortization
Capital expenditures
Goodwill
Total assets
Fiscal year ended July 30, 2016
Net sales
Restructuring and asset impairment expenses
Operating income (loss)
Interest expense
Interest income
Other, net
Income before income taxes
Depreciation and amortization
Capital expenditures
Goodwill
Total assets
67
260,363
—
—
—
85,388
43,402
352,342
2,811,948
9,210,815
2,922
247,419
—
—
—
83,063
53,328
353,234
2,724,069
8,395,821
2,811
228,476
—
—
—
68,278
39,464
348,143
2,672,620
15,946
(36,563)
—
—
—
2,243
1,206
10,153
189,312
232,192
3,942
(21,857)
—
—
—
2,988
2,784
18,025
203,154
238,691
2,741
(3,488)
—
—
—
2,728
1,911
18,025
201,603
69
—
3,425
—
—
—
—
—
—
(36,788)
(168,536)
—
463
—
—
—
—
—
—
(40,660)
(164,226)
—
(879)
—
—
—
—
—
—
(22,068)
—
—
16,471
(446)
(1,545)
—
—
—
—
—
—
—
17,114
(360)
(5,152)
—
—
—
—
—
—
—
16,259
(1,115)
743
—
—
—
—
16,013
227,225
16,471
(446)
(1,545)
212,745
87,631
44,608
362,495
2,964,472
9,274,471
6,864
226,025
17,114
(360)
(5,152)
214,423
86,051
56,112
371,259
2,886,563
8,470,286
5,552
224,109
16,259
(1,115)
743
208,222
71,006
41,375
366,168
2,852,155
Table of Contents
14. QUARTERLY FINANCIAL DATA (UNAUDITED)
The following table sets forth certain key interim financial information for the fiscal years ended July 28, 2018 and July 29, 2017 :
First
Quarter
Second
Quarter
Third
Quarter
Fourth
Quarter
Full Year
(In thousands except per share data)
$
2,457,545 $
2,528,011 $
2,648,879 $
2,592,248 $
10,226,683
367,216
52,394
30,505
371,522
36,485
50,486
408,087
77,834
51,891
375,942
1,522,767
46,032
32,788
212,745
165,670
$
$
$
$
0.60 $
0.60 $
1.00 $
0.99 $
1.03 $
1.02 $
0.65 $
0.64 $
3.28
3.26 *
50,817
50,449
50,424
50,431
50,530
50,957
50,741
50,751
50,901
50,837
44.94 $
32.52 $
52.69 $
38.04 $
49.81 $
40.88 $
47.73 $
32.03 $
52.69
32.03
First
Quarter
Second
Quarter
Third
Quarter
Fourth
Quarter
Full Year
(In thousands except per share data)
$
2,278,364 $
2,285,518 $
2,369,556 $
2,341,033 $
9,274,471
349,016
48,533
29,217
344,945
42,028
25,482
366,361
60,325
36,587
368,599
1,428,921
63,537
38,869
214,423
130,155
$
$
$
$
0.58 $
0.58 $
0.50 $
0.50 $
0.72 $
0.72 $
0.77 $
0.76 $
2.57
2.56
50,475
50,587
50,601
50,617
50,570
50,599
50,755
50,801
50,947
50,775
50.06 $
38.55 $
49.39 $
40.81 $
45.99 $
39.47 $
42.38 $
34.60 $
50.06
34.60
2018
Net sales
Gross profit
Income before income taxes
Net income
Per common share income
Basic:
Diluted:
Weighted average basic
Shares outstanding
Weighted average diluted
Shares outstanding
Market Price
High
Low
* Includes rounding
2017
Net sales
Gross profit
Income before income taxes
Net income
Per common share income
Basic:
Diluted:
Weighted average basic
Shares outstanding
Weighted average diluted
Shares outstanding
Market Price
High
Low
15. SUBSEQUENT EVENTS
ABL Loan Agreement
On August 30, 2018 (the "Signing Date”), the Company, entered into a Loan Agreement (the “New ABL Loan Agreement”), by and among the Company and
United Natural Foods West, Inc. (together with the Company, the “U.S. Borrowers”), and UNFI Canada, Inc. (the “Canadian Borrower” and, together with the U.S.
Borrowers, the “Borrowers”), the financial institutions that
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are parties thereto as lenders (collectively, the “Lenders”), Bank of America, N.A. as administrative agent for the Lenders (the “ABL Administrative Agent”), Bank
of America, N.A. (acting through its Canada branch), as Canadian agent for the Lenders (the “Canadian Agent”), and the other parties thereto. As of the Signing
Date and as a result of the Company’s entry into the New ABL Loan Agreement, all of the commitments under the Amended Commitment Letter with respect to
the Existing ABL Loan Agreement have been terminated and permanently reduced to zero. The commitment with respect to the New Term Loan Facility under the
Amended Commitment Letter remained unchanged.
The New ABL Loan Agreement provides for the New ABL Credit Facility (the loans thereunder, the “Loans”), of which up to (i) $1,950.0 million is available to
the U.S. Borrowers and (ii) $50.0 million is available to the Canadian Borrower. The New ABL Loan Agreement also provides for (i) a $125.0 million sublimit of
availability for letters of credit of which there is a further $5.0 million sublimit for the Canadian Borrower and (ii) a $100.0 million sublimit for short-term
borrowings on a swingline basis of which there is a further $3.5 million sublimit for the Canadian Borrower. Under the New ABL Loan Agreement, the Borrowers
may, at their option, increase the aggregate amount of the New ABL Credit Facility in an amount of up to $600.0 million (but in not less than $10.0 million
increments) without the consent of any Lenders not participating in such increase, subject to certain customary conditions and applicable Lenders committing to
provide the increase in funding. There can be no assurance that additional funding would be available.
The obligations of the Lenders to provide Loans under the New ABL Loan Agreement on the Closing Date are subject to a number of customary conditions,
including, without limitation, the consummation of the Merger (which must occur by January 25, 2019, subject to extension in certain circumstances pursuant to
the terms of Merger Agreement) and execution and delivery by the borrowers and the guarantors of definitive documentation consistent with the New ABL Loan
Agreement and the documentation standards specified therein.
Existing Term Loan Agreement Prepayment
On August 22, 2018, the Company notified its lenders that it intends to prepay its borrowings outstanding under its real estate backed term loan agreement, dated
August 14, 2014 (as amended by the First Amendment Agreement, dated April 29, 2016, and the Second Amendment Agreement, dated September 1, 2016, the
"Existing Term Loan Agreement") on October 1, 2018, which were approximately $110.0 million as of July 28, 2018. The Existing Term Loan Agreement was
previously scheduled to terminate on the earlier of (a) August 14, 2022 and (b) the date that is ninety days prior to the termination date of the Existing ABL Loan
Agreement. Concurrently with the prepayment of borrowings outstanding under the Existing Term Loan Agreement, the Company intends to draw on its Existing
ABL Loan Agreement in an amount equal to its Existing Term Loan Agreement prepayment amount.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
Not applicable.
ITEM 9A. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures .
We carried out an evaluation, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of
the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) as of the end of the period
covered by this Annual Report (the "Evaluation Date"). Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of the
Evaluation Date, our disclosure controls and procedures were effective.
Management's Annual Report on Internal Control Over Financial Reporting.
Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is
defined in Rules 13a-15(f) or 15d-15(f) promulgated under the Exchange Act as a process designed by, or under the supervision of, our principal executive and
principal financial officers and effected by our Board of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those
policies and procedures that:
•
•
Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;
Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally
accepted accounting principles, and that receipts and expenditures are being made only in accordance with authorizations of our management and
directors; and
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•
Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a
material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness
to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or
procedures may deteriorate.
Our management, including our Chief Executive Officer and Chief Financial Officer, assessed the effectiveness of our internal control over financial reporting as
of July 28, 2018 . In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway
Commission (COSO) in the Internal Control-Integrated Framework (2013 framework). Based on its assessment, our management concluded that, as of July 28,
2018 , our internal control over financial reporting was effective based on those criteria at the reasonable assurance level.
Report of the Independent Registered Public Accounting Firm.
The effectiveness of our internal control over financial reporting as of July 28, 2018 has been audited by KPMG LLP, an independent registered public accounting
firm, as stated in its attestation report which is included in "Item 8. Financial Statements and Supplementary Data" of this Annual Report.
Changes in Internal Controls Over Financial Reporting
No change in our internal control over financial reporting (as such term is defined in Exchange Act Rule 13a-15(f)or 15d-15(f)) occurred during the fiscal quarter
ended July 28, 2018 that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
ITEM 9B. OTHER INFORMATION
None.
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ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
PART III.
The information required by this item will be contained, in part, in our Definitive Proxy Statement on Schedule 14A for our Annual Meeting of Stockholders to be
held on December 18, 2018 (the " 2018 Proxy Statement") under the captions "Directors and Nominees for Director," "Executive Officers of the Company,"
"Section 16(a) Beneficial Ownership Reporting Compliance," and "Committees of the Board of Directors—Audit Committee" and is incorporated herein by this
reference.
We have adopted a code of conduct and ethics that applies to our Chief Executive Officer, Chief Financial Officer, and employees within our finance, operations,
and sales departments. Our code of conduct and ethics is publicly available on our website at www.unfi.com and is available free of charge by writing to United
Natural Foods, Inc., 313 Iron Horse Way, Providence, Rhode Island 02908, Attn: Investor Relations. We intend to make any legally required disclosures regarding
amendments to, or waivers of, the provisions of the code of conduct and ethics on our website at www.unfi.com. Please note that our website address is provided as
an inactive textual reference only.
ITEM 11. EXECUTIVE COMPENSATION
The information required by this item will be contained in the 2018 Proxy Statement under the captions "Non-employee Director Compensation," "Executive
Compensation", "Compensation Discussion and Analysis", Executive Compensation Tables," "Potential Payments Upon Termination or Change-in-Control,"
"CEO Pay Ratio," "Risk Oversight," "Compensation Risk," "Compensation Committee Interlocks and Insider Participation" and "Report of the Compensation
Committee" and is incorporated herein by this reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
The information required by this item will be contained, in part, in the 2018 Proxy Statement under the caption "Stock Ownership of Certain Beneficial Owners
and Management", and is incorporated herein by this reference.
The following table provides certain information with respect to equity awards under our equity compensation plans as of July 28, 2018 .
Number of securities to
be issued upon exercise
of outstanding options,
warrants and rights
Weighted-average
exercise price of
outstanding options
Number of securities remaining
available for future issuance
under equity compensation
plans (excluding securities
reflected in the second column)
1,636,279 (1) $
52.46 (1)
2,676,949 (2)
87,083 (3)
1,723,362
$
— (3)
52.46
—
2,676,949
Plan Category
Plans approved by stockholders
Plans not approved by
stockholders
Total
(1)
Includes 1,148,175 restricted stock units under the 2012 Plan, 162,910 performance-based restricted stock units under the 2012 Plan and 130,457 stock
options under the 2012 Plan, 33,517 restricted stock units under the 2004 Plan, 80,070 stock options under the 2004 Plan and 81,150 stock options under the
2002 Plan. Restricted stock units and performance stock units do not have an exercise price because their value is dependent upon continued employment
over a period of time or the achievement of certain performance goals, and are to be settled for shares of common stock. Accordingly, they have been
disregarded for purposes of computing the weighted-average exercise price.
(2) All shares were available for issuance under the 2012 Plan. The 2012 Plan authorizes grants in the form of stock options, stock appreciation rights, restricted
stock, restricted stock units, performance shares, performance units or a combination thereof but includes limits on the number of awards that may be issued
in the form of restricted shares or units. The number of shares remaining available for future issuances assumes that, with respect to outstanding performance-
based restricted stock units, the vesting criteria will be achieved at the target level.
(3) Consists of phantom stock units outstanding under the United Natural Foods Inc. Deferred Compensation Plan. See Note 11 "Retirement Plans" to our
Consolidated Financial Statements included in "Item 8. Financial Statements and Supplementary Data" of this Annual Report for more information. Phantom
stock units do not have an exercise price because the units may be settled only for shares of common stock on a one-for-one basis at a future date as outlined
in the plan.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
73
Table of Contents
The information required by this item will be contained in the 2018 Proxy Statement under the captions "Certain Relationships and Related Transactions" and
"Director Independence" and is incorporated herein by this reference.
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
The information required by this item will be contained in the 2018 Proxy Statement under the captions "Fees Paid to KPMG LLP" and “Policy on Audit
Committee Pre-Approval of Audit and Permissible Non-Audit Services,” and is incorporated herein by this reference.
74
Table of Contents
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) Documents filed as a part of this Annual Report.
PART IV.
1.
Report.
Financial Statements . The Financial Statements listed in the Index to Financial Statements in Item 8 hereof are filed as part of this Annual
2.
Financial Statement Schedules . All schedules have been omitted because they are either not required or the information required is included
in our consolidated financial statements or the notes thereto included in Item 8 hereof.
3.
Exhibits . The Exhibits listed in the Exhibit Index immediately preceding such Exhibits are filed as part of this Annual Report.
ITEM 16. FORM 10-K SUMMARY
None.
75
Table of Contents
Exhibit No.
2.1
3.1
3.2
4.1
10.1**
10.2**
10.3**
10.4**
10.5**
EXHIBIT INDEX
Description
Agreement and Plan of Merger, dated July 25, 2018, by and among SUPERVALU INC., SUPERVALU Enterprises, Inc., the Registrant and Jedi
Merger Sub, Inc. (incorporated by reference to the Registrant’s Current Report on Form 8-K, filed on July 26, 2018 (File No. 1-15723)).
Certificate of Incorporation of the Registrant, as amended (restated for SEC filing purposes only) (incorporated by reference to the Registrant's
Quarterly Report on Form 10-Q for the quarter ended January 1, 2015 (File No. 1-15723)).
Third Amended and Restated Bylaws of the Registrant (incorporated by reference to the Registrant's Current Report on Form 8-K, filed on
September 12, 2016 (File No. 1-15723)).
Specimen Certificate for shares of Common Stock, $0.01 par value, of the Registrant (incorporated by reference to the Registrant's Annual
Report on Form 10-K for the year ended August 1, 2009 (File No. 1-15723)).
2002 Stock Incentive Plan (incorporated by reference to the Registrant's Annual Report on Form 10-K for the year ended July 31, 2003 (File No.
1-15723)).
United Natural Foods, Inc. Amended and Restated 2004 Equity Incentive Plan (incorporated by reference to the Registrant's Current Report on
Form 8-K, filed on December 21, 2010 (File No. 1-15723)).
Form of Restricted Stock Agreement, pursuant to the Amended and Restated 2004 Equity Incentive Plan (incorporated by reference to the
Registrant's Registration Statement on Form S-8 POS (File No. 333-123462)).
Form of Restricted Unit Award Agreement, pursuant to the Amended and Restated 2004 Equity Incentive Plan (incorporated by reference to the
Registrant's Annual Report on Form 10-K for the year ended July 31, 2010 (File No. 1-15723)).
Form of Non-Statutory Stock Option Award Agreement, pursuant to the Amended and Restated 2004 Equity Incentive Plan (incorporated by
reference to the Registrant's Annual Report on Form 10-K for the year ended July 31, 2010 (File No. 1-15723)).
76
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Exhibit No.
10.6**
10.7**
10.8**
10.9**
10.10**
10.11**
10.12**
10.13**
10.14**
10.15**
Description
Form of Restricted Stock Unit Award Agreement, pursuant to the Amended and Restated 2004 Equity Incentive Plan (Employee) (incorporated
by reference to the Registrant’s Annual Report on Form 10-K for the year ended July 28, 2012 (File No. 1-15723)).
Form of Restricted Stock Unit Award Agreement, pursuant to the Amended and Restated 2004 Equity Incentive Plan (Director) (incorporated by
reference to the Registrant’s Annual Report on Form 10-K for the year ended July 28, 2012 (File No. 1-15723)).
Form of Non-Statutory Stock Option Award Agreement, pursuant to the 2002 Stock Incentive Plan (Employee) (incorporated by reference to the
Registrant’s Annual Report on Form 10-K for the year ended July 28, 2012 (File No. 1-15723)).
Form of Non-Statutory Stock Option Award Agreement, pursuant to the Amended and Restated 2004 Equity Incentive Plan (Director)
(incorporated by reference to the Registrant’s Annual Report on Form 10-K for the year ended July 28, 2012 (File No. 1-15723)).
Form of Non-Statutory Stock Option Award Agreement, pursuant to the Amended and Restated 2004 Equity Incentive Plan (Employee)
(incorporated by reference to the Registrant’s Annual Report on Form 10-K for the year ended July 28, 2012 (File No. 1-15723)).
United Natural Foods, Inc. 2012 Equity Incentive Plan (incorporated by reference to the Registrant's Current Report on Form 8-K filed on
December 18, 2012 (File No. 1-15723)) (the “2012 Equity Plan”).
Form of Terms and Conditions of Grant of Non-Statutory Stock Options to Employee, pursuant to the 2012 Equity Plan (incorporated by
reference to the Registrant's Quarterly Report on Form 10-Q for the quarter ended January 26, 2013 (File No. 1-15723)).
Form of Terms and Conditions of Grant of Non-Statutory Stock Options to Director, pursuant to the 2012 Equity Plan (incorporated by reference
to the Registrant's Quarterly Report on Form 10-Q for the quarter ended January 26, 2013 (File No. 1-15723)).
Form of Terms and Conditions of Grant of Restricted Share Units to Employee, pursuant to the 2012 Equity Plan (incorporated by reference to
the Registrant's Quarterly Report on Form 10-Q for the quarter ended January 26, 2013) (File No. 1-15723).
Form of Terms and Conditions of Grant of Restricted Share Units to Director, pursuant to the 2012 Equity Plan (incorporated by reference to the
Registrant's Quarterly Report on Form 10-Q for the quarter ended January 26, 2013) (File No. 1-15723).
77
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Exhibit No.
10.16**
10.17**
10.18**
10.19**
10.20**
10.21**
10.22**
10.23**
10.24**
10.25
10.26
Description
Terms and Conditions of Grant of Non-Statutory Stock Options to Employee, pursuant to the 2012 Equity Plan, effective September 17, 2015,
between Michael P. Zechmeister, Senior Vice President and Chief Financial Officer, and the Registrant (incorporated by reference to the
Registrant's Quarterly Report on Form 10-Q for the quarter ended October 31, 2015 (File No. 1-15723)).
Terms and Conditions of Grant of Restricted Share Units to Employee, pursuant to the 2012 Equity Plan, effective September 17, 2015, between
Michael P. Zechmeister, Senior Vice President and Chief Financial Officer, and the Registrant (incorporated by reference to the Registrant’s
Quarterly Report on Form 10-Q for the quarter ended October 31, 2015 (File No. 1-15723)).
United Natural Foods, Inc. Amended and Restated 2012 Equity Incentive Plan (incorporated by reference to the Registrant’s Definitive Proxy
Statement on Schedule 14A for the Registrant’s Annual Meeting of Stockholders held on December 16, 2015 (File No. 1-15723)) (the “A&R
2012 Equity Plan”).
Form of Terms and Conditions of Grant of (Pro-Rata Vesting) Restricted Share Units to Employee, pursuant to the A&R 2012 Equity Plan
(incorporated by reference to the Registrant's Annual Report on Form 10-K for the year ended July 30, 2016 (File No. 1-15723)).
Form of Terms and Conditions of Grant of (Cliff Vesting) Restricted Share Units to Employee, pursuant to the A&R 2012 Equity Plan
(incorporated by reference to the Registrant's Annual Report on Form 10-K for the year ended July 30, 2016 (File No. 1-15723)).
Form of Terms and Conditions of Grant of Restricted Share Units to Director, pursuant to the A&R 2012 Equity Plan (incorporated by reference
to the Registrant's Annual Report on Form 10-K for the year ended July 30, 2016 (File No. 1-15723)).
United Natural Foods, Inc. Deferred Compensation Plan (incorporated by reference to the Registrant's Annual Report on Form 10-K for the year
ended July 30, 2011 (File No. 1-15723)).
United Natural Foods, Inc. Deferred Stock Plan (incorporated by reference to the Registrant's Annual Report on Form 10-K for the year ended
July 30, 2011(File No. 1-15723)).
Offer Letter, dated August 7, 2015, between Michael P. Zechmeister, Senior Vice President and Chief Financial Officer, and the Registrant
(incorporated by reference to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended October 31, 2015 (File No. 1-15723)).
Form Indemnification Agreement for Directors and Officers (incorporated by reference to the Registrant's Quarterly Report on Form 10-Q for
the quarter ended May 2, 2009 (File No. 1-15723)).
Form of Modification of Indemnification Agreement (incorporated by reference to the Registrant's Annual Report on Form 10-K for the year
ended August 3, 2013 (File No. 1-15723)).
78
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Exhibit No.
Description
10.27
10.28**
10.29**
10.30**
10.31**
10.32
10.33+
10.34+
10.35+
10.36+
10.37
Revised Form Indemnification Agreement for Directors and Officers (incorporated by reference to the Registrant's Annual Report on Form 10-K
for the year ended August 3, 2013 (File No. 1-15723)).
Form of Change in Control Agreement between the Registrant and Christopher Testa (incorporated by reference to the Registrant's Annual
Report on Form 10-K for the year ended July 31, 2010 (File No. 1-15723)).
Form of Severance Agreement between the Registrant and each of Michael Funk and Christopher Testa (incorporated by reference to the
Registrant's Current Report on Form 8-K, filed on April 7, 2008 (File No. 1-15723)).
Severance Agreement between the Registrant and Michael P. Zechmeister, Senior Vice President and Chief Financial Officer, dated April 20,
2016 (incorporated by reference to the Registrant's Annual Report on Form 10-K for the year ended July 30, 2016 (File No. 1-15723)).
Change in Control Agreement between the Registrant and Michael P. Zechmeister, Senior Vice President and Chief Financial Officer, dated
April 20, 2016 (incorporated by reference to the Registrant's Annual Report on Form 10-K for the year ended July 30, 2016 (File No. 1-15723)).
Real Estate Term Notes between the Registrant and City National Bank, dated April 28, 2000 (incorporated by reference to the Registrant's
Annual Report on Form 10-K for the year ended July 31, 2000 (File No. 1-15723)).
Agreement for the Distribution of Products between the Registrant and Whole Foods Market Distribution, Inc., effective September 28, 2015
(incorporated by reference to the Registrant's Quarterly Report on Form 10-Q for the quarter ended October 31, 2015 (File No. 1-15723)).
Third Amended and Restated Loan and Security Agreement dated April 29, 2016, by and among United Natural Foods, Inc. and United Natural
Foods West, Inc. as U.S. Borrowers, UNFI Canada, Inc., as Canadian Borrowers, the Lenders party thereto, Bank of America, N.A. as
Administrative Agent for the Lenders, Bank of America, N.A. (acting through its Canada branch), as Canadian Agent for the Lenders and the
other parties thereto (incorporated by reference to the Registrant's Current Report on Form 8-K, filed on April 29, 2016 (File No. 1-15723)).
Term Loan Agreement dated August 12, 2014, by and among United Natural Foods, Inc. and Albert's Organics, Inc., as Borrowers, the Lenders
party thereto, Bank of America, N.A. as Administrative Agent for the Lenders, and the other parties thereto (incorporated by reference to the
Registrant's Current Report on Form 8-K, filed on August 20, 2014 (File No. 1-15723)).
First Amendment Agreement dated April 29, 2016, by and among United Natural Foods, Inc. and Albert’s Organics, Inc. as Borrowers, the
Lenders that are party to the Term Loan Agreement dated August 14, 2014, and Bank of America, N.A., as Administrative Agent, and the other
parties thereto (incorporated by reference to the Registrant's Current Report on Form 8-K, filed on April 29, 2016 (File No. 1-15723)).
Second Amendment Agreement dated September 1, 2016, by and among United Natural Foods, Inc. and Albert’s Organics, Inc. as Borrowers,
the Lenders that are party to the Term Loan Agreement dated August 14, 2014, and Bank of America, N.A., as Administrative Agent, and the
other parties thereto (incorporated by reference to the Registrant's Annual Report on Form 10-K for the year ended July 30, 2016 (File No. 1-
15723)).
10.38**
Form of Two-Year Performance-Based Vesting Restricted Share Unit Award Agreement, pursuant to the A&R 2012 Equity Plan (incorporated
by reference to the Registrant's Annual Report on Form 10-K for the year ended July 30, 2016 (File No. 1-15723)).
79
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Exhibit No.
Description
10.39
10.40
10.41
10.42
10.43
10.44**
10.45**
10.46**
10.47**
10.48**
10.49**
10.50**
10.51**
10.52**
10.53**
10.54*
Lease between ALCO Cityside Federal LLC, and the Registrant, dated October 14, 2008 (incorporated by reference to the Registrant’s Quarterly
Report on Form 10-Q for the quarter ended May 1, 2010 (File No. 1-15723)).
Amendment to Lease between ALCO Cityside Federal LLC, and the Registrant, dated May 12, 2009 (incorporated by reference to the
Registrant’s Quarterly Report on Form 10-Q for the quarter ended May 1, 2010 (File No. 1-15723)).
Second Amendment to Lease between ALCO Cityside Federal LLC and the Registrant, dated May 10, 2011 (incorporated by reference to the
Registrant’s Quarterly Report on Form 10-Q for the quarter ended January 31, 2015 (File No. 1-15723)).
Third Amendment to Lease between ALCO Cityside Federal LLC and the Registrant, dated August 7, 2013 (incorporated by reference to the
Registrant’s Quarterly Report on Form 10-Q for the quarter ended January 31, 2015 (File No. 1-15723)).
Fourth Amendment to Lease between ALCO Cityside Federal LLC and the Registrant, dated October 20, 2014 (incorporated by reference to the
Registrant’s Quarterly Report on Form 10-Q for the quarter ended January 31, 2015 (File No. 1-15723)).
Employment Agreement, dated as of October 28, 2016, by and among United Natural Foods, Inc., and Steven L. Spinner (incorporated by
reference to the Registrant’s Current Report on Form 8-K, filed on November 2, 2016 (File No. 1-15723)).
Form of Restricted Share Unit Award Agreement pursuant to the A&R 2012 Equity Plan (incorporated by reference to the Registrant’s Current
Report on Form 8-K, filed on November 2, 2016 (File No. 1-15723)).
Form of Restricted Share Unit Award Agreement pursuant to the A&R 2012 Equity Plan (incorporated by reference to the Registrant’s Current
Report on Form 8-K, filed on November 2, 2016 (File No. 1-15723)).
Form of Performance-Based Vesting Restricted Share Unit Award Agreement pursuant to the A&R 2012 Equity Plan (incorporated by reference
to the Registrant’s Current Report on Form 8-K, filed on November 2, 2016 (File No. 1-15723)).
Form of Performance-Based Vesting Restricted Share Unit Award Agreement pursuant to the A&R 2012 Equity Plan (incorporated by reference
to the Registrant’s Current Report on Form 8-K, filed on November 2, 2016 (File No. 1-15723)).
Form of Severance Agreement between the Registrant and each of Christopher Testa, Danielle Benedict, Eric Dorne, Paul Green, Sean Griffin,
John Hummel, and Michael Zechmeister (incorporated by reference to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended
January 28, 2017 (File No. 1-15723)).
Form of Change in Control Agreement between the Registrant and each of Christopher Testa, Danielle Benedict, Eric Dorne, Paul Green, Sean
Griffin, John Hummel, and Michael Zechmeister (incorporated by reference to the Registrant’s Quarterly Report on Form 8-K, filed on
December 22, 2016 (File No. 1-15723)).
Form of Terms and Conditions of Grant of Restricted Share Units to Employee pursuant to the A&R 2012 Equity Plan.
Form of Performance-Based Vesting Restricted Share Unit Award Agreement, pursuant to the A&R 2012 Equity Plan.
Fiscal 2018 Senior Management Annual Cash Incentive Plan.
Second Amended and Restated Commitment Letter dated August 8, 2018, as amended by Amendment No. 1 to the Second Amended and
Restated Commitment Letter dated September 21, 2018, from Goldman Sachs Bank USA, Bank of America, N.A., Merrill Lynch, Pierce,
Fenner & Smith Incorporated, Wells Fargo Bank, National Association, JPMorgan Chase Bank, N.A. and U.S. Bank National Association.
10.55* +
Loan Agreement dated August 30, 2018, by and among the Registrant, United Natural Foods West, Inc., UNFI Canada, Inc., the financial
institutions that are parties thereto as lenders, Bank of America, N.A., Bank of America, N.A. (acting through its Canada branch) and the other
parties thereto.
21*
23.1*
31.1*
31.2*
32.1*
32.2*
Subsidiaries of the Registrant.
Consent of Independent Registered Public Accounting Firm.
Certification of CEO pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
Certification of CFO pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
Certification of CEO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
Certification of CFO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
80
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Exhibit No.
Description
The following materials from the United Natural Foods, Inc.'s Annual Report on Form 10-K for the fiscal year ended July 28, 2018, formatted in
XBRL (eXtensible Business Reporting Language): (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Income, (iii) Consolidated
Statements of Comprehensive Income, (iv) Consolidated Statement of Stockholders' Equity, (v) Consolidated Statements of Cash Flows, and
(vi) Notes to Consolidated Financial Statements.
101*
* Filed herewith.
** Denotes a management contract or compensatory plan or arrangement.
+ Confidential treatment has been requested and granted with respect to certain portions of this exhibit pursuant to Rule 24b-2 of the Securities Exchange Act of
1934, as amended. Omitted portions have been filed separately with the United States Securities and Exchange Commission.
81
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SIGNATURES
Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
UNITED NATURAL FOODS, INC.
/s/ MICHAEL P. ZECHMEISTER
Michael P. Zechmeister
Chief Financial Officer
(Principal Financial and Accounting Officer)
Dated: September 24, 2018
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant
and in the capacities and on the dates indicated.
Name
Title
/s/ STEVEN L. SPINNER
President, Chief Executive Officer and Chairman (Principal
Date
September 24, 2018
Steven L. Spinner
Executive Officer)
/s/ MICHAEL P. ZECHMEISTER
Chief Financial Officer (Principal Financial and Accounting
September 24, 2018
Michael P. Zechmeister
/s/ ERIC F. ARTZ
Eric F. Artz
Officer)
Director
/s/ ANN TORRE BATES
Director
Ann Torre Bates
/s/ DENISE M. CLARK
Director
Denise M. Clark
/s/ DAPHNE J. DUFRESNE
Director
Daphne J. Dufresne
/s/ MICHAEL S. FUNK
Director
Michael S. Funk
/s/ JAMES P. HEFFERNAN
Director
James P. Heffernan
/s/ PETER A. ROY
Peter A. Roy
Director
82
September 24, 2018
September 24, 2018
September 24, 2018
September 24, 2018
September 24, 2018
September 24, 2018
September 24, 2018
EXECUTION VERSION
AMENDMENT NO. 1 TO SECOND AMENDED AND RESTATED COMMITMENT LETTER
AMENDMENT NO. 1 (this “ Amendment ”), dated as of September 21, 2018, to the Second Amended and Restated
Commitment Letter, dated as of August 8, 2018 (as amended, supplemented or otherwise modified prior to the date hereof, “ Commitment
Letter ”; and the Commitment Letter, as amended by this Amendment, the “ Amended Commitment Letter ”), by and among UNITED
NATURAL FOODS, INC. (the “ Borrower ”), GOLDMAN SACHS BANK USA (“ GS Bank ”), GOLDMAN SACHS LENDING
PARTNERS LLC, BANK OF AMERICA, N.A. (“ Bank of America ”), MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED (acting together with any of its designated affiliates, “ MLPFS ”; and, together with Bank of America,“ BAML ”),
WELLS FARGO BANK, NATIONAL ASSOCIATION (“ Wells Fargo Bank ”), JPMORGAN CHASE BANK, N.A (“ JPMCB ”) and U.S.
BANK NATIONAL ASSOCIATION (“ US Bank ”; and, together with GS Bank, BAML, Wells Fargo Bank and JPMCB, the “
Commitment Parties ”).
WHEREAS, the Borrower has requested that the Commitment Letter be amended on the terms set forth herein, and each
Commitment Party party hereto consents to this Amendment.
Accordingly, in consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto hereby agree as follows:
Section 1 Definitions . Capitalized terms used and not otherwise defined herein have the meanings assigned to them in the
Amended Commitment Letter.
Section 2 Amendments to Commitment Letter . Each of the parties hereto agrees that, effective on the Amendment
Effective Date (as defined below), the Commitment Letter shall be amended such that, after giving effect to all such amendments, the
Amended Commitment Letter is as set forth on Exhibit A attached hereto.
Section 3 Amendment Effective Date . This Amendment shall become effective as of the date on which the Borrower and
each Commitment Party execute and deliver a signature page hereto (the “ Amendment Effective Date ”), and such date is September 21,
2018.
Section 4 Effects of Amendment . Except as expressly set forth herein, the Commitment Letter shall remain in full force and
effect in accordance with its terms. From and after the Amendment Effective Date, each reference in the Commitment Letter to “this
Commitment Letter”, “hereunder”, “hereof”, “herein”, or words of like import, and each reference to the Commitment Letter in the Fee Letter
shall be deemed a reference to the Commitment Letter as amended hereby.
Section 5 Governing Law, Etc . THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. EACH PARTY HERETO HEREBY IRREVOCABLY AGREES
TO WAIVE (TO THE EXTENT PERMITTED BY APPLICABLE LAW) TRIAL BY JURY IN ANY SUIT, ACTION, PROCEEDING,
CLAIM OR COUNTERCLAIM BROUGHT BY OR ON BEHALF OF ANY PARTY RELATED TO OR ARISING OUT OF THIS
AMENDMENT.
#91297930v4
Section 6 Miscellaneous . The provisions contained in Sections 6 and 7 of the Amended Commitment Letter are hereby
incorporated by reference mutatis mutandis . Each of the parties hereto agree that this Amendment is a binding and effective agreement with
respect to the subject matter contained herein.
Section 7 Counterparts . This Amendment may be executed in any number of counterparts, each of which shall be deemed
an original and all of which, when taken together, shall constitute one agreement. Delivery of an executed counterpart of a signature page of
this Amendment by facsimile transmission or electronic transmission (e.g., “pdf” or “tiff”) shall be effective as delivery of a manually
executed counterpart of this Amendment.
[Signature pages follow]
#91297930v4
2
GOLDMAN SACHS BANK USA
By:
Name:
Title:
/s/ Robert Ehudin
Robert Ehudin
Authorized Signatory
GOLDMAN SACHS LENDING PARTNERS LLC
By:
/s/ Robert Ehudin
Name:
Title:
Robert Ehudin
Authorized Signatory
#91297930v4
BANK OF AMERICA, N.A.
By:
Name:
Title:
/s/ Jonathan Miscimarra
Jonathan Miscimarra
Director
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
By:
/s/ Jonathan Miscimarra
Name:
Title:
Jonathan Miscimarra
Director
#91297930v4
WELLS FARGO BANK, NATIONAL ASSOCIATION
By:
Name:
Title:
/s/ Lynn Gosselin
Lynn Gosselin
Director
#91297930v4
JPMORGAN CHASE BANK, N.A.
By:
Name:
Title:
/s/ Alicia T. Schreibstein
Alicia T. Schreibstein
Executive Director
#91297930v4
U.S. BANK NATIONAL ASSOCIATION
By:
Name:
Title:
/s/ Lisa Freeman
Lisa Freeman
SVP
#91297930v4
Accepted and agreed to as of
the date first written above:
UNITED NATURAL FOODS, INC.
By:
/s/ Michael Zechmeister
Name: Michael Zechmeister
Title:
CFO
#91297930v4
8
Exhibit A
[Attached.]
GOLDMAN SACHS BANK USA
GOLDMAN SACHS LENDING PARTNERS LLC
200 West Street
New York, New York 10282-2198
BANK OF AMERICA, N.A.
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
One Bryant Park
New York, New York 10036
WELLS FARGO BANK, NATIONAL
ASSOCIATION
550 S. Tryon Street
Charlotte, North Carolina 28202
JPMORGAN CHASE BANK, N.A
383 Madison Avenue
New York, New York 10179
U.S. BANK NATIONAL ASSOCIATION
3 Bryant Park
New York, NY 10036
CONFIDENTIAL
August 8, 2018
United Natural Foods, Inc.
313 Iron Horse Way
Providence, RI 02908
Attn: Michael Zechmeister
Chief Financial Officer
Ladies and Gentlemen:
Project Jedi
Second Amended and Restated Commitment Letter
You have advised Goldman Sachs Bank USA (“ GS Bank ”), Bank of America, N.A. (“ Bank of America ”), Merrill Lynch,
Pierce, Fenner & Smith Incorporated (acting together with any of its designated affiliates, “ MLPFS ” and, together with Bank of America
and their respective affiliates, “ BAML ”), Wells Fargo Bank, National Association (“ Wells Fargo Bank ”), JPMorgan Chase Bank, N.A. (“
JPMCB ”) and U.S. Bank National Association (“ US Bank ”, and together with GS Bank, BAML, Wells Fargo Bank and JPMCB,
collectively, the “ Commitment Parties ”, “ we ” or “ us ”), that United Natural Foods, Inc., a Delaware corporation (“ you ” or the “ Borrower
”), intends, directly or indirectly, to acquire a company identified to us as “Spring”, a Delaware corporation (the “ Target ”), and consummate
the other transactions described in the transaction description attached hereto as Exhibit A (the “ Transaction Description ”). Capitalized
terms used but not defined herein have the meanings assigned to them in the Transaction Description, the Summary of Terms and Conditions
attached hereto as Exhibit B (the “ Term Loan Facility Term Sheet ”) and Exhibit C (the “ ABL Facility Term Sheet ” and, collectively with
the Term Loan Facility Term Sheet, the “ Term Sheets ” and each a “ Term Sheet ”) and the Conditions Precedent to Funding attached hereto
as Exhibit D (together with this second amended and restated letter agreement, the Transaction Description and the Term Sheets, collectively,
the “ Commitment Letter ”). In the case of any such capitalized term that is subject to multiple
#91297930v4
9
and differing definitions, the appropriate meaning thereof in this letter agreement shall be determined by reference to the context in which it is
used.
This Second Amended and Restated Commitment Letter automatically amends, restates and supersedes in its entirety the
amended and restated commitment letter, dated August 7, 2018, by and among GS Bank, Goldman Sachs Lending Partners LLC (“ GSLP ”),
BAML and you (the “ First A&R Commitment Letter ”), and such First A&R Commitment Letter shall be of no further force and effect.
Reference is also made to that certain commitment letter (the “ Original Commitment Letter ”), dated July 25, 2018 (the “ Signing Date ”) by
and among GS Bank, GSLP and you.
1. Commitments .
In connection with the Transactions, (a) Bank of America, GS Bank, Wells Fargo Bank, JPMCB and US Bank (collectively in
such capacities, the “ Initial ABL Lenders ”) hereby commit to provide, severally and not jointly, 27.50%, 22.50%, 20.00%, 15.00% and
15.00%, respectively, of the aggregate principal amount of the ABL Facility (as defined in Exhibit A ) and (b) GS Bank, Bank of America
and US Bank (collectively, in such capacities, the “ Initial Term Loan Lenders ”, together with the Initial ABL Lenders, the “ Initial Lenders
”) hereby commit to provide, severally and not jointly, 45.00%, 45.00% and 10.00%, respectively, of the aggregate principal amount of the
Term Loan Facility (as defined in Exhibit A ) (together with the ABL Facility, collectively, the “ Facilities ”), in each case, upon the terms set
forth in this letter agreement and in the applicable Term Sheet and subject only to the satisfaction or waiver of the conditions expressly set
forth in Section 5 of this Commitment Letter.
2. Syndication .
You hereby appoint (a) in respect of the ABL Facility, MLPFS, GS Bank, Wells Fargo Bank, JPMCB and US Bank
(collectively, in such capacities, the “ ABL Lead Arrangers ”) to act, and each ABL Lead Arranger hereby agrees to act, as a lead arranger
and bookrunner, upon the terms set forth in this letter agreement and in the ABL Facility Term Sheet and (b) in respect of the Term Loan
Facility, GS Bank, MLPFS and US Bank (collectively, in such capacities, the “ Term Loan Lead Arrangers ”, and together with the ABL
Lead Arrangers, the “ Lead Arrangers ”) to act, and each Term Loan Lead Arranger hereby agrees to act, as a lead arranger and bookrunner,
upon the terms set forth in this letter agreement and in the Term Loan Facility Term Sheet. You agree that JPMCB may perform its
responsibilities hereunder through its affiliate, J.P. Morgan Securities LLC.
It is further agreed that, (a) MLPFS shall appear on the “left” of all marketing and other materials in connection with the ABL
Facility and will have the rights and responsibilities customarily associated with such name placement and each of GS Bank, Wells Fargo
Bank, JPMCB and US Bank shall appear on the “right” of all marketing and other materials in connection with the ABL Facility in such order
and will have the rights and responsibilities customarily associated with such name placement and (b) GS Bank shall appear on the “left” of
all marketing and other materials in connection with the Term Loan Facility and will have the rights and responsibilities customarily
associated with such name placement and each of MLPFS and US Bank shall appear on the “right” of all marketing and other materials in
connection with the Term Loan Facility in such order and will have the rights and responsibilities customarily associated with such name
placement. No other arrangers, bookrunners, managers, agents or co-agents will be appointed and no Lender (as defined below) will receive
compensation with respect to any of the Facilities outside the terms contained herein and in the letters of even date herewith addressed to you
providing, among other things, for certain fees relating to the Facilities (the “ Fee Letter ”) in order to obtain its commitment to participate in
the Facilities, in each case, unless you and we so agree.
The Lead Arrangers reserve the right, prior to or after the Closing Date (as defined on Exhibit A ), to syndicate all or a portion
of the Initial Lenders’ commitments hereunder to one or more banks, financial institutions or other institutional lenders and investors
reasonably acceptable to you (such acceptance not to be unreasonably withheld or delayed) that will become parties to the Facilities
Documentation (as defined
10
on Exhibit C ) pursuant to syndications to be managed by the Lead Arrangers and reasonably satisfactory to you (the banks, financial
institutions or other institutional lenders and investors becoming parties to the Facilities Documentation, together with the Initial Lenders,
being
11
collectively referred to as the “ Lenders ”); provided that, notwithstanding the Initial Lender’s right to syndicate the Facilities and receive
commitments with respect thereto, (a) the Initial Lenders and the Lead Arrangers will not syndicate (i) to those banks, financial institutions or
other persons separately identified in writing by you to us prior to the Signing Date, or to any affiliates of such banks, financial institutions or
other persons that are readily identifiable as affiliates by virtue of their names or that are identified to us in writing from time to time by you
or (ii) to bona fide competitors (or affiliates thereof readily identifiable on the basis of such persons’ names or that are identified to us in
writing by you from time to time) of you, the Target or any of your or its subsidiaries identified to us in writing from time to time by you
(other than bona fide fixed income investors or debt funds); provided that no such identification after the Signing Date pursuant to clause (i)
or (ii) shall apply retroactively to disqualify any person that has previously acquired an assignment or participation of an interest in any of the
Facilities with respect to amounts previously acquired (collectively, the “ Disqualified Institutions ”), and no Disqualified Institutions may
become Lenders or otherwise participate in the Facilities, and (b) notwithstanding the Lead Arrangers’ right to syndicate the Facilities and
receive commitments with respect thereto, except as expressly set forth in Section 9 or otherwise agreed in writing by you, (i) the Initial
Lenders shall not be relieved, released or novated from their respective obligations hereunder (including its obligation to fund the Facilities
on the Closing Date) in connection with any syndication, assignment or participation of the Facilities, including their respective commitments
hereunder in respect thereof, until after the Closing Date has occurred, (ii) no assignment or novation by any Initial Lender shall become
effective as between you and such Initial Lender with respect to all or any portion of such Initial Lender’s commitments in respect of the
Facilities until after the initial funding of the Facilities and the occurrence of the Closing Date, and (iii) each Initial Lender shall retain
exclusive control over all rights and obligations with respect to its commitments in respect of the Facilities, including all rights with respect to
consents, modifications, supplements, waivers and amendments, until the Closing Date has occurred.
Without limiting your obligations to assist with syndication efforts as set forth herein, it is understood that the Initial Lenders’
commitments hereunder are not conditioned upon the syndication of, or receipt of commitments or participations in respect of, the Facilities.
In connection with the syndication of the Facilities, you agree to use your commercially reasonable efforts to assist the Lead Arrangers (and
use your commercially reasonable efforts to cause the Target to assist) in completing syndications reasonably satisfactory to the Lead
Arrangers and you until the date that is the earlier of (a) 45 days after the Closing Date and (b) the date on which a “Successful Syndication”
(as defined in the Fee Letter), as applicable, is achieved (such earlier date, the “ Syndication Date ”). Such assistance shall include your using
commercially reasonable efforts to (i) ensure that the syndication efforts benefit from your existing banking relationships (and, to the extent
not in contravention of the Transaction Agreement, the Target’s existing banking relationships), (ii) cause direct contact between your senior
management, on the one hand, and the proposed Lenders, on the other hand (and, to the extent not in contravention of the Transaction
Agreement, your using commercially reasonable efforts to ensure such contact between the senior management of the Target, on the one
hand, and the proposed Lenders, on the other hand) at mutually agreed upon times and reasonable locations, (iii) assist (including, to the
extent not in contravention of the Transaction Agreement, the use of commercially reasonable efforts to cause the Target to assist) in the
preparation prior to the launch of general syndication of the Facilities of a customary confidential information memorandum for transactions
of this type (the “ Confidential Information Memorandum ”) for each of the Facilities and other customary marketing materials to be used in
connection with the syndication of the Facilities, (iv) host, with the Lead Arrangers and at the request of the Lead Arrangers, one meeting of
prospective Term Lenders and one meeting of prospective ABL Lenders, in each case at a time and at a location to be mutually agreed upon
(and to the extent necessary, one or more conference calls with prospective Lenders in addition to any such meeting), (v) prepare and provide
(and, to the extent not in contravention of the Transaction Agreement, to use commercially reasonable efforts to cause the Target to prepare
and provide) promptly to the Lead Arrangers all reasonably available customary information with respect to you, the Target and your and its
respective
12
subsidiaries and the Transactions, including all financial information and projections relating to the Target and its subsidiaries (including
financial estimates, forecasts and budgets of the Target, the “ Projections ”), in each case, as the Lead Arrangers may reasonably request in
connection with the syndication of the Facilities, (vi) obtain a public corporate credit rating (but no specific rating) and a public corporate
family rating (but no specific rating) in respect of the Borrower from each of Standard and Poor’s Rating Group (“ S&P ”) and Moody’s
Investors Service, Inc. (“ Moody’s ”) and public ratings (but no specific ratings) for the Term Loan Facility from each of S&P and Moody’s
prior to the launch of general syndication of the Term Loan Facility, (vii) ensure that until the Syndication Date, there shall be no competing
offering, placement or arrangement of any debt securities or syndicated credit facilities by you, your subsidiaries and, to the extent not in
contravention of the Transaction Agreement, the Target and its subsidiaries (in each case, other than the Facilities, working capital and other
indebtedness incurred in the ordinary course of business, indebtedness disclosed to the Commitment Parties on or prior to the Signing Date,
other indebtedness permitted to be outstanding or issued under the Transaction Agreement (including any amendments or refinancing of such
debt in connection with the Pre-Closing Reorganization (as defined in the Transaction Agreement) and indebtedness approved by the Lead
Arrangers (such consent not to be unreasonably withheld, delayed or conditioned)) without the prior written consent of the Lead Arrangers if
such offering, placement or arrangement would have a materially detrimental effect upon the primary syndication of the Facilities, (viii) in the
case of the ABL Facility, use commercially reasonable efforts to provide the New ABL Agent (as defined in Exhibit C ) and its advisors and
consultants with sufficient access to the Target to complete a field examination and inventory appraisal of the Target and its subsidiaries prior
to the Closing Date, in each case, to the extent not in contravention of the Transaction Agreement (and, if after such use of commercially
reasonable efforts, such examination and appraisal is not completed by the Closing Date, such examination and appraisal shall be required to
be completed thereafter by a time to be mutually agreed and, in any event, subsequent to the Closing Date and no later than a date that is 90
days following the Closing Date (subject to extensions by the New ABL Agent in its reasonable discretion)) and (ix) your using commercially
reasonable efforts to provide the Lead Arrangers a period (the “ Marketing Period ”) of 15 consecutive business days following the delivery
of the financial statements necessary to satisfy the conditions set forth in Sections (c) and (d) of Exhibit D attached hereto to syndicate the
Term Loan Facility and the ABL Facility; provided that (i) if the Marketing Period has not ended by August 17, 2018 then the Marketing
Period shall not begin before September 4, 2018, (ii) November 21, 2018 and November 23, 2018 shall not be business days for purposes of
calculating the Marketing Period and (iii) if the Marketing Period has not ended on or prior to December 21, 2018 then the Marketing Period
shall not commence prior to January 2, 2019. You understand that the Lead Arrangers may decide to commence syndication efforts for each
Facility promptly after the Signing Date. Notwithstanding anything to the contrary contained in this Commitment Letter, the Fee Letter, the
Facilities Documentation or any other letter agreement or undertaking concerning the financing of the Transactions to the contrary, (i) the
compliance with any of the provisions of this Commitment Letter (other than the conditions expressly set forth in Exhibit D attached hereto),
(ii) the commencement and the completion of the syndication of any of the Facilities and (iii) the obtaining of the ratings referenced above
shall not, in the case of any of the foregoing clauses (i) through (iii), constitute a condition precedent to any Initial Lender’s commitments
hereunder or to the funding and availability of the Facilities on the Closing Date or any time thereafter. For the avoidance of doubt, (x) you
will not be required to provide any information to the extent that the provision thereof (i) could violate or waive any attorney-client privilege,
(ii) violate or contravene any law, rule or regulation, or any obligation of confidentiality (not created in contemplation hereof) binding on you,
the Target or your or its respective subsidiaries or affiliates or (iii) constitute attorney work product (provided that in the event that you do not
provide information in reliance on the exclusions in this sentence relating to violation of any obligation of confidentiality, you shall use
commercially reasonable efforts to provide notice to the Lead Arrangers promptly upon obtaining knowledge that such information is being
withheld (but solely if providing such notice would not violate such obligation of confidentiality); provided that in the event that you do not
provide information pursuant to this clause (x)
13
and such information would be required to ensure that any marketing materials would not contain any untrue statement of material fact or
omit to state a material fact necessary in order to make the statements (taken as a whole) contained therein in light of the circumstances under
which they would be made, not materially misleading, you shall provide notice to the Lead Arrangers and you shall communicate, to the
extent feasible, the applicable information in a way that would not violate the applicable obligation) and (y) the only financial statements that
shall be required to be provided to the Lead Arrangers or the Initial Lenders in connection with the syndication of the Facilities or otherwise
shall be those required to be delivered pursuant to clauses (c) and (d) set forth in Exhibit D hereto.
The Lead Arrangers will manage, in consultation with you, all aspects of the syndication of the Facilities, including, without
limitation, selection of Lenders (subject to your reasonable consent (such consent not to be unreasonably withheld or delayed), and excluding
Disqualified Institutions), determination of when the Lead Arrangers will approach potential Lenders, the time of acceptance of the Lenders’
commitments, the final allocations of the commitments among the Lenders (subject to your consent rights, as described above) and the
amount and distribution of fees among the Lenders (subject to your consent rights, as described above).
You agree, at the reasonable request of the Lead Arrangers, to assist in the preparation of a version of the Confidential
Information Memorandum to be used in connection with the syndication of each Facility, consisting exclusively of information and
documentation that is either (a) publicly available (or could be derived from publicly available information) or (b) not material with respect to
you, the Target or your or its respective subsidiaries or any of your or its respective securities for purposes of United States federal securities
laws assuming such laws are applicable to you, the Target or your or its respective subsidiaries (all such information and documentation being
“ Public Lender Information ” and with any information and documentation that is not Public Lender Information being referred to herein as “
Private Lender Information ”).
You hereby acknowledge that the Lead Arrangers will make available, on a confidential basis, the information, Projections
and other offering and marketing materials and presentations, including the Confidential Information Memorandum, to be used in connection
with the syndication of each Facility (such information, Projections, other offering and marketing material and the Confidential Information
Memorandum, collectively, with the Term Sheets, the “ Information Materials ”), to the proposed syndicate of Lenders by posting the
Information Materials on Intralinks, SyndTrak Online or by similar electronic means.
It is understood that in connection with your assistance described above, (i) customary authorization letters will be included in the
Confidential Information Memorandum that authorizes the distribution thereof to prospective Lenders, confirms (if applicable) that the
additional version of the Confidential Information Memorandum does not include any Private Lender Information (other than information
about the Transaction or the Facilities) and (ii) the Confidential Information Memorandum shall contain customary provisions exculpating the
existing equity holders, you, the Target and the respective affiliates and subsidiaries of the foregoing and us and our affiliates with respect to
any liability related to the use or misuse of the contents of the Information Materials or related offering and marketing materials by the
recipients thereof. Before distribution of any Information Materials, you agree to identify and to use commercially reasonable efforts to cause
the Target to identify that portion of the Information Materials that may be distributed to the public-side lenders. By marking Information
Materials as “PUBLIC”, you shall be deemed to have authorized the Lead Arrangers and the proposed Lenders to treat such Information
Materials as not containing any Private Lender Information (it being understood that you shall not be under any obligation to mark the
Information Materials “PUBLIC”). You agree that, unless expressly identified as “PUBLIC”, each document to be disseminated by the Lead
14
Arrangers (or any other agent) to any Lender in connection with the Facilities will be deemed to contain Private Lender Information.
You agree, subject to the confidentiality provisions of this Commitment Letter, that the Lead Arrangers on your behalf may
distribute the following documents to all prospective Lenders, unless you advise the Lead Arrangers in writing (including by email) within a
reasonable time prior to their intended distributions (after you have been given a reasonable opportunity to review such documents) that such
material should only be distributed to prospective private Lenders: (a) administrative materials for prospective Lenders such as lender
meeting invitations and funding and closing memoranda; (b) notifications of changes to the Facilities’ terms; and (c) drafts and final versions
of term sheets and definitive documents with respect to the Facilities. If you advise us in writing (including by email) within a reasonable
time prior to their intended distributions (after you have been given a reasonable opportunity to review such documents) that any of the
foregoing items should be distributed only to private Lenders, then the Lead Arrangers will not distribute such materials to public Lenders
without your consent.
3. Information .
You hereby represent and warrant that (a) to your knowledge, insofar as it applies to information concerning the Target, its
subsidiaries and their respective businesses, all written information concerning you, the Target, your and its respective subsidiaries and your,
its and their respective businesses (other than the Projections, other forward-looking information and information of a general economic or
industry nature) that has been or will be made available by you (or on your behalf) to any Commitment Party in connection with the
Transactions (the “ Information ”) did not or will not when furnished, taken as a whole, contain any untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements contained therein not materially misleading in light of the
circumstances under which such statements are made, as supplemented and updated from time to time, and (b) the Projections contained in
the Confidential Information Memorandum will be prepared in good faith based upon assumptions believed by you to be reasonable at the
time of delivery thereof based on information provided by the Target or its representatives; it being understood that such Projections (i) are
subject to significant uncertainties and contingencies, many of which are beyond your control, that no assurance can be given that any
particular projections will be realized, that actual results may differ and that such differences may be material and (ii) are not a guarantee of
performance. If at any time prior to the later of the Closing Date and the Syndication Date, you become aware that any of the representations
and warranties in the preceding sentence are incorrect in any material respect (to your knowledge insofar as it applies to the Information and
Projections concerning the Target, its subsidiaries and their respective businesses), you agree to (and to use your commercially reasonable
efforts with respect to the Information and the Projections concerning the Target and its subsidiaries and their respective businesses) promptly
supplement the Information and the Projections such that the representations and warranties in the preceding sentence remain true in all
material respects (to your knowledge insofar as it applies to the Information and Projections concerning the Target, its subsidiaries and their
respective businesses, it being understood in each case that such supplementation shall cure any breach of such representations and
warranties). The accuracy of the foregoing representations and warranties, whether or not cured, shall not be a condition to the commitments
and obligations of the Initial Lenders hereunder or the funding of the Facilities on the Closing Date. In arranging the Facilities, including the
syndication of the Facilities, the Commitment Parties will be entitled to use and rely on the Information and the Projections without
responsibility for independent verification thereof.
4. Fees .
15
As consideration for the Initial Lenders’ commitments hereunder and the Lead Arrangers’ agreements to syndicate the
Facilities, you agree to pay (or to cause to be paid) the nonrefundable (except as set forth in the Fee Letter) fees as set forth in the Fee Letter.
5. Conditions .
The Initial Lenders’ commitments hereunder to fund the Facilities on the Closing Date are subject solely to the conditions
expressly set forth in Exhibit D hereto, and upon the satisfaction (or waiver by the applicable Lead Arrangers) of such conditions, the initial
funding of the Facilities shall occur. There are no conditions (implied or otherwise) to the commitments hereunder, and there will be no
conditions (implied or otherwise) under the Facilities Documentation to the funding of the Facilities on the Closing Date, including
compliance with the terms of this Commitment Letter, the Fee Letter and the Facilities Documentation, other than those that are expressly set
forth in Exhibit D .
Notwithstanding anything in this Commitment Letter, the Fee Letter, the Facilities Documentation or any other letter
agreement or other undertaking concerning the financing of the Transactions to the contrary, (a) the only representations and warranties to the
accuracy of which shall be a condition to the availability of the Facilities on the Closing Date shall be (i) such of the representations and
warranties made by the Target with respect to the Target and its subsidiaries in the Transaction Agreement as are material to the interests of
the Lenders, but only to the extent that you (or any of your affiliates) have the right (taking into account any applicable cure provisions) to
terminate your (or its) obligations under the Transaction Agreement or decline to consummate the Acquisition (in each case, in accordance
with the terms of the Transaction Agreement) as a result of a breach of such representations and warranties in the Transaction Agreement (the
“ Specified Transaction Agreement Representations ”) and (ii) the Specified Representations (as defined below) and (b) the terms of the
Facilities Documentation shall be in a form such that they do not impair availability of the Facilities on the Closing Date if the applicable
conditions set forth in Exhibit D as attached hereto are satisfied or waived by the Lead Arrangers (it being understood that to the extent any
lien search or Collateral or any security interests therein (including the creation or perfection of any security interest) (other than to the extent
that a lien on such Collateral may be perfected by the filing of a financing statement under the Uniform Commercial Code (“ UCC ”) or, with
respect to each material domestic wholly-owned subsidiary of the Borrower, by the delivery of stock or other certificates of each material
domestic wholly-owned restricted subsidiary of the Borrower that is part of the Collateral and, with respect to the Target and material
domestic wholly-owned restricted subsidiaries of the Target, by the delivery of stock or other certificates of the Target and material domestic
wholly-owned restricted subsidiaries of the Target, only to the extent such stock or other certificates are received from the Target on or prior
to the Closing Date after your use of commercially reasonable efforts to do so without undue burden or expense) is not or cannot be provided
or perfected on the Closing Date after your use of commercially reasonable efforts to do so, or without undue burden or expense, the delivery
of such lien search and/or Collateral (and creation or perfection of security interests therein), as applicable, shall not constitute a condition
precedent to the availability of the Facilities on the Closing Date but shall instead be required to be delivered or provided within 90 days after
the Closing Date (or such later date as may be reasonably agreed by the Borrower and the applicable Administrative Agent) pursuant to
arrangements to be mutually agreed by the Borrower and the applicable Administrative Agent). For purposes hereof, “ Specified
Representations ” means the representations and warranties made by the Loan Parties set forth in the applicable Facilities Documentation
relating to: organizational existence of the Loan Parties; organizational power and authority of the Loan Parties, and due authorization,
execution and delivery by the Loan Parties, in each case, as they relate to their entry into and performance of the applicable Facilities
Documentation; enforceability of the applicable Facilities Documentation against the Loan Parties; no conflicts with charter documents of the
Loan Parties as it relates to their entry into and performance of the applicable Facilities Documentation; solvency of the Borrower
16
and its subsidiaries on a consolidated basis on the Closing Date after giving effect to the Transactions (with solvency being determined in a
manner consistent with Annex I to Exhibit D attached hereto); subject to the immediately preceding sentence and the limitations set forth in
the Term Sheets, creation and perfection of security interests in the Collateral; Federal Reserve margin regulations; the use of proceeds of
borrowings under the Facilities on the Closing Date not violating the PATRIOT Act, OFAC or FCPA; and the Investment Company Act.
Notwithstanding anything to the contrary contained herein, to the extent any of the Specified Transaction Agreement Representations are
qualified or subject to “material adverse effect,” the definition thereof shall be “Material Adverse Effect” as defined in the Transaction
Agreement (“ Material Adverse Effect ”) for purposes of any representations and warranties made or to be made on, or as of, the Closing
Date. The provisions of this paragraph are referred to as the “ Certain Funds Provision ”.
6. Indemnity; Costs and Expenses .
You agree to indemnify and hold harmless each Commitment Party, its affiliates and their respective officers, directors,
employees, members, agents, advisors, representatives and controlling persons involved in the Transactions (each, a “ related party ” it being
understood that in no event will this indemnity apply to any Commitment Party or its affiliates in their capacity as financial advisors to you or
the Target in connection with the Acquisition or any other potential acquisition, collectively, the “ Indemnified Persons ” and each
individually an “ Indemnified Person ”), from and against any and all actual losses, claims, damages, liabilities and expenses, joint or several,
to which any such Indemnified Person may become subject arising out of or in connection with this Commitment Letter, the First A&R
Commitment Letter, the Original Commitment Letter, the Fee Letter, the First A&R Fee Letter (as defined in the Fee Letter), the Original Fee
Letter (as defined in the fee letter) or the Transactions or any claim, litigation, investigation or proceeding relating to any of the foregoing
(any of the foregoing, a “ Proceeding ”), regardless of whether any such Indemnified Person is a party thereto or whether a Proceeding is
brought by a third party or by you or any of your affiliates, and to reimburse each such Indemnified Person within 30 days after receipt of a
written request (together with reasonably detailed backup documentation supporting such reimbursement request) for the reasonable fees and
reasonable out-of-pocket expenses of one primary counsel for all Indemnified Persons (taken as a whole) (and, solely in the case of a conflict
of interest, one additional counsel as necessary to the affected Indemnified Persons (taken as a whole)) and to the extent reasonably
necessary, one local counsel in each relevant jurisdiction for Indemnified Persons (taken as a whole), but no other third-party advisors without
your prior consent, and other reasonable out-of-pocket expenses incurred in connection with investigating, or defending any of the foregoing
(in each case, excluding allocated costs of in-house counsel); provided that, the foregoing indemnity will not, as to any Indemnified Person,
apply to losses, claims, damages, liabilities or expenses to the extent they resulted from (A) the willful misconduct, bad faith or gross
negligence of such Indemnified Person or any of its affiliates or related parties (as determined in a final non-appealable judgment in a court of
competent jurisdiction), (B) any material breach of the obligations of such Indemnified Person or any of its affiliates or related parties under
this Commitment Letter, the First A&R Commitment Letter, the Original Commitment Letter, the Fee Letter, the First A&R Fee Letter or the
Original Fee Letter (as determined in a final non-appealable judgment in a court of competent jurisdiction) or (C) any dispute among
Indemnified Persons (or their respective affiliates or related parties) that does not involve an act or omission by you or any of your
subsidiaries (other than any claims against an Administrative Agent or a Lead Arranger in their capacity as such but subject to clause (i)(A)
above). Each Indemnified Person agrees (by accepting the benefits hereof), severally and not jointly, to refund and return any and all amounts
paid by you (or on your behalf) under this Section 6 to such Indemnified Person to the extent such Indemnified Person is not entitled to
payment of such amounts in accordance with the terms hereof .
In addition, you hereby agree to reimburse the Lead Arrangers and Initial Lenders from time to time upon demand (to the
extent you have been provided an invoice therefor at least three (3)
17
business days prior to such demand) for all reasonable documented out-of-pocket expenses (including, without limitation, reasonable
documented out-of-pocket expenses of the Lead Arrangers’ due diligence investigation, consultants’ fees (to the extent any such consultant
has been hired with your prior consent), syndication expenses (if applicable), travel expenses and reasonable fees, disbursements, field
examinations and appraisal expenses and other charges of counsel, but in the case of legal fees and expenses, limited to the reasonable fees
and reasonable documented out-of-pocket expenses of Davis Polk & Wardwell LLP as set forth in such Term Sheet and one local counsel in
each relevant jurisdiction) incurred in connection with the preparation of this Commitment Letter, the First A&R Commitment Letter, the
Original Commitment Letter, the Fee Letter, the First A&R Fee Letter, the Original Fee Letter and the Facilities Documentation, in each case,
to the extent such advisors have been hired with your prior consent. You acknowledge that we may receive a benefit, including, without
limitation, a discount, credit or other accommodation, from any of such counsel based on the fees such counsel may receive on account of
their relationship with us, including, without limitation, fees paid pursuant hereto.
Notwithstanding any other provision of this Commitment Letter, no party hereto shall be liable for (i) any damages arising
from the use by others of information or other materials obtained through electronic, telecommunications or other information transmission
systems, except to the extent such damages have resulted from the willful misconduct, bad faith, gross negligence or material breach of such
party or any of its affiliates or related parties of this Commitment Letter, as determined in a final, non-appealable judgment of a court of
competent jurisdiction, or (ii) any special, indirect, consequential or punitive damages arising out of or in connection with this Commitment
Letter, the First A&R Commitment Letter, the Original Commitment Letter, the Fee Letter, the First A&R Fee Letter or the Original Fee
Letter, provided that this clause (ii) shall not limit your indemnity or reimbursement obligations to the extent set forth in the second preceding
paragraph in respect of any losses, claims, damages, liabilities and expenses incurred or paid by an Indemnified Person to a third party that
are otherwise required to be indemnified in accordance with this Section 6 . You shall not be liable for any settlement of any Proceedings (or
any expenses related thereto) effected without your prior written consent (which consent shall not be unreasonably withheld, delayed or
conditioned), but if settled with your prior written consent or if there is a final non-appealable judgment against an Indemnified Person in any
such Proceedings, you agree to indemnify and hold harmless each Indemnified Person from and against any and all losses, claims, damages,
liabilities and expenses by reason of such settlement or judgment in accordance with the second preceding paragraph. You shall not, without
the prior written consent of an Indemnified Person (which consent shall not be unreasonably withheld, delayed or conditioned), effect any
settlement of any pending or threatened Proceedings in respect of which indemnity could have been sought hereunder by such Indemnified
Person unless (a) such settlement includes an unconditional release of such Indemnified Person in form and substance reasonably satisfactory
to such Indemnified Person from all liability on claims that are the subject matter of such Proceedings and (b) does not include any statement
as to or any admission of fault, culpability or a failure to act by or on behalf of such Indemnified Person.
Each Indemnified Person shall, in consultation with you, take all reasonable steps to mitigate any losses, claims, damages,
liabilities and expenses and shall give (subject to confidentiality or legal restrictions) such information and assistance to you as you may
reasonably request in connection with any Proceedings.
7. Confidentiality .
You acknowledge that the Lead Arrangers, the Initial Lenders and their respective affiliates may be providing debt financing,
equity capital or other services (including, without limitation, financial advisory services) to other companies in respect of which you or the
Target may have conflicting interests.
18
The Commitment Parties and their respective affiliates will not use information obtained from you, the Target or any of your or their
respective affiliates and subsidiaries by virtue of the transactions contemplated by this Commitment Letter or any of your or their other
respective relationships with you, the Target and your or their respective affiliates and subsidiaries in connection with the performance by
them and their respective affiliates of services for other persons or entities, and none of the Commitment Parties or their respective affiliates
will furnish any such information to such other persons or entities. You also acknowledge that none of the Commitment Parties or their
respective affiliates has any obligation to use in connection with the transactions contemplated by this Commitment Letter, or to furnish to
you, the Target or your or their respective subsidiaries, confidential information obtained by the Commitment Parties or their respective
affiliates from other persons or entities. This Commitment Letter and the Fee Letter are not intended to create a fiduciary relationship among
the parties hereto or thereto.
You further acknowledge and agree that (a) no fiduciary, advisory or agency relationship between you and the Commitment
Parties is intended to be or has been created in respect of any of the debt transactions contemplated by this Commitment Letter, irrespective of
whether the Commitment Parties have advised or are advising you on other matters, and you will not claim that the Commitment Parties have
rendered advisory services of any nature or respect with respect to the debt transactions contemplated hereby, (b) the Commitment Parties, on
the one hand, and you, on the other hand, have an arm’s-length business relationship that does not directly or indirectly give rise to, nor do
you rely on, any fiduciary duty on the part of the Commitment Parties, (c) you are capable of and responsible for evaluating and
understanding, and you understand and accept, the terms, risks and conditions of the transactions contemplated by this Commitment Letter
and (d) you have been advised that the Commitment Parties and their respective affiliates are engaged in a broad range of transactions that
may involve interests that differ from your interests and that the Commitment Parties and their respective affiliates have no obligation to
disclose such interests and transactions to you by virtue of any fiduciary, advisory or agency relationship. You agree not to assert any claim
you might allege based on any actual or potential conflicts of interest that might be asserted to arise or result from, on the one hand, the
engagement of us or our affiliate as a financial advisor, and on the other hand, our and our affiliates’ relationships with you as described and
referred to herein.
You further acknowledge that each of the Lead Arrangers (or an affiliate thereof) may be a full service securities firm
engaged in securities trading and brokerage activities as well as providing investment banking and other financial services. In the ordinary
course of business, each such person may provide investment banking and other financial services to, and/or acquire, hold or sell, for its own
accounts and the accounts of customers, equity, debt and other securities and financial instruments (including bank loans and other
obligations) of you and other companies with which you may have commercial or other relationships. With respect to any securities and/or
financial instruments so held by such person or any of its customers, all rights in respect of such securities and financial instruments,
including any voting rights, will be exercised by the holder of the rights, in its sole discretion. To the fullest extent permitted by law, you
hereby waive (to the extent permitted by applicable law) and release any claims that you may have against each such Lead Arranger with
respect to any breach or alleged breach of agency or fiduciary duty in connection with any aspect of any transaction contemplated by this
Commitment Letter.
You agree that you will not disclose this Commitment Letter, the Fee Letter, the Original Fee Letter or the contents of any of
the foregoing to any person without our prior written approval (which may include through electronic means) (not to be unreasonably
withheld, conditioned, delayed or denied), except that you may disclose (a) this Commitment Letter, the Fee Letter, the Original Fee Letter
and the contents hereof and thereof (i) to you and to your officers, directors, agents, employees, affiliates, members, partners, stockholders,
equityholders, controlling persons, agents, attorneys, accountants and advisors on a confidential basis and (ii) as required by applicable law,
compulsory legal process, pursuant
19
to the order of any court or administrative agency in any pending legal, judicial or administrative proceeding or to the extent required by
governmental and/or regulatory authorities (in which case you agree to use commercially reasonable efforts to inform us promptly thereof to
the extent lawfully permitted to do so), (b) this Commitment Letter, the Fee Letter, the Original Fee Letter and the contents hereof and thereof
to the Target, its direct or indirect parent companies and their respective officers, directors, agents, employees, affiliates, members, partners,
stockholders, equityholders, controlling persons, agents, attorneys, accountants and advisors, in each case in connection with the Transactions
and on a confidential basis ( provided that, any such disclosure of the Fee Letter or the Original Fee Letter shall be subject to redaction of the
fees, the economic “market flex” provisions contained therein in a manner reasonably acceptable to the applicable Lead Arrangers), (c) the
existence and contents of the Term Sheets to any rating agency, (d) the existence and contents of this Commitment Letter to a potential
Lender in connection with the Transactions, (e) the aggregate fee amounts contained in the Fee Letter as part of projections, pro forma
information or a generic disclosure of aggregate sources and uses related to fee amounts related to the Transactions to the extent customary or
required in offering and marketing materials or in any public filing relating to the Transactions, (f) the existence and contents of this
Commitment Letter and the Term Sheets in any proxy, public filing, prospectus, offering memorandum, offering circular, syndication
materials or other marketing materials in connection with the Acquisition or the financing thereof, (g) this Commitment Letter, the Fee Letter
and the contents hereof and thereof in connection with any remedy or enforcement of any right under this Commitment Letter, or the Fee
Letter and (h) after the Closing Date, the Fee Letter on a confidential basis to persons performing customary accounting functions, including
accounting for deferred financing costs; provided that, the foregoing restrictions shall cease to apply after the Facilities Documentation shall
have been executed and delivered by the parties thereto (other than in respect of the Fee Letter and the contents thereof).
Each Commitment Party agrees to keep confidential, and not to publish, disclose or otherwise divulge, information obtained
from or on behalf of you, the Target or your respective affiliates in the course of the transactions contemplated hereby, except that such
Commitment Party shall be permitted to disclose such confidential information (a) to their respective directors, officers, agents, employees,
attorneys, accountants and advisors, and to their respective affiliates involved in the Transactions (other than Excluded Affiliates) on a “need
to know” basis and who are made aware of the confidential nature of such information and have been advised of this obligation to keep
information of this type confidential; provided, that such Commitment Party shall remain liable for the breach of the provisions of this
paragraph by such directors, officers, agents, employees, attorneys, accountants and advisors, (b) on a confidential basis to any bona fide
potential Lender, prospective participant or swap counterparty (in each case, other than a Disqualified Institution and other persons to whom
you have affirmatively declined to consent to the syndication or assignment thereto prior to the disclosure of such confidential information to
such person) that agrees to keep such information confidential in accordance with (x) the provisions of this paragraph (or language
substantially similar to this paragraph that is reasonably acceptable to you) for the benefit of you or (y) other customary confidentiality
language in a “click-through” arrangement , (c) as required by the order of any court or administrative agency or in any pending legal, judicial
or administrative proceeding, or otherwise as required by applicable law, regulation or compulsory legal process (in which case we agree to
use commercially reasonable efforts to inform you promptly thereof to the extent lawfully permitted to do so (except with respect to any audit
or examination conducted by bank accountants or any self-regulatory authority or governmental or regulatory authority exercising
examination or regulatory authority)), (d) to the extent requested by any bank regulatory authority having jurisdiction over a Commitment
Party (including in any audit or examination conducted by bank accountants or any self-regulatory authority or governmental or regulatory
authority exercising examination or regulatory authority), (e) to the extent such information: (i) becomes publicly available other than as a
result of a breach of this Commitment Letter, the Fee Letter or other confidential or fiduciary obligation owed by such Commitment Party to
you, the Target or your or their respective affiliates or (ii) becomes available to the Commitment Party on a non-confidential
20
basis from a source other than you or on your behalf that, to such Commitment Party’s knowledge (after due inquiry), is not in violation of
any confidentiality obligation owed to you, the Target or your or their respective affiliates, (f) to the extent you shall have consented to such
disclosure in writing (which may include through electronic means), (g) in protecting and enforcing such Commitment Party’s rights with
respect to this Commitment Letter or the Fee Letter, (h) for purposes of establishing any defense available under securities laws, including,
without limitation, establishing a “due diligence” defense or to defend any claim related to this Commitment Letter or the Fee Letter, (i) to the
extent independently developed by such Commitment Party without reliance on confidential information or (j) with respect to the existence
and contents of the Term Sheets, in consultation with you, to the rating agencies; provided that, no such disclosure shall be made to the
members of such Commitment Party’s or any of its affiliates’ deal teams that are engaged as principals primarily in private equity, mezzanine
financing or venture capital (a “ Private Equity Affiliate ”) or are engaged in the sale of the Target and its subsidiaries, including through the
provision of advisory services (a “ Sell Side Affiliate ” and, together with the Private Equity Affiliates, the “ Excluded Affiliates ”) other than
a limited number of senior employees who are required, in accordance with industry regulations or such Commitment Party’s internal policies
and procedures to act in a supervisory capacity and the Commitment Party’s internal legal, compliance, risk management, credit or
investment committee members. In addition, each Commitment Party may disclose the existence of the Facilities to market data collectors,
similar services providers to the lending industry, and service providers to such Commitment Party in connection with the administration and
management of the Facilities after the Closing Date. The Commitment Parties’ and their respective affiliates’, if any, obligations under this
paragraph shall terminate automatically to the extent superseded by the confidentiality provisions in the Facilities Documentation upon the
effectiveness thereof and, in any event, will terminate two years from the Signing Date.
8. Patriot Act .
We hereby notify you that pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into
law October 26, 2001) (the “ Patriot Act ”)), each of us and each of the Lenders may be required to obtain, verify and record information that
identifies the Borrower and each Loan Party, which information may include its name and address and other information that will allow each
of us and the Lenders to identify the Borrower and each Loan Party in accordance with the Patriot Act. This notice is given in accordance
with the requirements of the Patriot Act and is effective for each of us and the Lenders.
9. Governing Law, Etc .
This Commitment Letter and the commitments hereunder and the Fee Letter shall not be assignable by any party hereto
(except between Goldman Sachs Bank USA and GSLP (which assignment shall reduce the commitment of the assignor to the extent of the
assigned interest and the applicable assignee shall become bound by the terms and conditions and subject to all commitments and obligations
of an “Initial Lender” and “Commitment Party” hereunder)) without the prior written consent of each of the other parties hereto, and any
attempted assignment without such consent shall be void; provided that MLPFS may, without notice to you, assign its rights and obligations
under this Commitment Letter to any other registered broker dealer wholly owned by Bank of America Corporation to which all or
substantially all of Bank of America Corporation’s or any of its subsidiaries’ investment banking, commercial lending services or related
businesses may be transferred following the date of this Commitment Letter. This Commitment Letter may not be amended or any provision
hereof waived or modified except by an instrument in writing signed by the Commitment Parties and you. This Commitment Letter may be
executed in any number of counterparts, each of which shall be deemed an original and all of which, when taken together, shall constitute one
agreement. Delivery of an executed counterpart of a signature page of this Commitment Letter by facsimile transmission or electronic
21
transmission (e.g., “pdf” or “tiff”) shall be effective as delivery of a manually executed counterpart of this Commitment Letter. This
Commitment Letter and the Fee Letter are the only agreements that have been entered into among the parties hereto with respect to the
Facilities and set forth the entire understanding of the parties hereto with respect thereto. This Commitment Letter is intended to be solely for
the benefit of the parties hereto and is not intended to confer any benefits upon, or create any rights in favor of, any person other than the
parties hereto, the Indemnified Persons and, if any of this Commitment Letter or any commitment hereunder is assigned in accordance with
the first sentence of this Section 9 above, the applicable assignee or assignees. Subject to the limitations set forth in Section 2 above, the
Commitment Parties may perform the duties and activities described hereunder through any of their respective affiliates (other than an
Excluded Affiliate or other Disqualified Institution) and the provisions of Section 6 shall apply with equal force and effect to any of such
affiliates so performing any such duties or activities. This Commitment Letter shall be governed by, and construed in accordance with, the
laws of the State of New York; provided , however , that (a) the interpretation of the definition of Material Adverse Effect and whether a
Material Adverse Effect has occurred, (b) the accuracy of any Specified Transaction Agreement Representations and whether you (or any of
your affiliates) have the right (taking into account any applicable cure provisions) to terminate your (or its) obligations under the Transaction
Agreement or decline to consummate the Acquisition (in each case, in accordance with the terms of the Transaction Agreement) as a result of
a breach of such Specified Transaction Agreement Representations and (c) whether the Acquisition has been consummated in accordance
with the terms of the Transaction Agreement shall, in each case, be governed by and construed in accordance with the laws of the State of
Delaware, without giving effect to any choice or conflict of law provision or rule (whether of the State of Delaware or any other jurisdiction)
that would cause the application of the laws of any jurisdiction other than the State of Delaware.
Each party hereto hereby irrevocably and unconditionally submits to the exclusive jurisdiction of any state or Federal court
sitting in the Borough of Manhattan in the City of New York, and, in each case, any appellate court thereof, over any suit, action or
proceeding arising out of or relating to this Commitment Letter or the Fee Letter or the performance of services hereunder or thereunder,
whether in contract, tort or otherwise, and irrevocably and unconditionally agrees that it will not commence any such suit, action or
proceeding against any of the other parties hereto arising out of or in any way relating to this Commitment Letter or the Fee Letter or the
performance of services hereunder or thereunder in any forum other than such courts. Each party hereto agrees that service of any process,
summons, notice or document by registered mail addressed to such party shall be effective service of process for any suit, action or
proceeding brought in any such court. Each party hereto hereby irrevocably and unconditionally waives any objection to the laying of venue
of any such suit, action or proceeding brought in any such court and any claim that any such suit, action or proceeding has been brought in
any inconvenient forum and agrees that a final judgment in any such suit, action or proceeding shall be conclusive and may be enforced in
other jurisdictions by suit on the judgment or in any other matter provided by law. EACH PARTY HERETO HEREBY IRREVOCABLY
AGREES TO WAIVE (TO THE EXTENT PERMITTED BY APPLICABLE LAW) TRIAL BY JURY IN ANY SUIT, ACTION,
PROCEEDING, CLAIM OR COUNTERCLAIM BROUGHT BY OR ON BEHALF OF ANY PARTY RELATED TO OR ARISING OUT
OF THIS COMMITMENT LETTER OR THE FEE LETTER OR THE PERFORMANCE OF SERVICES HEREUNDER OR
THEREUNDER OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
Each of the parties hereto agrees that, if accepted by you (a) this Commitment Letter is a binding and enforceable agreement
with respect to the subject matter contained herein, including an agreement to negotiate in good faith the Facilities Documentation by the
parties hereto in a manner consistent with this Commitment Letter, it being acknowledged and agreed that the funding of the Facilities is
subject to the conditions precedent set forth in Section 5 hereof and (b) the Fee Letter is a binding and enforceable
22
agreement with respect to the subject matter contained therein. Reasonably promptly after the execution of this Commitment Letter, the
parties hereto shall proceed with the negotiation in good faith of the Facilities Documentation for the purpose of executing and delivering the
Facilities Documentation substantially simultaneously with the consummation of the Acquisition.
The syndication (if applicable), indemnification, expense reimbursement (if applicable), information (if applicable),
compensation (if applicable), jurisdiction, waiver of jury trial, service of process, venue, governing law, absence of fiduciary duty and
confidentiality provisions contained herein and in the Fee Letter shall remain in full force and effect regardless of whether the Facilities
Documentation shall be executed and delivered and notwithstanding the termination of this Commitment Letter or the Initial Lenders’
commitments hereunder; provided that your obligations under this Commitment Letter, other than your obligations relating to syndication
assistance in respect of the Facilities (which shall terminate in accordance with Section 2) and confidentiality of the Fee Letter , shall
automatically terminate and be superseded by the provisions of the Facilities Documentation upon the execution and delivery thereof, and you
shall automatically be released from all liability in connection therewith at such time. You may terminate (on a pro rata basis among all
Initial Lenders) all or any portion of the Initial Lenders’ commitments hereunder at any time subject to the provisions of the preceding
sentence; provided that the termination by you of the Initial Term Loan Lenders’ commitments with respect to the Term Loan Facility in full
will automatically, and without any further action on the part of you or the Initial Lenders, terminate all of the Initial ABL Lenders’
commitments with respect to the ABL Facility.
Please indicate your acceptance of the terms hereof and of the Fee Letter by signing in the appropriate space below and in the
Fee Letter and returning to us facsimiles or electronic copies of this Commitment Letter and the Fee Letter, in each case not later than
11:59 p.m., New York City time, on August 8, 2018, failing which the Initial Lenders’ commitments hereunder will expire at such time. In
the event that (a) the initial borrowing under the Facilities does not occur on or before the Original End Date (as defined in the Transaction
Agreement as in effect on the Signing Date) (or to the extent extended pursuant to the proviso to Section 7.1(b) of the Transaction Agreement
as in effect on the Signing Date, the Extended End Date (as defined in the Transaction Agreement as in effect on the Signing Date)), (b) the
Acquisition closes without the use of the Facilities (in each case, as to such Facility) or (c) the Transaction Agreement is validly terminated
by you prior to the closing of the Acquisition, then this Commitment Letter and the commitments hereunder shall automatically terminate
unless we shall, in our sole discretion, agree to an extension. Notwithstanding anything to the contrary, (i) in the event the ABL Amendment
is approved by the requisite lenders under the Existing ABL Facility on or prior to the Closing Date, immediately upon the Borrower’s receipt
of such approval, the commitments hereunder in respect of the Backstop ABL Facility shall be automatically terminated and thenceforth the
commitments hereunder in respect of the Incremental ABL Facility shall constitute the entire commitments hereunder in respect of the ABL
Facility and (ii) in the event the Specified Disposition (as defined in Exhibit B) is consummated on or prior to the Closing Date, to the extent
the net proceeds thereof are not applied to reduce pension liabilities on a dollar-for-dollar basis on or prior to the Closing Date, the Term
Loan Facility shall be reduced on a dollar-for-dollar basis with the amount of such net proceeds on the Closing Date. The termination of any
commitment shall not prejudice your rights and remedies in respect of any breach of this Commitment Letter or the Fee Letter.
[ SIGNATURE PAGES FOLLOW ]
23
We are pleased to have been given the opportunity to assist you in connection with the financing for the Transactions.
Very truly yours,
GOLDMAN SACHS BANK USA
By:
Name:
Title:
GOLDMAN SACHS LENDING PARTNERS LLC
By:
Name:
Title:
[Signature Page to 2 nd A&R Commitment Letter]
BANK OF AMERICA, N.A.
By:
Name:
Title:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By:
Name:
Title:
[Signature Page to 2 nd A&R Commitment Letter]
WELLS FARGO BANK, NATIONAL ASSOCIATION
By:
Name:
Title:
[Signature Page to 2 nd A&R Commitment Letter]
JPMORGAN CHASE BANK, N.A.
By:
Name:
Title:
[Signature Page to 2 nd A&R Commitment Letter]
U.S. BANK NATIONAL ASSOCIATION
By:
Name:
Title:
[Signature Page to 2 nd A&R Commitment Letter]
Accepted and agreed to as of
the date first written above:
UNITED NATURAL FOODS, INC.
By:
Name:
Title:
[Signature Page to 2 nd A&R Commitment Letter]
Project Jedi
Senior Secured Term Loan Facility
Senior Secured ABL Facility
Transaction Description
EXHIBIT A
Capitalized terms used but not defined in this Exhibit A shall have the respective meanings set forth in the letter agreement to
which this Exhibit A is attached and in the other Exhibits attached thereto. In the case of any such capitalized term that is subject to multiple
and differing definitions, the appropriate meaning thereof in this Exhibit A shall be determined by reference to the context in which it is used.
United Natural Foods, Inc., a Delaware corporation (the “ Borrower ”) intends to acquire (the “ Acquisition ”) a company
identified to us as “Spring”, a Delaware corporation (the “ Target ”), pursuant to the Agreement and Plan of Merger, dated as of the Signing
Date, among, inter alia , the Target, the Borrower and a wholly-owned subsidiary of the Borrower incorporated under the laws of the State of
Delaware (“ Merger Sub ”) (together with the schedules and exhibits thereto, and as may be amended, modified, supplemented or waived
from time to time in accordance with the terms herein and therein, the “ Transaction Agreement ”).
In connection with the foregoing, it is intended that:
a) The Borrower will obtain (i) either (x) an increase in the U.S. Revolver Commitments and/or the Canadian Commitments under and as
defined in that certain Third Amended and Restated Loan and Security Agreement, dated as of April 29, 2016, by and among the
Borrower, Bank of America, N.A., as administrative agent and the other borrowers, agents and lenders party thereto (the “ Existing ABL
Facility ”) in an aggregate principal amount of $1,100,000,000 (the “ Incremental ABL Facility ”) and an amendment to the Existing ABL
Facility (i) to the extent necessary to permit the incurrence of the Term Loan Facility and the Incremental ABL Facility and matters
related thereto, including authorizing the ABL Administrative Agent to execute and deliver an intercreditor agreement on the terms
described in the other Exhibits attached hereto described herein, (ii) that provides that the “Borrowing Base” shall be deemed to be no less
than $1,500,000,000 on the Closing Date (“ Minimum Available ABL Amount ”) and (iii) that provides that the borrowing under the
Existing ABL Facility on the Closing Date of the Minimum Available ABL Amount is subject solely to conditions precedent that are
analogous to and no more restrictive than those set forth in Exhibit D hereto (the “ ABL Amendment ”) or (y) in the event the ABL
Amendment is not approved by the requisite lenders under the Existing ABL Facility on or prior to the Closing Date, an asset-based
revolving facility in an aggregate principal amount of $2,000,000,000 comprised of (A) an asset-based revolving facility in an aggregate
principal amount of $1,950,000,000 available for U.S. Borrowers and (B) an asset-based revolving facility in an aggregate principal
amount of $50,000,000 available for the Canadian Borrower (collectively, the “ Backstop ABL Facility ” and, together with the
Incremental ABL Facility, the “ ABL Facility ”) that will be used to replace the Existing ABL Facility and (ii) a senior secured term loan
facility in an aggregate principal amount of $2,150,000,000 (the “ Term Loan Facility ” and, together with the ABL Facility, each, a “
Facility ” and collectively, the “ Facilities ”).
b) The proceeds of (x) cash on hand and (y) the ABL Loans and the Term Loans made on the Closing Date will be used to fund (i) the
payment of consideration pursuant to the terms and conditions of the Transaction Agreement (the “ Purchase Consideration ”), and the
other payments contemplated by the Transaction Agreement, (ii) the repayment in full (or the termination, discharge or defeasance (or
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arrangements reasonably satisfactory to the Initial Lenders for the termination, discharge or defeasance (or, in the case of the Existing
Term Facility, irrevocable notice for the repayment or redemption thereof will be given))) of all outstanding indebtedness (and the release
of guarantees and liens securing such indebtedness) of (A) the Borrower and its subsidiaries under (1) that certain Term Loan Agreement,
dated as of August 14, 2014, by and among the Borrower, Bank of America, N.A., as administrative agent, the lenders party thereto and
the other parties thereto, as amended on or prior to the Closing Date (the “ Existing Term Facility ”) and (2) in the case the ABL
Amendment is not approved by the requisite lenders under the Existing ABL Facility on or prior to the Closing Date, the Existing ABL
Facility, as amended on or prior to the Closing Date (provided that, for the avoidance of doubt, any letters of credit outstanding under the
Existing ABL Facility that are cash collateralized or otherwise backstopped or “rolled over” into the Backstop ABL Facility shall be
permitted to remain outstanding) and (B) the Target and its subsidiaries under (1) the Second Amended and Restated Term Loan Credit
Agreement, dated as of January 31, 2014, by and among the Target, Goldman Sachs Bank USA, as administrative agent, the lenders party
thereto and the other parties thereto, as amended on or prior to the Closing Date, (2) that certain Amended and Restated Credit
Agreement, dated as of March 21, 2013, by and among the Target, Wells Fargo Bank, National Association, as administrative agent, the
lenders party thereto and the other parties thereto, as amended on or prior to the Closing Date (provided that, for the avoidance of doubt,
any letters of credit outstanding thereunder that are cash collateralized or otherwise backstopped or “rolled over” into the Backstop ABL
Facility shall be permitted to remain outstanding) (the “ Target ABL Facility ”), (3) the Target’s 6.75% Senior Notes due June 1, 2021
and (4) the Target’s 7.75% Senior Notes due November 15, 2022 (the repayment, termination, discharge, defeasance, arrangement and
release of all such indebtedness in this clause (ii), the “ Closing Date Refinancing ”), (iii) fees and expenses incurred in connection with
the foregoing and transactions related thereto (such fees and expenses, the “ Transaction Costs ”) and (iv) with respect to the ABL
Facility, working capital and general corporate purposes.
c) On the Closing Date, the Acquisition will be effected via the merger (the “ Merger ”) of Merger Sub with and into the Company, with the
Company as the surviving entity of such Merger.
For purposes of the Commitment Letter and the Fee Letter, “ Closing Date ” shall mean the date that the loans under the
Facilities are funded and, substantially concurrently therewith, the Transaction is consummated. The transactions described above, together
with the transactions related thereto (including the payment of all Transaction Costs), are collectively referred to herein as the “ Transactions
”.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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#91297610v2
C-I-2
Project Jedi
$2,150,000,000 Senior Secured Term Loan Facility
Summary of Terms and Conditions
EXHIBIT B
Capitalized terms used but not defined in this Exhibit B shall have the meanings set forth in the Commitment Letter to which
this Exhibit B is attached and in the other Exhibits attached thereto. In the case of any such capitalized term that is subject to multiple and
differing definitions, the appropriate meaning thereof in this Exhibit B shall be determined by reference to the context in which it is used.
Borrower :
United Natural Foods, Inc.
Term Loan Administrative Agent :
Goldman Sachs Bank USA (“ GS Bank ”) will act as the sole administrative agent and sole collateral
agent (in such capacities and together with its successors and permitted assigns, the “ Term Loan
Administrative Agent ” and, collectively with the New ABL Agent (as defined in Exhibit C ), the “
Administrative Agent ”) for a syndicate of banks, financial institutions and other institutional lenders
and investors (other than Disqualified Institutions) (together with the Initial Term Loan Lenders, the “
Term Lenders ” and, collectively with the ABL Lenders (as defined in Exhibit C ), the “ Lenders ”)
reasonably acceptable to the Borrower (such acceptance not to be unreasonably withheld or delayed).
Term Loan Lead Arrangers and
Bookrunners :
GS Bank, MLPFS and US Bank (collectively, in such capacities, the “ Term Loan Lead Arrangers ”
and, together with the ABL Lead Arrangers (as defined in Exhibit C ), the “ Lead Arrangers ”).
Term Loan Facility :
A term loan facility in an aggregate principal amount of $2,150 million (the “ Term Loan Facility ”;
loans incurred under the Term Loan Facility shall be the “ Term Loans ”). The Term Loan Facility will
be available to the Borrower in U.S. Dollars.
Use of Proceeds : The proceeds of Term Loans will be applied on the Closing Date, together with cash
on hand and any amount drawn under the ABL Facility, to (a) finance a portion of the Purchase
Consideration and (b) pay Transaction Costs.
Availability : The full amount of Term Loans must be drawn in a single drawing on the Closing Date.
Amounts repaid or prepaid under the Term Loan Facility may not be reborrowed.
Interest Rates and Fees : As described on Annex I to this Exhibit B .
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Guarantees :
Security :
Maturity and Amortization: The Term Loan Facility will mature on the day that is seven (7) years
after the Closing Date (the “Maturity Date”) and will amortize in equal quarterly installments in an
aggregate annual amount equal to 1.0% of its original principal amount (subject to reduction in
connection with debt prepayments and debt buy backs), commencing the second full fiscal quarter
after the Closing Date, with the balance payable on the final maturity date.
All obligations of the Borrower under the Term Loan Facility will be unconditionally guaranteed (the “
Guarantees ”) by each existing and subsequently acquired or organized direct or indirect wholly-
owned U.S. restricted subsidiary of the Borrower to the extent permitted by applicable law and subject
to exceptions and limitations consistent with the Existing Term Facility and other customary
exceptions to be mutually agreed upon between the Borrower and the Term Loan Administrative
Agent (as defined below) (collectively, the “ Term Loan Guarantors ” and the Term Loan Guarantors,
together with the Borrower, the “ Term Loan Loan Parties ”; and, the Term Loan Guarantors together
with the ABL Guarantors, the “ Guarantors ”; and, the Term Loan Loan Parties together with the ABL
Loan Parties, the “ Loan Parties ”); provided , that on the Closing Date, each ABL Guarantor will also
be a Term Loan Guarantor; provided , further , that subsidiaries that are not “eligible contract
participants” (after giving effect to any “keepwell” provisions) shall not guarantee swap obligations to
the extent it is illegal or unlawful under the Commodity Exchange Act, or any regulation thereunder,
by virtue of such subsidiary failing to constitute an “eligible contract participant”. Notwithstanding the
foregoing, it is understood and agreed that there shall be no guarantees governed under the laws of any
non-U.S. jurisdiction.
Subject to the Certain Funds Provision and the provisions of the immediately following paragraph and
consistent with the Existing Term Facility, the obligations of Borrower and the Term Loan Guarantors
in respect of the Term Loan Facility will be secured by (a) a perfected first-priority (subject to
exceptions consistent with the Existing ABL Facility and the Existing Term Facility) security interest
in the Term Loan Priority Collateral (as defined in Exhibit C ) and (b) a perfected second-priority
(subject to permitted liens, including in respect of the applicable ABL Facility, and other exceptions
consistent with the Existing ABL Facility and the Existing Term Facility) security interest in the ABL
Priority Collateral (as defined in Exhibit C) (the foregoing, collectively, the “ Collateral ”), in each
case, subject to permitted liens and to certain exceptions and limitations consistent with the Existing
ABL Facility and the Existing Term Facility and other customary exceptions to be mutually agreed
upon between the Borrower and the Term Loan Administrative Agent.
Notwithstanding anything to the contrary, the Borrower and the Term Loan Guarantors shall not be
required, nor shall the Term Loan Administrative Agent be authorized, (i) to perfect the above
described pledges, security, interests and mortgages by any means other than by (A) filings pursuant to
the UCC in the office of the secretary of state (or similar central filing office) of the relevant State(s),
(B) filings in United States government
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offices with respect to intellectual property as expressly required in the Term Loan Facility
Documentation, (C) delivery to the Term Loan Administrative Agent, for its possession, of all
Collateral consisting of material intercompany notes and stock certificates of the Borrower and its
material wholly-owned restricted subsidiaries and material instruments, issued to the Borrower or a
Guarantor or (D) mortgages in respect of fee owned real property located in the U.S. with a fair
market value in excess of an amount to be mutually agreed between the Borrower and the Term Loan
Administrative Agent, in each case expressly required in the Term Loan Facility Documentation, (ii)
to enter into any control agreement with respect to any deposit account, securities account or
commodities account or contract, (iii) to take any action in any non-U.S. jurisdiction or pursuant to the
requirements of the laws of any non-U.S. jurisdiction in order to create any security interests or to
perfect any security interests, including with respect to any intellectual property registered outside of
the U.S. (it being understood that there shall be no security agreements or pledge agreements governed
under the laws of any non-U.S. jurisdictions) or (iv) except as expressly set forth above, to take any
other action with respect to any Collateral to perfection through control agreements or to otherwise
perfect by “control”.
All the above-described pledges and security interests shall be created on terms, and pursuant to
documentation, consistent with the Term Loan Documentation Principles and subject to exceptions
permitted under the Term Loan Facility Documentation. Notwithstanding anything to the contrary
contained herein, the requirements of the preceding paragraphs in this “Security” section shall be
subject to the Certain Funds Provision.
Intercreditor Matters :
The lien priority, relative rights and other creditors’ rights issues in respect of the Term Loan Facility
and the ABL Facility will be set forth in a customary intercreditor agreement consistent with the Term
Loan Documentation Principles and the ABL Documentation Principles.
Uncommitted Incremental Facilities : After the Closing Date, the Borrower will have the right to solicit the existing Term Lenders or
prospective lenders determined by the Borrower to provide (x) incremental commitments consisting of
one or more new tranches of revolving credit facilities available under the Facilities Documentation
(each, an “ Incremental Revolving Facility ”) and/or (y) incremental commitments consisting of one or
more increases to the Term Loan Facility and/or one or more new tranches of term loans to be made
available under the Term Loan Facility Documentation (each, a “ Incremental Term Facility ” and
together with any Incremental Revolving Facility, the “ Incremental Facilities ”) in an aggregate
amount not to exceed the pro forma Consolidated EBITDA (to be defined in a manner consistent with
the Term Loan Documentation Principles and including, without limitation, customary pro forma
adjustments to include run-rate synergies management expects to be realized, subject to customary
parameters to be agreed) on the Closing Date (the “ Incremental Fixed Dollar Basket ”), plus (2) all
voluntary prepayments of the Term Loan Facility, any Incremental Term Facility and permanent
commitment reductions of any Incremental Revolving Facility (except to the extent funded with the
proceeds of the
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incurrence of long-term indebtedness), plus (3) an unlimited amount so long as, in the case of this
clause (3), after giving effect to the incurrence of such amount, any acquisition consummated in
connection therewith and all other appropriate pro forma adjustments, (x) if such Incremental Facility
is secured on a pari passu basis with the Term Loans, the Consolidated First Lien Net Leverage Ratio
(as defined below) is equal to or less than the pro forma Consolidated First Lien Net Leverage Ratio
on the Closing Date, (y) if such Incremental Facility is secured on a junior basis to the Term Loans,
the Consolidated Secured Net Leverage Ratio (as defined below) is equal to or less than the pro forma
Consolidated Secured Net Leverage Ratio on the Closing Date or (z) if such Incremental Facility is
unsecured, the Consolidated Total Net Leverage Ratio (as defined below) is equal to or less than the
pro forma Consolidated Total Net Leverage Ratio on the Closing Date, in each case, after giving
effect to any acquisition consummated in connection therewith and all other appropriate pro forma
adjustments, and assuming for purposes of this calculation that (i) the full committed amount of any
Incremental Revolving Facility and any Incremental Equivalent Debt then being incurred at such time
shall be treated as outstanding and (ii) cash proceeds of any such Incremental Facility and Incremental
Equivalent Debt then being incurred shall not be netted from indebtedness ( provided , however , that
if amounts incurred under this clause (3) are incurred concurrently with the incurrence of Incremental
Facilities in reliance on clause (1) and/or clause (2) above, the Consolidated First Lien Net Leverage
Ratio, the Consolidated Secured Net Leverage Ratio or Consolidated Total Net Leverage Ratio, as
applicable, shall be permitted to exceed the Consolidated First Lien Net Leverage Ratio, the
Consolidated Secured Net Leverage Ratio or the Consolidated Total Net Leverage Ratio, as
applicable, to the extent of such amounts incurred in reliance on clause (1) and/or clause (2)), on terms
agreed by the Borrower and the lender(s) providing the respective Incremental Facility (it being
understood that (A) if the Consolidated First Lien Net Leverage Ratio, Consolidated Secured Net
Leverage Ratio or Consolidated Total Net Leverage Ratio, as applicable, incurrence test is met, then,
at the election of the Borrower, any Incremental Facility may be incurred under clause (3) above
regardless of whether there is capacity under clause (1) and/or clause (2) above and (B) any portion of
any Incremental Facility incurred in reliance on clause (1) and/or clause (2) shall be reclassified, as the
Borrower may elect from time to time, as incurred under clause (3) if the Borrower meets the
applicable leverage ratio under clause (3) at such time on a pro forma basis); provided that:
(i) (a) no event of default (or, in the case of an Incremental Facility the proceeds of which will be used
to finance a Permitted Acquisition or other similar permitted investment or repayment of indebtedness
that requires an irrevocable prepayment or redemption notice, no payment or bankruptcy event of
default) exists or would exist after giving effect thereto and (b) the representations and warranties in
the Term Loan Facility Documentation shall be true and correct in all material respects ( provided
that, in the case of an Incremental Facility used to finance a Permitted Acquisition or other similar
permitted investment or repayment of indebtedness that requires an irrevocable prepayment or
redemption notice, only the Specified
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Representations (conformed as necessary for such Permitted Acquisition) shall be required to be true
and correct in all material respects),
(ii) any Incremental Facility shall rank pari passu or junior in right of payment with the Facilities and
will either be secured on a pari passu or junior basis with the Term Loan Facility by the same
Collateral securing the Term Loan Facility or be unsecured, and shall not be secured by any lien on the
assets of any Term Loan Loan Party that does not also secure the then outstanding Term Loan Facility,
or be guaranteed by any subsidiary other than a Term Loan Loan Party under the then outstanding
Term Loan Facility, and
(iii) loans to be made under any Incremental Facility (each, under any Incremental Term Facility, an “
Incremental Term Loan ” and, each, under any Incremental Revolving Facility, an “ Incremental
Revolving Loan ” and, collectively with Incremental Term Loans, the “ Incremental Loans ”) shall be
subject to terms determined by the Borrower and the lenders providing such Incremental Facility,
except that:
(1) in connection with any Incremental Term Loans, unless any Incremental Term Loans are
made a part of the Term Loan Facility (in which case all terms thereof shall be identical to
those of the Term Loan Facility), (a) if the “effective margin” applicable to any Incremental
Term Loans that are pari passu in right of payment and security with the initial Term Loans
(which (x) shall be deemed to include all upfront or similar fees or OID (amortized over the
shorter of (1) the weighted average life to maturity of such loans and (2) four years) payable
to all lenders providing such Incremental Term Loans, (y) if such Incremental Term Loans
include an interest rate floor greater than the applicable interest rate floor under the initial
Term Loans, such differential between interest rate floors shall be equated to the applicable
interest rate margin for purposes of determining whether an increase to the interest rate
margin under the initial Term Loans shall be required, but only to the extent an increase in
the interest rate floor in the initial Term Loans would cause an increase in the interest rate
then in effect thereunder, and in such case, the interest rate floor (but not the interest rate
margin) applicable to the initial Term Loans shall be increased to the extent of such
differential between interest rate floors and (z) shall exclude structuring, underwriting,
ticking, arrangement, amendment, consent, commitment and other fees payable in
connection therewith) determined as of the initial funding date for such Incremental Term
Loans, exceeds the “effective margin” applicable to the initial Term Loans (determined on
the same basis as provided above) by more than 0.50%, then the “effective margin” for the
initial Term Loans shall be increased so that the “effective margin” thereof equals the
“effective margin” of such Incremental Term Loans, minus 0.50% (all adjustments made
pursuant to this clause (iii)(1)(a), the “ MFN Adjustment ”); provided that if any
Incremental Term Loan is incurred more than 12 months after the Closing Date, the MFN
Adjustments shall not apply, (b) the final stated maturity date for any
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Incremental Term Loans may be the same as or later (but not sooner) than the final stated
maturity date applicable to the then-existing Term Loans, (c) the average weighted life to
maturity of such Incremental Term Loans shall be no shorter than the average weighted life
to maturity applicable to the then-existing Term Loans (without giving effect to any
amortization or prepayments on the outstanding Term Loans), (d) the Borrower may issue,
in lieu of any Incremental Term Loans, first lien secured or junior lien secured or unsecured
notes, first lien loans, junior lien loans, unsecured loans, or secured or unsecured
“Mezzanine” debt (“ Incremental Equivalent Debt ”) (in each case, (x) if in the form of
junior lien or unsecured loans or notes, with a maturity at least 91 days after the maturity of
the then existing Term Loans (or if in the form of first lien secured loans or notes, with a
maturity no earlier than the maturity of the then existing Term Loans), (y) not guaranteed by
any subsidiary other than a Term Loan Loan Party under the then outstanding Term Loan
Facility and (z) to the extent secured, subject to customary intercreditor terms to be
consistent with the Term Loan Documentation Principles and not secured by any lien on the
assets of any Term Loan Loan Party that does not also secure the then outstanding Term
Loan Facility) if the applicable conditions to effecting and borrowing under an Incremental
Term Facility (as if such Incremental Equivalent Debt were an Incremental Term Loan)
would have been satisfied, provided that, the provisions of the preceding clause (iii)(1)(a)
shall not apply other than with respect to any loans that are pari passu with the Term Loans
in security and right of payment, and clauses (iii)(1)(b) and (iii)(1)(c) shall not apply to any
customary bridge facility so long as the long-term debt into which any such customary
bridge facility is to be converted satisfies such clauses; provided further that (x) mandatory
prepayments shall not be permitted to be applied to any Incremental Term Facility or
Incremental Equivalent Debt on a greater than pro rata basis relative to the initial Term
Loans (except with respect to mandatory prepayments with the proceeds of Refinancing
Facilities or Refinancing Notes) and (y) the covenants, events of default and guarantees of
such Incremental Term Loans or Incremental Equivalent Debt, if not consistent with the
terms of the corresponding Term Loans, shall not be materially more restrictive to the
Borrower, when taken as a whole, than the terms of the Term Loans unless (1) lenders under
the Term Loan Facility also receive the benefit of such more restrictive terms or (2) such
more restrictive terms apply after the maturity date of the initial Term Loan Facility; and
(2) in connection with any Incremental Revolving Loans, (a) the final stated maturity date
for any Incremental Revolving Loans may be the same as or later (but not sooner) than the
final stated maturity date applicable to the ABL Facility, (b) any Incremental Revolving
Loans shall not be subject to (x) any mandatory prepayments other than those customary
mandatory prepayments in connection with the Incremental Revolving Loans under any
Incremental Revolving Facility exceeding the commitments thereunder or (y) any mandatory
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commitment reductions or scheduled amortization payments and (c) the covenants, events of
default and guarantees of any Incremental Revolving Loans shall not be materially more
restrictive to the Borrower, when taken as a whole, than the terms of the Term Loans.
Existing lenders under the Facilities may, but shall not be obligated to without their prior written
consent, provide a commitment and/or make any loans pursuant to any Incremental Facility, and
nothing contained herein constitutes, or shall be deemed to constitute, a commitment with respect to
any Incremental Facility. The use of proceeds, if any, of any Incremental Facility will be as agreed by
the Borrower and the lenders providing such Incremental Facility.
“ Consolidated First Lien Net Leverage Ratio ” shall mean the ratio of (i) consolidated first lien net
debt (consisting of indebtedness for borrowed money (including, for the avoidance of doubt, any
amounts outstanding under the ABL Facility), capitalized lease obligations, purchase money debt and
drawn and unreimbursed letters of credit as reflected on the balance sheet of the Borrower and its
restricted subsidiaries, in each case secured, in whole or in part, by first priority liens on the assets of
the Borrower or any restricted subsidiary), minus unrestricted cash and cash equivalents (excluding
for purposes of any calculation of the Consolidated First Lien Net Leverage Ratio in connection with
the incurrence of any indebtedness, the cash proceeds of such incurrence) to (ii) Consolidated
EBITDA for the most recent four fiscal quarter period for which financial statements have been
delivered (or were required to have been delivered) pursuant to the Term Loan Facility
Documentation.
“ Consolidated Secured Net Leverage Ratio ” shall mean the ratio of (i) consolidated secured net debt
(consisting of indebtedness for borrowed money (including, for the avoidance of doubt, any amounts
outstanding under the ABL Facility), capitalized lease obligations, purchase money debt and drawn
and unreimbursed letters of credit as reflected on the balance sheet of the Borrower and its restricted
subsidiaries, in each case secured, in whole or in part, by liens on the assets of the Borrower or any
restricted subsidiary), minus unrestricted cash and cash equivalents (excluding for purposes of any
calculation of the Consolidated Secured Net Leverage Ratio in connection with the incurrence of any
indebtedness, the cash proceeds of such incurrence) to (ii) Consolidated EBITDA for the most recent
four fiscal quarter period for which financial statements have been delivered (or were required to have
been delivered) pursuant to the Term Loan Facility Documentation.
“ Consolidated Total Net Leverage Ratio ” shall mean the ratio of (i) consolidated net debt (consisting
of indebtedness for borrowed money, capitalized lease obligations, purchase money debt and drawn
and unreimbursed letters of credit as reflected on the balance sheet of the Borrower and its restricted
subsidiaries), minus unrestricted cash and cash equivalents (excluding for purposes of any calculation
of the Consolidated Total Net Leverage Ratio in connection with the incurrence of any indebtedness,
the cash proceeds of such incurrence) to (ii) Consolidated
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Refinancing Facilities :
EBITDA for the most recent four fiscal quarter period for which financial statements have been
delivered (or were required to have been delivered) pursuant to the Term Loan Facility
Documentation.
The Term Loan Facility Documentation will permit the Borrower to refinance loans under the Term
Loan Facility or any Incremental Term Facility or commitments under the Incremental Revolving
Facility from time to time, in whole or part, with one or more new term facilities (each, a “
Refinancing Term Facility ”) or new revolving credit facilities (each a “ Refinancing Revolving
Facility ” and, together with any Refinancing Term Facility, collectively, the “ Refinancing Facilities
”), respectively, under the Term Loan Facility Documentation solely with the consent of the Borrower
and the institutions providing such Refinancing Term Facility or Refinancing Revolving Facility and
with one or more additional series of senior unsecured notes or loans or senior secured notes or loans
that will be secured by the Collateral on a pari passu or junior basis with the Term Loan Facility (such
notes or loans, “ Refinancing Notes ”); provided that (i) with respect to Refinancing Facilities or
Refinancing Notes that are secured, customary intercreditor agreements are entered into which are
reasonably acceptable to the Borrower and Term Loan Administrative Agent, (ii) any Refinancing
Term Facility or Refinancing Notes do not mature prior to the maturity date of, or have a shorter
weighted average life than, loans under the Term Loan Facility or Incremental Term Facility being
refinanced (without giving effect to any amortization or prepayments on the outstanding Term Loans
or Incremental Term Loans, as applicable) or, with respect to any Refinancing Notes, have mandatory
prepayment provisions (other than related to customary asset sale (or similar event) and change of
control offers or prepayments and customary acceleration rights after an event of default) that would
result in mandatory prepayment of such Refinancing Notes prior to the loans under the Term Loan
Facility being refinanced (it being understood the Borrower shall be permitted to prepay or offer to
purchase any first lien secured Refinancing Notes pursuant to the second paragraph of the “Mandatory
Prepayments” section below), (iii) any Refinancing Revolving Facility does not mature prior to the
maturity date of the revolving commitments being refinanced, (iv) the aggregate principal amount of
any Refinancing Facility or Refinancing Notes shall not be greater than the aggregate principal amount
of the applicable class under the Facilities being refinanced or replaced, plus any fees, premiums,
original issue discount and accrued interest associated therewith and costs and expenses related thereto
and such Facilities being refinanced or replaced will be permanently reduced on a dollar-for-dollar
basis concurrently with the issuance of such Refinancing Facility or Refinancing Notes, (v) the Term
Loan Facility Documentation will contain provisions providing for the pro rata treatment of the
payment, borrowing, participation and commitment reduction of any Incremental Revolving Facility
and any Refinancing Revolving Facility, (vi) any Refinancing Facility or Refinancing Notes, to the
extent secured, shall not be secured by any lien on any asset of any Term Loan Loan Party that does
not also secure the then outstanding applicable Term Loans, or be guaranteed by any Subsidiary other
than the Term Loan Guarantors under the then outstanding Term Loans, (vii) the other terms and
conditions of such Refinancing Facilities or
B-8
Refinancing Notes (excluding pricing, fees and optional prepayment or redemption terms which shall
be determined in good faith by the Borrower) shall either, at the option of the Borrower, (x) reflect
market terms and conditions (taken as a whole) at the time of incurrence or issuance (as determined in
good faith by the Borrower) or (y) if not consistent with the terms of the corresponding class under the
Term Loan Facility, not be materially more restrictive to the Borrower, when taken as a whole, than
the terms of the applicable class under the Term Loan Facility (or any revolving credit facility
thereunder) being refinanced or replaced unless (1) the Term Lenders under the corresponding class
under the Term Loan Facility also receive the benefit of such more restrictive terms or (2) any such
provisions apply only after the maturity date of the Term Loan Facility. In connection with any
Refinancing Facility or Refinancing Notes, the Term Loan Facility Documentation will provide the
Borrower the right to require the applicable Term Lenders or lenders in respect of any Incremental
Facility to assign their loans and commitments to the providers of any such Refinancing Facility or
Refinancing Notes.
Mandatory Prepayments :
The Term Loans shall be prepaid with:
(a) 100% of the net cash proceeds from issuances of debt by the Borrower or any of its
restricted subsidiaries (with appropriate exceptions for all permitted indebtedness (other than
Refinancing Term Facilities and Refinancing Notes) and the Incremental Facilities);
(b) for each fiscal year of the Borrower (beginning with the first full fiscal year following the
Closing Date) 50% (with step-downs to 25% and 0% if the Consolidated First Lien Net
Leverage Ratio is less than 0.50:1.00 and 1.00:1.00 inside the Consolidated First Lien Net
Leverage Ratio as of the Closing Date) of the Borrower’s annual excess cash flow (to be
defined consistent with the Term Loan Documentation Principles (such definition to provide
for a deduction from excess cash flow, without duplication among periods, of cash used (or
to be used within a time period to be mutually agreed and consistent with the Term Loan
Documentation Principles) to finance permitted acquisitions, other investments and capital
expenditures (to the extent such amount are used or to be used within agreed upon time
period for permitted acquisitions, other investments and capital expenditures, including any
of the foregoing for which a binding agreement (or binding commitment) then exists and
subject to reversal if such case is not so used within such agreed time period and to the
extent not financed with long term debt proceeds) and for certain restricted payments,
permitted tax distributions, scheduled payments of indebtedness and prepayments of other
indebtedness, subject to limitation consistent with the Term Loan Documentation Principles,
and to include a dollar-for-dollar credit for the following (to the extent not financed with
long-term debt proceeds): (x) voluntary permanent prepayments of (i) the Term Loan
Facility and any Incremental Term Facility, any Incremental Equivalent Debt, any
Refinancing Notes and any Refinancing Term Facility, in each case that is secured on a pari
passu basis with the Term Loan Facility (in each case, including any
B-9
debt buyback, but limited to the actual cash amount paid by Borrower in connection with
such buyback) and (ii) the ABL Facility, any Incremental Revolving Facility, any
Refinancing Revolving Facility and any revolving facility refinancing, replacing or
extending any of the foregoing (to the extent accompanied by a permanent reduction of the
relevant commitment) and (y) repayment of the ABL Loans made to account for any
additional OID or upfront fees that are implemented pursuant to the “market flex” provisions
of the Fee Letter; and
(c) 100% of the net cash proceeds of all non-ordinary course asset sales or other dispositions of
property by the Borrower or any of its restricted subsidiaries (including casualty insurance
and condemnation proceeds and to the extent not consummated prior to the Closing Date and
the net proceeds thereof not applied to reduce pension liabilities on a dollar-for-dollar basis,
dispositions in whole or in part of the retail business of the Target (collectively, the “
Specified Disposition ”), but with exceptions for ordinary course dispositions, dispositions
of obsolete or worn-out property and property no longer used or useful in the business (other
than the Specified Disposition) and other exceptions to be consistent with the Term Loan
Facility Documentation) in excess of an individual and annual threshold amount to be agreed
and (other than with respect to proceeds of the Specified Disposition) subject to a 100%
reinvestment right if reinvested (or committed to be reinvested) within 18 months of such
sale or disposition (or 24 months in the event a binding letter of intent is entered into within
such 18-month period).
Mandatory prepayments shall be applied pro rata among classes of term loans, except that (i) the
Borrower may direct that proceeds of Refinancing Term Facilities or Refinancing Notes shall be
applied to the class or classes of term loans to be refinanced as selected by the Borrower and (ii)
Incremental Term Facilities and Refinancing Term Facilities may participate in mandatory
prepayments on a less than pro rata basis. Mandatory prepayments of the Term Loans shall be
applied to scheduled installments thereof in direct order of maturity (without premium or penalty);
provided , that the Term Loan Facility Documentation shall provide that in the case of mandatory
prepayments pursuant to clauses (b) or (c) above, a ratable portion of such mandatory prepayment may
be applied to redeem, prepay or offer to purchase any Refinancing Notes or Incremental Equivalent
Debt (collectively, “ Additional Debt ”), in each case secured on a pari passu basis with the Term Loan
Facility and if required under the terms of the applicable documents governing such Additional Debt.
All prepayments referred to in clauses (a) through (c) above are subject to there being no adverse tax
consequences and to permissibility under (i) local law ( e.g. , financial assistance, corporate benefit,
restrictions on upstreaming of cash intra-group and the fiduciary and statutory duties of the directors of
the relevant subsidiaries) and (ii) material constituent document restrictions (including as a result of
minority ownership by third parties)
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Voluntary Prepayments :
Prepayment Premium :
and other material agreements (so long as any prohibition is not created in contemplation of such
prepayment). The non-application of any prepayment amounts as a consequence of the foregoing
provisions will not, for the avoidance of doubt, constitute a default or an event of default, and such
amounts shall be available for working capital purposes of the Borrower and its restricted subsidiaries
as long as not required to be prepaid in accordance with the following provisions. Borrower and its
restricted subsidiaries will undertake to use reasonable efforts to overcome or eliminate any such
restrictions (subject to the considerations above and as determined in the Borrower’s reasonable
business judgment) to make the relevant prepayment. Notwithstanding the foregoing, any prepayments
required after application of the above provision shall be net of any costs, expenses or taxes incurred
by the Borrower or any of its affiliates and arising as a result of compliance with the preceding
sentence.
Any Term Lender under the Term Loan Facility may elect not to accept its pro rata portion of any
mandatory prepayment (other than with respect to Refinancing Notes and Refinancing Term Facilities)
(each, a “ Declining Term Loan Lender ”). Any prepayment amount declined by a Declining Term
Loan Lender may be retained by the Borrower (“ Retained Declined Proceeds ”).
Voluntary prepayments of borrowings under the Term Loan Facility will be permitted at any time, in
minimum principal amounts to be mutually agreed upon between the Borrower and the Term Loan
Administrative Agent consistent with the Term Loan Documentation Principles, without premium or
penalty (except the Prepayment Premium referred to below), subject to reimbursement of the Term
Lenders’ redeployment costs (other than lost profits) in the case of a prepayment of Adjusted LIBOR
Loans prior to the last day of the relevant interest period. Voluntary prepayments of the Term Loans
shall be applied to installments thereof as directed by the Borrower (and absent such direction, in
direct order of maturity). All voluntary prepayments shall be applied to the class or classes of Term
Loans as selected by the Borrower.
Voluntary prepayments and mandatory prepayments (or repricing or refinancing through any waiver,
consent or amendment, including any mandatory assignment in connection therewith) of initial Term
Loans made pursuant to clause (a) of the “Mandatory Prepayments” section of this Term Sheet prior to
the date that is six months after the Closing Date will be subject to a prepayment premium of 1.00%
(the “ Prepayment Premium ”) of the principal amount prepaid, refinanced or amended to the extent
constituting a Repricing Transaction. “ Repricing Transaction ” shall mean (i) any prepayment or
repayment of initial Term Loans with the proceeds of, or any conversion of initial Term Loans into,
any new or replacement tranche of senior secured term loans under credit facilities the primary
purpose of which is to reduce the all-in-yield applicable to the initial Term Loans and (ii) any
amendment to the initial Term Loan Facility (or any exercise of any “yank-a-bank” rights in
connection therewith) the primary purpose of which is to reduce the all-in-yield applicable to the
initial Term Loans (with the all-in-yield, in each case, calculated in a manner consistent
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with the MFN Adjustment); provided that such Prepayment Premium shall not apply if such
refinancing or amendment is in connection with a “change of control” transaction, initial public
offering or any transformative acquisition.
Term Loan Facility Documentation : The definitive documentation with respect to the Term Loan Facility (the “ Term Loan Facility
Documentation ”) will be initially prepared by counsel to the Borrower based on a recent precedent to
be agreed for a similarly-situated borrower in the syndicated term loan “B” market to be mutually
agreed, will contain only those mandatory prepayments set forth above in this Term Sheet and
representations, warranties, conditions to borrowing, affirmative, negative and financial covenants and
events of default set forth below in this Term Sheet, in each case applicable to the Borrower and its
restricted subsidiaries, with materiality thresholds, qualifications, exceptions, “baskets” and grace and
cure periods to be mutually agreed, with changes and modifications that reflect the “market flex”
provisions of the Fee Letter and shall be no less favorable (except as expressly set forth in this Exhibit
B) to the Borrower and its subsidiaries than the Existing Term Facility (collectively, the “ Term Loan
Documentation Principles ”). Notwithstanding the foregoing, all leases of the Borrower, the
Guarantors and the respective restricted subsidiaries of the Borrower or Subsidiary Guarantors that are
or would be treated as operating leases for purposes of GAAP as of the Signing Date shall be
accounted for as operating leases for purposes of the defined financial terms, including “Capital Lease
Obligations” under the Term Loan Facility Documentation regardless of any change to GAAP
following such date which would otherwise require such leases to be treated as capital leases; provided
that financial reporting shall not be affected thereby. The Term Loan Facility Documentation will
contain customary European Union bail-in and Beneficial Ownership Regulation provisions and, to
the extent applicable, Department of Labor lender regulatory representations. The Term Loan Facility
Documentation shall be subject in all respects to the Certain Funds Provision.
Representations
and Warranties :
Consistent with the Term Loan Documentation Principles and include (and limited to) the following
(to be applicable to the Borrower and its restricted subsidiaries): pro forma financial statements; no
Material Adverse Effect (as defined below) after the Closing Date; legal existence; compliance with
laws (including, without limitation, anti-terrorism laws, FCPA and OFAC); organizational power and
authority; due authorization, execution, delivery and enforceability of the Term Loan Facility
Documentation; no violation of or conflict with law, organizational documents or material debt
agreements; government approvals; material litigation; ownership of material property; intellectual
property; taxes; the Patriot Act; Beneficial Ownership Certification; FCPA; Sanctions (including
OFAC); Federal Reserve regulations; ERISA and Canadian pension regulations; Investment Company
Act; environmental matters; labor matters; governmental consents; solvency on the Closing Date;
accuracy of written disclosure; the Patriot Act; PACA and PSA, and creation, perfection and validity
of security interests (subject to permitted liens and other exceptions to perfection to be mutually
agreed and consistent with the Term Loan Documentation Principles).
B-12
Conditions Precedent:
Affirmative Covenants :
“ Material Adverse Effect ” means any event, circumstance or condition that has had a material and
adverse effect on (a) the business, results of operations or financial condition of the Borrower and its
restricted subsidiaries, taken as a whole, (b) the ability of the Borrower and its restricted subsidiaries,
taken as a whole, to perform their material payment obligations under the Facilities Documentation or
(c) material remedies (taken as a whole) of the Administrative Agent and the Lenders under the
Facilities Documentation.
The availability of the Term Loan Facility on the Closing Date will be subject solely to the applicable
conditions precedent set forth in Exhibit D to the Commitment Letter. For the avoidance of doubt, it is
agreed that conditions set forth in Exhibit D are subject, in all respects, to the Certain Funds
Provision.
Consistent with the Term Loan Documentation Principles (to be applicable to the Borrower and its
restricted subsidiaries) and limited to the following: delivery of consolidated annual audited financial
statements within 120 days of the end of each fiscal year without any going concern qualification or
exception (except to the extent such qualification or exception is a result of a current maturity of
indebtedness or any actual or prospective default of any financial covenant) and, for each of the first
three fiscal quarters of any fiscal year, quarterly unaudited financial statements within 45 days for each
of the first three fiscal quarters of any fiscal year; together with the delivery of annual financials,
customary management discussion and analysis; together with the delivery of quarterly financials,
summary management discussion and analysis; quarterly lender calls at the Term Loan Administrative
Agent’s request; annual budgets and quarterly (for the first three fiscal quarters of each fiscal year) and
annual compliance certificates; payment of material taxes; maintenance of existence; compliance with
laws; maintenance of property (subject to casualty, condemnation and normal wear and tear) and
adequate insurance; maintenance of books and records; right of the Term Loan Administrative Agent
to inspect property and books and records (subject to frequency and cost reimbursement limitations
consistent with the Term Loan Documentation Principles and other than information subject to
confidentiality obligations or attorney-client privilege and other exceptions to be agreed); information
(including, without limitation, the PATRIOT Act and the Beneficial Ownership Regulation); notices of
events of default; changes in fiscal year; designation and re-designation of restricted and unrestricted
subsidiaries; notices of litigation and ERISA events which, in either case, result in a Material Adverse
Effect; use of proceeds; further assurances with respect to the Collateral and Guarantees; material
changes in lines of business (other than lines of business complementary, ancillary, synergistic or
incidentally related to then-existing lines of business); commercially reasonable efforts to maintain
public ratings (but not to maintain a specific rating); in each case, all with customary materiality
qualifiers, exceptions and limitations to be agreed upon and consistent with the Term Loan
Documentation Principles.
B-13
Negative Covenants :
Consistent with the Term Loan Documentation Principles (to be applicable to the Borrower and its
restricted subsidiaries) and limited to the following (which shall be subject to customary materiality
qualifiers, exceptions and limitations to be mutually agreed upon and which shall be consistent with
the Term Loan Documentation Principles):
1. Limitation on asset sales (with exceptions to include, without limitation, the Specified Disposition).
2. Limitation on mergers, liquidations, dissolutions and other fundamental changes.
3. Limitations on dividends, stock repurchases and redemptions of equity interests.
4. Limitation on incurrence of indebtedness (with exceptions to include, without limitation, the
Facilities, any Incremental Facility, Refinancing Facility, Incremental Equivalent Debt or Refinancing
Notes or and any permitted refinancings thereof).
5. Limitation on investments.
6. Limitation on liens (with exceptions to include liens securing the Facilities (including any
Incremental Facility and any Refinancing Facility), Incremental Equivalent Debt and Refinancing
Notes).
7. Limitations on restrictions on distributions from subsidiaries and granting of negative pledge
clauses.
8. Limitations on prepayments, redemptions and repurchases of certain material debt that is
subordinated in right of payment or security to the Facilities or is unsecured, excluding for the
avoidance of doubt, the ABL Loans.
9. Limitations on amendments to organizational documents and material Junior Debt documents, in
each case, solely to the extent such amendments are materially adverse to the Term Lenders.
10. Limitations on transactions with affiliates.
Unless an event of default has occurred and is continuing or would result therefrom (at the time of
execution of a binding agreement in respect thereof), the Borrower and its restricted subsidiaries may
make acquisitions (each, a “ Permitted Acquisition ”), subject solely to the following terms and
conditions: (i) after giving effect thereto, the Borrower is in compliance with the permitted lines of
business covenant and (ii) if the Borrower or any of its restricted subsidiaries acquires the majority of
the equity interests of any person in connection with such acquisition such person will, subject to the
right of the Borrower to designate an unrestricted subsidiary and (subject to a cap on amounts invested
by Term Loan Loan Parties in entities that do not become (or assets that do not become owned by)
Term Loan
B-14
Loan Parties) become a restricted subsidiary and, solely to the extent required by and subject to the
limitations set forth in, “Guarantee”” and “Security” and the immediately preceding parenthetical
above, the acquired company and its subsidies will become Term Loan Guarantors and pledge their
Collateral to the Term Loan Administrative Agent.
The Borrower will be also permitted to utilize an “ Available Additional Basket ” in an amount equal
to (a) a fixed amount to be agreed, plus (b) 50% of cumulative consolidated net income (to be defined
consistent with the Term Loan Documentation Principled), plus (c) the proceeds of new public or
private qualified equity issuances by, and capital contributions to, the Borrower after the Closing Date,
plus (d) debt and disqualified stock which have been exchanged or converted into qualified equity of
the Borrower (and any direct or indirect parent thereof) after the Closing Date, plus (e) the proceeds of
sales of investments made under the Available Additional Basket, plus (f) without duplication of
amounts under clause (e) above, returns, profits, distributions and similar amounts received on
investments made under the Available Additional Basket (up to the amount of the original
investment), plus (g) the investments of the Borrower and its restricted subsidiaries in any unrestricted
subsidiary that have been transferred to the Borrower or any of its restricted subsidiaries, in each case
up to the amount of the original investment made in such unrestricted subsidiary under the Available
Additional Basket, plus (h) the amount of Retained Declined Proceeds, plus (i) the sale of equity
interests or assets of an unrestricted subsidiary, joint venture or minority investment that has been re-
designated as a restricted subsidiary or that has been merged or consolidated into a Term Loan Party or
any of its restricted subsidiaries or the fair market value of the assets of any unrestricted subsidiary,
joint venture or minority investment that have been transferred to a Term Loan Loan Party or any of its
restricted subsidiaries, in each case up to the amount of the original investment made in such
unrestricted subsidiary, joint venture or minority investment under the Available Additional Basket,
plus (k) certain other items to be mutually agreed and consistent with the Term Loan Documentation
Principles, in the case of each of the foregoing clauses (a) through (k), to the extent not otherwise
applied to make investments to other restricted payments (including subordinated debt prepayments,
redemptions or repurchases); provided that, to the extent such amounts are to be utilized for
dividends, stock repurchases and redemptions of equity interests or for prepayments, redemption and
repurchases of Junior Debt, the unused amounts under the Available Additional Basket shall only be
available so long as (x) no event of default has occurred and is continuing and (y) the Borrower shall
be in compliance, on a pro forma basis, with a Consolidated Total Net Leverage Ratio to be agreed
(the “ Available Additional Basket Conditions ”).
Limited Condition Transactions :
Consistent with the Term Loan Documentation Principles.
Financial Covenant :
None.
Unrestricted Subsidiaries :
The Term Loan Facility Documentation will contain provisions pursuant to
B-15
Events of Default :
Voting :
which, so long as no event of default is continuing, the Borrower will be permitted to designate any
existing or subsequently acquired or organized subsidiary as an “unrestricted subsidiary” and
subsequently re-designate any such unrestricted subsidiary as a restricted subsidiary, if, on a pro forma
basis, the Borrower would be in compliance with a maximum Consolidated Total Net Leverage Ratio
equal to the Consolidated Total Net Leverage Ratio on the Closing Date, provided, (x) such
designation of a restricted subsidiary as an unrestricted shall be deemed to constitute the incurrence of
indebtedness and liens of such subsidiary (and reduction in an outstanding investment). Unrestricted
subsidiaries will not be subject to the mandatory prepayments, representations and warranties,
covenants, events of default or other provisions of the Term Loan Facility Documentation, and the
results of operations and indebtedness of unrestricted subsidiaries will not be taken into account for
purposes of calculating any financial ratios or baskets contained in the Term Loan Facility
Documentation.
Consistent with the Term Loan Documentation Principles (to be applicable to the Borrower and its
restricted subsidiaries) and limited to the following (with grace periods, baskets and materiality
thresholds to be mutually agreed upon and consistent with the Term Loan Documentation Principles):
nonpayment of principal; nonpayment of interest with a grace period of 5 business days; nonpayment
of fees or other amounts with a grace period of 10 business days; any representation or warranty in the
Term Loan Facility Documentation proving to have been materially incorrect when made or deemed
made; failure to perform or observe covenants set forth in the Term Loan Facility Documentation
within a specified period of time where appropriate (subject, in the case of affirmative covenants, to a
grace period of 30 days following written notice from the Term Loan Administrative Agent (other
than in respect of maintenance of the Borrower’s existence and notices of default); cross-default (other
than with respect to the ABL Facility) and cross-acceleration to debt in excess of a materiality
threshold; cross-acceleration to the ABL Facility; bankruptcy and insolvency defaults (with a 60 day
grace period for involuntary proceedings); final monetary judgment defaults to the extent not covered
by indemnities or insurance above a materiality threshold (with a 60 day grace period); customary
ERISA events that would result in a Material Adverse Effect; invalidity of material guarantees or
impairment of security of a material portion of the Collateral; and change of control (to be defined in a
manner consistent with the Term Loan Documentation Principles)).
Amendments and waivers of the Term Loan Facility Documentation will require the approval of Term
Lenders holding more than 50% of the aggregate amount of loans and commitments under the
Facilities (the “ Required Term Lenders ”), except that (a) only the consent of each directly and
adversely affected Lender (and not the Required Term Lenders) shall be required with respect to
(i) increases in commitments of such Term Lender (it being understood that a waiver of any condition
precedent or the waiver of any default, event of default or mandatory prepayment shall not constitute
an increase of any commitment of any Term Lender), (ii) reductions of principal, interest or fees
payable to such Term Lender
B-16
(other than waivers of default interest, a default or event of default or mandatory prepayment),
provided that any change in the definitions of any ratio used in the calculation of any rate of interest
or fees (or the component definitions) shall not constitute a reduction in any rate of interest or fees,
(iii) extensions of final scheduled maturity or scheduled times for payment of principal, interest or fees
owing to such Term Lender (it being understood and agreed that the waiver of any mandatory
prepayment, default interest, default or event of default shall only require the consent of the Required
Term Lenders) and (iv) alterations of such Lender’s pro rata sharing of payments, (b) the consent of all
Term Lenders shall be required with respect to (i) releases of all or substantially all of the Term Loan
Guarantors or all or substantially all of the Collateral (other than in connection with permitted asset
sales, dispositions, mergers, liquidations or dissolutions or as otherwise permitted) and (ii) reductions
to any of the voting percentages, and (c) the consent of the Term Loan Administrative Agent shall be
required with respect to amendments and waivers directly adversely affecting its rights or duties; it
being understood that (i) additional extensions of credit permitted under the Term Loan Facility
Documentation shall not require the consent of all Term Lenders but instead shall only require the
consent of each Term Lender extending such credit, (ii) any applicable intercreditor agreement may be
amended solely with the consent of the Term Loan Administrative Agent to give effect thereto or to
carry out the purposes thereof and (iii) there shall be no “class” voting requirement for amendments,
modifications or supplements to the Term Loan Facility Documentation.
The Term Loan Facility Documentation shall contain a mechanism to permit the Borrower (a) with the
consent of each directly and adversely affected Term Lender under the Term Loan Facility, but
without the consent of any other Term Lender or the Required Term Lenders, to extend the maturity
date and to provide for different interest rates and fees and prepayments for the Term Lender providing
such extended maturity date, so long as an offer to extend the final expiration or maturity date of the
applicable Facility is made to all Term Lenders of the applicable class on a pro rata basis pursuant to
procedures established by the Term Loan Administrative Agent and (b) with the consent of each
directly and adversely affected Term Lender under the applicable Facility (but no other Term Lender)
to provide for a “re-pricing” amendment which reduces the interest rate accruing in respect of the
Term Loans and/or Revolving Loans held by such Term Lender.
In connection with any proposed amendment, modification, waiver or termination (a “ Proposed
Change ”) requiring the consent of all Term Lenders or all directly and adversely affected Term
Lenders, if the consent to such Proposed Change of other Term Lenders whose consent is required is
not obtained (but the consent of the Required Term Lenders or more than 50% (in principal amount) of
the directly and adversely affected Term Lenders, as applicable, is obtained) (any such Term Lender
whose consent is not obtained being referred to as a “ Non-Consenting Lender ”), then the Borrower
may, at its option and at its sole expense and effort, upon notice to such Non-Consenting Lender and
the Term Loan Administrative Agent,
B-17
(x) require such Non-Consenting Lender to assign and delegate, without recourse (in accordance with
and subject to customary restrictions on assignment), all its interests, rights and obligations under the
Term Loan Facility Documentation with respect to the applicable class or classes of loans to an
assignee that shall assume such obligations (which assignee may be another Term Lender, if a Term
Lender accepts such assignment) and/or (y) terminate the commitment of such Non-Consenting
Lender and prepay such Term Lender on a non- pro rata basis; provided that, such Non-Consenting
Lender shall have received payment of an amount equal to the outstanding principal of its loans,
accrued interest thereon, accrued fees and all other amounts then due and owing to it under the Term
Loan Facility Documentation with respect to such class or classes from the assignee (to the extent of
such outstanding principal and accrued interest and fees) or the Borrower (in the case of all other
amounts).
The Term Loan Facility Documentation shall contain customary provisions consistent with the Term
Loan Documentation Principles for replacing or terminating the commitments of (i) an insolvent Term
Lender, (ii) a Lender failing to fund its commitment (a “ Defaulting Lender ”), (iii) a Lender seeking
indemnity for increased costs or grossed-up tax payments and (iv) a Lender refusing to extend its
commitment, in each case consistent with the Term Loan Documentation Principles.
In addition, the Term Loan Facility Documentation shall provide for the amendment (or amendment
and restatement) of the Term Loan Facility Documentation to (a) add one or more additional or
replacement credit facilities thereto and changes related thereto and (b) to provide for term loans
replacing all or a portion of the Term Loans, subject to customary limitations, with only the consent of
the Borrower and the lenders providing such replacement term loans and, in connection with any of
the foregoing, the right of the Borrower to require the applicable Term Lenders to assign their Term
Loans to the providers of any replacement credit facility or loans or to prepay their outstanding loans
and terminate their commitments.
The Term Loan Facility Documentation will permit guarantees, collateral security documents and
related documents to be amended and waived with the consent of the Term Loan Administrative Agent
at the request of Borrower without the need for consent by any other Term Lender if such amendment
or waiver is delivered in order to (i) comply with local law or advice of local counsel or (ii) cause such
guarantee, collateral security document or other document to be consistent with or effectuate the credit
agreement and the other Term Loan Facility Documentation. The Term Loan Administrative Agent
shall be entitled (in its discretion) to extend any deadline for taking actions required to perfect security
interests in collateral.
In addition, if the Term Loan Administrative Agent and the Borrower shall have jointly identified an
obvious error, defect or any error or omission of a technical nature in the Term Loan Facility
Documentation, then the Term Loan Administrative Agent and the Borrower shall be permitted to
amend such provision without further action or consent of any other party if such amendment is posted
to the Lenders and Required Lenders (to be defined)
B-18
Cost and Yield Protection :
Assignments and Participations :
Expenses and Indemnification :
do not oppose such amendment within five business days of such posting.
Usual for facilities and transactions of this type (including mitigation provisions and to include Dodd-
Frank and Basel III as changes in law) and consistent with the Term Loan Documentation Principles;
provided that requests for such additional payments shall be limited to circumstances in which the
applicable Lender is imposing such charges on other similarly situated borrowers under comparable
syndicated credit facilities. The Term Loan Facility Documentation will contain customary tax gross-
up provisions.
The Term Lenders will be permitted to assign loans and commitments with the consent (not to be
unreasonably withheld or delayed) of the Borrower (unless a payment or bankruptcy (with respect to
the Borrower) event of default has occurred and is continuing or such assignment is to a Term Lender,
an affiliate of a Term Lender or an approved fund of a Term Lender); provided that, with respect to
the Term Loan Facility, the Borrower’s consent shall be deemed given if it fails to respond within
fifteen business days; provided further that, no loans or commitments shall be assigned to
Disqualified Institutions. Each assignment (except to other Term Lenders or their affiliates) will be in
a minimum amount of $1,000,000 or will be the assignment of the entire remaining amount of an
assigning Term Lender’s Term Loans.
The Term Loan Administrative Agent shall have no duties or responsibilities for monitoring or
enforcing prohibitions on assignment to Disqualified Institutions.
The Term Lenders will be permitted to participate loans and commitments without restriction (except
as provided below). Voting rights of participants shall be limited to matters in respect of (a) reductions
of principal, interest or fees owing to such participant, (b) extensions of final scheduled maturity or
scheduled times for payment of interest or fees owing to such participant and (c) releases of Collateral
or Guarantees requiring the approval of all Term Lenders. In no event shall any portion of the
Facilities be participated to any Disqualified Institution (so long as the identity of any such
Disqualified Institution to whom no portion of the Facilities shall be participated is available to all
Term Lenders).
The Borrower shall pay within thirty (30) days after written demand (including documentation
reasonably supporting such request) (a) all reasonable documented out-of-pocket expenses of the Term
Loan Administrative Agent and the Term Loan Lead Arrangers associated with the syndication,
preparation, execution, delivery, negotiation and administration of the Term Loan Facility
Documentation and any amendment or waiver with respect thereto (in the case of (i) legal fees and
expenses, limited to the reasonable documented fees, disbursements and other charges of one counsel
identified herein and, to the extent reasonably necessary, one local counsel in each relevant
jurisdiction, which, in each case, shall exclude allocated costs of in-house counsel and (ii) fees or
B-19
expenses with respect to any other advisor or consultant, solely to the extent the Borrower has consented to the
retention of such person) and (b) all reasonable documented out-of-pocket expenses of the Term Loan Administrative
Agent and the Term Lenders (in the case of legal fees and expenses, limited to the reasonable documented fees,
disbursements and other charges of one counsel for the Term Loan Administrative Agent and the Term Lenders (taken
as a whole) and to the extent reasonably necessary, one local counsel in each relevant jurisdiction and, in the event of
a conflict of interest, one additional conflicts counsel for the affected Indemnified Persons (as defined below) taken as
a whole, which, in each case, shall exclude allocated costs of in-house counsel), in connection with the enforcement of
the Term Loan Facility Documentation.
The Borrower will, within thirty (30) days after written demand, indemnify the Term Loan
Administrative Agent, the Term Loan Lead Arrangers, the Term Lenders, their respective affiliates,
and their respective officers, directors, employees, members, agents, advisors, representatives and
controlling persons (each an “ Indemnified Person ”), and hold them harmless from and against all
losses, claims, damages, liabilities and expenses (in the case of (i) legal fees and expenses, limited to
reasonable fees, disbursements and other charges of one primary counsel for all such Indemnified
Persons (taken as a whole) and to the extent reasonably necessary, one local counsel in each relevant
jurisdiction and, in the event of a conflict of interest, one additional counsel for the affected
Indemnified Persons taken as a whole, which, in each case, shall exclude allocated costs of in-house
counsel and (ii) any other advisor or consultant, solely to the extent the Borrower has consented to the
retention of such person) and liabilities of any such Indemnified Person arising out of or relating to
any claim or any action, suit or other proceedings (regardless of whether any such Indemnified Person
is a party thereto or whether such claim, litigation, or other proceeding is brought by a third party or by
the Borrower or any of its affiliates) that relate to the Term Loan Facility Documentation or the use of
proceeds therefrom; provided that, no Indemnified Person will be indemnified (a) for its (or any of its
affiliates’ or any of its or their respective officers’, directors’, employees’, members’, agents’,
advisors’, representatives’ and controlling persons’) willful misconduct, bad faith or gross negligence
(to the extent determined in a final non-appealable order of a court of competent jurisdiction), (b) for
its (or any of its affiliates’ or any of its officers’, directors’, employees’, members’, agents’, advisors’,
representatives’ and controlling persons’) material breach of its obligations under the Term Loan
Facility Documentation (to the extent determined in a final non-appealable order of a court of
competent jurisdiction), (c) for any dispute among Indemnified Persons (or any of their respective
affiliates or any of their respective officers, directors, members, employees, agents, advisors,
representatives and controlling persons) that does not involve an act or omission by the Borrower or
any of its subsidiaries (other than any claims against the Term Loan Administrative Agent or the Term
Loan Lead Arrangers in their capacity as such but subject to clause (a) and (b) above) or (d) for any
settlement effected without the Borrower’s prior written consent (not to be unreasonably withheld or
delayed), but if settled with Borrower’s prior written consent or if there is a final non-appealable
B-20
judgment against an Indemnified Person in any such proceeding, the Borrower will indemnify and
hold harmless such Indemnified Person from and against any and all actual losses, claims, damages,
liabilities and expenses by reason of such settlement or judgment in accordance with this section. Each
such Indemnified Person agrees to refund and return any and all amounts paid by the Borrower to such
Indemnified Person to the extent any of the foregoing items described in clauses (a) through (d) occurs
(to the extent determined in a final non-appealable order of a court of competent jurisdiction). None of
the Indemnified Persons or the Borrower shall be liable for any special, indirect, consequential or
punitive damages in connection with the Facilities (except to the extent of its indemnity or
reimbursement obligations hereunder in respect of any losses, claims, damages, liabilities and
expenses incurred or paid by an Indemnified Person to a third party).
Governing Law
and Forum :
New York.
Counsel to Term Loan
Administrative Agent and Term Loan
Lead Arrangers :
Davis Polk & Wardwell LLP
B-21
Interest Rates :
The interest rates under the Term Loan Facility are set forth in the Fee Letter.
ANNEX I TO EXHIBIT B
As used herein and in the Fee Letter:
“ Adjusted LIBOR ” means the London interbank offered rate, adjusted for statutory reserve
requirements (and each Term Loan designated as such, an “ Adjusted LIBOR Loan ”); provided that
Adjusted LIBOR shall be deemed to be no less than 0.00% per annum.
“ ABR ” means the highest of (i) the rate the Term Loan Administrative Agent announces from
time to time as its prime rate, (ii) the Federal Funds Effective Rate, plus 1/2 of 1% and (iii)
Adjusted LIBOR plus 1% (and each Term Loan designated as such, an “ ABR Loan ”) .
Adjusted LIBOR borrowings may be made for interest periods of 1, 2, 3 or 6 months and, if available
to all relevant Term Lenders, a period shorter than one month or a period of 12 months, as selected
by the Borrower.
Interest on Adjusted LIBOR Loans and all fees will be payable in arrears on the basis of a 360-day
year, calculated on the basis of the actual number of days elapsed. Interest on ABR Loans will be
payable in arrears on the basis of a 365-day year (or a 366-day year in a leap year) calculated on the
basis of the actual number of days elapsed. Interest will be payable on Adjusted LIBOR Loans on the
last day of the applicable interest period (or at the end of each three months, in the case of interest
periods longer than three months) and upon prepayment, and on ABR Loans quarterly and upon
prepayment.
If either (i) the Term Loan Administrative Agent determines that adequate and reasonable means do
not exist for ascertaining Adjusted LIBOR and such circumstances are unlikely to be temporary
and/or (ii) the supervisor for the administrator of the London interbank offered rate or a
governmental authority having jurisdiction over the Term Loan Administrative Agent has made a
public statement identifying a specific date after which the London interbank offered rate shall no
longer be used for determining interest rates for loans, then the Term Loan Administrative Agent and
the Borrower shall endeavor to establish an alternate rate of interest to “LIBOR” and that gives due
consideration to the then prevailing market convention for determining a rate of interest for
syndicated loans in the United States at such time and shall enter into an amendment to reflect such
alternate rate of interest and such other related changes to the Term Loan Facility Documentation as
may be applicable, which amendment shall not require the consent of any Lender unless the Term
Loan Administrative Agent shall have received, within five business days of the date notice of such
successor or alternative index rate is provided to the Lenders, a written notice from the Required
Lenders stating that such Required Lenders object to such amendment.
Default Rate:
Upon any payment or bankruptcy event of default, the interest rate will be,
#91120726v8
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with respect to overdue principal, the applicable interest rate, plus 2.00% per annum and, with
respect to any other overdue amount, the interest rate applicable to ABR Loans, plus 2.00% per
annum (other than to Defaulting Lenders). Interest on such overdue amounts will be payable upon
written demand.
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#91297610v2
B-I-2
Project Jedi
ABL Facility
Summary of Terms and Conditions
EXHIBIT C
Capitalized terms used but not defined in this Exhibit C shall have the respective meanings set forth in the letter agreement to
which this Exhibit C is attached and in the other Exhibits attached thereto. In the case of any such capitalized term that is subject to multiple
and differing definitions, the appropriate meaning thereof in this Exhibit C shall be determined by reference to the context in which it is used.
Borrowers :
With respect to the U.S. Facility (as defined below), the Borrower (as defined in Exhibit B ) (the “
Borrower ”) and other domestic co-borrowers consistent with the Existing ABL Facility (collectively,
the “ U.S. Borrowers ”).
With respect to the Canadian Facility (as defined below), UNFI Canada, Inc. (the “ Canadian
Borrower ”).
ABL Administrative Agent and ABL
Collateral Agent :
In the case of the Incremental ABL Facility, the administrative agent and collateral agent under the
Existing Facility will continue to act as the administrative agent and collateral agent (the “ Existing
ABL Agent ”; the Existing ABL Agent or the New ABL Agent (as defined below), as the case may be,
the “ ABL Administrative Agent ”).
In the case of the Backstop ABL Facility, Bank of America, N.A. (“ Bank of America ”) will act as the
sole administrative agent and sole collateral agent (in such capacities and together with its permitted
successors, the “ New ABL Agent ” and, collectively with the Term Loan Administrative Agent (as
defined in Exhibit B ), the “ Administrative Agents ”) for a syndicate of banks, financial institutions
and other institutional lenders and investors (other than Disqualified Institutions) (together with the
Initial ABL Lenders, the “ ABL Lenders ” and, collectively with the Term Lenders (as defined in
Exhibit B ), the “ Lenders ”) reasonably acceptable to the Borrower (such acceptance not to be
unreasonably withheld or delayed).
ABL Lead Arrangers and
Bookrunners :
MLPFS, GS Bank, Wells Fargo Bank, JPMCB and US Bank (collectively, in such capacities, the “
ABL Lead Arrangers ” and, together with the Term Loan Lead Arrangers (as defined in Exhibit B ),
the “ Lead Arrangers ”).
ABL Facility :
Either (x) an increase in the U.S. Revolver Commitments and/or the Canadian Commitments under
and as defined in the Third Amended and Restated Loan and Security Agreement dated as of April 29,
2016 among the Borrower, Bank of America, N.A. and the other borrowers, agents and lenders party
thereto (the “ Existing ABL Facility ”) in an aggregate principal amount of $1,100,000,000 (the “
Incremental ABL Facility ”) pursuant to the ABL Amendment or (y) in the event the ABL
Amendment is not approved by the requisite lenders under the Existing ABL Facility on or prior to the
Closing Date, an asset-based revolving facility in an aggregate principal amount of $2,000,000,000
comprised of (i) an asset-based revolving credit facility in an aggregate principal amount of
$1,950,000,000 available for
Use of Proceeds :
U.S. Borrowers (the “ U.S. Facility ”) and (ii) an asset-based revolving facility in an aggregate
principal amount of $50,000,000 available for the Canadian Borrower (the “ Canadian Facility ”)
(collectively, the “ Backstop ABL Facility ” and, together with the Incremental ABL Facility, the “
ABL Facility ”; loans incurred under the ABL Facility shall be the “ ABL Loans ”). The ABL Loans
will be subject to availability as described under the heading “Availability” below.
Subject to Availability (as defined below), the proceeds of loans under the ABL Facility will be used
(a) on the Closing Date, to issue or cash collateralize any letters of credit or to fund any upfront fees or
OID due to the exercise of the “market flex” provisions of the Fee Letter with respect to the Term
Loan Facility, (b) on or after the Closing Date, to finance working capital and general corporate
purposes from time to time for the Borrower and its subsidiaries, (c) on the Closing Date, to fund a
portion of the purchase price in connection with the Acquisition, and (d) on the Closing Date, to pay
transaction fees, costs and expenses; provided that the aggregate amount of ABL Loans made on the
Closing Date for purposes set forth in clauses (b) through (d) above shall not exceed $1,200 million
in the aggregate plus , at the Borrower’s election, an amount sufficient to fund any original issue
discount (“ OID ”) or upfront fees required to be funded in connection with the “market flex”
provisions of the Fee Letter.
Availability :
In the case of the Incremental ABL Facility: pursuant to the Existing ABL Facility.
In the case of the Backstop ABL Facility:
Availability under the U.S. Facility will be equal to the lesser of (a) the then available unutilized
commitments under the U.S. Facility and (b) the then available unutilized U.S. Borrowing Base (as
defined below).
“ U.S. Borrowing Base ” shall mean (a) 90% of Eligible Accounts (to be defined in a manner
consistent with the ABL Documentation Principles), plus (b) 90% of NOLV Percentage of the Value
of Eligible Inventory (each to be defined in a manner consistent with the ABL Documentation
Principles), plus (c) Qualified Cash (to be defined in a manner consistent with the ABL
Documentation Principles), plus (d) Eligible Pharmacy Receivables (to be defined in a manner
consistent with the Target ABL Facility with certain exceptions to be agreed), subject to advance rates
to be agreed, plus (e) Pharmacy Scripts Availability (to be defined in a manner consistent with the
Target ABL Facility with certain exceptions to be agreed), in each case of the U.S. Borrowers, minus
(f) applicable reserves (such reserves shall be established from time to time by the ABL
Administrative Agent in its permitted discretion on the same terms and conditions of and consistent
with the ABL Documentation Principles).
Availability under the Canadian Facility will be equal to the lesser of (a) the then available unutilized
commitments under the Canadian Facility and (b) the then available unutilized Canadian Borrowing
Base (as defined below).
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“ Canadian Borrowing Base ” shall mean (a) 90% of Eligible Accounts (to be defined in a manner
consistent with the ABL Documentation Principles), plus (b) 90% of NOLV Percentage of the Value
of Eligible Inventory (each to be defined in a manner consistent with the ABL Documentation
Principles), plus (c) Qualified Cash (to be defined in a manner consistent with the ABL
Documentation Principles), in each case of the Canadian Borrower, minus (d) applicable reserves
(such reserves shall be established from time to time by the ABL Administrative Agent in its permitted
discretion on the same terms and conditions of and consistent with the ABL Documentation
Principles).
The U.S. Borrowing Base and the Canadian Borrowing Base (collectively, the “ Borrowing Base ”)
shall be computed pursuant to a Borrowing Base certificate to be delivered by the Borrower in such
manner and at such frequency as is consistent with the ABL Documentation Principles.
The Borrower will use commercially reasonable efforts to deliver a field examination and inventory
appraisal prior to the Closing Date. In the event the New ABL Agent has not received its field
examinations and inventory appraisals with respect to the Target and its subsidiaries (the “ Target
Group ”) prior to the Closing Date, the Borrower shall provide the New ABL Agent and its advisors
and consultants with sufficient access and relevant information relating to the Target Group and its
assets to complete such field examinations and inventory appraisals on or before the 90th day after the
Closing Date. In the case of the Backstop ABL Facility, during the period from the Closing Date and
until the New ABL Agent’s receipt and reasonable opportunity to review such field examinations and
inventory appraisals, Availability with respect to the Target Group (to the extent any member is an
ABL Loan Party) shall be based on the Target’s existing asset-based revolving credit facility; and if
the New ABL Agent does not receive such field examinations and inventory appraisals on or prior to
the 90th day after the Closing Date, Availability with respect to the Target Group shall be zero on and
after such 90th day until the New ABL Agent’s receipt and reasonable opportunity to review such
field examinations and inventory appraisals.
Notwithstanding the foregoing, it is agreed that regardless of the Borrowing Base calculations on the
Closing Date, availability under the ABL Facility (whether the Existing ABL Facility, as amended by
the Incremental ABL Facility, or the Backstop ABL Facility) shall be no less than $1,500 million on
the Closing Date until the 90 th day after the Closing Date; provided if the ABL Administrative Agent
receives field examinations and inventory appraisals prior to the Closing Date and Availability is less
than or equal to $1,500 million, then Availability shall be deemed to be the greater of (x) such
Availability and (y) $1,300 million until the 90 th day after the Closing Date.
Interest Rates and Fees :
As set forth on Annex I to this Exhibit C .
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Maturity :
The Incremental ABL Facility will mature, and the lending commitments thereunder will terminate, on
April 29, 2021 and the Backstop ABL Facility will mature, and the lending commitments thereunder
will terminate, on the date that is five (5) years from the Closing Date.
Cash Management/Cash Dominion :
In the case of the Incremental ABL Facility, pursuant to the Existing ABL Facility.
In the case of the Backstop ABL Facility, the Borrower shall deliver account control agreements on the
Borrower’s concentration accounts and other accounts to be mutually agreed within 90 days after the
Closing Date, subject to extensions agreed to by the ABL Administrative Agent. After a Trigger Event
(as defined in the Existing ABL Facility), amounts in controlled accounts will be swept into a core
concentration account maintained with the ABL Administrative Agent, subject to customary
exceptions and thresholds and consistent with the ABL Documentation Principles.
Letters of Credit :
In the case of the Incremental ABL Facility, pursuant to the Existing ABL Facility.
In the case of the Backstop ABL Facility:
Up to an amount to be agreed of the ABL Facility will be available to the Borrower in the form of
standby and trade letters of credit, which will reduce availability under the ABL facility on a dollar-
for-dollar basis. Letters of credit will be issued by GS Bank and other ABL Lenders (in such capacity,
the “ Issuing Banks ”); provided that neither GS Bank nor any of its affiliates shall be required to
issue trade letters of credit; provided , further , that each Initial ABL Lender that holds commitments
under the ABL Facility shall have a letter of credit commitment that is proportionate with its
commitment under the ABL Facility. Each letter of credit shall expire not later than the earlier of (a)
12 months after its date of issuance or such longer period of time as may be agreed by the applicable
Issuing Bank and (b) the fifth business day prior to the final maturity of the ABL Facility; provided
that any standby letter of credit may provide for renewal thereof for additional periods of up to 12
months or such longer period of time as may be agreed by the applicable Issuing Bank (which in no
event shall extend beyond the date referred to in clause (b) above, except to the extent cash
collateralized or backstopped pursuant to arrangements reasonably acceptable to the relevant Issuing
Banks).
Drawings under any letter of credit shall be reimbursed by the Borrower (whether with its own funds
or with the proceeds of borrowings under the ABL Facility) within one (1) business day. Each ABL
Lender under the ABL Facility shall be irrevocably obligated to reimburse such Issuing Bank pro rata
based upon their respective ABL Facility commitments.
Swingline Loans :
Consistent with the ABL Documentation Principles.
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Guarantees :
In the case of the Incremental ABL Facility, pursuant to the Existing ABL Facility.
In the case of the Backstop ABL Facility, all obligations of the Borrower under the ABL Facility and,
at the option of the Borrower, the obligations of the Borrower or any of its subsidiaries under interest
rate protection, currency exchange or other hedging arrangements with the ABL Administrative
Agent, an ABL Lead Arranger, an ABL Lender or an affiliate of the ABL Administrative Agent, an
ABL Lead Arranger or an ABL Lender (at the time such agreement was entered into or, in the case of
any such arrangements existing on the Closing Date, on the Closing Date) specifically designated by
the Borrower as “ABL Pari Passu Secured Hedging Arrangements” (collectively, the “ ABL Pari
Passu Secured Hedging Arrangements ”) and, at the option of the Borrower, the cash management
obligations of the Borrower or any of its subsidiaries owing to the ABL Administrative Agent, any
ABL Lender or an affiliate of the ABL Administrative Agent or any ABL Lender (at the time such
arrangement was entered into or, in the case of any such arrangements existing on the Closing Date,
on the Closing Date) and specifically identified by the Borrower as “ABL Secured Cash Management
Obligations” (collectively, “ ABL Secured Cash Management Obligations ”) will be unconditionally
guaranteed (the “ ABL Guarantees ”) by each Guarantor under the Term Loan Facility and as provided
in the following proviso, each wholly-owned subsidiary of the Borrower organized in Canada subject
to limitations consistent with the Existing ABL Facility (the “ ABL Guarantors ” and, collectively with
the Borrower, the “ ABL Loan Parties ”); provided , that (a)(i) no ABL Loan Party organized in
Canada shall be required to guarantee or shall otherwise be liable for the obligations of any domestic
Loan Party, but the domestic Loan Parties shall be required to guarantee the obligations of the Loan
Parties organized in Canada and (ii) each Loan Party organized in Canada shall guarantee the
obligations of the Canadian Borrower and (b) on the Closing Date, each Term Loan Guarantor will
also be an ABL Guarantor; provided , further , that subsidiaries that are not “eligible contract
participants” (after giving effect to any “keepwell” provisions) shall not guarantee swap obligations to
the extent it is illegal or unlawful under the Commodity Exchange Act, or any regulation thereunder,
by virtue of such subsidiary failing to constitute an “eligible contract participant”.
Security :
In the case of the Incremental ABL Facility, pursuant to the Existing ABL Facility.
In the case of the Backstop ABL Facility:
The ABL Facility, the ABL Guarantees, the ABL Pari Passu Secured Hedging Arrangements (at the
option of the Borrower, subject to customary procedures to be agreed, which shall include that pari
passu treatment in the waterfall will require reserves) and the ABL Secured Cash Management
Obligations (at the option of the Borrower, subject to customary procedures to be agreed) will be
secured by the following: (a) a perfected first-priority (subject to exceptions consistent with the
Existing ABL Facility and the
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Existing Term Facility) security interest in the following: (i) all personal property of the Borrower and
each ABL Guarantor consisting of accounts receivable, cash, deposit accounts and security accounts
(the “ Current Asset Collateral ”), (ii) all owned and after acquired inventory of the Borrower and the
ABL Guarantors (the “ Inventory Collateral ”), (iii) the right to use trademarks, tradenames and other
intellectual property in connection with the processing or sale of inventory or the sale or collection on
accounts receivable under a royalty fee license agreement or to the extent necessary to sell such
Current Asset Collateral or Inventory Collateral, and (iv) all letter of credit rights, commercial tort
claims, chattel paper, supporting obligations, general intangibles (including contract rights, customer
lists and Pharmacy Scripts (to be defined in a manner consistent with the Target ABL Facility)),
documents, books, records and instruments relating to such Current Asset Collateral or Inventory
Collateral and, in the case of each of clause (i) through (iv), the proceeds thereof (including insurance,
indemnity, guaranty and condemnation proceeds), in each case subject to exceptions consistent with
the ABL Documentation Principles (the foregoing, collectively, the “ ABL Priority Collateral ”) and
(b) a perfected second-priority security interest in substantially all other present and after-acquired
assets of the Loan Parties other than real property (subject to customary exceptions consistent the
Term Facility Documentation Principles) and proceeds of the foregoing (such collateral, excluding
ABL Priority Collateral, the “ Term Loan Priority Collateral ” and together with the ABL Priority
Collateral, the “ Collateral ”), in each case subject to exceptions consistent with the Documentation
Principles.
All the above-described pledges and security interests shall be created on terms, and pursuant to
documentation, consistent with the Documentation Principles and subject to exceptions permitted
under the Documentation Principles. Notwithstanding anything to the contrary contained herein, the
requirements of the preceding paragraphs in this “Security” section shall be subject to the Certain
Funds Provision.
Intercreditor Matters :
The lien priority, relative rights and other creditors’ rights issues in respect of the ABL Facility and the
Term Loan Facility will be set forth in a customary intercreditor agreement consistent with the ABL
Documentation Principles and the Term Loan Documentation Principles.
Uncommitted Incremental Facilities : Consistent with the ABL Documentation Principles; provided that in the case of the Backstop ABL
Facility, the aggregate amount of any increase in commitments under the Backstop ABL Facility after
the Closing Date shall not exceed $600 million.
Consistent with the ABL Documentation Principles.
Mandatory Prepayments :
Voluntary Prepayments :
Consistent with the ABL Documentation Principles
ABL Documentation :
The definitive documentation with respect to the ABL Facility (the “ ABL Facility Documentation ”
and, collectively with the Term Loan Facility Documentation (as defined in Exhibit B ), the “
Facilities Documentation ”) will be drafted based on the Existing ABL Facility as in effect on the date
hereof, as modified by the ABL Amendment if approved by the requisite
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lenders under the Existing ABL Facility (in the case of the Backstop ABL Facility, with (i) reasonable
modifications to the mechanical, operational, administrative and agency provisions to reflect the
administrative guidelines and practices of the New ABL Agent reasonably agreed to by the Borrower
and, in each case, to the extent not inconsistent with the terms of this Exhibit C, including additions of
provisions regarding European Union bail-in and Beneficial Ownership Regulation and (ii)
conforming changes to the representations and warranties, affirmative and negative covenants and
events of default set forth in the Term Loan Facility, where appropriate) (collectively, the “ ABL
Documentation Principles ”). The Term Loan Documentation Principles (as defined in Exhibit B )
and the ABL Documentation Principles are referred to collectively herein as the “ Documentation
Principles ”.
Consistent with the ABL Documentation Principles.
The availability of the ABL Facility on the Closing Date will be subject solely to the applicable
conditions precedent set forth in Exhibit D to the Commitment Letter. For the avoidance of doubt, it is
agreed that conditions set forth in Exhibit D are subject, in all respects, to the Certain Funds
Provision.
Representations
and Warranties :
Conditions Precedent to Initial
Borrowing:
Conditions Precedent
to each Borrowing (other than on the
Closing Date):
Consistent with the ABL Documentation Principles.
Affirmative Covenants :
Consistent with the ABL Documentation Principles.
Negative Covenants :
Financial Covenant :
Consistent with the ABL Documentation Principles; provided that incurrence of the Facilities and the
Incremental Facilities (as defined in Exhibit B ) and the Specified Disposition shall, in each case, be
permitted.
Consistent with the ABL Documentation Principles; provided that “Trigger Event” as defined in the
Existing ABL Facility shall be amended to increase the dollar prong of each threshold from
$60,000,000 to $235,000,000.
Events of Default :
Consistent with the ABL Documentation Principles; provided that the threshold for monetary
judgments will be set at any amount to be mutually agreed.
Voting :
Consistent with the ABL Documentation Principles.
Cost and Yield Protection :
Consistent with the ABL Documentation Principles.
Assignments and Participations :
Consistent with the ABL Documentation Principles.
Expenses and Indemnification :
Consistent with the ABL Documentation Principles.
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Governing Law
and Forum :
New York.
Counsel to ABL Administrative
Agent and ABL Lead Arrangers :
Davis Polk & Wardwell LLP
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Interest Rates:
In the case of the Incremental ABL Facility, pursuant to the Existing ABL Facility.
In the case of the Backstop ABL Facility:
Initially, from and after the Closing Date until the last day of the first full fiscal quarter ending after the
Closing Date, the interest rates under (i) the U.S. Facility will be Adjusted LIBOR plus 1.25% for
Adjusted LIBOR Loans or ABR plus 0.25% for ABR Loans and (ii) the Canadian Facility will be BA
Equivalent Rate plus 1.25% for BA Equivalent Rate Loans or Canadian Prime Rate plus 0.25% for
Canadian Prime Rate Loans, and then on the first day of each fiscal quarter thereafter (the “Adjustment
Date”), the applicable margin under the ABL Facility will be determined from the pricing grid below
based on the average daily Aggregate Availability (as defined in the Existing ABL Facility) for the fiscal
quarter ending immediately prior to such Adjustment Date.
Applicable Margin for
Adjusted LIBOR
Loans/BA Equivalent Rate
Loans
Applicable Margin for
ABR Loans/Canadian
Prime Rate Loans
1.00%
1.25%
1.50%
—%
0.25%
0.50%
Average Daily Aggregate
Availability
Greater than or equal to
66.67% of the Line Cap
Greater than or equal to
33.33% of the Line Cap but
less than 66.67% of the Line
Cap
Less than 33.33% of the Line
Cap
As used herein:
“ Adjusted LIBOR ” means the London interbank offered rate, adjusted for statutory
reserve requirements provided that Adjusted LIBOR shall be deemed to be no less than
0.00% per annum.
“ Adjusted LIBOR Loans ” means ABL Loans, the rate of interest on which is based on
Adjusted LIBOR.
“ ABR ” means the highest of (i) the U.S. prime rate published in The Wall Street Journal
from time to time, (ii) the one month Adjusted LIBOR plus 1.0% and (iii) the Federal
Funds Effective Rate, plus 1/2 of 1% .
“ ABR Loans ” means ABL Loans, the rate of interest on which is based on ABR.
“ BA Equivalent Rate ” will be defined in a manner consistent with the ABL
Documentation Principles.
#91297610v2
“ BA Equivalent Rate Loans ” means ABL Loans, the rate of interest on which is based on BA
Equivalent Rate.
“ Canadian Prime Rate ” will be defined in a manner consistent with the ABL Documentation
Principles.
“ Canadian Prime Rate Loans ” means ABL Loans, the rate of interest on which is based on the
Canadian Prime Rate.
In no event shall the Adjusted LIBOR, ABR, BA Equivalent Rate or Canadian Prime Rate be less than
zero.
If either (i) the ABL Administrative Agent determines that adequate and reasonable means do not exist
for ascertaining Adjusted LIBOR and such circumstances are unlikely to be temporary and/or (ii) the
supervisor for the administrator of the London interbank offered rate or a governmental authority
having jurisdiction over the ABL Administrative Agent has made a public statement identifying a
specific date after which the London interbank offered rate shall no longer be used for determining
interest rates for loans, then the ABL Administrative Agent and the Borrower shall endeavor to
establish an alternate rate of interest to “Adjusted LIBOR” and that gives due consideration to the then
prevailing market convention for determining a rate of interest for syndicated loans in the United
States at such time and shall enter into an amendment to reflect such alternate rate of interest and such
other related changes to the ABL Facility Documentation as may be applicable, which amendment
shall not require the consent of any Lender unless the ABL Administrative Agent shall have received,
within five business days of the date notice of such successor or alternative index rate is provided to
the Lenders, a written notice from the Required Lenders (to be defined) stating that such Required
Lenders object to such amendment.
Interest Periods and Computation of
Interest and Fees :
Default Rate :
Consistent with the ABL Documentation Principles.
Consistent with the ABL Documentation Principles.
Letter of Credit Fees:
In the case of the Incremental ABL Facility, pursuant to the Existing ABL Facility.
In the case of the Backstop ABL Facility:
A per annum fee equal to the applicable spread over Adjusted LIBOR under the ABL Facility in effect
from time to time will accrue on the aggregate face amount of outstanding letters of credit under the
ABL Facility, payable in arrears at the end of each quarter after the Closing Date and upon termination
of the ABL Facility. Such fees shall be distributed to the ABL Lenders (other than to Defaulting
Lenders) pro rata in accordance with their commitments under the ABL Facility. In addition, the
Borrower shall pay to each Issuing Bank, for its own account, (a) a fronting fee of 0.125% on the
aggregate face amount of outstanding letters of credit, payable in arrears
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C-I-2
at the end of each quarter after the Closing Date and upon termination of the ABL Facility and (b) the
Issuing Bank’s customary issuance and administration fees.
Commitment Fees:
In the case of the Incremental ABL Facility, pursuant to the Existing ABL Facility.
In the case of the Backstop ABL Facility:
Initially, 0.375% per annum on the undrawn portion (for this purpose, disregarding Swingline Loans
as a utilization of the ABL Facility) of the commitments in respect of the ABL Facility and from and
after the date that is three months after the Closing Date, (a) if average daily usage is greater than or
equal to 25% of the total commitments, 0.25% per annum on the undrawn portion (for this purpose,
disregarding Swingline Loans as a utilization of the ABL Facility) of the commitments in respect of
the ABL Facility and (b) if average daily usage is less than 25% of the total commitments, 0.375% per
annum on the undrawn portion (for this purpose, disregarding Swingline Loans as a utilization of the
ABL Facility) of the commitments in respect of the ABL Facility.
Project Jedi
Conditions Precedent to Funding
EXHIBIT D
Capitalized terms used but not defined in this Exhibit D shall have the meanings set forth in the Commitment Letter and the
other Exhibits attached to the Commitment Letter to which this Exhibit D is attached. In the case of any such capitalized term that is subject
to multiple and differing definitions, the appropriate meaning thereof in this Exhibit D shall be determined by reference to the context in
which it is used.
Subject, in each case, to the Certain Funds Provision, the initial availability of, and initial funding under, the Facilities on the
Closing Date shall be subject solely to the satisfaction or waiver by the Lead Arrangers, as applicable, of the following conditions precedent:
(a) The Acquisition shall have been, or substantially concurrently with the initial borrowing under the Facilities shall be,
consummated in all material respects in accordance with the Transaction Agreement. No provision of the Transaction Agreement shall have
been amended or otherwise modified, no provisions thereof shall have been waived by you and no consent shall be granted by you
thereunder, in each case, in a manner material and adverse to the Initial Lenders (in its capacity as such) without the consent of the Lead
Arrangers (not to be unreasonably withheld, delayed, denied or conditioned); provided that (i) any reduction in the purchase price for the
Acquisition set forth in the Transaction Agreement of greater than 10% shall be deemed to be material and adverse to the interests of the
Initial Lenders, and any reduction in the purchase price of 10% or less shall be deemed to be material and adverse to the interests of the Initial
Lenders unless applied to reduce the Term Loan Facility on a dollar-for-dollar basis, (ii) any increase in the purchase price set forth in the
Transaction Agreement shall be deemed to be not material and adverse to the interests of the Lenders so long as such purchase price increase
is not funded with additional indebtedness and (iii) any change to the definition of Material Adverse Effect (as defined in the Transaction
Agreement as in effect on the Signing Date) shall be deemed materially adverse to the Initial Lenders and shall require the consent of the
Lead Arrangers (not to be unreasonably withheld, delayed, denied or conditioned).
(b) The Closing Date Refinancing shall have been consummated prior to, or shall be made or consummated substantially
concurrently with the initial borrowing under the Facilities.
(c) The Lead Arrangers shall have received copies of (A)(i) the audited consolidated balance sheet and related consolidated
statements of operations, comprehensive income, change in stockholders’ equity and cash flows for the fiscal years of the Borrower ended
August 1, 2015, July 30, 2016 and July 29, 2017 (it being understood that the Lead Arrangers acknowledges receipt of such audited financial
statements) and for each subsequent fiscal year of the Borrower ended at least 60 days before the Closing Date and (ii) the unaudited
consolidated balance sheet and related consolidated statements of operations, comprehensive income, change in stockholders’ equity and cash
flows for each subsequent fiscal quarter (other than the fourth fiscal quarter of the Borrower’s fiscal year) ended at least 40 days before the
Closing Date (it being understood that the Lead Arrangers acknowledge receipt of the unaudited consolidated financial statements in respect
of the fiscal quarters ended October 28, 2017, January 27, 2018 and April 28, 2018) and (B)(i) the audited consolidated balance sheet and
related consolidated statements of operations, comprehensive income, change in stockholders’ equity and cash flows for the fiscal years of the
Target ended February 27, 2016, February 25, 2017 and February 24, 2018 (it being understood that the Lead Arrangers acknowledges receipt
of such audited financial statements) and for each subsequent fiscal year of the Target ended at least 60 days before the Closing Date and (ii)
the unaudited consolidated balance sheet and related
consolidated statements of operations, comprehensive income, change in stockholders’ equity and cash flows for each subsequent fiscal
quarter (other than the fourth fiscal quarter of the Target’s fiscal year) ended at least 40 days before the Closing Date.
(d) The Lead Arrangers shall have received an unaudited pro forma consolidated balance sheet and related unaudited pro
forma consolidated statement of income of the Borrower and its subsidiaries as of and for the twelve-month period ending on the last day of
the most recently completed four-fiscal quarter period ended at least 40 days (or 60 days if such four-fiscal quarter period is the end of the
Borrower’s fiscal year) prior to the Closing Date, prepared after giving effect to the Transactions as if the Transactions had occurred on such
date (in the case of such pro forma balance sheet) or on the first day of such period (in the case of such pro forma statement of income), as
applicable (which need not be prepared in compliance with Regulation S-X of the Securities Act of 1933, as amended, or include adjustments
for purchase accounting (including adjustments of the type contemplated by Financial Accounting Standards Board Accounting Standards
Codification 805, Business Combinations (formerly SFAS 141R))).
(e) Subject to the Certain Funds Provision, all documents and instruments required to grant and perfect the Administrative
Agent’s security interests in the Collateral shall have been executed and delivered by the Loan Parties and, if applicable, be in proper form for
filing.
(f) The Administrative Agent shall have received (at least three (3) business days prior to the Closing Date) all
documentation and other information about the Borrower and each Guarantor as has been reasonably requested in writing at least ten (10)
business days prior to the Closing Date by the Administrative Agent or the Lead Arrangers that is required by regulatory authorities under
applicable “know your customer” and anti-money laundering rules and regulations, including without limitation the PATRIOT Act and the
Beneficial Ownership Certification.
(g) (i) (x) With respect to the ABL Facility, the execution and delivery by the Borrower and the other Loan Parties of the
ABL Facility Documentation consistent with the Commitment Letter and the ABL Facility Term Sheet shall have occurred and (y) with
respect to the Term Loan Facility, the execution and delivery by the Borrower and the other Loan Parties of the Term Loan Facility
Documentation consistent with the Commitment Letter and the Term Loan Facility Term Sheet shall have occurred, (ii) with respect to each
such Facility, the delivery of customary legal opinion(s) from counsel to the Loan Parties, customary evidence of organizational
authorization, customary officer’s and secretary’s certificates, customary organizational good standing certificates (to the extent such concept
exists), customary borrowing requests and a solvency certificate of the Borrower’s chief financial officer, chief operating officer or other
officer with similar responsibilities substantially in the form attached as Annex I hereto shall have each occurred and (iii) with respect to the
ABL Facility, the delivery by the Borrower of a Borrowing Base Certificate if a borrowing under the ABL Facility is requested to be made on
the Closing Date.
(h) All fees required to be paid on the Closing Date pursuant to the Fee Letter and reasonable out-of-pocket expenses
required to be paid on the Closing Date pursuant to the Commitment Letter, in each case to the extent invoiced at least three (3) business days
prior to the Closing Date, shall have been paid, or shall be paid substantially concurrently with, the initial borrowing under the Facilities
(which amounts may be offset against the proceeds of the Facilities).
(i) Except (a) as disclosed in any form, document or report publicly filed with or publicly furnished to the SEC by the
Target or any of its Subsidiaries (for purposes of this section, as defined in the Transaction Agreement as in effect on the Signing Date) on or
after February 27, 2016 and prior to the Signing Date (excluding any disclosures set forth in any “risk factors”, “forward-looking
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D-2
statements” or “market risk” sections or in any other section to the extent they are cautionary, predictive or forward-looking in nature) or (b)
as disclosed in the Company Disclosure Schedule (as defined in the Transaction Agreement as in effect on the Signing Date) delivered to the
Commitment Parties prior to or concurrently with the execution and delivery of this Commitment Letter (provided that disclosure of any item
in any section or subsection of the Company Disclosure Schedule shall be deemed disclosed with respect to any other section or subsection to
the extent that the relevance of any disclosed event, item or occurrence in such section or subsection to such other section or subsection is
reasonably apparent on its face), since February 24, 2018, there has not been any change, occurrence or development that has had or would
reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.
(j) The Specified Representations shall be true and correct in all material respects as of the Closing Date.
(k) The Specified Transaction Agreement Representations shall be true and correct in all material respects, but only to the
extent that the Borrower (or any of its affiliates) has the right (taking into account any applicable cure provisions) to terminate its obligations
under the Transaction Agreement or decline to consummate the Acquisition (in each case, in accordance with the terms of the Transaction
Agreement) as a result of a breach of such Specified Transaction Agreement Representation.
(l) The Closing Date shall not occur prior to 45 days after the Signing Date.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
#91120726v8
#91297610v2
D-3
ANNEX I to EXHIBIT D
FORM OF SOLVENCY CERTIFICATE
SOLVENCY CERTIFICATE of
THE COMPANY AND ITS SUBSIDIARIES
[DATE]
Pursuant to (i) Section [__] of that certain [__] (the “ Term Loan Credit Agreement ”) and (ii) Section [__] of that certain [__] (the “ ABL
Credit Agreement ” and, collectively with the Term Loan Credit Agreement, the “ Credit Agreement ”), the undersigned hereby certifies to
the Administrative Agent and the Lenders, solely in such undersigned’s capacity as [chief financial officer] [chief operating officer] [specify
other officer with similar responsibilities] of the Borrower, and not individually (and without personal liability), as follows:
As of the date hereof, on a pro forma basis after giving effect to the consummation of the Transactions, including the making of the Loans
under the Credit Agreement on the date hereof, and after giving effect to the application of the proceeds of such Loans:
(a)
(b)
(c)
(d)
the fair value of the assets (on a going concern basis) of the Borrower and its Subsidiaries, on a consolidated
basis, exceeds, on a consolidated basis, their debts and liabilities, subordinated, contingent or otherwise;
the present fair saleable value of the property (on a going concern basis) of the Borrower and its Subsidiaries,
on a consolidated basis, is greater than the amount that will be required to pay the probable liability, on a
consolidated basis, of their debts and other liabilities, subordinated, contingent or otherwise, as such debts and
other liabilities become absolute and matured in the ordinary course of business;
the Borrower and its Subsidiaries, on a consolidated basis, are able to pay their debts and liabilities,
subordinated, contingent or otherwise, as such liabilities become absolute and matured in the ordinary course
of business; and
the Borrower and its Subsidiaries, on a consolidated basis, are not engaged in, and are not about to engage in,
business contemplated as of the date hereof for which they have unreasonably small capital.
For purposes of this Solvency Certificate, the amount of any contingent liability at any time shall be computed as the amount that would
reasonably be expected to become an actual and matured liability in the ordinary course of business. Capitalized terms used but not otherwise
defined herein shall have the respective meanings assigned to them in the applicable Credit Agreement.
The undersigned is familiar with the business and financial position of the Borrower and its Subsidiaries (taken as a whole). In reaching the
conclusions set forth in this Solvency Certificate, the undersigned has made such other investigations and inquiries as the undersigned has
deemed appropriate, having taken into account the nature of the particular business anticipated to be conducted by the Borrower and its
Subsidiaries (taken as a whole) after consummation of the transactions contemplated by the Credit Agreement.
[ Signature Page Follows. ]
IN WITNESS WHEREOF, the undersigned has executed this Solvency Certificate in such undersigned’s capacity as [chief financial
officer][chief operating officer][specify other officer with similar responsibilities] of the Borrower, on behalf of the Borrower, and not
individually, as of the date first stated above.
Name:
Title:
UNITED NATURAL FOODS, INC.,
UNITED NATURAL FOODS WEST, INC.
and certain other Subsidiaries from time to time,
as U.S. Borrowers
and
UNFI CANADA, INC. ,
as Canadian Borrower
______________________________________________________________________________
LOAN AGREEMENT
Dated as of August 30, 2018
U.S.$2,000,000,000.00
______________________________________________________________________________
CERTAIN FINANCIAL INSTITUTIONS,
as Lenders
and
BANK OF AMERICA, N.A. ,
as Administrative Agent
BANK OF AMERICA, N.A. (acting through its Canada branch) ,
as Canadian Agent
GOLDMAN SACHS BANK USA, WELLS FARGO BANK, NATIONAL ASSOCIATION, JPMORGAN CHASE BANK, N.A. and
U.S. BANK NATIONAL ASSOCIATION ,
as Co-Syndication Agents
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,
and
GOLDMAN SACHS BANK USA, WELLS FARGO BANK, NATIONAL ASSOCIATION, JPMORGAN CHASE BANK,
N.A. and U.S. BANK NATIONAL ASSOCIATION ,
as Joint Lead Arrangers and Joint Bookrunners
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
TABLE OF CONTENTS
DEFINITIONS; RULES OF CONSTRUCTION
Definitions
Accounting Terms
Uniform Commercial Code
Certain Matters of Construction
Conversions of Canadian Dollars
Collateral Located in the Province of Québec
Certain Calculations and Tests
Credit Agreement Schedules
CREDIT FACILITIES
Commitments
[Intentionally Omitted.]
Letter of Credit Facility
INTEREST, FEES AND CHARGES
Interest
Fees
Computation of Interest, Fees, Yield Protection
Reimbursement Obligations
Illegality
Inability to Determine Rates
Increased Costs; Capital Adequacy
Mitigation
Funding Losses
Maximum Interest
LOAN ADMINISTRATION
Manner of Borrowing and Funding Loans
Defaulting Lender
Number and Amount of Applicable Offered Rate Loans; Determination of
Rate
Borrower Agent
One Obligation; Limitation on Obligations of the Canadian Borrower
Effect of Termination
PAYMENTS
Page
2
2
71
71
71
72
73
73
74
75
75
79
79
83
83
85
86
87
87
88
89
90
90
90
91
91
95
96
96
97
97
97
Section 1
1.1.
1.2.
1.3.
1.4.
1.5.
1.6.
1.7.
1.8.
SECTION 2.
2.1.
2.2.
2.3.
SECTION 3.
3.1.
3.2.
3.3.
3.4.
3.5.
3.6.
3.7.
3.8.
3.9.
3.10.
SECTION 4.
4.1.
4.2.
4.3.
4.4.
4.5.
4.6.
SECTION 5.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
- i m#-
TABLE OF CONTENTS
(continued)
General Payment Provisions
Repayment of Loans
[Intentionally Omitted.]
Payment of Other Obligations
Marshaling; Payments Set Aside
Application and Allocation of Payments
Application of Payments
Loan Account; Account Stated
Taxes
Lender Tax Information
Nature and Extent of Each Borrower’s Liability
CONDITIONS PRECEDENT
Conditions Precedent to Effectiveness of This Agreement
Conditions Precedent to All Credit Extensions on the Closing Date
Conditions Precedent to All Credit Extensions after the Closing Date
Certain Funds Period
[INTENTIONALLY OMITTED]
COLLATERAL ADMINISTRATION
Borrowing Base Certificates
Administration of Accounts
Administration of Inventory
[Intentionally Omitted.]
Cash Management; Administration of Deposit Accounts
General Provisions
REPRESENTATIONS AND WARRANTIES
General Representations and Warranties
Complete Disclosure
COVENANTS AND CONTINUING AGREEMENTS
Affirmative Covenants
Negative Covenants
Financial Covenant
EVENTS OF DEFAULT; REMEDIES ON DEFAULT
Events of Default
5.1.
5.2.
5.3.
5.4.
5.5.
5.6.
5.7.
5.8.
5.9.
5.10.
5.11.
SECTION 6.
6.1.
6.2.
6.3.
6.4.
SECTION 7.
SECTION 8.
8.1.
8.2.
8.3.
8.4.
8.5.
8.6.
SECTION 9.
9.1.
9.2.
SECTION 10.
10.1.
10.2.
10.3.
SECTION 11.
11.1.
Page
97
98
98
98
98
98
100
100
100
102
104
107
107
109
113
114
114
114
114
115
116
116
116
117
118
118
126
127
127
135
150
150
150
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
- ii m#-
TABLE OF CONTENTS
(continued)
Remedies upon Default
License
Setoff
Remedies Cumulative; No Waiver
AGENTS
Appointment, Authority and Duties of Agents
Agreements Regarding Collateral and Borrower Materials
Reliance by Agents
Action upon Default
Ratable Sharing
Indemnification
Limitation on Responsibilities of Agents
Successor Agents and Co-Agents
Due Diligence and Non-Reliance
Remittance of Payments and Collections
Individual Capacities
Agent Titles
Bank Product Providers
No Third Party Beneficiaries
Authorization to Enter into Loan Documents
No Third Party Beneficiaries
BENEFIT OF AGREEMENT; ASSIGNMENTS
Successors and Assigns
Participations
Assignments
Replacement of Certain Lenders
MISCELLANEOUS
Consents, Amendments and Waivers
Indemnity
Notices and Communications
Performance of Borrowers’ Obligations
Credit Inquiries
11.2.
11.3.
11.4.
11.5.
SECTION 12.
12.1.
12.2.
12.3.
12.4.
12.5.
12.6.
12.7.
12.8.
12.9.
12.10.
12.11.
12.12.
12.13.
12.14.
12.15.
12.16.
SECTION 13.
13.1.
13.2.
13.3.
13.4.
SECTION 14.
14.1.
14.2.
14.3.
14.4.
14.5.
Page
153
154
154
154
155
155
158
160
160
160
161
161
162
162
163
163
164
164
164
165
165
166
166
166
167
168
169
169
171
172
173
173
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
- iii m#-
TABLE OF CONTENTS
(continued)
Severability
Cumulative Effect; Conflict of Terms
Counterparts; Execution
Time is of the Essence
Relationship with Lenders
No Advisory or Fiduciary Responsibility
Confidentiality
Judgment Currency
GOVERNING LAW
Consent to Forum
Waivers by Borrowers
Patriot Act Notice
Waiver of Sovereign Immunity
Pari Passu Treatment
Acknowledgement and Consent to Bail-in of EEA Financial Institutions
Intercreditor Agreement
NO ORAL AGREEMENT
14.6.
14.7.
14.8.
14.9.
14.10.
14.11.
14.12.
14.13.
14.14.
14.15.
14.16.
14.17.
14.18.
14.19.
14.20.
14.21.
14.22.
Page
173
173
174
174
174
174
174
174
175
176
176
176
177
177
177
179
179
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
- iv m#-
LIST OF EXHIBITS AND SCHEDULES
Exhibit A U.S. Revolver Note
Exhibit B Canadian Note
Exhibit C Assignment and Acceptance
Exhibit D Assignment Notice
Exhibit E Intercreditor Agreement
Exhibit F Credit Card Notification
Schedule 1.1(a) U.S. Revolver Commitments and Canadian Commitments of Lenders
Schedule 1.1(b) Fiscal Periods; Fiscal Quarters
Schedule 9.1.4 Names and Capital Structure
Schedule 9.1.11 Patents, Trademarks, Copyrights and Licenses
Schedule 9.1.14 Environmental Matters
Schedule 9.1.16 Litigation
Schedule 9.1.18 Pension Plans
Schedule 9.1.20 Labor Contracts
Schedule 10.1.11 Post-Closing Deliverables
Schedule 10.2.1 Existing Debt
Schedule 10.2.2 Existing Liens
Schedule 10.2.5 Existing Investments
Schedule 10.2.17 Existing Affiliate Transactions
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
- v m#-
LOAN AGREEMENT
THIS LOAN AGREEMENT is dated as of August 30 , 2018, by and among UNITED NATURAL FOODS, INC. , a Delaware
corporation (“ UNFI ”), UNITED NATURAL FOODS WEST, INC. , a California corporation (“ UNFW ”) and certain Subsidiaries of
UNFI party hereto from time to time that become borrowers pursuant to Section 10.1.9 (each such Subsidiary, together with UNFI and
UNFW, collectively, “ U.S. Borrowers ”), UNFI CANADA, INC. , a corporation organized under the Canada Business Corporations Act (“
Canadian Borrower ” and, together with U.S. Borrowers, collectively, “ Borrowers ”), the financial institutions party to this Agreement from
time to time as lenders (collectively, “ Lenders ”), BANK OF AMERICA, N.A. , a national banking association, as administrative agent for
the Lenders (“ Administrative Agent ”), BANK OF AMERICA, N.A. (acting through its Canada branch), as Canadian agent for the Lenders
(“ Canadian Agent ”), the Co-Syndication Agents set forth on the cover page hereof, and MERRILL LYNCH, PIERCE, FENNER &
SMITH INCORPORATED, GOLDMAN SACHS BANK USA , and WELLS FARGO BANK, NATIONAL ASSOCIATION ,
JPMORGAN CHASE BANK, N.A. and U.S. BANK NATIONAL ASSOCIATION , as Joint Lead Arrangers and Joint Bookrunners.
R E C I T A L S:
WHEREAS , on the Closing Date, UNFI will acquire (the “ Supervalu Acquisition ”) Supervalu Inc., a Delaware corporation (“
Supervalu ”), pursuant to the Agreement and Plan of Merger, dated as of July 25, 2018 (together with the schedules and exhibits thereto and
as amended, restated, amended and restated, supplemented or otherwise modified from time to time in a manner not prohibited hereunder, the
“ Supervalu Acquisition Agreement ”), by and among, inter alia , Supervalu Inc., UNFI and Supervalu Enterprises, Inc., a wholly-owned
subsidiary of UNFI incorporated under the laws of the State of Delaware.
WHEREAS , in connection with the foregoing, the Borrowers have requested the Lenders to make available to the Borrowers an
asset based revolving credit facility in an aggregate principal amount of U.S.$2,000,000,000, which facility will consist of U.S. Revolver
Commitments of U.S.$1,950,000,000 and Canadian Commitments of U.S.$50,000,000, and the proceeds under which will be used for the
purposes set forth in Section 2.1.3.
WHEREAS in connection with the foregoing, on the Closing Date, the Borrower Agent shall use the proceeds of (x) cash on hand,
(y) the loans incurred under the Term Loan Facility and (z) the Loans made on the Closing Date to fund (i) the payment of consideration
pursuant to the terms and conditions of the Supervalu Acquisition Agreement, and the other payments contemplated by the Supervalu
Acquisition Agreement, (ii) the repayment in full (or the termination, discharge or defeasance) of, and termination of commitments under, all
outstanding indebtedness (and the release of guarantees and liens securing such indebtedness) of (A) the Borrower Agent and its Subsidiaries
under (1) the Term Loan Agreement, dated as of August 14, 2014, by and among the Borrower Agent, Bank of America, N.A., as
administrative agent, the lenders party thereto and the other parties party thereto (the “ Existing UNFI Term Loan Credit Agreemen t”) and
(2) that Third Amended and Restated Loan and Security Agreement, dated as of April 29, 2016, by and among UNFI, UNFW, THE Canadian
Borrower, the lenders party thereto, the Administrative Agent and the other parties party thereto (the “ Existing UNFI ABL Credit Agreement
”) (including the payment in full of any outstanding interest, fees and expenses owing or accruing under or in respect of the Existing UNFI
ABL Credit Agreement) and (B) Supervalu Inc. and its Subsidiaries under (1) the Second Amended and Restated Term Loan Credit
Agreement, dated as of January 31, 2014, by and among Supervalu Inc., Goldman Sachs Bank USA, as administrative agent, the lenders party
thereto and the other parties party thereto, (2) the Amended and Restated Credit Agreement, dated as of March 21, 2013, by and among
Supervalu Inc., Wells
Fargo Bank, National Association, as administrative agent, the lenders party thereto and the other parties party thereto, (3) Supervalu Inc.’s
6.75% Senior Notes due June 1, 2021 and (4) Supervalu Inc.’s 7.75% Senior Notes due November 15, 2022 (the repayment, termination,
discharge, defeasance, arrangement and release of all such indebtedness in this clause (ii) or, solely, in the case of the Existing UNFI Term
Loan Credit Agreement, the giving of irrevocable notice for the repayment or redemption thereof in full, collectively, the “ Closing Date
Refinancing ”), (iii) fees and expenses incurred in connection with the foregoing and transactions related thereto and (iv) working capital and
general corporate purposes.
WHEREAS , substantially concurrently with the closing of the Supervalu Acquisition, the Borrower Agent is entering into the Term
Loan Agreement to incur first lien term loans in an aggregate principal amount of up to $2,150,000,000, subject to the terms of the
Intercreditor Agreement.
WHEREAS , the Lenders have indicated their willingness to make Loans, and the Issuing Banks have indicated their willingness to
issue Letters of Credit, in each case, on the terms and subject to the conditions set forth herein.
NOW, THEREFORE , for valuable consideration hereby acknowledged, the parties agree as follows:
SECTION 1. DEFINITIONS; RULES OF CONSTRUCTION
1.1. Definitions . As used herein, the following terms have the meanings set forth below:
ABL Priority Collateral : as defined in the Intercreditor Agreement.
Account : as defined in the UCC or PPSA, as applicable, and all “claims” (for purposes of the Civil Code of Québec), including all
rights to payment for goods sold or leased, or for services rendered.
Account Debtor : a Person who is obligated under an Account, Chattel Paper or General Intangible, including, without limitation, a
Credit Card Issuer, a Credit Card Processor, a Fiscal Intermediary or another Third Party Payor.
Acquired EBITDA : with respect to any Acquired Entity or Business for any period or any Converted Restricted Subsidiary, the
amount for such period of Consolidated EBITDA of such Acquired Entity or Business or Converted Restricted Subsidiary, as applicable, all
as determined on a consolidated basis for such Acquired Entity or Business or Converted Restricted Subsidiary, as applicable.
Acquired Entity or Business : the meaning specified in the definition of the term “Consolidated EBITDA.”
Adjusted Aggregate Availability : the sum of (a) Aggregate Availability, plus (b) subject to Section 10.1.1(c) , the amount by which
(i) the sum of (A) the U.S. Accounts Formula Amount, plus (B) the U.S. Credit Card Receivables Formula Amount, plus (C) the U.S.
Inventory Formula Amount, plus (D) the U.S. Pharmacy Receivables Formula, plus (E) Pharmacy Scripts Availability, plus (F) the Canadian
Accounts Formula Amount, plus (G) the Canadian Inventory Formula Amount, minus (H) the Availability Reserve exceeds (ii) the Aggregate
Commitments; provided , that the amount in this clause (b) shall not exceed an amount equal to 2.50% of the Aggregate Commitments as of
the applicable date of determination.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
2
Administrative Agent : as defined in the preamble to this Agreement.
Affiliate : with respect to any Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified. “ Control ” means the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or
otherwise. “ Controlling ” and “ Controlled ” have correlative meanings.
Agent or Applicable Agent : the Administrative Agent or the Canadian Agent, as the context requires.
Agent Indemnitees : each Agent and its Affiliates and their respective officers, directors, employees, agents and attorneys.
Agent Professionals : attorneys, accountants, appraisers, auditors, business valuation experts, environmental engineers or consultants,
turnaround consultants, and other professionals and experts retained by any Agent.
Aggregate Availability : on any date of determination, an amount equal to the sum of (a) U.S. Revolver Availability plus (b)
Canadian Availability.
Aggregate Availability Certificate : a certificate, in form satisfactory to Administrative Agent, by which Borrowers certify as to the
daily average Aggregate Availability, U.S. Revolver Availability and Canadian Availability (a) for purposes of determining the termination
date of a Trigger Event, for the thirty (30) consecutive days prior to such termination date, and (b) for all other purposes herein, for the most
recently ended Fiscal Quarter.
Aggregate Borrowing Base : on any date of determination, an amount equal to the sum of (a) the U.S. Revolver Borrowing Base plus
(b) the Canadian Borrowing Base.
Aggregate Canadian Commitments : the aggregate amount of Canadian Commitments of all Canadian Lenders.
Aggregate Commitments : the Aggregate U.S. Revolver Commitments and the Aggregate Canadian Commitments.
Aggregate U.S. Revolver Commitments : the aggregate amount of U.S. Revolver Commitments of all U.S. Revolver Lenders.
Agreement : this Loan Agreement.
Allocable Amount : as defined in Section 5.11.3 .
Anti-Corruption Laws : all laws, rules, and regulations of any jurisdiction applicable to the Borrowers or their Subsidiaries from time
to time concerning or relating to bribery or corruption.
Anti-Terrorism Laws : any applicable laws relating to terrorism or money laundering, including the Patriot Act, the Proceeds of
Crime (Money Laundering) and Terrorist Financing Act (Canada) and associated regulations and guidance and the Criminal Code (Canada).
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
3
Applicable Commitment Termination Date : the U.S. Revolver Commitment Termination Date or the Canadian Commitment
Termination Date, as the context requires.
Applicable Floating Rate : the Base Rate or the Canadian Prime Rate, as the context requires.
Applicable Floating Rate Loans : Base Rate Loans or Canadian Prime Rate Loans, as the context requires.
Applicable Law : all laws, rules, regulations and governmental guidelines applicable to the Person, conduct, transaction, agreement or
matter in question, including all applicable statutory law, common law and equitable principles, and all provisions of constitutions, treaties,
statutes, rules, regulations, orders and decrees of Governmental Authorities.
Applicable Lenders : with respect to (a) U.S. Revolver Loans and Letters of Credit issued for the account or benefit of the U.S.
Borrowers or their Subsidiaries, the U.S. Revolver Lenders, and (b) Canadian Loans and Letters of Credit issued for the account or benefit of
the Canadian Borrower or its Subsidiaries, the Canadian Lenders.
Applicable Margin : with respect to any Type of Loan, the margin set forth below, as determined by the daily average Aggregate
Availability for the last Fiscal Quarter:
Level
I
II
III
Aggregate Availability
(Daily Average)
> 66.67%
< 66.67% but > 33.33%
< 33.33%
Applicable
Floating Rate
Loans
0.00%
0.25%
0.50%
Applicable Offered
Rate
Loans
1.00%
1.25%
1.50%
From and after the Closing Date until the last day of the first full Fiscal Quarter ending after the Closing Date, margins shall be determined as
if Level II were applicable. Thereafter, the margins shall be subject to increase or decrease based upon daily average Aggregate Availability
for the most recently ended Fiscal Quarter upon receipt by Administrative Agent pursuant to Section 10.1.2 of the Aggregate Availability
Certificate for the most recently ended Fiscal Quarter, which change shall be effective on the first day of the calendar month following
receipt. If, by the first day of a month, any Aggregate Availability Certificate due in the preceding month has not been received, then, at the
option of Administrative Agent or Required Lenders, the margins shall be determined as if Level III were applicable, from such day until the
first day of the calendar month following actual receipt.
Applicable Offered Rate : LIBOR or the BA Equivalent Rate, as the context requires.
Applicable Offered Rate Loans : LIBOR Loans or BA Equivalent Rate Loans, as the context requires.
Applicable Termination Date : the U.S. Revolver Termination Date or the Canadian Termination Date, as the context requires.
Approved Fund : any Person (other than a natural person) that is engaged in making, purchasing, holding or otherwise investing in
commercial loans and similar extensions of credit in its ordinary course
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
4
of activities, and is administered or managed by a Lender, an entity that administers or manages a Lender, or an Affiliate of either.
Asset Disposition : a sale, lease, license, consignment, transfer or other disposition of Property of the Borrower Agent or any
Subsidiary thereof, including a disposition of Property in connection with a sale-leaseback transaction or synthetic lease.
Assignment and Acceptance : an assignment agreement between a Lender and Eligible Assignee, in the form of Exhibit C or
otherwise satisfactory to the Applicable Agent.
Attributable Debt : on any date, in respect of any Capital Lease of any Person, the capitalized amount thereof that would appear on a
balance sheet of such Person prepared as of such date in accordance with GAAP.
Availability Reserve : the sum (without duplication) of (a) the Inventory Reserve; (b) the Rent and Charges Reserve; (c) the Bank
Product Reserve; (d) the aggregate amount of liabilities secured by Liens upon ABL Priority Collateral that are senior to any Agent’s Liens
(but imposition of any such reserve shall not waive an Event of Default arising therefrom), but not in excess of the Value of the affected ABL
Priority Collateral; and (e) such additional reserves (including, without limitation, a reserve equal to the amount outstanding under all Seller
Notes), in such amounts and with respect to such matters, as the Administrative Agent in its Permitted Discretion may elect to impose from
time to time, including reserves with respect to amounts owing by any Borrowing Base Obligor to any Person to the extent secured by a Lien
on, or trust over, any ABL Priority Collateral including pursuant to PACA and/or PSA, or the rights of suppliers under Section 81.1 of the
Bankruptcy and Insolvency Act (Canada) or of farmers, fishermen and aquaculturists under Section 81.2 of the Bankruptcy and Insolvency
Act (Canada) and Prior Claims.
Available Equity Amount : at any time (the “ Available Equity Amount Reference Time ”), an amount equal to, without duplication,
(a) the amount of any capital contributions or other equity issuances (or issuances of Debt or Disqualified Equity Interests, in each case after
the Closing Date, that have been converted into or exchanged for Qualified Equity Interests) received as cash equity by any Borrower
(including to the extent issued by a direct or indirect parent company of any Borrower and subsequently contributed to any Borrower as
Qualified Equity Interests) during the 30-day period immediately preceding the Available Equity Amount Reference Time, but excluding all
proceeds from the issuance of Disqualified Equity Interests, plus (b) the aggregate amount of all dividends, returns, interests, profits,
distributions, income and similar amounts (in each case, to the extent made in cash or Cash Equivalents) received by any Borrower or any
Subsidiary on Investments made using the Available Equity Amount during the period from and including the Business Day immediately
following the Closing Date through and including the Available Equity Amount Reference Time minus (c) the sum, without duplication, and,
without taking into account the proposed portion of the Available Equity Amount calculated above to be used at the applicable Available
Equity Amount Reference Time, of:
(a) the aggregate amount of any Investments made by any Borrower or any Subsidiary using the Available Equity Amount
after the Closing Date and prior to the Available Equity Amount Reference Time;
(b) the aggregate amount of Distributions made by any Borrower or any Subsidiary using the Available Equity Amount
pursuant to Section 10.2.4(h) after the Closing Date and prior to the Available Equity Amount Reference Time; and
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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(c) the aggregate amount expended on prepayments, repurchases, redemptions, defeasements and acquisitions, in each case
of Junior Debt, made by any Borrower or any Subsidiary using the Available Equity Amount after the Closing Date and prior to the
Available Equity Amount Reference Time.
BA Equivalent Rate : for the applicable Interest Period of each BA Equivalent Rate Loan, the rate of interest per annum equal to the
annual rates applicable to Canadian Dollar bankers’ acceptances having an identical or comparable term as the proposed BA Equivalent Rate
Loan displayed and identified as such on the display referred to as the “CDOR Page” (or any display substituted therefor) of Reuter Monitor
Money Rates Service as at approximately 10:00 A.M. on such day (or, if such day is not a Business Day, as of 10:00 A.M. on the
immediately preceding Business Day), provided , that if such rates do not appear on the CDOR Page at such time on such date, the rate for
such date will be the annual discount rate (rounded upward to the nearest whole multiple of 1/100 of 1%) as of 10:00 A.M. on such day at
which a Canadian chartered bank listed on Schedule 1 of the Bank Act (Canada) as selected by Bank of America-Canada Branch is then
offering to purchase Canadian Dollar bankers’ acceptances accepted by it having such specified term (or a term as closely as possible
comparable to such specified term); provided , that in no event shall the BA Equivalent Rate be less than zero.
BA Equivalent Rate Loan : any Loan in Canadian Dollars bearing interest at a rate determined by reference to the BA Equivalent
Rate. All BA Equivalent Rate Loans shall be denominated in Canadian Dollars.
Bail-In Action : the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of
any liability of an EEA Financial Institution.
Bail-In Legislation : with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European
Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is
described in the EU Bail-In Legislation Schedule.
Bank of America : Bank of America, N.A., a national banking association, and its successors and assigns.
Bank of America-Canada Branch : Bank of America, N.A. (acting through its Canada branch), and its successors and assigns.
Bank of America Indemnitees : Bank of America and its Affiliates and their respective officers, directors, employees, branches
(including Bank of America-Canada Branch), agents, mandataries, and attorneys.
Bank Product : any of the following products, services or facilities extended to any Borrower or Subsidiary by a Lender or any of its
Affiliates: (a) Cash Management Services; (b) products under Hedging Agreements; (c) commercial credit card and merchant card services;
and (d) other banking products or services as may be requested by any Borrower or Subsidiary, other than Letters of Credit.
Bank Product Reserve : the sum of (a) with respect to Qualified Secured Bank Product Obligations, an amount equal to the sum of the
maximum amounts of the then outstanding Qualified Secured Bank Product Obligations to be secured as set forth in the notices delivered by
Secured Bank Product Providers providing such Qualified Secured Bank Product Obligations and the Borrower Agent to the Administrative
Agent in accordance with clause (b) of the definition of Secured Bank Product
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Providers plus (b) with respect to any other Secured Bank Product Obligations, the aggregate amount of reserves established by
Administrative Agent from time to time in its Permitted Discretion to reflect the reasonably anticipated liabilities in respect of such other then
outstanding Secured Bank Product Obligations.
Bankruptcy Code : Title 11 of the United States Code.
Base Rate : for any day, a per annum rate equal to the highest of (a) the Prime Rate for such day; (b) the Federal Funds Rate for such
day, plus 0.50%; and (c) LIBOR for a one-month interest period as determined on such day, plus 1.0%.
Base Rate Loan : any Loan that bears interest based on the Base Rate. All Base Rate Loans shall be denominated in U.S. Dollars.
Beneficial Ownership Certification : a certification regarding beneficial ownership as required by the Beneficial Ownership
Regulation.
Beneficial Ownership Regulation : 31 C.F.R. § 1010.230.
Benefits Plan : (a) an “employee benefit plan” (as defined in ERISA) that is subject to Title I of ERISA, (b) a “plan” as defined in and
subject to Section 4975 of the Code or (c) any Person whose assets include (for purposes of ERISA Section 3(42) or otherwise for purposes of
Title I of ERISA or Section 4975 of the Code) the assets of any such “employee benefit plan” or “plan”.
Board of Governors : the Board of Governors of the Federal Reserve System.
Borrowed Money : with respect to any Obligor, without duplication, its (a) Debt that (i) arises from the lending of money by any
Person to such Obligor, (ii) is evidenced by notes, drafts, bonds, debentures, credit agreements or similar instruments, (iii) accrues interest in
the absence of default or is a type upon which interest charges are customarily paid (excluding trade payables owing in the Ordinary Course
of Business), or (iv) was issued or assumed as full or partial payment for Property (excluding trade payables owing in the Ordinary Course of
Business); (b) Capital Leases; (c) reimbursement obligations with respect to standby letters of credit; and (d) guaranties of any Debt of the
foregoing types owing by another Person.
Borrower Agent : as defined in Section 4.4 .
Borrower Materials : U.S. Revolver Borrowing Base information, Canadian Borrowing Base information, Compliance Certificates,
Aggregate Availability Certificates, reports, financial statements and other written materials delivered by Borrowers hereunder, as well as
other Reports and written information provided by Administrative Agent to Lenders.
Borrowers : as defined in the preamble to this Agreement.
Borrowing : a group of Loans of one Type that are made on the same day or are converted into Loans of one Type on the same day.
Borrowing Base Certificate : a certificate, in form satisfactory to Administrative Agent, prepared by Borrowers, by which a Senior
Officer of Borrower Agent certifies the calculation of the U.S. Revolver Borrowing Base and the Canadian Borrowing Base.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Borrowing Base Obligor : each U.S. Borrowing Base Obligor and the Canadian Borrower.
Business Day : any day other than (a) a Saturday, Sunday or other day on which commercial banks are authorized to close under the
laws of, or are in fact closed in, North Carolina and New York, (b) if such day relates to a LIBOR Loan, any such day on which dealings in
U.S. Dollar deposits are conducted between banks in the London interbank Eurodollar market, and (c) when used with reference to a
Canadian Loan, any other day on which banks are permitted or required to be closed in Toronto, Ontario, Canada or Montreal, Quebec,
Canada.
California Producer’s Lien Law : §55631, et seq. of the California Food and Agricultural Code.
Canadian Accounts Formula Amount : 90% of the U.S. Dollar Equivalent of the Value of Eligible Accounts of the Canadian
Borrower; provided , however , that such percentage shall be reduced by 1.0% for each percentage point of Dilution.
Canadian Agent : as defined in the preamble to this Agreement.
Canadian Availability : the Canadian Borrowing Base minus the Total Canadian Outstandings.
Canadian Borrower : as defined in the preamble to this Agreement.
Canadian Borrowing Base : on any date of determination, an amount equal to the lesser of (a) the Aggregate Canadian Commitments;
and (b) subject to Section 10.1.1(c) , the sum of the Canadian Accounts Formula Amount, plus the Canadian Inventory Formula Amount,
plus Qualified Cash of the Canadian Borrower, minus the Availability Reserve (it being understood that the amount of the Availability
Reserve shall be allocated, in the Permitted Discretion of the Administrative Agent and without duplication, between the U.S. Revolver
Borrowing Base and the Canadian Borrowing Base).
Canadian Commitment : for any Canadian Lender, its obligation to make Canadian Loans and to participate in Canadian LC
Obligations up to the maximum principal U.S. Dollar amount shown on Schedule 1.1(a) , as hereafter modified pursuant to Section 2.1.7 or
an Assignment and Acceptance to which it is a party.
Canadian Commitment Termination Date : the earliest to occur of (a) the Canadian Termination Date; (b) the date on which the
Canadian Borrower terminates the Aggregate Canadian Commitments pursuant to Section 2.1.4 ; or (c) the date on which the Aggregate
Canadian Commitments are terminated pursuant to Section 11.2 .
Canadian Debtor Relief Laws : the Bankruptcy and Insolvency Act (Canada), the Companies’ Creditors Arrangement Act (Canada),
the Winding-up Act (Canada) and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium,
rearrangement, receivership, insolvency, reorganization, dissolution or similar provincial, territorial, federal or other applicable jurisdictional
debtor relief laws of Canada.
Canadian Deed of Hypothec : any deed of hypothec creating a hypothec in favor of the Canadian Agent, as hypothecary
representative for the benefit of the Secured Parties, pursuant to the laws of the Province of Quebec on the assets of any Obligor existing
under the laws of the Province of Quebec, having its domicile (within the meaning of the Civil Code of Quebec) in the Province of Quebec or
having a place of business or tangible property situated in the Province of Quebec.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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8
Canadian Dollar Equivalent : of any amount means, at the time of determination thereof, (a) if such amount is expressed in Canadian
Dollars, such amount and (b) if such amount is denominated in any other currency, the equivalent of such amount in Canadian Dollars as
determined by the Canadian Agent using the Spot Rate.
Canadian Dollars or CD$ : the lawful currency of Canada.
Canadian Guarantor : any Guarantor that is a Canadian Subsidiary.
Canadian Intellectual Property Security Agreements : any agreement executed on or after the Closing Date confirming or effecting
the grant of any Lien on Intellectual Property owned by the Canadian Borrower to the Canadian Agent, for the benefit of the Secured Parties,
in accordance with this Agreement and the Canadian Security Agreement.
Canadian Inventory Formula Amount : 90% of the NOLV Percentage of the U.S. Dollar Equivalent of the Value of Eligible Inventory
of the Canadian Borrower.
Canadian LC Conditions : the following conditions necessary for issuance of a Letter of Credit for the account or benefit of the
Canadian Borrower or any of its Subsidiaries: (a) each of the conditions set forth in Section 6 shall have been satisfied (or, solely with respect
to any such Letter of Credit issued on the Closing Date, the conditions set forth in Section 6.2 only); (b) after giving effect to such issuance,
the U.S. Dollar Equivalent of Canadian LC Obligations does not exceed U.S.$5,000,000, Total LC Obligations do not exceed
U.S.$125,000,000, no Overadvance exists, no Canadian Overadvance exists, Total Canadian Outstandings do not exceed the Canadian
Borrowing Base, and Total Outstandings do not exceed the Aggregate Borrowing Base; (c) the expiration date of such Letter of Credit is (i)
no more than one year from issuance (or such longer period of time as may be agreed by the applicable Issuing Bank in its discretion) in the
case of standby Letters of Credit, and (ii) no more than 120 days from issuance (or such longer period of time as may be agreed by the
applicable Issuing Bank in its discretion) in the case of commercial Letters of Credit, (d) the Letter of Credit and payments thereunder are
denominated in Canadian Dollars or U.S. Dollars, (e) the form of the proposed Letter of Credit is reasonably satisfactory to the Canadian
Agent and the applicable Issuing Bank and (f) the Total LC Obligations with respect to Letters of Credit issued by the applicable Issuing
Bank would not exceed such Issuing Bank’s LC Commitment with respect to the issuance of Letters of Credit for the account or benefit of the
Canadian Borrower or any of its Subsidiaries.
Canadian LC Obligations : the sum (without duplication) of (a) all amounts owing by the Canadian Borrower for any drawings under
Letters of Credit issued for the account or on behalf of the Canadian Borrower or any of its Subsidiaries; and (b) the amount available to be
drawn under outstanding Letters of Credit issued for the account or on behalf of the Canadian Borrower or any of its Subsidiaries, except to
the extent Cash Collateralized.
Canadian Lenders : the Lenders indicated on Schedule 1.1(a) as the Lenders of Canadian Loans, the Canadian Swingline Lenders,
any Issuing Bank that issues a Letter of Credit for the account or on behalf of the Canadian Borrower and any other Person who hereafter
becomes a “Canadian Lender” pursuant to the terms hereof.
Canadian Loan : (a) a loan made to the Canadian Borrower pursuant to Section 2.1.1(b) , (b) any Swingline Loan for the account of
the Canadian Borrower, (c) any Overadvance Loan for the account of the Canadian Borrower deemed by the Canadian Agent to be a
Canadian Loan and (d) any Canadian Protective Advance.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Canadian Loan Party : each Obligor that is organized or formed under the laws of Canada or any province or territory thereof.
Canadian MEPP : any Canadian Plan that constitutes a multi-employer pension plan within the meaning of the Pension Benefits Act
(Ontario) or under applicable pension standards legislation of another Canadian jurisdiction.
Canadian Note : a promissory note executed by the Canadian Borrower in favor of a Canadian Lender in the form of Exhibit B , in
the amount of such Canadian Lender’s Canadian Commitment.
Canadian Obligations : the Obligations of the Canadian Borrower or any other Canadian Loan Party, as applicable.
Canadian Overadvance : as defined in Section 2.1.5 .
Canadian Pension Event : an event which gives rise to a Lien (other than a Permitted Lien) in respect of a Canadian Plan that is a
registered pension plan or pension plan (within the meaning of the Pension Benefits Act (Ontario) or under applicable pension standards
legislation of another Canadian jurisdiction) or an event which would entitle a Person (with or without the consent of any Borrower or any of
its Subsidiaries) to trigger or request a wind-up or termination, in full or in part, of such a Canadian Plan, or the institution of any procedure
or other steps by any Person to trigger the termination of or obtain an order to terminate or wind-up, in full or in part, any such plan, or the
receipt by any Borrower or any of its Subsidiaries of material correspondence from a Governmental Authority or any other Person relating to
any circumstance or event that could lead to or trigger a potential or actual, partial or full, termination or wind-up of any such plan, or any
other event in relation to any such plan which could otherwise reasonably be expected to adversely affect the registered or tax status of any
such plan maintained by, sponsored by, or in which participates, any Borrower, or to which any of its Subsidiaries makes contributions.
Canadian Plan : any pension or other employee benefit plan (other than any provincial or territorial medical or drug program to which
the Canadian Borrower or any of its Subsidiaries is obliged to directly or indirectly contribute but which is administered by a Governmental
Authority) and which is: (a) a plan maintained by the Canadian Borrower or any of its Subsidiaries; (b) a plan to which the Canadian
Borrower or any of its Subsidiaries contributes or is required to contribute; (c) a plan to which the Canadian Borrower or any of its
Subsidiaries was required to make contributions at any time during the five (5) calendar years preceding the date of this Agreement; or (d)
any other plan with respect to which the Canadian Borrower or any of its Subsidiaries or Affiliates has incurred or may incur liability,
including contingent liability either to such plan or to any Person, administration or Governmental Authority. For purposes of this provision,
“pension plan” means a plan that is subject to registration under the Pension Benefits Act (Ontario) or applicable pension standards legislation
of another Canadian jurisdiction.
Canadian Prime Rate : a fluctuating rate per annum equal to the highest of (a) 30-day Reuters Canadian Deposit Offering Rate for
bankers’ acceptances plus 1/2 of 1%, (b) the rate of interest publicly announced from time to time by Bank of America-Canada Branch as its
reference rate of interest for loans made in Canadian Dollars to Canadian customers and designated as its “prime rate” and (c) BA Equivalent
Rate for a one month interest period as determined on such day, plus 1.0%; provided , that in no event shall such rate be less than zero. The
“prime rate” is a rate set by Bank of America-Canada Branch based upon various factors, including Bank of America-Canada Branch’s costs
and desired return, general economic conditions and other factors and is used as a reference point for pricing some loans.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Any change in the Canadian Prime Rate due to a change in Bank of America-Canada Branch’s Canadian prime rate shall be effective on the
effective date of such change in Bank of America-Canada Branch’s prime rate.
Canadian Prime Rate Loan : any Loan that bears interest based on the Canadian Prime Rate. All Canadian Prime Rate Loans shall be
denominated in Canadian Dollars.
Canadian Protective Advance : as defined in Section 2.1.6(b) .
Canadian Security Agreement : the Security Agreement, dated as of the Closing Date, by the Canadian Borrower in favor of the
Canadian Agent.
Canadian Security Documents : the Closing Date Canadian Security Documents and all other security agreements, deeds of hypothec,
pledge agreements, or other collateral security agreements, instruments or documents entered into or to be entered into by a Canadian Loan
Party pursuant to which such Canadian Loan Party grants or perfects a security interest in certain of its assets to the Canadian Agent to secure
the Canadian Obligations, including PPSA financing statements and financing change statements, as applicable, required to be executed or
delivered pursuant to any Closing Date Canadian Security Document, and in each case any applicable joinder agreement to any of the
foregoing.
Canadian Subsidiary : a Subsidiary that is organized or formed under the laws of Canada or any province or territory thereof.
Canadian Swingline Lender : Bank of America, N.A. (acting through its Canada branch) in its capacity as provider of Swingline
Loans (subject to its right to resign under Section 4.1.3), or any successor swing line lender hereunder that becomes a party hereto pursuant to
documentation reasonably agreed between such Canadian Swingline Lender, the Administrative Agent and the Borrower Agent.
Canadian Termination Date : the date that is five years after the Closing Date.
Capital Expenditures : all liabilities incurred or expenditures made by a Borrower or Subsidiary for the acquisition of fixed assets, or
any improvements, replacements, substitutions or additions thereto with a useful life of more than one year.
Capital Lease : any lease that is required to be capitalized for financial reporting purposes in accordance with GAAP.
Cash Collateral : cash, and any interest or other income earned thereon, that is delivered to the Applicable Agent to Cash Collateralize
any Obligations.
Cash Collateralize : the delivery of cash to the Applicable Agent, as security for the payment of the applicable Obligations, in an
amount equal to (a) with respect to the applicable LC Obligations, 105% of the aggregate of such LC Obligations, and (b) with respect to any
inchoate, contingent or other Obligations (including Secured Bank Product Obligations), the Applicable Agent’s good faith estimate of the
amount that is due or could become due, including all fees and other amounts relating to such Obligations. “ Cash Collateralization ” has a
correlative meaning.
Cash Equivalents : (a) marketable obligations issued or unconditionally guaranteed by, and backed by the full faith and credit of, the
United States government, maturing within 12 months of the date of acquisition; (b) certificates of deposit, time deposits and bankers’
acceptances maturing within 12 months
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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of the date of acquisition, and overnight bank deposits, in each case which are issued by Bank of America or a commercial bank organized
under the laws of the United States or any state or district thereof, rated A-2 (or better) by S&P or P-2 (or better) by Moody’s at the time of
acquisition, and (unless issued by a Lender) not subject to offset rights; (c) repurchase obligations with a term of not more than 120 days for
underlying investments of the types described in clauses (a) and (b) entered into with any bank described in clause (b); (d) commercial paper
issued by Bank of America or rated A-2 (or better) by S&P or P-2 (or better) by Moody’s, and maturing within twelve months of the date of
acquisition; and (e) shares of any money market fund that has substantially all of its assets invested continuously in the types of investments
referred to above, has net assets of at least U.S. $500,000,000 and has the highest rating obtainable from either Moody’s or S&P.
Cash Management Services : any services provided from time to time to any Borrower or Subsidiary in connection with operating,
collections, payroll, trust, or other depository or disbursement accounts, including automated clearinghouse, e-payable, electronic funds
transfer, wire transfer, controlled disbursement, overdraft, depository, information reporting, lockbox and stop payment services.
Cash Receipts : (i) all proceeds of collections of Accounts, Credit Card Receivables and Pharmacy Receivables, (ii) all available cash
receipts from the sale of ABL Priority Collateral (including Inventory) and (iii) all casualty insurance proceeds arising from any of the
foregoing.
CERCLA : the Comprehensive Environmental Response Compensation and Liability Act (42 U.S.C. § 9601 et seq .).
Certain Funds Period : the period commencing on the Signing Date and ending on the earlier of (and including) (i) the Pre-Closing
Commitment Termination Date and (ii) the Closing Date.
Certified Medicaid Provider : any provider or supplier, including without limitation a pharmacy, that has in effect an agreement with
a Governmental Authority of a state to participate in Medicaid.
Certified Medicare Provider : a provider or supplier, including without limitation a pharmacy, that has in effect an agreement with the
Centers for Medicare and Medicaid Services to participate in Medicare.
CFC : a Subsidiary that is a “controlled foreign corporation” within the meaning of Section 957 of the Code.
Change in Law : the occurrence, after the Signing Date, of (a) the adoption, taking effect or phasing in of any law, rule, regulation or
treaty; (b) any change in any law, rule, regulation or treaty or in the administration, interpretation or application thereof by any Governmental
Authority; or (c) the making, issuance or application of any request, guideline, requirement or directive (whether or not having the force of
law) by any Governmental Authority; provided , however , that “Change in Law” shall include, regardless of the date enacted, adopted or
issued, all requests, rules, guidelines, requirements or directives (i) under or relating to the Dodd-Frank Wall Street Reform and Consumer
Protection Act, or (ii) promulgated pursuant to Basel III by the Bank for International Settlements, the Basel Committee on Banking
Supervision (or any similar authority) or any other Governmental Authority.
Change of Control : (a) a “person” or “group” (within the meaning of Sections 13(d) and 14(d)(2) of the Securities Exchange Act of
1934 (the “ Exchange Act ”)), becoming the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act) of Voting Stock of UNFI
entitled to exercise more than 50% of the total voting power of all outstanding Voting Stock of UNFI (including any right to acquire
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Voting Stock that is not then outstanding of which such person or group is deemed the beneficial owner); (b) during any period of 12
consecutive months, a majority of the members of the board of directors of UNFI cease to be composed of individuals (i) who were members
of that board on the first day of such period, (ii) whose election or nomination to that board was approved by individuals referred to in clause
(i) above constituting at the time of such election or nomination at least a majority of that board or (iii) whose election or nomination to that
board was approved by individuals referred to in clauses (i) and (ii) above constituting at the time of such election or nomination at least a
majority of that board; (c) UNFI shall cease to own 100% of the issued and outstanding Voting Stock of any Borrower (other than UNFI); (d)
all or substantially all of a Borrowing Base Obligor’s assets are sold or transferred, other than sale or transfer to another Borrowing Base
Obligor (other than to the Canadian Borrower) or (e) the occurrence of a “Change of Control” (or similar event, however denominated), as
defined in the Term Loan Agreement.
Claims : all claims, liabilities, obligations, losses, damages, penalties, judgments, proceedings, interest, costs and expenses of any
kind (including remedial response costs, reasonable attorneys’ fees and Extraordinary Expenses) at any time (including after Full Payment of
the Obligations or replacement of any Agent or any Lender) incurred by any Indemnitee or asserted against any Indemnitee by any Obligor or
other Person, in any way relating to (a) any Loans, Letters of Credit, Loan Documents, Borrower Materials, or the use thereof or transactions
relating thereto, (b) any action taken or omitted in connection with any Loan Documents, (c) the existence or perfection of any Liens, or
realization upon any Collateral, (d) exercise of any rights or remedies under any Loan Documents or Applicable Law, or (e) failure by any
Obligor to perform or observe any terms of any Loan Document, in each case including all costs and expenses relating to any investigation,
litigation, arbitration or other proceeding (including an Insolvency Proceeding or appellate proceedings), whether or not the applicable
Indemnitee is a party thereto.
Closing Date : the first date on which the conditions set forth in Section 6.2 have been satisfied or waived in accordance with the
terms hereof.
Closing Date Canadian Security Documents : the Canadian Security Agreement, the Canadian Intellectual Property Security
Agreements and the Canadian Deed of Hypothec.
Closing Date Guaranty Agreement : that certain Continuing Guaranty Agreement dated as of the Closing Date by and among the U.S.
Borrowers and the Guarantors party thereto (including, as applicable Supervalu Inc. and its Subsidiaries) and the Administrative Agent.
Closing Date Loan Documents : the Closing Date Guaranty Agreement, the Closing Date Security Documents, the Intercreditor
Agreement (to the extent that the Term Loan Facility is entered into on or prior to the Closing Date) and each Note to the extent requested in
writing by a Lender at least three (3) Business Days prior to the Closing Date.
Closing Date Refinancing : as defined in the recitals to this Agreement.
Closing Date Security Documents : the Closing Date Canadian Security Documents, the Closing Date U.S. Security Agreement, the
U.S. Intellectual Property Security Agreements and the Closing Date Guaranty Agreement.
Closing Date Solvency Certificate : as defined in Section 6.2.11 .
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Closing Date U.S. Security Agreement : that certain Security Agreement dated as of the Closing Date by and among the U.S.
Borrowers and the Guarantors party thereto in favor of the Administrative Agent.
Code : the Internal Revenue Code of 1986.
Collateral : all the “Collateral” as defined in the Security Documents, which shall include substantially all personal property of the
Obligors and all other property of whatever kind and nature pledged or charged as collateral under any Security Document; provided, that ,
the Collateral shall not in any event include (i) any Excluded Property or (ii) any property excluded as Collateral pursuant to any Security
Document to the extent such exclusion is consistent with the Guarantee and Collateral Requirement.
Commitment Letter : the second amended and restated commitment letter dated August 8, 2018 by and among the Lead Arrangers
and the Borrower Agent.
Commodity Exchange Act : the Commodity Exchange Act (7 U.S.C. § 1 et seq .).
Company Competito r: any Person that is a bona fide competitor of the Borrowers, Supervalu or any of their respective Subsidiaries.
Compliance Certificate : a certificate, in form reasonably satisfactory to Administrative Agent, by which the Borrower Agent certifies
as to (a) the Fixed Charge Coverage Ratio for the most recently ended period of four consecutive Fiscal Quarters, (b) the calculations attached
thereto demonstrating the Fixed Charge Coverage Ratio for such period, (c) the daily average Aggregate Availability, U.S. Revolver
Availability and Canadian Availability for the most recently ended Fiscal Quarter, and (d) to the extent the Borrowers’ compliance with
Section 10.3.1 is required at the time such Compliance Certificate is required to be delivered, the Borrowers’ compliance with such Section.
Connection Income Taxes : Other Connection Taxes that are imposed on or measured by net income (however denominated), or are
franchise or branch profits Taxes.
Consolidated Cash Interest Charges : as of any date for the applicable period ending on such date with respect to the Borrowers and
their Subsidiaries on a consolidated basis, the Consolidated Interest Expense determined on a cash basis only and solely in respect of Debt of
the type described in clause (a) of the definition thereof and excluding, for the avoidance of doubt, (i) amortization of deferred financing
costs, debt issuance costs, commissions, fees and expenses, (ii) any expenses resulting from discounting of indebtedness in connection with
the application of recapitalization accounting or purchase accounting, (iii) penalties or interest related to taxes and any other amounts of
noncash interest resulting from the effects of acquisition method accounting or pushdown accounting), (iv) the accretion or accrual of, or
accrued interest on, discounted liabilities during such period, (v) any one-time cash costs associated with breakage in respect of Hedging
Agreements for interest rates, (vi) all non-recurring interest expense consisting of liquidated damages for failure to timely comply with
registration rights obligations, all as calculated on a consolidated basis in accordance with GAAP and (vii) expensing of bridge, arrangement,
structuring, commitment or other financing fees.
Consolidated Depreciation and Amortization Expense : with respect to any Person for any period, the total amount of depreciation
and amortization expense, including the amortization of deferred financing fees or costs, capitalized expenditures, customer acquisition costs
and incentive payments, conversion costs and contract acquisition costs, the amortization of original issue discount resulting from
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
14
the issuance of Debt at less than par and amortization of favorable or unfavorable lease assets or liabilities, of such Person and its Subsidiaries
for such period on a consolidated basis and otherwise determined in accordance with GAAP.
Consolidated EBITDA : with respect to any Person for any period, the Consolidated Net Income of such Person (and with respect to
the Borrowers and their Subsidiaries, such Persons on a consolidated basis) for such period:
(a)
increased (without duplication) by the following:
(i)provision for Taxes based on income or profits or capital, including, without limitation, state franchise, excise
and similar Taxes and foreign withholding Taxes of such Person paid or accrued during such period,
including any penalties and interest relating to any tax examinations, deducted (and not added back) in
computing Consolidated Net Income; plus
(ii)Consolidated Interest Expense, of such Person for such period (including (x) net losses or any obligations under
any Hedging Agreements or other derivative instruments entered into for the purpose of hedging interest
rate, currency or commodities risk, (y) bank fees and (z) costs of surety bonds in connection with
financing activities, to the extent the same were deducted (and not added back) in calculating such
Consolidated Net Income); plus
(iii)Consolidated Depreciation and Amortization Expense of such Person for such period to the extent the same
were deducted (and not added back) in computing Consolidated Net Income; plus
(iv)any fees, expenses or charges (other than depreciation or amortization expense) related to any equity offering,
Investment, acquisition, disposition or recapitalization permitted hereunder or the incurrence of Debt
permitted to be incurred hereunder (including a refinancing thereof) (whether or not successful),
including (A) such fees, expenses or charges related to this Agreement, the Term Loan Agreement and
any other credit facilities (including fees, expenses or charges of any consultants and advisors incurred in
connection with the Transaction or the Supervalu Acquisition) and (B) any amendment or other
modification of this Agreement, the Term Loan Agreement and any other credit facilities, in each case,
deducted (and not added back) in computing Consolidated Net Income; plus
(v)the amount of any restructuring charge or reserve, integration cost or other business optimization expense or
cost, including in connection with establishing new facilities, that is deducted (and not added back) in
such period in computing Consolidated Net Income, including any one-time costs incurred in connection
with acquisitions or divestitures after the Closing Date, and costs related to the closure and/or
consolidation of facilities and to exiting lines of business; plus
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
15
(vi)any other non-cash charges, write-downs, expenses, losses or items reducing Consolidated Net Income for such
period including any impairment charges, the impact of purchase accounting and all reserves during such
period on account of contingent cash payments that may be required in a future period ( provided, that if
any such non-cash charges represent an accrual or reserve for potential cash items in any future period,
(A) Borrower Agent may elect not to add back such non-cash charge in the current period and (B) to the
extent Borrower Agent elects to add back such non-cash charge, the cash payment in respect thereof in
such future period shall be subtracted from Consolidated EBITDA to such extent) or other items
classified by Borrower Agent as special items less other non-cash items of income increasing
Consolidated Net Income (excluding any such non-cash item of income to the extent it represents a
receipt of cash in any future period); plus
(vii)non-cash charges or losses from (A) any joint venture of any Borrower or any Subsidiary and (B) non-cash
minority interest reductions; plus
(viii)the amount of “run-rate” cost savings, synergies and incremental earnings from administrative, selling or
production-related activities projected by Borrower Agent in good faith to result from actions taken
prior to or during, or expected to be taken following such period (which cost savings, synergies or
incremental earnings shall be subject only to certification by a Senior Officer of the Borrower Agent
and shall be calculated on a pro forma basis as though such cost savings, synergies or incremental
earnings had been realized on the first day of such period), net of the amount of actual benefits realized
prior to or during such period from such actions; provided that (A) a Senior Officer of the Borrower
Agent shall have certified to the Administrative Agent that (x) such cost savings, synergies or
incremental earnings are reasonably identifiable, reasonably attributable to the actions specified and
reasonably anticipated to result from such actions, and (y) such actions have been taken or are to be
taken within eighteen (18) months of the event giving rise thereto and (B) the aggregate increase to
Consolidated EBITDA for any period pursuant to this clause (viii) and clause (ii) of the definition of
“Pro Forma Adjustment” shall not exceed for any period 25% of Consolidated EBITDA (calculated
after giving effect to any increases pursuant to this clause (viii) and clause (ii) of the definition of “Pro
Forma Adjustment”); plus
(ix)(A) any costs or expense incurred by any Borrower or any Subsidiary pursuant to any management equity plan
or stock option plan or any other management or employee benefit plan or agreement or any stock
subscription or shareholder agreement, to the extent that such cost or expenses are funded with cash
proceeds contributed to the capital of the any Borrower or Net Proceeds of an issuance of Equity
Interests (other than Disqualified Equity Interests) of any Borrower and (B) cash payments under long-
term management equity incentive plans; plus
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
16
(x)cash receipts (or any netting arrangements resulting in reduced cash expenditures) not representing Consolidated
EBITDA or Consolidated Net Income in any period to the extent non-cash gains relating to such income
were deducted in the calculation of Consolidated EBITDA pursuant to paragraph (b) below for any
previous period and not added back; plus
(xi)any net loss included in Consolidated Net Income attributable to non-controlling interests pursuant to the
application of Accounting Standards Codification Topic 810-10-45; plus
(xii)realized foreign exchange losses resulting from the impact of foreign currency changes on the valuation of
assets or liabilities on the balance sheet of any Borrower and its Subsidiaries; plus
(xiii)net realized losses from Hedging Agreements or embedded derivatives that require similar accounting
treatment and the application of Accounting Standard Codification Topic 815 and related
pronouncements; plus
(xiv)[Intentionally Omitted]; plus
(xv)the amount of any charges, expenses, costs or other payments in respect of facilities no longer used or useful in
the conduct of the business of the Borrowers and their Subsidiaries; plus
(xvi)costs, expenses and payments in connection with actual or prospective litigation, legal settlements, fines,
judgments or orders; plus
(xvii)any other adjustments or add-backs with respect to the Supervalu Acquisition specified in (but without
duplication) (i) the Due Diligence Report prepared by PricewaterhouseCoopers LLP, dated as of June
2018 and delivered to certain Lead Arrangers on June 22, 2018 and (ii) the “Project Eden” Financial
Due Diligence Assistance Report prepared by KPMG LLP and dated as of June 20, 2018 provided that
in no event shall the aggregate amount added to Consolidated EBITDA pursuant to this clause (xvii) in
any period exceed $214,000,000;
(b) decreased (without duplication) by the following:
(i)non-cash gains increasing Consolidated Net Income of such Person for such period (other than any such amounts
in connection with the sale of routes to independent operators), excluding any non-cash gains to the extent
they represent the reversal of an accrual or cash reserve for a potential cash item that reduced
Consolidated EBITDA in any prior period and any non-cash gains with respect to cash actually received
in a prior period so long as such cash did not increase Consolidated EBITDA in such prior period; plus
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
17
(ii)realized foreign exchange income or gains resulting from the impact of foreign currency changes on the
valuation of assets or liabilities on the balance sheet of the Borrowers and their Subsidiaries; plus
(iii)any net realized income or gains from any obligations under any Hedging Agreements or embedded derivatives
that require similar accounting treatment and the application of Accounting Standard Codification Topic
815 and related pronouncements; plus
(iv)any amount included in Consolidated Net Income of such Person for such period attributable to non-controlling
interests pursuant to the application of Accounting Standards Codification Topic 810-10-45;
(c)
increased or decreased (without duplication) by, as applicable, any non-cash adjustments resulting from the
application of Accounting Standards Codification Topic 460 or any comparable regulation; and
(d)
Forma Adjustment.
increased or decreased (to the extent not already included in determining Consolidated EBITDA) by any Pro
There shall be included in determining Consolidated EBITDA for any period, without duplication, (A) the Acquired EBITDA of any
Person, property, business or asset acquired by any Borrower or any Subsidiary during such period (but not the Acquired EBITDA of any
related Person, property, business or assets to the extent not so acquired), to the extent not subsequently sold, transferred or otherwise
disposed of by such Borrower or such Subsidiary during such period (each such Person, property, business or asset acquired and not
subsequently so disposed of, an “ Acquired Entity or Business ”), and the Acquired EBITDA of any Unrestricted Subsidiary that is converted
into a Restricted Subsidiary during such period (each, a “ Converted Restricted Subsidiary ”), based on the actual Acquired EBITDA of such
Acquired Entity or Business or Converted Restricted Subsidiary for such period (including the portion thereof occurring prior to such
acquisition) and (B) an adjustment in respect of each Acquired Entity or Business equal to the amount of the Pro Forma Adjustment with
respect to such Acquired Entity or Business for such period (including the portion thereof occurring prior to such acquisition) as specified in a
certificate executed by a Senior Officer and delivered to the Lenders and the Administrative Agent. For purposes of determining the
Consolidated EBITDA for any period, there shall be excluded in determining Consolidated EBITDA for any period the Disposed EBITDA of
any Person, property, business or asset (other than any Unrestricted Subsidiary) sold, transferred or otherwise disposed of, closed or classified
as discontinued operations by any Borrower or any Subsidiary during such period (each such Person, property, business or asset so sold or
disposed of, a “ Sold Entity or Business ”) and the Disposed EBITDA of any Restricted Subsidiary that is converted into an Unrestricted
Subsidiary during such period (each, a “ Converted Unrestricted Subsidiary ”), based on the actual Disposed EBITDA of such Sold Entity or
Business or Converted Unrestricted Subsidiary for such period (including the portion thereof occurring prior to such sale, transfer or
disposition).
Consolidated First Lien Net Leverage Ratio : with respect to any most recently ended period of four consecutive Fiscal Quarters
calculated on a pro forma basis, the ratio of (a) Consolidated Total Debt (i) that is secured by a Lien on the Collateral on a pari passu or
senior priority basis with the Liens securing the Term Loan Facility (but without regard to the control of remedies) or (ii) that constitutes
Capital Lease obligations of the Borrower Agent or any of its Subsidiaries, plus, the principal amount of Obligations, as of the last day of
such most recently ended period of four consecutive Fiscal Quarters
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
18
calculated on a pro forma basis to (b) Consolidated EBITDA of the Borrowers and the Subsidiaries for such most recently ended period of
four consecutive Fiscal Quarters calculated on a pro forma basis.
Consolidated Interest Expense : with respect to any Person for any period (and with respect to the Borrowers and Subsidiaries, such
Persons on a consolidated basis), without duplication, the sum of:
(a)
consolidated interest expense of such Person for such period, to the extent such expense was deducted (and not
added back) in computing Consolidated Net Income (including (a) amortization of original issue discount or premium resulting from
the issuance of Debt at less than par, (b) all commissions, discounts and other fees and charges owed with respect to letters of credit
or bankers acceptances, (c) non-cash interest payments, (d) the interest component of Capital Lease obligations and (e) net payments,
if any, pursuant to interest rate obligations under any Hedging Agreements with respect to Debt); plus
(b)
(c)
consolidated capitalized interest of such Person for such period, whether paid or accrued; less
interest income for such period.
For purposes of this definition, interest on a Capital Lease obligation shall be deemed to accrue at an interest rate reasonably
determined by such Person to be the rate of interest implicit in such Capital Lease obligation in accordance with GAAP.
Consolidated Net Income : with respect to any Person for any period, the net income (loss) of such Person for such period determined
on a consolidated basis in accordance with GAAP (and with respect to the Borrowers and Subsidiaries, such Persons on a consolidated basis);
provided , however , that there will not be included in such Consolidated Net Income:
(a)
any net gain (or loss) from disposed, abandoned or discontinued operations and any net gain (or loss) on disposal
of disposed, discontinued or abandoned operations;
(b)
any net gain (or loss) realized upon the sale or other disposition of any asset or disposed operations of any
Borrower or any Subsidiary (including pursuant to any sale/leaseback transaction) which is not sold or otherwise disposed of in the
ordinary course of business (as determined in good faith by a Senior Officer or the board of directors of the Borrower Agent),
including the gain on the sale of routes to independent operators;
(c)
any extraordinary expenses, exceptional, unusual or nonrecurring gain, loss, charge or expense, or any charges,
expenses or reserves (including relating to the Transaction Expenses) in respect of any restructuring, relocation, redundancy or
severance expense, new product introductions or one-time compensation charges;
(d)
the cumulative effect of a change in accounting principles;
(e)
any (i) non-cash compensation charge or expense arising from any grant of stock, stock options or other equity
based awards (including any long-term management equity incentive plans) and any non-cash deemed finance charges in respect of
any pension liabilities or other provisions and (ii) income (loss) attributable to deferred compensation plans or trusts;
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
19
(f)
all deferred financing costs written off and premiums paid or other expenses incurred directly in connection with
any early extinguishment of Debt and any net gain (loss) from any write-off or forgiveness of Debt;
(g)
any unrealized gains or losses in respect of any obligations under any Hedging Agreement or any ineffectiveness
recognized in earnings related to hedge transactions or the fair value of changes therein recognized in earnings for derivatives that do
not qualify as hedge transactions, in each case, in respect of any obligations under any Hedging Agreement;
(h)
any unrealized foreign currency translation gains or losses in respect of Debt of any Person denominated in a
currency other than the functional currency of such Person and any unrealized foreign exchange gains or losses relating to translation
of assets and liabilities denominated in foreign currencies;
(i)
any unrealized foreign currency translation or transaction gains or losses in respect of Debt or other obligations of
any Borrower or any Subsidiary owing to any Borrower or any Subsidiary;
(j)
any purchase accounting effects including, but not limited to, adjustments to inventory, property and equipment,
software and other intangible assets and deferred revenue in component amounts required or permitted by GAAP and related
authoritative pronouncements (including the effects of such adjustments pushed down to the Borrowers and the Subsidiaries), as a
result of any consummated acquisition (including the Supervalu Acquisition), or the amortization or write-off of any amounts thereof
(including any write-off of in process research and development);
(k)
any impairment charge, write-down or write-off, including impairment charges, write-downs or write-offs relating
to goodwill, intangible assets, long-lived assets, investments in debt and equity securities or as a result of a Change in Law or
regulation;
(l)
any after-tax effect of income (loss) from the early extinguishment or cancellation of Debt or any obligations under
any Hedging Agreements or other derivative instruments;
(m)
accruals and reserves that are established within twelve months after the Closing Date that are so required to be
established as a result of the Transaction in accordance with GAAP;
(n)
any net unrealized gains and losses resulting from Hedging Agreements or embedded derivatives that require
similar accounting treatment and the application of Accounting Standards Codification Topic 815 and related pronouncements;
(o)
any deferred tax expense associated with tax deductions or net operating losses arising as a result of the
Transactions, or the release of any valuation allowance related to such item; and
(p)
any net income (loss) of any Person if such Person is not a Restricted Subsidiary, except that equity of any
Borrower or Restricted Subsidiary in the net income of any such Person for such period will be included in such Consolidated Net
Income up to the aggregate amount of
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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cash or Cash Equivalents actually distributed to such Borrower or Restricted Subsidiary as a dividend or other distribution or return
on investment during such Period.
In addition, to the extent not already excluded from the Consolidated Net Income of such Person, notwithstanding anything to the
contrary in the foregoing, Consolidated Net Income shall exclude (i) any expenses and charges that are reimbursed by indemnification or
other reimbursement provisions in connection with any investment (including the Supervalu Acquisition) or any sale, conveyance, transfer or
other disposition of assets permitted hereunder (it being understood and agreed that if such Person has notified a third party of such amount to
be reimbursed or indemnified and such third party has not denied its reimbursement or indemnification obligation, such amounts shall also be
excluded) and (ii) to the extent covered by insurance and actually reimbursed, or, so long as the Borrower Agent has made a determination
that there exists reasonable evidence that such amount will in fact be reimbursed by the insurer and only to the extent that such amount is (A)
not denied by the applicable carrier in writing within 180 days and (B) in fact reimbursed within 365 days of the date of such evidence (with a
deduction for any amount so added back to the extent not so reimbursed within such 365 days), expenses with respect to liability or casualty
events or business interruption.
Consolidated Secured Net Leverage Ratio : with respect to any most recently ended period of four consecutive Fiscal Quarters
calculated on a pro forma basis, the ratio of (a) Consolidated Total Debt that is secured by a Lien on the property of the Borrower Agent or
any of its Subsidiaries and (b) Consolidated EBITDA of the Borrowers and the Subsidiaries for such most recently ended period of four
consecutive Fiscal Quarters calculated on a pro forma basis.
Consolidated Total Debt : as of any date of determination, (a) the aggregate principal amount of Debt of the Borrowers and the
Subsidiaries outstanding on such date, determined on a consolidated basis in accordance with GAAP (but excluding the effects of any
discounting of Debt resulting from the application of purchase accounting in connection with the Transaction or any Permitted Acquisition),
consisting of Debt for borrowed money (including obligations evidenced by bonds, debentures, notes, loan agreements or other similar
instruments), Capital Lease obligations and letters of credit (but only to the extent any letter of credit has been drawn but not reimbursed)
minus (b) the aggregate amount of unrestricted cash and Cash Equivalents (in each case, free and clear of all Liens other than any
nonconsensual Lien that is permitted under the Loan Documents, Liens of the Administrative Agent, Liens in favor of the Term Loan Facility
Agent under the Term Loan Facility Documents and any Liens securing other Debt permitted hereunder to be secured by a Lien on the
Collateral along with the Obligations), which aggregate amount of cash and Cash Equivalents shall be determined without giving pro forma
effect to the proceeds of Debt incurred on such date; provided that Consolidated Total Debt shall not include obligations under Hedging
Agreements entered into in the ordinary course of business and not for speculative purposes.
Consolidated Total Net Leverage Ratio : with respect to any most recently ended period of four consecutive Fiscal Quarters
calculated on a pro forma basis, the ratio of (a) Consolidated Total Debt as of the last day of such any most recently ended period of four
consecutive Fiscal Quarters calculated on a pro forma basis to (b) Consolidated EBITDA of the Borrowers and the Subsidiaries for such most
recently ended period of four consecutive Fiscal Quarters calculated on a pro forma basis.
Contingent Obligation : any obligation of a Person arising from a guaranty, indemnity or other assurance of payment or performance
of any Debt or dividend (“ primary obligations ”) of another obligor (“ primary obligor ”) in any manner, whether directly or indirectly,
including any obligation of such Person under any (a) guaranty, endorsement, co-making or sale with recourse of an obligation of a primary
obligor; (b) obligation to make take-or-pay or similar payments regardless of nonperformance by any
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
21
other party to an agreement; and (c) arrangement (i) to purchase any primary obligation or security therefor, (ii) to supply funds for the
purchase or payment of any primary obligation, (iii) to maintain or assure working capital, equity capital, net worth or solvency of the
primary obligor, (iv) to purchase Property or services for the purpose of assuring the ability of the primary obligor to perform a primary
obligation, or (v) otherwise to assure or hold harmless the holder of any primary obligation against loss in respect thereof. The amount of any
Contingent Obligation shall be deemed to be the stated or determinable amount of the primary obligation (or, if less, the maximum amount
for which such Person may be liable under the instrument evidencing the Contingent Obligation) or, if not stated or determinable, the
maximum reasonably anticipated liability with respect thereto.
Contribution Debt : unsecured Debt of any Borrower or any Subsidiary in an amount equal to the aggregate amount of cash
contributions made after the Closing Date to any Borrower in exchange for Qualified Equity Interests of any Borrower, except to the extent
utilized in connection with any other transaction permitted by Section 10.2.8 and Section 10.2.9 and except to the extent such amount
increases the Available Equity Amount.
Converted Restricted Subsidiary : as defined in the definition of “Consolidated EBITDA”.
Converted Unrestricted Subsidiary : as defined in the definition of “Consolidated EBITDA”.
Credit Card Agreements : all agreements now or hereafter entered into by any U.S. Borrowing Base Obligor or for the benefit of any
U.S. Borrowing Base Obligor, in each case with any Credit Card Issuer or any Credit Card Processor with respect to sales transactions
involving credit card or debit card purchases.
Credit Card Issuer : any Person (other than an Obligor) who issues or whose members issue credit cards, including, without
limitation, MasterCard or VISA bank credit or debit cards or other bank credit or debit cards issued through World Financial Network
National Bank, MasterCard International, Inc., Visa, U.S.A., Inc. or Visa International and American Express, Discover, Diners Club, Carte
Blanche and other non-bank credit or debit cards, including, without limitation, credit or debit cards issued by or through American Express
Travel Related Services Company, Inc., Novus Services, Inc., PayPal and other issuers approved by the Administrative Agent.
Credit Card Notifications : notifications substantially in the form attached hereto as Exhibit F .
Credit Card Processor : any servicing or processing agent or any factor or financial intermediary who facilitates, services, processes
or manages the credit authorization, billing transfer and/or payment procedures with respect to any U.S. Borrowing Base Obligor’s sales
transactions involving credit card or debit card purchases by customers using credit cards or debit cards issued by any Credit Card Issuer.
Credit Card Receivables : amounts, together with all income, payments and proceeds thereof, owed by a Credit Card Issuer or Credit
Card Processor to a U.S. Borrowing Base Obligor resulting from charges by a customer of a U.S. Borrowing Base Obligor on credit or debit
cards issued by such Credit Card Issuer or processed by such Credit Card Processor (including, without limitation, electronic benefits
transfers) in connection with the sale of goods by a U.S. Borrowing Base Obligor, or services performed by a U.S. Borrowing Base Obligor,
in each case in the ordinary course of its business.
Credit Card Receivables Dilution : the percent, determined for the Borrowers’ most recent Fiscal Quarter, equal to (a) bad debt write-
downs or write-offs, discounts, returns, promotions, credits, credit memos and other dilutive items with respect to Credit Card Receivables,
divided by (b) gross sales.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
22
CST Exposure : the sum (without duplication) of (x) the aggregate fair market value (reasonably determined by the Borrower Agent
in good faith) of all Property disposed of by the Borrower Agent and its Subsidiaries in reliance of clause (s) of Section 10.2.6, plus (y) the
aggregate amount of Investments made by the Borrower Agent and its Subsidiaries in reliance of clause (w) of the definition of “Permitted
Investment” (in an amount equal to the amount actually invested, giving effect to returns on capital but without giving effect to increases or
decreases in value or any cancellation of such investment), plus (z) the aggregate principal amount of Debt of the Borrower Agent and its
Subsidiaries (including the aggregate principal amount of Debt guaranteed by the Borrower Agent and its Subsidiaries) entered into in
reliance of clause (x) of Section 10.2.1.
Customer Support Transaction : any one of the following transactions entered into in the ordinary course of business of the Obligors
and that is consistent with current practice of the Obligors (including those practices of the members of the Supervalu Group that shall
become Obligors pursuant to the terms hereof on the Closing Date) as of the Signing Date: (a) any sublease by an Obligor to a customer of
any Obligor of leased real property or leased equipment of such Obligor that constitutes a Capital Lease, (b) any lease by a Obligor to a
customer of any Obligor of owned real property or equipment of such Obligor that constitutes a Capital Lease, (c) any assignment of a lease
of real property or equipment by any Obligor that constitutes a Capital Lease to a customer of any Obligor in connection with which the
assigning Obligor is not released from liability under such lease, (d) any guarantee by an Obligor for the benefit of a third party of Debt or
operating lease obligations of a customer of any Obligor, (e) any loan of money or property (other than ABL Priority Collateral) by an
Obligor to a customer, (f) any other transfer of equipment or Real Estate not otherwise permitted pursuant to this Agreement by an Obligor to
a customer and (g) cash payments to new or existing customers to secure, maintain or expand business; provided , that, the foregoing clauses
(a) through (g) shall not be construed to apply to the sale of inventory on credit by any Obligor to a customer in the ordinary course of
business.
CWA : the Clean Water Act (33 U.S.C. §§ 1251 et seq .).
Debt : as to any Person at a particular time, without duplication, all of the following, whether or not included as indebtedness or
liabilities in accordance with GAAP:
(a)
all obligations of such Person for borrowed money and all obligations of such Person evidenced by bonds,
debentures, notes, loan agreements or other similar instruments;
(b)
the maximum amount (after giving effect to any prior drawings or reductions which may have been reimbursed)
of all letters of credit (including standby and commercial), banker’s acceptances, bank guaranties, surety bonds, performance bonds
and similar instruments issued or created by or for the account of such Person;
(c)
net obligations of such Person under any Hedging Agreement;
(d)
all obligations of such Person to pay the deferred purchase price of property or services (other than (i) trade
accounts payable in the ordinary course of business and (ii) any earn-out obligation until such obligation becomes a liability on the
balance sheet of such Person in accordance with GAAP and if not paid within thirty (30) days after becoming due and payable);
(e)
indebtedness (excluding prepaid interest thereon) secured by a Lien on property owned or being purchased by
such Person (including indebtedness arising under conditional sales or other title retention agreements and mortgage, industrial
revenue bond, industrial development
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
23
bond and similar financings), whether or not such indebtedness shall have been assumed by such Person or is limited in recourse;
(f)
(g)
(h)
all Attributable Debt;
all obligations of such Person in respect of Disqualified Equity Interests; and
all Contingent Obligations of such Person in respect of any of the foregoing.
For all purposes hereof, the Debt of any Person shall (A) include the Debt of any partnership or joint venture (other than a joint
venture that is itself a corporation, company, or limited liability company) in which such Person is a general partner or a joint venturer, except
to the extent such Person’s liability for such Debt is otherwise limited and (B) in the case of the Borrowers and the Subsidiaries, exclude all
intercompany Debt having a term not exceeding 364 days (inclusive of any roll-over or extensions of terms) and made in the ordinary course
of business consistent with past practice. The amount of any net obligation under any Hedging Agreement on any date shall be deemed to be
the Swap Termination Value thereof as of such date. The amount of Debt of any Person for purposes of clause (e) shall be deemed to be equal
to the lesser of (i) the aggregate unpaid amount of such Debt and (ii) the fair market value of the property encumbered thereby as determined
by such Person in good faith.
Debt Fund Affiliate : an Affiliate of a Company Competitor that is a bona fide debt fund or an investment vehicle that is primarily
engaged in making, purchasing, holding or otherwise investing in commercial loans, bonds and similar extensions of credit in the ordinary
course of its business and with respect to which neither such Company Competitor nor any other Affiliate of such Company Competitor
(other than other Debt Fund Affiliates) makes investment decisions or has the power, directly or indirectly, to direct or cause the direction of
such Debt Fund Affiliate’s investment decisions.
Default : an event or condition that, with the lapse of time or giving of notice, would constitute an Event of Default.
Default Rate : for any Obligation (including, to the extent permitted by law, interest not paid when due), 2% plus the interest rate
otherwise applicable thereto.
Defaulting Lender : any Lender that (a) has failed to comply with its funding obligations hereunder, and such failure is not cured
within two Business Days; (b) has notified Administrative Agent or any Borrower that such Lender does not intend to comply with its
funding obligations hereunder or has made a public statement to that effect; (c) has failed, within three Business Days following request by an
Agent or any Borrower, to confirm in a manner satisfactory to such Agent and Borrowers that such Lender will comply with its funding
obligations hereunder; (d) has, or has a direct or indirect parent company that has, become the subject of an Insolvency Proceeding (including
reorganization, liquidation, or appointment of a receiver, interim receiver, receiver manager, custodian, administrator or similar Person by the
Federal Deposit Insurance Corporation or any other regulatory authority) or (e) become the subject of a Bail-in Action; provided , however ,
that a Lender shall not be a Defaulting Lender solely by virtue of a Governmental Authority’s ownership of an equity interest in such Lender
or parent company unless the ownership provides immunity for such Lender from jurisdiction of courts within the United States or from
enforcement of judgments or writs of attachment on its assets, or permits such Lender or Governmental Authority to repudiate or otherwise to
reject such Lender’s agreements.
Deposit Account Control Agreements : the deposit account control agreements to be executed by each institution maintaining a
Deposit Account for an Obligor, in favor of the Applicable Agent, for the
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
24
benefit of the applicable Secured Parties, as security for the Obligations or the Canadian Obligations, as the case may be.
Designated Jurisdiction : any country or territory that is the subject of any comprehensive Sanctions.
Designated Non-Cash Consideration : means the fair market value of non-cash consideration received by any Borrower or any
Subsidiary in connection with an Asset Disposition pursuant to Section 10.2.6(m) that is designated as Designated Non-Cash Consideration
pursuant to a certificate of a Senior Officer of the Borrower Agent setting forth the basis of such valuation.
Dilution : the percent, determined for Borrowers’ most recent Fiscal Quarter, equal to (a) bad debt write-downs or write-offs,
discounts, returns, promotions, credits, credit memos and other dilutive items with respect to Accounts, divided by (b) gross sales.
Disposed EBITDA : with respect to any Sold Entity or Business or any Converted Unrestricted Subsidiary for any period, the amount
for such period of Consolidated EBITDA of such Sold Entity or Business or such Converted Unrestricted Subsidiary, all as determined on a
consolidated basis for such Sold Entity or Business or such Converted Unrestricted Subsidiary.
Disqualified Equity Interests : any Equity Interest which, by its terms (or by the terms of any security or other Equity Interests into
which it is convertible or for which it is exchangeable), or upon the happening of any event or condition (a) matures or is mandatorily
redeemable (other than solely for Qualified Equity Interests), pursuant to a sinking fund obligation or otherwise (except as a result of an
initial public offering, change of control or asset sale so long as any rights of the holders thereof upon the occurrence of an initial public
offering, change of control or asset sale event shall be subject to the prior repayment in full of the Loans and all other Obligations (other than
Secured Bank Product Obligations and contingent indemnification and expense reimbursement obligations as to which no claim has been
made) that are accrued and payable and the termination of the U.S. Revolver Commitments, the Canadian Commitments and all outstanding
Letters of Credit (unless cash collateralized or backstopped in a manner reasonably acceptable to the applicable Issuing Bank), (b) is
redeemable at the option of the holder thereof (other than solely for Qualified Equity Interests), in whole or in part, (c) provides for the
scheduled payments of dividends in cash, or (d) is or becomes convertible into or exchangeable for Debt or any other Equity Interests that
would constitute Disqualified Equity Interests, in each case, prior to the date that is ninety-one (91) days after the latest Applicable
Termination Date at the time such Equity Interests are issued.
Disqualified Institution : unless otherwise consented to by the Borrower in writing, (a) those banks, financial institutions or other
Persons separately identified in writing by the Borrower prior to the date of the Commitment Letter, (b) Company Competitors identified by
the Borrower to the Administrative Agent by name in writing from time to time after the Closing Date or (c) any affiliates of the foregoing
that are readily identifiable by virtue of their names or that are identified in writing by the Borrower to the Administrative Agent from time to
time, but excluding Debt Fund Affiliates. Notwithstanding anything in the Loan Documents to the contrary, the Administrative Agent shall
not be responsible (or have any liability) for, or have any duty to ascertain, inquire into, monitor or enforce compliance with the provisions
thereof relating to Disqualified Institutions. Without limiting the generality of the foregoing, the Administrative Agent shall not (1) be
obligated to ascertain, monitor or inquire as to whether any Lender or participant or prospective Lender or participant is a Disqualified
Institution or (2) have any liability with respect to or arising out of any assignment or participation of Loans or commitments, or disclosure of
confidential information, to any Disqualified Institution;
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
25
provided , that (i) any permitted updates to the list of Disqualified Institutions will not become effective until one Business Day after such
update has been provided to the Administrative Agent and (ii) no updates to the list of Disqualified Institutions shall be deemed to
retroactively disqualify any parties that have previously acquired an assignment or participation interest in respect of the U.S. Revolver
Commitments, the Canadian Commitments and Loans from continuing to hold or vote such previously acquired assignments and
participations on the terms set forth herein for Lenders that are not Disqualified Institutions.
Distribution : any declaration or payment of a distribution, interest or dividend on any Equity Interest (other than payment-in-kind);
or any purchase, redemption, or other acquisition or retirement for value of any Equity Interest; or any payment or repurchase permitted under
Section 10.2.4(b) .
Distributions Payment Conditions : as defined in the final paragraph of Section 10.2.4 .
Domestic Guarantor : any Guarantor that is a Domestic Subsidiary.
Domestic Subsidiary : any Subsidiary that is organized under the laws of any political subdivision of the United States other than any
FSHCO.
Dominion Account : a special account established by any Obligor at Bank of America or another bank acceptable to Administrative
Agent, over which the Applicable Agent has exclusive control for withdrawal purposes.
EEA Financial Institution : (a) any credit institution or investment firm established in any EEA Member Country which is subject to
the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution
described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an
institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.
EEA Member Country : any of the member states of the European Union, Iceland, Liechtenstein, and Norway.
EEA Resolution Authority : any public administrative authority or any person entrusted with public administrative authority of any
EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.
Eligible Account : an Account owing to a Borrowing Base Obligor that arises in the Ordinary Course of Business from the sale of
goods or rendition of services, is payable in U.S. Dollars (or U.S. Dollars or Canadian Dollars in respect of Accounts owing to the Canadian
Borrower) and is deemed by Administrative Agent, in its Permitted Discretion to be an Eligible Account). Without limiting the foregoing, no
Account shall be an Eligible Account if:
(a) it is unpaid for more than 60 days after the original due date, or more than 90 days after the original invoice date;
(b) 50% or more of the Accounts owing by the Account Debtor are not Eligible Accounts under the foregoing clause (a) ;
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
26
(c) when aggregated with other Accounts owing by the Account Debtor, it exceeds 25% of the aggregate Eligible Accounts
(or such higher percentage as Administrative Agent may establish for the Account Debtor from time to time), to the extent of such
excess;
(d) it does not conform with a covenant or representation herein;
(e) it is owing by a creditor or supplier, or is otherwise subject to a potential offset, counterclaim, dispute, deduction,
discount, recoupment, reserve, defense, chargeback, credit or allowance (but ineligibility shall be limited to the amount thereof);
provided , that no Account that otherwise constitutes an Eligible Account shall be rendered ineligible by virtue of this clause (e) to the
extent, but only to the extent, that the Account Debtor’s right to set-off is limited by an enforceable agreement that is reasonably
satisfactory to the Administrative Agent;
(f) an Insolvency Proceeding has been commenced by or against the Account Debtor; or the Account Debtor has failed, has
suspended or ceased doing business, is liquidating, dissolving or winding up its affairs, is not Solvent, or is the subject of any
Sanctions, including but not limited to being listed on any specially designated nationals list maintained by OFAC; or the applicable
Borrowing Base Obligor is not able to bring suit or enforce remedies against the Account Debtor through judicial process;
(g) the Account Debtor is organized or has its principal offices or assets outside the United States or Canada, unless the
Account is supported by a letter of credit (delivered to and directly drawable by the Administrative Agent) or credit insurance
satisfactory in all respects to the Administrative Agent;
(h) it is owing by a Governmental Authority, unless (i) with respect to an Account owing to any U.S. Borrowing Base
Obligor, the Account Debtor is the United States or any department, agency or instrumentality thereof and the Account has been
assigned to Administrative Agent in compliance with the federal Assignment of Claims Act or (ii) with respect to an Account owing
to the Canadian Borrower, the Account Debtor is the Canadian government (Her Majesty The Queen in Right of Canada) or a
political subdivision thereof, or any province or territory, or any department, agency or instrumentality thereof and the Account has
been assigned to the Canadian Agent in compliance with the Financial Administration Act (Canada);
(i) it is not subject to a duly perfected, first priority Lien in favor of the Applicable Agent, or is subject to any other Lien
(other than a Permitted Lien in favor of the Term Loan Facility Agent that is subject to the Intercreditor Agreement);
(j) the goods giving rise to it have not been delivered to the Account Debtor, the services giving rise to it have not been
accepted by the Account Debtor, or it otherwise does not represent a final sale;
(k) (i) it is evidenced by Chattel Paper or an Instrument of any kind, unless such Chattel Paper or Instrument is in the
possession of the Administrative Agent, and to the extent necessary or appropriate, endorsed to the Administrative Agent or (ii) has
been reduced to judgment;
(l) (A) its payment has been extended except to the extent granted in the ordinary course of business or (B) the Account
Debtor has made a partial payment;
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
27
(m) it arises from a sale to an Affiliate that is a Subsidiary or in which any Borrowing Base Obligor has a direct or indirect
controlling interest, from a sale on a cash-on-delivery, bill-and-hold, sale‑or‑return, sale‑on‑approval, consignment, or other
repurchase or return basis, or from a sale for personal, family or household purposes;
(n) it represents a progress billing or retainage, or relates to services for which a performance, surety or completion bond or
similar assurance has been issued;
(o) the portion, if any, that it includes a billing for interest, fees or late charges, but ineligibility shall be limited to the
extent thereof;
(p) the Account is owed by an Account Debtor that has a pending PACA Claim or PSA Claim being asserted against a
Borrower or any Subsidiary at the time that the Eligible Accounts are being determined;
(q) the Account constitutes a Credit Card Receivable or a Pharmacy Receivable;
(r) the Account is attributable to any Supervalu Group Discontinued Operation; or
(s) the Account is subject to any factoring arrangement.
In calculating delinquent portions of Accounts under clauses (a) and (b) above, credit balances more than 90
days old will be excluded.
Eligible Assignee : a Person that is (a) a Lender, Affiliate of a Lender or Approved Fund; (b) any other financial institution approved
by Borrower Agent (which approval shall not be unreasonably withheld or delayed, and shall be deemed given if no objection is made within
five Business Days after Borrower Agent’s receipt of notice of the proposed assignment), the Administrative Agent and each Issuing Bank
(such consent not to be unreasonably withheld or delayed) that extends revolving credit facilities of this type in its ordinary course of
business; or (c) during any Event of Default, any Person acceptable to (i) the Administrative Agent in its discretion and (ii) each Issuing Bank
(such consent not to be unreasonably withheld or delayed); provided , that in no event shall a Defaulting Lender or a Disqualified Institution
be an Eligible Assignee.
Eligible Credit Card Receivables : at the time of any determination thereof, each Credit Card Receivable that at all times satisfies the
criteria set forth below and which has been earned by performance and represents the bona fide amounts due to a U.S. Borrowing Base
Obligor from a Credit Card Processor and/or Credit Card Issuer, and in each case originated in the ordinary course of business of such U.S.
Borrowing Base Obligor and which, in the Permitted Discretion of the Administrative Agent, is deemed an Eligible Credit Card Receivable.
Without limiting the foregoing, in order to be an Eligible Credit Card Receivable, an Account shall indicate no Person other than a U.S.
Borrowing Base Obligor as payee or remittance party. In determining the amount to be so included, the face amount of an Account shall be
reduced by, without duplication, to the extent not reflected in such face amount, (i) the amount of all accrued and actual fees, discounts,
claims or credits pending, promotional program allowances, price adjustments, finance charges or other allowances (including any amount
that a U.S. Borrowing Base Obligor may be obligated to rebate to a customer, a Credit Card Processor or Credit Card Issuer pursuant to the
terms of any agreement or understanding (written or oral)) and (ii) the aggregate amount of all cash received in respect of such Account but
not yet applied by the Obligors to reduce the amount of such Credit Card Receivable. Eligible Credit Card Receivables shall not include any
Credit Card Receivable:
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
28
(a) which is unpaid more than five (5) Business Days after the date of determination of eligibility thereof;
(b) where such Credit Card Receivable or the underlying contract contravenes any laws, rules or regulations applicable thereto,
including, rules and regulations relating to truth-in-lending, fair credit billing, fair credit reporting, equal credit opportunity, fair debt
collection practices and privacy or any party to the underlying contract is in violation of any such laws, rules or regulations;
(c) which is not a valid, legally enforceable obligation of the applicable Credit Card Issuer or Credit Card Processor with respect
thereto;
(d) which is disputed, is with recourse due to the creditworthiness of the cardholder, or with respect to which a claim, chargeback,
offset, deduction or counterclaim, dispute or other defense has been asserted (to the extent of such claim, chargeback, offset, deduction or
counterclaim, dispute or other defense);
(e) that is not subject to a perfected, first priority security interest in favor of the Administrative Agent senior in right of security to all
other security interests thereon, or with respect to which a Borrower does not have good, valid and marketable title thereto, free and clear of
any Lien, other than Liens granted to the Administrative Agent pursuant to the Security Documents and Liens permitted under clauses (c) ,
(d) or (p) of Section 10.2.2 or a Permitted Lien in favor of the Term Loan Facility Agent that is subject to the Intercreditor Agreement;
(f) which does not conform to all representations, warranties or other provisions in the Loan Documents relating to Credit Card
Receivables;
(g) which does not constitute an “Account” or “Payment Intangible” (as each such term is defined in the UCC);
(h) as to which the Credit Card Issuer or Credit Card Processor has asserted the right to require any U.S. Borrowing Base Obligor to
repurchase such Credit Card Receivable from such Credit Card Issuer or Credit Card Processor;
(i) which is due from a Credit Card Issuer or Credit Card Processor which is the subject of an Insolvency Proceeding;
(j) which is evidenced by “chattel paper” or an “instrument” of any kind unless such “chattel paper” or “instrument” is in the
possession of the Administrative Agent, and to the extent necessary or appropriate, endorsed to the Administrative Agent;
(k) which is a Pharmacy Receivable or an Eligible Account;
(l) which arise from the “Purchase Advantage” private label credit card of any U.S. Borrowing Base Obligor or any other proprietary
credit card of any U.S. Borrowing Base Obligor where such any U.S. Borrowing Base Obligor has liability for the failure of the card holder to
make payment thereunder as a result of the financial condition of such card holder;
(m) which is payable in any currency other than U.S. Dollars;
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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(n) which the Administrative Agent determines in its Permitted Discretion to be uncertain of collection;
(o) which is attributable to any Supervalu Group Discontinued Operation; or
(p) which is subject to any factoring arrangement.
Eligible Inventory : Inventory owned by a Borrowing Base Obligor that Administrative Agent, in its Permitted Discretion, deems to
be Eligible Inventory. Without limiting the foregoing, no Inventory shall be Eligible Inventory unless it:
(a) is finished goods or raw materials, and not work-in-process, packaging or shipping materials, labels, samples, display
items, bags, replacement parts or manufacturing supplies;
(b) is not held on consignment unless by an Obligor, nor subject to any deposit or down payment;
(c) is in new and saleable condition and is not damaged, defective, shopworn or otherwise unmerchantable for sale;
(d) is not slow-moving, obsolete or unmerchantable, and does not constitute returned or repossessed goods;
(e) other than in the case of any Inventory attributable to the Supervalu Group, is not perishable (including
perishable agricultural or farming products such as fruits, vegetables or meat); provided that any Inventory
attributable to the Supervalu Group that is perishable (including perishable agricultural or farming products such as
fruits, vegetables or meat) shall not constitute Eligible Inventory to the extent that the Value thereof exceeds twenty-
five percent (25%) of the U.S. Revolver Borrowing Base (determined without regard to the limitation in this proviso);
(f) meets all applicable standards imposed by any Governmental Authority having regulatory authority over such
Inventory, and does not constitute Hazardous Materials;
(g) conforms with the covenants and representations herein;
(h) is subject to the Applicable Agent’s duly perfected, first priority Lien, and no other Lien (other than a Permitted Lien in
favor of the Term Loan Facility Agent that is subject to the Intercreditor Agreement);
(i) is within the continental United States or Canada, is not in transit except between locations of Borrowing Base Obligors
and is not consigned to any Person;
(j) is not subject to any warehouse receipt or negotiable document;
(k) is not subject to any License or other arrangement that restricts such Borrowing Base Obligor’s or such Agent’s right to
dispose of such Inventory, unless the Applicable Agent has received an appropriate Lien Waiver;
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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(l) is not located on leased premises or in the possession of a warehouseman, processor, repairman, mechanic, shipper,
freight forwarder or other Person, unless the lessor or such Person has delivered a Lien Waiver or an appropriate Rent and Charges
Reserve has been established;
(m) is not attributable to any Supervalu Group Discontinued Operation; and
(n) if acquired in a Permitted Acquisition or which is not of the type usually sold in the ordinary course of a Borrower’s
business, until the Administrative Agent has completed or received (A) an appraisal of such Inventory from appraisers reasonably
satisfactory to the Administrative Agent and establishes an Inventory advance rate and Availability Reserves (if applicable) therefor,
and otherwise agrees that such Inventory shall be deemed Eligible Inventory, and (B) such other due diligence as the Administrative
Agent may reasonably require (including a field examination with respect thereto, which will not be considered for purposes of any of
the limitations in Section 10.1.1), all of the results of the foregoing to be reasonably satisfactory to the Administrative Agent.
Eligible Pharmacy Receivables : at the time of any determination thereof, each Pharmacy Receivable that at all times satisfies the
criteria set forth below and which has been earned by performance, and in each case originated in the ordinary course of business of any U.S.
Borrowing Base Obligor and which, in the Permitted Discretion of the Administrative Agent, is deemed to be an Eligible Pharmacy
Receivable. In determining the amount to be so included, the face amount of a Pharmacy Receivable shall be reduced by, without duplication,
to the extent not reflected in such face amount, (1) any and all returns, accrued rebates, discounts (which may, at the Administrative Agent’s
option, be calculated on shortest terms), credits, allowances or sales or excise taxes of any nature at any time issued, owing, claimed by
Account Debtors, granted, outstanding or payable in connection with such Pharmacy Receivables at such time, and (2) the aggregate amount
of all customer deposits, unapplied cash, bonding subrogation rights to the extent not cash collateralized. Eligible Pharmacy Receivables shall
not include any Pharmacy Receivable:
(a) which is unpaid within the earlier of thirty (30) days following its original due date or sixty (60) days following its
original invoice date;
(b) that is the obligation of an Account Debtor (or its Affiliates) if fifty percent (50%) or more of the dollar amount of all
Pharmacy Receivables owing by that Account Debtor (or its Affiliates) are ineligible under the other criteria listed in clause (a) above;
(c) where such Pharmacy Receivable or the underlying contract contravenes any laws, rules or regulations applicable
thereto, including, rules and regulations relating to truth-in-lending, fair credit billing, fair credit reporting, equal credit opportunity, fair
debt collection practices and privacy or any party to the underlying contract is in violation of any such laws, rules or regulations;
(d) which is not a valid, legally enforceable obligation of the applicable Account Debtor with respect thereto;
(e) which is disputed, or with respect to which a claim, chargeback, offset, deduction or counterclaim, dispute or other
defense has been asserted (to the extent of such claim, chargeback, offset, deduction or counterclaim, dispute or other defense);
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
31
(f) that is not subject to a perfected, first priority security interest in favor of the Administrative Agent, or with respect to
which a U.S. Borrowing Base Obligor does not have good, valid and marketable title thereto, free and clear of any Lien, other than Liens
granted to the Administrative Agent pursuant to the Security Documents and Liens permitted under clauses (c) , (d) or (p) of Section
10.2.2 or a Permitted Lien in favor of the Term Loan Facility Agent that is subject to the Intercreditor Agreement;
(g) which does not conform to all representations, warranties or other provisions in the Loan Documents relating to
Pharmacy Receivables;
(h) which does not constitute an “Account” or “Payment Intangible” (as each such term is defined in the UCC);
(i) which is due from an Account Debtor which is the subject of an Insolvency Proceeding;
(j) where the Account Debtor obligated upon such Pharmacy Receivable suspends business, makes a general assignment for
the benefit of creditors or fails to pay its debts generally as they come due;
(k) which is evidenced by “chattel paper” or an “instrument” of any kind unless such “chattel paper” or “instrument” is in the
possession of the Administrative Agent, and to the extent necessary or appropriate, endorsed to the Administrative Agent;
(l) which is a Credit Card Receivable or an Eligible Account;
(m) which do not direct payment thereof to be sent to a Dominion Account;
(n) which is payable in any currency other than U.S. Dollars;
(o) for which the Account Debtor is (i) any Governmental Authority (including, without limitation, Medicare, Medicaid and
food assistance programs) or (ii) a Credit Card Issuer or Credit Card Processor;
(p) for which the Account Debtor is not a (i) retail customer or (ii) Third Party Payor;
(q) that does not arise from the sale of medication, medical equipment or other medical items by such U.S. Borrowing Base
Obligor in the ordinary course of its business;
(r) with respect to an Account Debtor, other than a Supervalu Investment Grade Account Debtor, whose total obligations
owing to U.S. Borrowing Base Obligors exceed fifteen percent (15%) (such percentage, as applied to a particular Account Debtor, being
subject to reduction by Administrative Agent in its Permitted Discretion if the creditworthiness of such Account Debtor deteriorates or
otherwise, in any event, as applied to a particular Account Debtor being subject to increase as to such Account Debtor by Administrative
Agent in its Permitted Discretion) of all Eligible Pharmacy Receivables, to the extent of the obligations owing by such Account Debtor in
excess of such percentage; provided , that , in each case, the amount of Eligible Pharmacy Receivables that are excluded because they
exceed the foregoing
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
32
percentage shall be determined by Administrative Agent based on all of the otherwise Eligible Pharmacy Receivables prior to giving
effect to any eliminations based upon the foregoing concentration limit;
(s) (i) upon which such U.S. Borrowing Base Obligor’s right to receive payment is not absolute or is contingent upon the
fulfillment of any condition whatsoever, (ii) as to which Pharmacy Receivable the Account Debtor is located in a state requiring the filing
of a Notice of Business Activities Report or similar report in order to permit such U.S. Borrowing Base Obligor to use the courts of such
state or to otherwise seek judicial enforcement of payment of such Pharmacy Receivable, in each case unless such U.S. Borrowing Base
Obligor has qualified to do business in such state or has filed a Notice of Business Activities Report (or equivalent report, as applicable)
for the most recent year for which such qualification or report is required (in each case to the extent that the Administrative Agent has
determined to render such Pharmacy Receivable ineligible), or (iii) if the Pharmacy Receivable represents a progress billing consisting of
an invoice for goods sold or used or services rendered pursuant to a contract under which the Account Debtor’s obligation to pay that
invoice is subject to such U.S. Borrowing Base Obligor’s completion of further performance under such contract or is subject to the
equitable lien of a surety bond issuer;
(t) to the extent any U.S. Borrowing Base Obligor or any Subsidiary thereof is (i) liable for goods sold or services rendered
by the applicable Account Debtor to any U.S. Borrowing Base Obligor or any Subsidiary thereof, or (ii) liable for accrued and actual
discounts, claims, unpaid fees, credit or credits pending, promotional program allowances, price adjustment, finance charges or other
allowances (including any amount that any U.S. Borrowing Base Obligor or any Subsidiary thereof, as applicable, may be obligated to
rebate to a customer pursuant to the terms of any agreement or understanding (whether written or oral), but in each case only to the extent
of the potential offset resulting therefrom;
(u) that is the obligation of an Account Debtor located in a foreign country unless payment thereof is supported by an
irrevocable letter of credit reasonably satisfactory to the Administrative Agent as to form, substance and issuer or domestic confirming
bank ( provided , that, at any time an Event of Default exists, in addition, any such letter of credit shall have been delivered to
Administrative Agent and shall be directly drawable by Administrative Agent) or is covered by credit insurance in form, substance and
amount, and by an insurer, reasonably satisfactory to Administrative Agent;
(v) with respect to which an invoice, reasonably acceptable to the Administrative Agent in form, has not been sent to the
applicable Account Debtor or such invoice does not include a true and correct statement of the bona fide payment obligation incurred in
the amount of the Pharmacy Receivable for medication, medical equipment or other medical items sold to and accepted by the applicable
Account Debtor;
(w) in a transaction wherein goods are placed on consignment or are sold pursuant to a guaranteed sale, a sale or return, a sale
on approval, a bill and hold, or any other terms by reason of which the payment by an Account Debtor may be conditional;
(x) as to which any check, draft or other items of payment has previously been received which has been returned unpaid or
otherwise dishonored;
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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(y) to the extent such Pharmacy Receivable consists of finance charges as compared to obligations to such U.S. Borrowing
Base Obligor for goods sold;
(z) to the extent such Pharmacy Receivable exceeds any credit limit established by the Administrative Agent in its
Permitted Discretion, but only after a determination made by the Administrative Agent in its Permitted Discretion that the
creditworthiness of such applicable Account Debtor has declined in such a manner that the prospects for payment on such Pharmacy
Receivable have or may become materially impaired;
(aa) which the Administrative Agent determines in its Permitted Discretion to be uncertain of collection;
(bb) which is attributable to any Supervalu Group Discontinued Operation; or
(a) which is subject to any factoring arrangement.
Any Pharmacy Receivables that are not Eligible Pharmacy Receivables shall nevertheless be part of the ABL Priority Collateral.
Eligible Prescription Files : at the time of any determination thereof, each Prescription File that at all times satisfies the criteria set
forth below and which arises and is maintained in the ordinary course of the business of any U.S. Borrowing Base Obligor and which is of a
type included in an appraisal of Prescription Files received by the Administrative Agent in accordance with the requirements of the
Administrative Agent (including Prescription Files acquired by such U.S. Borrowing Base Obligor after the date of such appraisal) and
which, in the Permitted Discretion of the Administrative Agent, is deemed to be an Eligible Prescription File. Eligible Prescription Files shall
not include any Prescription Files: (a) at premises other than those owned, leased or licensed and in each case controlled by a U.S. Borrowing
Base Obligor; (b) subject to a Lien in favor of any Person other than Administrative Agent or a Permitted Lien in favor of the Term Loan
Facility Agent that is subject to the Intercreditor Agreement; (c) that are not in a form that may be sold or otherwise transferred or are subject
to regulatory restrictions on the transfer thereof that are not acceptable to the Administrative Agent in its Permitted Discretion; or (d) which
are attributable to any Supervalu Group Discontinued Operation. The criteria for Eligible Prescription Files set forth above may only be
changed and any new criteria for Eligible Prescription Files may be established by the Administrative Agent in the exercise of its Permitted
Discretion based solely on either: (i) an event, condition or other circumstance arising after the Closing Date, or (ii) an event, condition or
other circumstance existing on the Closing Date to the extent that such event, condition or circumstance has not been identified by a Borrower
to the field examiners of Administrative Agent prior to the Closing Date (except to the extent that it may have been identified but the
Administrative Agent has elected not to establish eligibility criteria with respect thereto as of the Closing Date), in either case under clause (i)
or (ii) which adversely affects or would reasonably be expected to adversely affect the Prescription Files or the Administrative Agent’s ability
to realize upon the Prescription Files in any material respect, in each case, as determined by Administrative Agent in its Permitted Discretion.
Any Prescription Files that are not Eligible Prescription Files shall nevertheless be part of the ABL Priority Collateral.
Enforcement Action : any action to enforce any Obligations (other than Secured Bank Product Obligations) or Loan Documents or to
exercise any rights or remedies relating to any Collateral (whether by judicial action, self-help, notification of Account Debtors, exercise of
setoff or recoupment, exercise of any right to act in an Obligor’s Insolvency Proceeding or to credit bid Obligations, or otherwise).
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Environmental Laws : all Applicable Laws (including all programs, permits and guidance promulgated by regulatory agencies),
relating to pollution, the protection of the environment or human health and safety, including CERCLA, RCRA and CWA.
Environmental Notice : a written notice from any Governmental Authority or other Person of any possible noncompliance with,
investigation of a possible violation of, litigation relating to, or potential fine or liability under any Environmental Law, or with respect to any
Environmental Release, environmental pollution or hazardous materials, including any complaint, summons, citation, order, claim, demand or
request for correction, remediation or otherwise.
Environmental Release : a release as defined in CERCLA or under any other Environmental Law.
Equity Interest : equity securities, ordinary shares, preference shares, deferred shares, other similar shares, shares of capital stock,
partnership interests, membership interests in a limited liability company, beneficial interests in a trust or other equity ownership interests in a
Person, and any warrants, options or other similar rights entitling the holder thereof to purchase or acquire any of the foregoing; provided that
“Equity Interests” shall not include Debt that is convertible into Equity Interests.
ERISA : the Employee Retirement Income Security Act of 1974, as amended, and the rules and regulations promulgated thereunder.
ERISA Affiliate : any trade or business (whether or not incorporated) under common control with an Obligor within the meaning of
Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes of provisions relating to Section 412 of the Code).
ERISA Event : (a) a Reportable Event with respect to a Pension Plan; (b) a withdrawal by any Obligor or ERISA Affiliate from a
Pension Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial employer (as defined in Section 4001(a)(2) of
ERISA) or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of ERISA; (c) a complete or partial withdrawal
by any Obligor or ERISA Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is or is expected to be insolvent or in
endangered or critical status; (d) the filing of a notice of intent to terminate, the treatment of a plan amendment as a termination under Section
4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e) the
determination that any Pension Plan is or is expected to be “at risk” under the Code or ERISA; (f) an event or condition which constitutes or
could reasonably be expected to constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to
administer, any Pension Plan; (g) the failure to satisfy the minimum funding standards with respect to a Pension Plan within the meaning of
Section 412 or 430 of the Code or Section 302 or 303 of ERISA, whether or not waived; (h) conditions contained in Section 303(k)(1)(A) of
ERISA for imposition of a lien shall have been met with respect to any Pension Plan; or (i) the imposition of any material liability under Title
IV of ERISA, other than for PBGC premiums due but not delinquent under Section 4007 of ERISA, upon any Obligor or ERISA Affiliate.
EU Bail-In Legislation Schedule : the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor
person), as in effect from time to time.
Event of Default : as defined in Section 11 .
Excluded Equity : Equity Interests (a) of any Subsidiary acquired pursuant to a Permitted Acquisition financed with Debt permitted
pursuant to Section 10.2.1 if such Equity Interests are pledged
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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and/or mortgaged as security for such Debt and if and for so long as the terms of such Debt prohibit the creation of any other Lien on such
Equity Interests (and which prohibition was not created in contemplation of such Permitted Acquisition), (b) of any CFC or FSHCO in excess
of 65% of the issued and outstanding voting Equity Interests and 100% of the nonvoting Equity Interests of each such CFC or FSHCO;
provided , that nothing in this clause (b) shall limit the pledge of the Equity Interests of the Canadian Borrower or any CFC or FSHCO that is
a Canadian Subsidiary or a Subsidiary of the Canadian Borrower, in each case, to secure Obligations other than the U.S. Obligations, (c) of
any Subsidiary with respect to which the Administrative Agent and the Borrower Agent have determined in their reasonable judgment and
agreed in writing that the costs of providing a pledge of such Equity Interests or perfection thereof is excessive in view of the benefits to be
obtained by the Secured Parties therefrom, (d) of any captive insurance companies, not-for-profit Subsidiaries, special purpose entities, (e) of
any non-wholly-owned Subsidiary; (f) of any Subsidiary outside the United States (other than any Guarantor designated as such pursuant to
the definition of “Guarantor”) the pledge of which is prohibited by applicable Laws or which would reasonably be expected to result in a
violation or breach of, or conflict with, fiduciary duties of such Subsidiary’s officers, directors or managers and (g) of any Unrestricted
Subsidiary.
Excluded Obligor : (a) any Subsidiary that is prohibited by applicable Law or by any contractual obligation existing on the Closing
Date (or, if later, the date such Subsidiary first becomes a Subsidiary) from guaranteeing the Obligations (and in the case of such contractual
obligation, not entered into in contemplation of the acquisition of such Subsidiary) or which would require governmental (including
regulatory) consent, approval, license or authorization to provide a guarantee unless such consent, approval, license or authorization has been
received, (b) any Subsidiary acquired pursuant to a Permitted Acquisition that, at the time of such Permitted Acquisition, has assumed
secured Debt not incurred in contemplation of such Permitted Acquisition and each Subsidiary that is a Subsidiary thereof that guarantees
such Debt to the extent such secured Debt prohibits such Subsidiary from becoming a Guarantor ( provided , that each such Subsidiary shall
cease to be an Excluded Obligor under this clause (b) if such secured Debt is repaid or becomes unsecured, if such Subsidiary ceases to be an
obligor with respect to such secured Debt or such prohibition no longer exists, as applicable), (c) any Immaterial Subsidiary, (d) captive
insurance companies, (e) not-for-profit Subsidiaries, (f) special purpose entities, (g) any non-wholly-owned Subsidiary, (h) any Unrestricted
Subsidiary, (i) solely in the case of any U.S. Obligation, any CFC, any FSHCO, and, in each case, any Subsidiary thereof and (j) any other
Subsidiary with respect to which, in the reasonable judgment of the Administrative Agent, the cost or other consequences (including any
adverse tax consequences) of providing a guarantee shall be excessive in view of the benefits to be obtained by the Lenders therefrom; in
each case of this definition, unless such Subsidiary is designated by the Borrower Agent as a Guarantor pursuant to the definition of
“Guarantors”.
Excluded Property : (a) any fee-owned real property and any leasehold interests in real property (it being understood that no action
shall be required with respect to creation or perfection of security interests with respect to such leases, including to obtain landlord waivers,
estoppels or collateral access letters), (b) (i) motor vehicles and other assets subject to certificates of title to the extent a Lien thereon cannot
be perfected by the filing of a UCC or PPSA financing statement, (ii) letter of credit rights to the extent a Lien thereon cannot be perfected by
the filing of a UCC or PPSA financing statement and (iii) commercial tort claims expected to result in a recovery of less than an amount to be
set forth in the applicable Security Documents, (c) assets for so long as a pledge thereof or a security interest therein is prohibited by
Applicable Law or any permitted contractual obligation binding on such assets on the Closing Date (or, if later, the date such asset or right
was acquired by the Borrower or the applicable Guarantor (or the date the owner of such asset or right became a Subsidiary) to the extent not
entered into in contemplation of such acquisition), or the pledge or creation of a security interest in which would require governmental
consent, approval, license or authorization, other than to the extent such prohibition
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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or restriction is rendered ineffective under the UCC, the PPSA or other Applicable Law, (d) margin stock, (e) any cash, deposit accounts and
securities accounts (including securities entitlements and related assets) (it being understood that this exclusion shall not affect the grant of
the Lien on proceeds of Collateral and all proceeds of Collateral shall be Collateral), unless the foregoing constitutes ABL Priority Collateral,
(f) any lease, license or other agreements, or any property subject to a purchase money security interest, Capital Lease or similar
arrangements, in each case to the extent permitted under the Loan Documents, to the extent that a pledge thereof or a security interest therein
would violate or invalidate such lease, license or agreement, purchase money, Capital Lease or similar arrangement, or create a right of
termination in favor of any other party thereto (other than the Borrowers or a Guarantor) after giving effect to the applicable anti-assignment
clauses of the Uniform Commercial Code, the PPSA and applicable Laws, other than the proceeds and receivables thereof the assignment of
which is expressly deemed effective under applicable Laws notwithstanding such prohibition, (g) any assets (including Equity Interests)
owned by any CFC or any FSHCO; provided , that nothing in this clause (g) shall limit the pledge of assets by the Canadian Borrower or any
other CFC or FSHCO that is designated a Guarantor pursuant to the definition of “Guarantor” to secure Obligations other than the U.S.
Obligations, (h) any assets not otherwise excluded by this definition if a pledge thereof or granting a security interest therein would result in a
material adverse tax consequence as reasonably determined by the Borrower Agent in consultation with the Administrative Agent, (i) assets
for which the Administrative Agent and the Borrower Agent have determined in their reasonable judgment and agree in writing that the cost
of creating or perfecting such pledges or security interests therein would be excessive in view of the benefits to be obtained by the Lenders
therefrom, (j) any intent-to-use trademark application in the United States prior to the filing of a “Statement of Use” or “Amendment to
Allege Use” with respect thereto, to the extent, if any, that, and solely during the period, if any, in which, the grant, attachment, or
enforcement of a security interest therein would impair the validity or enforceability of such intent-to-use trademark application under
applicable Federal law and (k) Excluded Equity.
Excluded Swap Obligation : with respect to an Obligor, each Swap Obligation as to which, and only to the extent that, such Obligor’s
guaranty of or grant of a Lien as security for such Swap Obligation is or becomes illegal under the Commodity Exchange Act because the
Obligor does not constitute an “eligible contract participant” as defined in the act (determined after giving effect to any keepwell, support or
other agreement for the benefit of such Obligor and all guarantees of Swap Obligations by other Obligors) when such guaranty or grant of
Lien becomes effective with respect to the Swap Obligation. If a Hedging Agreement governs more than one Swap Obligation, only the Swap
Obligation(s) or portions thereof described in the foregoing sentence shall be Excluded Swap Obligation(s) for the applicable Obligor.
Excluded Taxes : any of the following Taxes imposed on or with respect to a Recipient or required to be withheld or deducted from a
payment to a Recipient, (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes,
in each case, (i) imposed as a result of such Recipient being organized under the laws of, or having its principal office or, in the case of any
Lender, its applicable lending office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other
Connection Taxes, (b) in the case of a Lender, U.S. federal or Canadian withholding Taxes imposed on amounts payable to or for the account
of such Lender with respect to an applicable interest in a Loan or Commitment pursuant to a law in effect on the date on which (i) such
Lender acquires such interest in the Loan or Commitment (other than pursuant to an assignment request by the Borrower under Section 13.4)
or (ii) such Lender changes its lending office, except in each case to the extent that, pursuant to Section 5.9, amounts with respect to such
Taxes were payable either to such Lender's assignor immediately before such Lender became a party hereto or to such Lender
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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immediately before it changed its lending office, (c) Taxes attributable to such Recipient’s failure to comply with Section 5.10, and (d) any
U.S. federal withholding Taxes imposed under FATCA.
Existing UNFI Letters of Credit : those letters of credit issued by Bank of America under the Existing UNFI ABL Credit Agreement
that are outstanding on the Closing Date.
Existing Supervalu Letters of Credit : those letters of credit issued by an issuing bank under the Existing Supervalu Inc. Credit
Agreement that are outstanding on the Closing Date.
Existing Supervalu Inc. Credit Agreement : the Amended and Restated Credit Agreement dated as of March 21, 2013 by and among,
inter alios , Supervalu Inc., the lenders party thereto from time to time and Wells Fargo Bank, National Association, as administrative agent
(together with its successors and assigns) as such agreement may be amended, supplemented, modified, restated, renewed or replaced
(whether upon or after termination or otherwise) in whole or in part from time to time; provided , that any amendment to the computation of
the borrowing base thereunder (including to any applicable component definition of the definition of borrowing base) shall be taken into
account for purposes of Section 10.1.1 at the discretion of the Administrative Agent.
Existing UNFI ABL Credit Agreement : as defined in the recitals to this Agreement.
Existing UNFI Term Loan Credit Agreement : as defined in the recitals to this Agreement.
Extraordinary Expenses : all costs, expenses or advances that (i) any Agent may incur during a Default or Event of Default, or during
the pendency of an Insolvency Proceeding of an Obligor, or (ii) any Lender may incur at any time after the acceleration of the Obligations
hereunder or during the pendency of an Insolvency Proceeding of an Obligor, including, in each case, those relating to (a) any audit,
inspection, repossession, storage, repair, appraisal, insurance, manufacture, preparation or advertising for sale, sale, collection, or other
preservation of or realization upon any Collateral; (b) any action, arbitration or other proceeding (whether instituted by or against such Agent,
any Lender, any Obligor, any representative of creditors of an Obligor or any other Person) in any way relating to any Collateral (including
the validity, perfection, priority or avoidability of such Agent’s Liens with respect to any Collateral), Loan Documents, Letters of Credit or
Obligations, including any lender liability or other Claims; (c) the exercise, protection or enforcement of any rights or remedies of such Agent
in, or the monitoring of, any Insolvency Proceeding; (d) settlement or satisfaction of any taxes, charges or Liens with respect to any
Collateral; (e) any Enforcement Action; (f) negotiation and documentation of any modification, waiver, workout, restructuring or forbearance
with respect to any Loan Documents or Obligations; and (g) Protective Advances. Such costs, expenses and advances include transfer fees,
Other Taxes, storage fees, insurance costs, permit fees, utility reservation and standby fees, legal fees, appraisal fees, brokers’ fees and
commissions, auctioneers’ fees and commissions, accountants’ fees, environmental study fees, wages and salaries paid to employees of any
Obligor or independent contractors in liquidating any Collateral, and travel expenses.
FATCA : Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is
substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof
and any agreement entered into pursuant to Section 1471(b)(1) of the Code, and any fiscal or regulatory legislation, rules or practices adopted
pursuant to any intergovernmental agreement, treaty or convention among Governmental Authorities and implementing such Sections of the
Code.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Federal Funds Rate : (a) the weighted average of interest rates on overnight federal funds transactions with members of the Federal
Reserve System, as published by the Federal Reserve Bank of New York on the next Business Day; or (b) if no such rate is published on the
next Business Day, the average rate (rounded up, if necessary, to the nearest 1/8 of 1%) charged to Bank of America on the applicable day on
such transactions, as determined by Administrative Agent; provided , that in no event shall such rate be less than zero.
Fee Letter : the second amended and restated fee letter dated August 8, 2018 by and among the Lead Arrangers and the Borrower
Agent.
Fiscal Intermediary : any qualified insurance company or other Person that has entered into an ongoing relationship with any
Governmental Authority to make payments to payees under Medicare, Medicaid or any other federal, state or local public health care or
medical assistance program pursuant to any of the Health Care Laws.
Fiscal Period : each of the twelve (12) periods of either four weeks or five weeks (as applicable) in each Fiscal Year, as further
described on Schedule 1.1(b) attached hereto.
Fiscal Quarter : any fiscal quarter described on Schedule 1.1(b) attached hereto.
Fiscal Year : the fiscal year of Borrowers and Subsidiaries for accounting and tax purposes, ending on the Saturday closest to July 31
of each year.
Fixed Charge Coverage Ratio : the ratio, determined on a consolidated basis for Borrowers and Subsidiaries as of any date of
determination for the four Fiscal Quarters then most recently ended, of (a) Consolidated EBITDA minus Capital Expenditures (except those
financed with Borrowed Money other than Loans) and cash taxes paid, to (b) Fixed Charges.
Fixed Charges : the sum of the following, to the extent paid or required to be paid in cash: Consolidated Cash Interest Charges,
scheduled principal payments made on Borrowed Money and Distributions made.
FLSA : the Fair Labor Standards Act of 1938.
Foreign Lender : any U.S. Revolver Lender that is not a U.S. Person.
Foreign Plan : any employee benefit plan or arrangement (a) maintained or contributed to by any Obligor or Subsidiary that is not
subject to the laws of the United States or any jurisdiction in Canada; or (b) mandated by a government other than the United States
(including any local or state government) or Canada (or any Canadian provincial or territorial government) for employees of any Obligor or
Subsidiary.
Foreign Subsidiary : any Subsidiary that is organized under the laws of any political subdivision of any jurisdiction other than the
United States.
Fronting Exposure : a Defaulting Lender’s interest in LC Obligations, Swingline Loans and Protective Advances, except to the extent
Cash Collateralized by the Defaulting Lender or allocated to other Lenders hereunder.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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FSHCO : (a) any Subsidiary that owns no material assets (directly or through one or more entities treated as flow-through entities for
U.S. federal income tax purposes) other than Equity Interests (or Equity Interests and Debt) of one or more CFCs and cash or Cash
Equivalents incidental thereto.
Full Payment : with respect to any Obligations (other than (i) Secured Bank Product Obligations with respect to Bank Products
consisting of Hedging Agreements and (ii) any other Secured Bank Product Obligations as to which, in the case of this clause (ii) only,
arrangements satisfactory to the applicable Secured Bank Product Provider have been made): (a) the full cash payment thereof, including any
interest, fees and other charges accruing during an Insolvency Proceeding (whether or not allowed in the proceeding but excluding any
contingent indemnification obligations for which no claim has been made); and (b) if such Obligations are LC Obligations or inchoate or
contingent in nature (other than any contingent indemnification obligations for which no claim has been made), Cash Collateralization thereof
(or delivery of a standby letter of credit acceptable to the Applicable Agent in its discretion, in the amount of required Cash Collateral). No
U.S. Revolver Loans or Canadian Loans shall be deemed to have been paid in full until all U.S. Revolver Commitments or Canadian
Commitments, as the case may be, have expired or been terminated.
GAAP : generally accepted accounting principles in effect in the United States from time to time.
Governmental Approvals : all authorizations, consents, approvals, licenses and exemptions of, registrations and filings with, and
required reports to, all Governmental Authorities.
Governmental Authority : any federal, state, provincial, territorial, local, foreign or other agency, authority, body, commission, court,
instrumentality, political subdivision, central bank, or other entity or officer exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions for any governmental, judicial, investigative, regulatory or self-regulatory authority (including the
Financial Conduct Authority, the Prudential Regulation Authority and any supra-national bodies such as the European Union or European
Central Bank).
Guarantee and Collateral Requirement : the requirement that:
(a) all payment Obligations of the U.S. Borrowers and the Domestic Guarantors shall have been unconditionally
guaranteed, jointly and severally, solely by each wholly-owned Domestic Subsidiary of the Borrower Agent, in each case, other than any
Excluded Obligor; provided , that each U.S. Borrower shall, in addition to becoming a party to the Closing Date Guaranty Agreement,
accede to this Agreement and be bound by the provisions herein, including Section 5.11 ;
(b) all payment Obligations of the Canadian Borrower and the Canadian Guarantors (if any) shall have been
unconditionally guaranteed, jointly and severally, by each U.S. Loan Party and each wholly-owned Canadian Subsidiary, other than any
Excluded Obligor;
(c) (i) the Applicable Agent shall have received each Security Document required to be delivered on the Closing Date
pursuant to Section 6.2.2(b) (in each case, in a form approved by the Applicable Agent and the Borrower Agent in their reasonable
discretion without the further consent of any other party hereto so long as the form thereof is consistent with the requirements in this
Guarantee and Collateral Requirement), in each case duly executed by each applicable Borrower and each applicable Subsidiary of the
Borrower Agent that is required to be a Guarantor pursuant to clause (a) or (b) above from time to time and such Security Documents,
taken as a whole and together with the other documents, instruments and actions described in this Guarantee and
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Collateral Requirement but subject to the limitations set forth herein (including limitations with respect to Excluded Property), shall
grant Liens in favor of the Applicable Agent on substantially all Collateral in order to secure the Obligations and (ii) to the extent the
Term Loan Agreement is outstanding, the Administrative Agent and the Term Loan Facility Agent shall have entered into, and each
Obligor (other than any Canadian Loan Party) shall have entered into or acknowledged, the Intercreditor Agreement;
(d) (i) the Obligors shall have taken all actions reasonably necessary (including, without limitation, entering into and
delivering Credit Card Notifications) and delivered to the Applicable Agent or such other applicable Person all documents, UCC
financing statements, PPSA financing statements, filings with the United States Copyright Office, the United States Patent and
Trademark Office and the Canadian Intellectual Property Office covering Collateral that consists of Intellectual Property, other filings,
instruments, Equity Interests and related transfer powers (as more fully set forth herein), in each case, pursuant to the terms of the
applicable Security Document that are necessary to perfect the Liens described in the Collateral and (ii)(x) in the case of any such Liens
granted by the Canadian Loan Parties, such Liens shall be perfected on a first-priority basis, (y) in the case of any such Liens granted by
the U.S. Loan Parties over Collateral constituting ABL Priority Collateral, such Liens shall be perfected on a first-priority basis and (z)
in the case of any such Liens granted by the U.S. Loan Parties over Collateral constituting Term Priority Collateral, such Liens shall be
perfected on a second-priority basis to the extent the first-priority Lien with respect to such Collateral is granted in favor of the Term
Loan Facility Agent, in each case subject to Permitted Liens; provided , that, prior to the discharge of the Term Loan Agreement, Term
Priority Collateral that is required to be delivered to the Administrative Agent hereunder or under any Security Document shall be
delivered to the Term Loan Facility Agent instead to the extent required under the Intercreditor Agreement and, to the extent so
delivered, shall be held by the Term Loan Facility Agent as gratuitous bailee for the applicable Secured Parties solely for the purpose of
perfecting the security interest granted to the Administrative Agent under the applicable Security Documents; provided, further, that no
filings shall be required to be made other than, for the purposes of perfection, pursuant to the UCC with the office of the secretary of
state (or similar filing office) of the relevant State(s), the PPSA or, solely with respect to intellectual property constituting Collateral,
with the applicable United States governmental offices and the Canadian Intellectual Property Office; and
(e) in furtherance of and not in limitation of clauses (c) and (d) above but subject to the proviso in clause (d) above, all
outstanding Equity Interests, in each case, directly owned by the Obligors and all intercompany Debt owing to any Obligor, in each case
constituting Collateral and other than property excluded from the Guarantee and Collateral Requirement pursuant to the second full
paragraph of this clause (e) of this Guarantee and Collateral Requirement definition, shall have been pledged in favor of the Applicable
Agent pursuant to and to the extent required under the applicable Security Document and, to the extent required by the applicable
Security Document, the Applicable Agent shall have received certificates or other instruments (if any) representing such Equity Interests
and any such notes or other instruments, together with stock powers, note powers or other instruments of transfer (if applicable) with
respect thereto endorsed in blank (collectively, the “ Pledged Collateral ”).
Notwithstanding the foregoing provisions of this definition or anything in this Agreement or any other Loan Document to the
contrary:
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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(i) Liens required to be granted from time to time pursuant to the Guarantee and Collateral Requirement
(including perfection actions applicable thereto) and guarantees required to be provided pursuant to the Guarantee and
Collateral Requirement shall, in each case, be subject to exceptions and limitations (including materiality thresholds
and qualifiers) set forth in the Security Documents.
(ii) The Guarantee and Collateral Requirement shall not apply to any Excluded Property.
(iii) The execution and delivery of deposit account control agreement, securities account control agreement
or other control agreements shall not be required with respect to any deposit account, securities account, commodities
account or other asset specifically requiring perfection through control agreements or any other means of perfection
by “control” (as such term is used under the UCC or the PPSA, as applicable) except to the extent set forth in Section
8 .
(iv) No actions in any jurisdiction other than the United States of America (including any state thereof and
the District of Columbia) or Canada (including any province or territory thereof) shall be required in order to create
any security interests in assets located, titled, registered or filed outside of the United States of America or Canada or
to perfect such security interests including, in each case, intellectual property (it being understood that there shall be
in no security agreements, pledge agreements or other security instruments governing the laws of a non-U.S.
jurisdiction other than the Canadian Security Documents).
(v) The Applicable Agent may grant extensions of time for the granting and perfection of security interests
where it reasonably determines, in consultation with the Borrower Agent, that such grant or perfection cannot be
accomplished without undue effort or expense by the time or times at which it would otherwise be required by this
Agreement or the Security Documents.
(vi) (A) The Canadian Obligations shall be secured by the Collateral of the Canadian Loan Parties and the
U.S. Loan Parties, but the Obligations of the U.S. Loan Parties shall not in any event be secured by the Collateral of
the Canadian Loan Parties or of any other CFC or FSHCO and (B) in no event shall any CFC or FSHCO that is not a
Canadian Subsidiary be required to become an Obligor.
(vii) In no event shall the Collateral consist of Real Estate.
(viii) The Security Documents shall include customary provisions relating to Excluded Swap Obligations.
(ix) The Guarantee and Collateral Requirement shall be subject to the limitations set forth in the final
paragraph of Section 6.2 with respect to Collateral granted on the Closing Date.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Guarantor Payment : as defined in Section 5.11.3 .
Guarantors : Natural Retail Group, Inc., a Delaware corporation, Albert’s Organics, Inc., a California corporation, United Natural
Trading, LLC, a Delaware limited liability company, Blue Marble Brands, LLC, a Delaware limited liability company, Select Nutrition, LLC,
a Delaware limited liability company, Tony’s Fine Foods, a California corporation, Nor-Cal Produce, Inc., a California corporation, and,
subject to the prior written consent of the Administrative Agent with respect to any Person that is not a Canadian Subsidiary or a Domestic
Subsidiary, each other Person who guarantees payment or performance of any Obligations.
Guaranty : (a) the Closing Date Guaranty Agreement and (b) each other guaranty agreement executed by a Guarantor in favor of the
Applicable Agent.
Hazardous Materials : all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes or other
pollutants including petroleum or petroleum distillates, natural gas, natural gas liquids, asbestos or asbestos-containing materials,
polychlorinated biphenyls, radon gas, toxic mold, infectious wastes and all other substances, wastes, chemicals, pollutants, contaminants or
compounds of any nature in any form regulated pursuant to any Environmental Law.
Health Care Laws : all federal, state and local laws, rules, regulations, interpretations, guidelines, ordinances and decrees primarily
relating to patient healthcare, any health care provider, medical assistance and cost reimbursement programs, as now or at any time hereafter
in effect, applicable.
Hedging Agreement : any “swap agreement” as defined in Section 101(53B)(A) of the Bankruptcy Code.
HIPAA : the Health Insurance Portability and Accountability Act of 1996, as the same now exists or may hereafter from time to time
be amended, modified, recodified or supplemented, together with all rules and regulations thereunder.
HIPAA Compliance Date : as defined in Section 9.1.29.(b) .
HIPAA Compliance Plan : as defined in Section 9.1.29.(a) .
Immaterial Subsidiary : any Subsidiary of a Borrower that, together with its Subsidiaries, (a) generated less than 5% of Consolidated
EBITDA for the Fiscal Year most recently ended or (b) had total assets (including Equity Interests in other Subsidiaries and excluding
investments that are eliminated in consolidation) of less than 5% of the total assets of the Borrowers and their Subsidiaries, on a consolidated
basis, as of the end of the Fiscal Year most recently ended; provided , however , that if at any time there are Subsidiaries that are classified as
“Immaterial Subsidiaries” but that collectively (i) generated more than 5% of Consolidated EBITDA for the Fiscal Year most recently ended
or (ii) had total assets (including Equity Interests in other Subsidiaries and excluding investments that are eliminated in consolidation) of
equal to or greater than 5% of the total assets of the Borrowers and their Subsidiaries on a consolidated basis, as of the end of the Fiscal Year
most recently ended, then the Borrowers shall cause such Subsidiaries to comply with the provisions of Section 10.1.9 such that, after such
Subsidiaries become Guarantors hereunder, the Subsidiaries that are not Guarantors shall (A) have generated less than 5% of Consolidated
EBITDA for the Fiscal Year most recently ended and (B) have had total assets of less than 5% of the total assets of the Borrowers and their
Subsidiaries on a consolidated basis as of the end of the Fiscal Year most recently ended. To the extent any of such Subsidiaries are acquired
or formed during the relevant Fiscal Year, the percentages set forth above shall be calculated on a pro forma basis
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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after giving effect to such acquisition or formation as if such acquisition or formation had occurred on the first day of such Fiscal Year.
Incremental Equivalent Debt: Debt of any Borrower or any Subsidiary in an aggregate principal amount not to exceed the Maximum
Incremental Facilities Amount so long as (A) such Debt shall not mature prior to the date that is 91 days after the latest Applicable
Termination Date (or prior to the latest Applicable Termination Date in the case of any such Debt that is secured with a Lien on the Term
Loan Priority Collateral ranking pari passu with the Liens securing the Term Loan Facility); provided , that the foregoing requirements of this
clause (A) shall not apply to the extent such Debt constitutes a customary bridge facility, so long as the long-term Debt into which such
customary bridge facility is to be converted or exchanged satisfies the requirements of this clause (A), (B) such Debt shall not have
mandatory prepayment, redemption or offer to purchase events more onerous than those applicable to the initial term loans under the Term
Loan Facility; provided , that the foregoing requirements of this clause (2) shall not apply to the extent such Debt constitutes a customary
bridge facility, so long as the long-term Debt into which such customary bridge facility is to be converted or exchanged satisfies the
requirements of this clause (B), (C) in the case of any secured Incremental Equivalent Debt, shall be subject to customary intercreditor terms
(including those in the Intercreditor Agreement and/or any other lien subordination and intercreditor arrangement reasonably satisfactory to
the Borrower and the Administrative Agent, as applicable), (D) such Debt is not guaranteed by any Person other than any Obligor, (E) if such
Debt is secured, it is not secured by any assets other than the Collateral and (F) the maximum aggregate principal amount of Incremental
Equivalent Debt that may be incurred by Subsidiaries that are not Obligors shall not exceed the greater of (x) U.S.$50,000,000 and (y) 5.00%
of Consolidated EBITDA of the Borrowers and the Subsidiaries for the most recently ended most recently ended period of four consecutive
Fiscal Quarters calculated on a pro forma basis at any one time outstanding (this clause (F), the “ Non-Loan Party Incremental Debt Baske
t”).
Incremental Fixed Dollar Basket : the greater of (x) $875,000,000 and (y) 100% of Consolidated EBITDA (calculated on a pro forma
basis) for the most recently ended period of four consecutive Fiscal Quarters.
Indemnified Taxes : (a) Taxes other than Excluded Taxes imposed on or with respect to any payment made by or on account of any
Obligation of any Borrower or Guarantor under any Loan Document and (b) to the extent not otherwise described in (a), Other Taxes.
Indemnitees : Agent Indemnitees, Lender Indemnitees, Issuing Bank Indemnitees and Bank of America Indemnitees.
Insolvency Proceeding : any case or proceeding commenced by or against a Person under any state, provincial, territorial, federal or
foreign law for, or any agreement of such Person to, (a) the entry of an order for relief under the Bankruptcy Code, any Canadian Debtor
Relief Law, or any other insolvency, debtor relief or debt adjustment law; (b) the appointment of a receiver, interim receiver, receiver
manager, trustee, liquidator, administrator, conservator or other custodian for such Person or any part of its Property; (c) an assignment or
trust mortgage for the benefit of creditors; or (d) in the case of the Canadian Borrower or any Canadian Subsidiary, the filing of a notice of
intention to make a proposal or the filing of a proposal under the Bankruptcy and Insolvency Act (Canada).
Intellectual Property : all intellectual property rights and similar Property of a Person, including inventions, designs, patents,
copyrights, trademarks, service marks, trade names, trade secrets, confidential or proprietary information, customer lists, know-how, software
and databases; all goodwill associated therewith or symbolized by the foregoing; all embodiments or fixations thereof and all related
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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documentation, applications, registrations and franchises; all extensions or renewals thereof; all licenses or other rights to use any of the
foregoing; and all books and records relating to the foregoing; and all rights to sue for past, present and future infringements of any of the
foregoing.
Intellectual Property Claim : any claim or assertion (whether in writing, by suit or otherwise) that a Borrower’s or Subsidiary’s
ownership, use, marketing, sale or distribution of any Inventory, Equipment, Intellectual Property or other Property or service violates another
Person’s Intellectual Property.
Intercreditor Agreement : the Intercreditor Agreement dated as of the Closing Date, by and between the Administrative Agent and the
Term Loan Facility Agent, and acknowledged by the Obligors (other than the Canadian Borrower), as such agreement may be amended,
supplemented, modified, restated, renewed or replaced (whether upon or after termination or otherwise) in whole or in part from time to time
in accordance with the terms set forth therein. The Intercreditor Agreement executed on the Closing Date shall be substantially in the form of
Exhibit E with such modifications or in such other form as shall be consistent with market terms governing security arrangements for the
sharing of Liens and Collateral proceeds on a Split Collateral Basis at the time the Intercreditor Agreement is proposed to be established, so
long as the terms of the Intercreditor Agreement are reasonably satisfactory to the Administrative Agent and the Borrower Agent; provided ,
that if the proposed Intercreditor Agreement differs from Exhibit E in any material respect, the Administrative Agent shall post the proposed
Intercreditor Agreement to Lenders and such Intercreditor Agreement shall be deemed to be acceptable to the Administrative Agent and the
Lenders unless the Required Lenders shall have delivered notice in writing to the Administrative Agent objecting to such Intercreditor
Agreement within five Business Days of the posting thereof.
Interest Period : as defined in Section 3.1.3 .
Inventory : as defined in the UCC or PPSA, as applicable, including all goods intended for sale, lease, display or demonstration; all
work in process; and all raw materials, and other materials and supplies of any kind that are or could be used in connection with the
manufacture, printing, packing, shipping, advertising, sale, lease or furnishing of such goods, or otherwise used or consumed in a Borrower’s
business (but excluding Equipment).
Inventory Reserve : reserves established by Administrative Agent in its Permitted Discretion to reflect factors that may negatively
impact the Value of Inventory, including change in salability, obsolescence, seasonality, theft, shrinkage, imbalance, change in composition
or mix, markdowns and vendor chargebacks.
Investment : any acquisition of all or substantially all assets of a Person; any acquisition of record or beneficial ownership of any
Equity Interests of a Person; or any advance or capital contribution to or other investment in a Person.
IRS : the United States Internal Revenue Service.
Issuing Bank : each of (i) Bank of America, Bank of America-Canada Branch and any Affiliate of Bank of America, (ii) each other
Lender listed on Schedule 1.1(a) (and, in each case, any Affiliate of any such Lender selected by such Lender to issue Letters of Credit on its
behalf) and (iii) any replacement Letter of Credit issuer appointed pursuant to Section 2.3.4 and any other Lender designated as an Issuing
Bank by the Borrower Agent.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Issuing Bank Indemnitees : each Issuing Bank and its Affiliates and their respective officers, directors, employees, agents and
attorneys.
ITA : the Income Tax Act (Canada).
Junior Debt : Debt incurred by an Obligor that is (w) in excess of the Threshold Amount and subordinated in right of payment to the
prior payment of all Obligations of such Obligor under the Loan Documents, (x) in excess of the Threshold Amount and junior in priority to
the Liens securing the Obligations or (z) in excess of the Threshold Amount and is unsecured, to the extent, in the case of this clause (z), any
prepayment, redemption, purchase, defeasance or other satisfaction prior to the scheduled maturity thereof is funded by a Borrowing.
LC Application : an application by Borrower Agent or the Canadian Borrower, as the case may be, to the applicable Issuing Bank for
issuance of a Letter of Credit, in form satisfactory to such Issuing Bank and Agent.
LC Commitment : as to any Issuing Bank, its commitment to issue Letters of Credit, and to amend, increase or extend Letters of
Credit previously issued by it, pursuant to Section 2.3 , in an aggregate face amount at any time outstanding not to exceed (a) in the case of
any Issuing Bank party hereto as of the Signing Date, the amount set forth opposite such Issuing Bank’s name on Schedule 1.1(a) under the
heading “LC Commitments” and (b) in the case of any Lender that becomes an Issuing Bank hereunder thereafter, the amount which shall be
set forth in the written agreement by which such Lender shall become an Issuing Bank hereunder, in each case as such commitment may be
changed from time to time pursuant to the terms hereof or with the agreement in writing of such Issuing Bank, the Borrower Agent and the
Administrative Agent. The aggregate LC Commitments of all the Issuing Banks shall be less than or equal to the LC Sublimit at all times.
LC Documents : all documents, instruments and agreements (including LC Requests and LC Applications) delivered by the
applicable Borrowers or any other Person to the applicable Issuing Bank or the Applicable Agent in connection with any Letter of Credit.
LC Obligations : U.S. LC Obligations and/or Canadian LC Obligations, as the context requires.
LC Request : a request for issuance of a Letter of Credit, to be provided by Borrower Agent or the Canadian Borrower, as the case
may be, to the applicable Issuing Bank, in form satisfactory to the Applicable Agent, as the case may be, and the applicable Issuing Bank.
LC Sublimit : an amount equal to $125,000,000; provided , that only up to $5,000,000 of such amount shall be available for the
issuance of Letters of Credit for the account or benefit of the Canadian Borrower or any of its Subsidiaries.
Lead Arrangers : collectively, Merrill Lynch, Pierce, Fenner & Smith Incorporated (or any other registered broker-dealer wholly-
owned by Bank of America Corporation to which all or substantially all of Bank of America Corporation’s or any of its subsidiaries’
investment banking, commercial lending services or related businesses may be transferred following the Signing Date), Goldman Sachs Bank
USA, Wells Fargo Bank, National Association, JPMorgan Chase Bank, N.A and U.S. Bank National Association in their capacities as lead
arrangers and bookrunners with respect to this Agreement.
Lender Indemnitees : Lenders and Secured Bank Product Providers, and their Affiliates and their respective officers, directors,
employees, agents and attorneys.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Lenders : as defined in the preamble to this Agreement, including the U.S. Revolver Lenders, the Canadian Lenders, each Swingline
Lender and any other Person who hereafter becomes a “U.S. Revolver Lender” and/or a “Canadian Lender” pursuant to an Assignment and
Acceptance.
Lending Office : the office designated as such by the applicable Lender at the time it becomes party to this Agreement or thereafter by
notice to (a) with respect to a U.S. Revolver Lender, Administrative Agent and Borrower Agent and (b) with respect to a Canadian Lender,
each Agent and the Borrower Agent.
Letter of Credit : any standby or commercial letter of credit (including the Existing UNFI Letters of Credit and, solely to the extent
agreed by the Administrative Agent in its reasonable discretion, the Existing Supervalu Letters of Credit) issued by the applicable Issuing
Bank for the account of a Borrower or a Subsidiary, or any indemnity, guarantee, exposure transmittal memorandum or similar form of credit
support issued by Administrative Agent, the Canadian Agent or the applicable Issuing Bank for the benefit of a Borrower or a Subsidiary.
Letters of Credit issued for the account or benefit of a U.S. Borrower or a Subsidiary shall be issued in U.S. Dollars. Letters of Credit issued
for the account or benefit of the Canadian Borrower or a Subsidiary thereof shall be issued in Canadian Dollars or U.S. Dollars.
LIBOR : for any Interest Period with respect to a LIBOR Loan, the per annum rate of interest determined by Administrative Agent at
or about 11:00 a.m. (London time) two Business Days prior to such Interest Period, for a term equivalent to such Interest Period, equal to the
London Interbank Offered Rate, or comparable or successor rate approved by Administrative Agent, as published on the applicable Reuters
screen page (or other commercially available source designated by Administrative Agent from time to time); provided , that any such
comparable or successor rate shall be applied by Administrative Agent, if administratively feasible, in a manner consistent with market
practice; provided further , that in no event shall LIBOR be less than zero.
LIBOR Loan : a Loan that bears interest based on LIBOR (other than by virtue of clause (c) of the definition of “Base Rate”). All
LIBOR Loans shall be denominated in U.S. Dollars.
LIBOR Screen Rate : the LIBOR quote on the applicable screen page the Administrative Agent designates to determine LIBOR (or
such other commercially available source providing such quotations as may be designated by the Administrative Agent from time to time).
LIBOR Successor Rate : as defined in Section 3.6 .
LIBOR Successor Rate Conforming Changes : with respect to any proposed LIBOR Successor Rate, any conforming changes to the
definition of Base Rate, Interest Period, timing and frequency of determining rates and making payments of interest and other administrative
matters as may be appropriate, in the discretion of the Administrative Agent, to reflect the adoption of such LIBOR Successor Rate and to
permit the administration thereof by the Administrative Agent in a manner substantially consistent with market practice (or, if the
Administrative Agent determines that adoption of any portion of such market practice is not administratively feasible or that no market
practice for the administration of such LIBOR Successor Rate exists, in such other manner of administration as the Administrative Agent
determines in consultation with the Borrower Agent).
License : any license or agreement under which an Obligor is authorized to use Intellectual Property in connection with any
manufacture, marketing, distribution or disposition of Collateral, any use of Property or any other conduct of its business.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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Licensor : any Person from whom an Obligor obtains the right to use any Intellectual Property.
Lien : any Person’s interest in Property securing an obligation owed to, or a claim by, such Person, whether such interest is based on
common law, statute or contract, including liens, security interests, pledges, Licenses, hypothecations, statutory trusts, reservations,
exceptions, encroachments, easements, rights-of-way, covenants, conditions, restrictions, leases, and other title exceptions and encumbrances
affecting Property. For avoidance of doubt, the interest of a landlord or lessor under a lease or license that is not a Capital Lease shall not in
and of itself be regarded to be a Lien on the property interest of the tenant or lessee pursuant to the subject lease.
Lien Waiver : an agreement, in form and substance reasonably satisfactory to the Applicable Agent, by which (a) for any material
Collateral located on leased premises, the lessor waives or subordinates any Lien it may have on the Collateral, and agrees to permit the
Applicable Agent to enter upon the premises and remove the Collateral or to use the premises to store or dispose of the Collateral; (b) for any
Collateral held by a warehouseman, processor, shipper, customs broker or freight forwarder, such Person waives or subordinates any Lien it
may have on the Collateral, agrees to hold any Documents in its possession relating to the Collateral as agent for the Applicable Agent, and
agrees to deliver the Collateral to the Applicable Agent upon request; (c) for any Collateral held by a repairman, mechanic or bailee, such
Person acknowledges the Applicable Agent’s Lien, waives or subordinates any Lien it may have on the Collateral, and agrees to deliver the
Collateral to the Applicable Agent upon request; and (d) for any Collateral subject to a Licensor’s Intellectual Property rights, the Licensor
grants to Agent the right, vis-à-vis such Licensor, to enforce Agent’s Liens with respect to the Collateral, including the right to dispose of it
with the benefit of the Intellectual Property, whether or not a default exists under any applicable License.
Limited Condition Transaction : (x) any Permitted Acquisition or other similar investment, including by way of merger, by any
Borrower or one or more of their Subsidiaries permitted pursuant to this Agreement whose consummation is not conditioned upon the
availability of, or on obtaining, third party financing and (y) any redemption, repurchase, defeasance, satisfaction and discharge or repayment
of indebtedness requiring irrevocable notice in advance of such redemption, repurchase, satisfaction and discharge or repayment.
Loan : a U.S. Revolver Loan and/or a Canadian Loan, as the context requires.
Loan Account : the loan account established by each Lender on its books pursuant to Section 5.8 .
Loan Documents : this Agreement, the Other Agreements, the Intercreditor Agreement and the Security Documents.
Loan Year : each 12 month period commencing on the Closing Date and on each anniversary of the Closing Date.
Margin Stock : as defined in Regulation U of the Board of Governors.
Material Adverse Effect : the effect of any event or circumstance that, taken alone or in conjunction with other events or
circumstances, (a) has or could be reasonably expected to have a material adverse effect on the business, operations, Properties or condition
(financial or otherwise) of the Obligors, taken as a whole, on the value of any material portion of the Collateral, on the enforceability of any
Loan Documents, or on the validity or priority of any Agent’s Liens on any Collateral; (b) impairs the ability of the Obligors, taken as a
whole, to perform their payment obligations under the Loan
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Documents; or (c) otherwise results in a material adverse effect on the ability of any Agent or any Lender to enforce or collect any
Obligations or to realize upon any Collateral.
Material Contract : any agreement or arrangement to which a Borrower or Subsidiary is party (other than the Loan Documents) for
which breach, termination, nonperformance or failure to renew could reasonably be expected to have a Material Adverse Effect.
Maximum Incremental Facilities Amount : at any date of determination, an aggregate principal amount of up to (i) the Incremental
Fixed Dollar Basket, plus (ii) the aggregate amount of voluntary prepayments of loans under (A) the Term Loan Facility (including purchases
of such loans by the Borrowers or any of their Subsidiaries at or below par, in which case the amount of voluntary prepayments of such Loans
shall be deemed not to exceed the actual purchase price of such Loans below par), other than from proceeds of long term Debt (other than
revolving Debt) and (B) Incremental Equivalent Debt and other Debt permitted by Section 10.1.1(l), in each case secured on a pari passu
basis with the Term Loan Facility and, in the case of any such Debt that is revolving in nature, to the extent such prepayments are
accompanied by permanent commitment reductions, plus (iii) an unlimited amount, so long as in the case of this clause (iii) only, such
amount at such date of determination can be incurred without causing (w) in the case of incremental Loans under the Term Loan Facility and
Incremental Equivalent Debt, in each case, secured with a Lien on the Term Priority Collateral ranking pari passu with the Liens securing the
obligations under the Term Loan Facility, the Consolidated First Lien Net Leverage Ratio to exceed 4.00 to 1.00, (x) in the case of
incremental loans under the Term Loan Facility and Incremental Equivalent Debt, in each case that is secured by a Lien on the Term Priority
Collateral ranking junior to the Lien securing the obligations under the Term Loan Facility or secured with a Lien on property of the
Borrower Agent or any of its Subsidiaries that does not constitute Collateral, the Consolidated Secured Net Leverage Ratio to exceed 4.00 to
1.00, (y) in the case of unsecured incremental term loans under the Term Loan Facility and unsecured Incremental Equivalent Debt, in each
case incurred under the Non-Loan Party Incremental Debt Basket, the Consolidated Total Net Leverage Ratio to exceed 4.00 to 1.00 and (z)
in the case of all other unsecured incremental loans under the Term Loan Facility and unsecured Incremental Equivalent Debt, the
Consolidated Total Net Leverage Ratio to exceed 4.50 to 1.00, in each case on a pro forma basis, and after giving effect to any other
transactions consummated in connection therewith and assuming for purposes of this calculation that (1) any cash proceeds of any
incremental loans under the Term Loan Facility then being incurred shall not be netted from the numerator in the Consolidated First Lien Net
Leverage Ratio, Consolidated Secured Net Leverage Ratio or Consolidated Total Net Leverage Ratio, as applicable, for purposes of
calculating the Consolidated First Lien Net Leverage Ratio, Consolidated Secured Net Leverage Ratio or Consolidated Total Net Leverage
Ratio, as applicable, under this clause (iii) for purposes of determining whether such incremental loans under the Term Loan Facility can be
incurred and (2) in the case of any incremental revolving facility or any incremental term loan facility with delayed draw commitments, that
the commitments thereunder are fully drawn on the date of incurrence (provided, however, that if amounts incurred under this clause (iii) are
incurred concurrently with the incurrence of incremental loans under the Term Loan Facility (in each case, including any unused
commitments obtained) in reliance on clause (i) and/or clause (ii) above, the Consolidated First Lien Net Leverage Ratio, Consolidated
Secured Net Leverage Ratio or the Consolidated Total Net Leverage Ratio shall be calculated without giving effect to such amounts incurred
(or commitments obtained) in reliance on the foregoing clause (i) and/or clause (ii)); provided further, for the avoidance of doubt, to the
extent the proceeds of any incremental loans under the Term Loan Facility are being utilized to repay Debt, such calculations shall give pro
forma effect to such repayments). The Borrowers may elect to use clause (iii) above regardless of whether the Borrowers have capacity under
clause (i) or clause (ii) above. Further, the Borrowers may elect to use clause (iii) above prior to using clause (i) or clause (ii) above, and if
both clause (iii) and clause (i) and/or
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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clause (ii) are available and the Borrowers do not make an election, then the Borrower swill be deemed to have elected to use clause (iii)
above. Notwithstanding the foregoing, the Borrowers may re-designate any Debt originally designated as incurred under clause (i) and/or
clause (ii) above as having been incurred under clause (iii), so long as at the time of such re-designation, the Borrowers would be permitted to
incur under clause (iii) the aggregate principal amount of Debt being so re-designated (for purposes of clarity, with any such re-designation
having the effect of increasing the Borrowers’ ability to incur Debt under clause (i) and/or clause (ii) on and after the date of such re-
designation by the amount of Debt so re-designated).
Medicaid : the health care financial assistance program jointly financed and administered by the Federal and State governments under
Title XIX of the Social Security Act.
Medicare : the health care financial assistance program under Title XVIII of the Social Security Act.
Moody’s : Moody’s Investors Service, Inc., and its successors.
Multiemployer Plan : any employee benefit plan of the type defined in Section 4001(a)(3) of ERISA, to which any Obligor or ERISA
Affiliate makes or is obligated to make contributions, or during the preceding five plan years, has made or been obligated to make
contributions.
Net Proceeds : with respect to an Asset Disposition, proceeds (including, when received, any deferred or escrowed payments)
received by a Borrower or Subsidiary in cash from such disposition, net of (a) reasonable and customary costs and expenses actually incurred
in connection therewith, including legal fees and sales commissions; (b) amounts applied to repayment of Debt secured by a Permitted Lien
(that, in the case of Collateral sold, is senior to any Agent’s Liens thereon); (c) transfer or similar taxes; and (d) reserves for indemnities, until
such reserves are no longer needed.
NOLV Percentage : the net orderly liquidation value of Inventory, expressed as a percentage, expected to be realized at an orderly,
negotiated sale held within a reasonable period of time, net of all liquidation expenses, as determined from the most recent appraisal of
Borrowers’ Inventory performed by an appraiser and on terms reasonably satisfactory to Administrative Agent.
Non-Consenting Lender : any Lender that does not approve any consent, waiver or amendment that (a) requires the approval of all
Lenders or all affected Lenders in accordance with the terms of Section 14.1 and (b) has been approved by the Required Lenders.
Non-Defaulting Lender : any Lender that is not a Defaulting Lender.
Notes : each U.S. Revolver Note, Canadian Note or other promissory note executed by a Borrower to evidence any Obligations.
Notice of Borrowing : a Notice of Borrowing to be provided by (a) Borrower Agent to request a Borrowing of U.S. Revolver Loans
in a form reasonably satisfactory to Administrative Agent or (b) Canadian Borrower to request a Borrowing of Canadian Loans in form
reasonably satisfactory to Canadian Agent.
Notice of Conversion/Continuation : a Notice of Conversion/Continuation to be provided by Borrower Agent or Canadian Borrower,
as the case may be, to request a conversion or continuation of any Loans as Applicable Offered Rate Loans, in form satisfactory to the
Applicable Agent.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Obligations : all (a) principal of and premium, if any, on the Loans, (b) LC Obligations and other obligations of Obligors with respect
to Letters of Credit, (c) interest, expenses, fees, indemnification obligations, Extraordinary Expenses and other amounts payable by Obligors
under Loan Documents, (d) Secured Bank Product Obligations, and (e) other Debts, obligations and liabilities of any kind owing by Obligors
pursuant to the Loan Documents, whether now existing or hereafter arising, whether evidenced by a note or other writing, whether allowed in
any Insolvency Proceeding, whether arising from an extension of credit, issuance of a letter of credit, acceptance, loan, guaranty,
indemnification or otherwise, and whether direct or indirect, absolute or contingent, due or to become due, primary or secondary, or joint or
several; provided , that Obligations of an Obligor shall not include its Excluded Swap Obligations.
Obligor : each Borrower and Guarantor.
OFAC : Office of Foreign Assets Control of the U.S. Treasury Department.
Ordinary Course of Business : the ordinary course of business of any Borrower or Subsidiary undertaken in good faith.
Organic Documents : with respect to any Person, its charter, certificate or articles of incorporation, bylaws, articles of organization,
limited liability company agreement, operating agreement, members’ agreement, shareholders agreement, partnership agreement, certificate
of partnership, certificate of formation, voting trust agreement, or similar agreement or instrument governing the formation or governance of
such Person.
OSHA : the Occupational Safety and Hazard Act of 1970.
Other Agreement : each Note; LC Document; Lien Waiver; Borrowing Base Certificate, Aggregate Availability Certificate,
Compliance Certificate or Perfection Certificate.
Other Connection Taxes : with respect to any Recipient, Taxes imposed as a result of a present or former connection between such
Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become a
party to, performed its obligations under, received payments under, received or perfected a Lien under, engaged in any other transaction
pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).
Other Taxes : all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from any
payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a Lien
under, or otherwise with respect to, any Loan Document, except such Taxes that are Other Connection Taxes imposed with respect to an
assignment (other than an assignment made pursuant to Section 13.4(a) ).
Overadvance : a U.S. Revolver Overadvance or a Canadian Overadvance, as the context requires.
Overadvance Loan : a Base Rate Loan made when a U.S. Revolver Overadvance exists or is caused by the funding thereof or a BA
Equivalent Rate Loan made when a Canadian Overadvance exists or is caused by the funding thereof, as the context requires.
PACA : the Perishable Agricultural Commodities Act (7 USC §§ 499a et seq.).
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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PACA Claim : with respect to any Person, any right or claim of or for the benefit of such Person under PACA or any similar law
enacted by any other state or jurisdiction including any right, title or interest in or to any claims, remedies or trust assets or other benefits or
any proceeds thereof.
Participant : as defined in Section 13.2.1 .
Patriot Act : the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism
Act of 2001, Pub. L. No. 107-56, 115 Stat. 272 (2001).
Payment Item : each check, draft or other item of payment payable to a Borrower, including those constituting proceeds of any
Collateral.
PBGC : the Pension Benefit Guaranty Corporation.
Pension Plan : any employee pension benefit plan (as such term is defined in Section 3(2) of ERISA), other than a Multiemployer
Plan, that is subject to Title IV of ERISA and is sponsored or maintained by any Obligor or ERISA Affiliate or to which the Obligor or
ERISA Affiliate contributes or has an obligation to contribute, or in the case of a multiple employer or other plan described in Section
4064(a) of ERISA, has made contributions at any time during the preceding five plan years, or, if such plan were terminated, would under
Section 4062 or 4069 of ERISA be deemed to be an “employer” as defined in Section 3(5) of ERISA.
Perfection Certificate : a customary perfection certificate for a secured asset-based credit facility with an “all assets” grant of security
that is subject to a crossing-lien intercreditor agreement.
Permitted Acquisition : the acquisition, whether through a single transaction or a series of related transactions (including by way of
merger, amalgamation or consolidation permitted by Section 10.2.9 ), of (a) all or substantially all of the Properties of any Person or of a
business unit or line of business of any Person, or (b) Equity Interests of any Person, in each case that is a type of business (or assets used in a
type of business) that is a Permitted Business, in each case so long as:
(i) (1)(A) daily average Adjusted Aggregate Availability for the 30 consecutive days immediately before
consummating the proposed Permitted Acquisition, calculated on a pro forma basis after giving effect to such
Permitted Acquisition as if such Permitted Acquisition had been consummated at the beginning of such 30 day period
shall be at least 10% of the Aggregate Borrowing Base and (B) Borrowers shall have a Fixed Charge Coverage Ratio
of at least 1.00:1.00 for the most recently completed period of four Fiscal Quarters for which financial statements
have been provided pursuant to Section 10.1.2 , calculated on a pro forma basis after giving effect to such Permitted
Acquisition as if such Permitted Acquisition had been made at the beginning of such period of four Fiscal Quarters;
provided , that to the extent daily average Adjusted Aggregate Availability for the 30 consecutive days immediately
before consummating the proposed Permitted Acquisition, calculated on a pro forma basis after giving effect to such
Permitted Acquisition as if such Permitted Acquisition had been consummated at the beginning of such 30 day
period, is at least 15% of the Aggregate Borrowing Base, this clause (B) shall not be applicable and (2) with respect
to any Permitted Acquisition with consideration exceeding $25,000,000, UNFI shall have delivered to the
Administrative Agent on or prior to the earlier of (x) the execution of a definitive or binding agreement
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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to enter into the proposed Permitted Acquisition and (y) the consummation of such proposed Permitted Acquisition
(or such later date as agreed to by the Administrative Agent in its discretion), a statement, certified by a Senior Office
of UNFI, setting forth, in reasonable detail, computations (determined in a manner reasonably acceptable to the
Administrative Agent) evidencing satisfaction of the requirements set forth in clause (1) above;
(ii) no Event of Default shall exist before or after giving effect to the proposed Permitted Acquisition;
(iii) in the event that Borrowers wish to have the Accounts and Inventory (and, where applicable, such
Credit Card Receivables, Pharmacy Receivables and/or Prescription Files) of the entity to be acquired or invested in
be included in the U.S. Revolver Borrowing Base or the Canadian Borrowing Base, as the case may be, (x) Borrowers
shall arrange for each Agent and its representatives to have reasonable access to financial information and the assets
and Properties to be acquired that will, upon consummation of the acquisition, become ABL Priority Collateral for the
Obligations and (y) the Administrative Agent may conduct, in its reasonable discretion, a field examination and
appraisal with respect to such Accounts and Inventory (and, where applicable, such Credit Card Receivables,
Pharmacy Receivables and/or Prescription Files), with results reasonably satisfactory to the Administrative Agent,
prior to including such Accounts and Inventory in the U.S. Revolver Borrowing Base or the Canadian Borrowing
Base, as the case may be;
(iv) if any such acquisition is structured as the acquisition of all or substantially all of the Equity Interests
of a Person to be acquired (including by way of merger, amalgamation or consolidation permitted by Section 10.2.9 )
or Borrowers create a Subsidiary to make the acquisition, Borrowers shall, or shall cause such Person or Subsidiary
to, comply with Section 10.1.9 , if required; and
(v) in the case of a proposed Permitted Acquisition of the Equity Interests of another Person, the board of
directors (or comparable governing body of such Person) shall not have disapproved the proposed Permitted
Acquisition.
Permitted Business : the business of the Borrowers and the Subsidiaries as conducted on the Signing Date and businesses and
business activities that are reasonably related or complementary thereto or ancillary or incidental thereto or that the Borrowers have
determined, in their reasonable business judgment, would enhance the business, operations and condition (financial or otherwise) of the
Borrowers and the Subsidiaries.
Permitted Contingent Obligations : Contingent Obligations (a) arising from endorsements of Payment Items for collection or deposit
in the Ordinary Course of Business; (b) arising from Hedging Agreements permitted hereunder; (c) existing on the Signing Date, and any
extension, modification, renewal or replacement thereof that does not increase the amount of such Contingent Obligation when extended,
modified, renewed or replaced; (d) incurred in the Ordinary Course of Business in favor of suppliers, customers, lessors and licensors or with
respect to surety, appeal, bid or performance bonds, completion guarantees or other similar obligations; (e) arising from customary
indemnification obligations or obligations in respect of purchase price (including earn-outs) or other similar adjustments in favor of
purchasers in connection with dispositions of assets permitted hereunder or in connection with
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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the Transactions, a Permitted Acquisition or any other Investment expressly permitted hereunder; (f) arising under the Loan Documents; (g)
of a Borrower or a Subsidiary with respect to Debt of a Borrower or a Subsidiary that is permitted under Section 10.2.1 ; or (h) in an
aggregate amount of the greater of (x) U.S.$25,000,000 and (y) 3.00% of Consolidated EBITDA of the Borrowers and the Subsidiaries for the
most recently ended period of four consecutive Fiscal Quarters calculated on a pro forma basis, in each case or less at any time.
Permitted Discretion : as used herein, with reference to the Administrative Agent, a determination made in the exercise, in good faith,
of reasonable business judgment from the perspective of a secured, asset-based lender for comparable asset-based lending transactions.
Permitted Investments :
(a) (i) Investments existing on the Signing Date and identified on Schedule 10.2.5 , and any extension, modification,
renewal or replacement of any such Investment that does not increase the amount of such Investment when extended, modified, renewed
or replaced, and (ii) Investments in Subsidiaries existing on the Signing Date;
(b) Investments in Domestic Subsidiaries; provided , that (i) any acquisition of Equity Interests in a Person that was not
previously a Subsidiary shall be subject to compliance with the requirements set forth in the definition of “Permitted Acquisition” and (ii)
Investments pursuant to this clause (b) in Domestic Subsidiaries that are not Guarantors, together with (x) Investments pursuant to clause
(c) of this definition by an Obligor in any Person that is not an Obligor and (y) Investments pursuant to clause (d) of this definition, shall
not at any one time exceed the greater of (x) U.S. $200,000,000 and (y) 25.00% of Consolidated EBITDA of the Borrowers and the
Subsidiaries for the most recently ended period of four consecutive Fiscal Quarters calculated on a pro forma basis;
(c) Investments in Foreign Subsidiaries by Foreign Subsidiaries; provided , that Investments pursuant to this clause (c) by
an Obligor in any Person that is not an Obligor, together with (x) Investments pursuant to clause (b) of this definition in Domestic
Subsidiaries that are not Guarantors and (y) Investments pursuant to clause (d) of this definition, shall not at any one time exceed the
greater of (x) U.S. $200,000,000 and (y) 25.00% of Consolidated EBITDA of the Borrowers and the Subsidiaries for the most recently
ended period of four consecutive Fiscal Quarters calculated on a pro forma basis;
(d) Investments in Foreign Subsidiaries by UNFI and Domestic Subsidiaries; provided , that Investments pursuant to this
clause (d), together with (x) Investments pursuant to clause (b) of this definition in Domestic Subsidiaries that are not Guarantors and (y)
Investments pursuant to clause (c) of this definition by an Obligor in any Person that is not an Obligor, shall not at any one time exceed
the greater of (x) U.S. $200,000,000 and (y) 25.00% of Consolidated EBITDA of the Borrowers and the Subsidiaries for the most
recently ended period of four consecutive Fiscal Quarters calculated on a pro forma basis;
(e) loans and advances permitted by Section 10.2.7 ;
(f) Permitted Contingent Obligations;
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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(g) Investments consisting of extensions of credit in the nature of accounts receivable or notes receivable arising from the
grant of trade credit in the Ordinary Course of Business, and Investments received in satisfaction or partial satisfaction thereof from
financially troubled account debtors to the extent reasonably necessary in order to prevent or limit loss;
(h) Investments in assets that were Cash Equivalents when made that are, to the extent required by the Loan Documents,
subject to the Applicable Agent’s Lien and control, pursuant to documentation in form and substance satisfactory to such Agent;
(i) Permitted Acquisitions;
(j) (i) Investments not otherwise described in the preceding clauses but subject to the final proviso of this clause (j);
provided , that (A) no Event of Default shall exist before or after giving effect to the proposed Investment, (B) daily average Adjusted
Aggregate Availability for the 30 consecutive days immediately before consummating the proposed Investment, calculated on a pro
forma basis after giving effect to such Investment as if such Investment had been consummated at the beginning of such 30 day period,
shall be at least 10% of the Aggregate Borrowing Base and (C) Borrowers shall have a Fixed Charge Coverage Ratio of at least 1.00:1.00
for the most recently completed period of four Fiscal Quarters for which financial statements have been provided pursuant to
Section 10.1.2 , calculated on a pro forma basis after giving effect to such Investment as if such Investment had been made at the
beginning of such period of four Fiscal Quarters; provided , that to the extent daily average Adjusted Aggregate Availability for the 30
consecutive days immediately before consummating the proposed Investment, calculated on a pro forma basis after giving effect to such
Investment as if such Investment had been consummated at the beginning of such 30 day period, is at least 15% of the Aggregate
Borrowing Base, this clause (C) shall not be applicable, and (ii) UNFI shall have delivered to the Administrative Agent not less than two
(2) Business Days prior to the earlier of (x) the execution of a definitive or binding agreement to consummate the proposed Investment
and (y) the consummation of such proposed Investment, a statement, certified by a Senior Officer of UNFI, setting forth, in reasonable
detail, computations (determined in a manner reasonably acceptable to the Administrative Agent) evidencing satisfaction of the
requirements set forth in clause (i) above; provided , further, that any acquisition of Equity Interests in a Person that was not previously a
Subsidiary shall be subject to compliance with the requirements set forth in the definition of “Permitted Acquisition”;
(k) other Investments in an aggregate amount outstanding at any one time not to exceed the greater of (x) U.S.
$150,000,000 and (y) 17.50% of Consolidated EBITDA of the Borrowers and the Subsidiaries for the most recently ended period of four
consecutive Fiscal Quarters calculated on a pro forma basis;
(l) [Intentionally Omitted];
(m) the Supervalu Acquisition;
(n) asset purchases (including purchases of inventory, supplies and materials) and the licensing or contribution of
intellectual property pursuant to joint marketing arrangements with other Persons, in each case in the ordinary course of business;
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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(o) Investments consisting of Liens, Debt, fundamental changes, Asset Dispositions and restricted payments permitted
under Section 10.2.1 , Section 10.2.2 , Section 10.2.4 , Section 10.2.6 and Section 10.2.9 , respectively;
(p) Investments in Hedging Agreements permitted under Section 10.2.1(d) ;
(q) promissory notes and other noncash consideration received in connection with an Asset Dispositions permitted by
Section 10.2.6 ;
(r) Investments in the ordinary course of business consisting of endorsements for collection or deposit and customary trade
arrangements with customers consistent with past practices;
(s) Investments (including debt obligations and Equity Interests) received in connection with the bankruptcy or
reorganization of suppliers and customers or in settlement of delinquent obligations of, or other disputes with, customers and suppliers
arising in the ordinary course of business or upon the foreclosure with respect to any secured Investment or other transfer of title with
respect to any secured Investment;
(t) Investments as valued at cost at the time each such Investment is made and including all related commitments for future
Investments, in an amount not exceeding the Available Equity Amount;
(u) Investments held by a Subsidiary acquired after the Closing Date or of a corporation or company merged into any
Borrower or merged or consolidated with any Subsidiary in accordance with Section 10.2.9 after the Closing Date to the extent that such
Investments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were in existence on
the date of such acquisition, merger or consolidation;
(v) Guarantee Obligations of any Borrower or any Subsidiary in respect of leases (other than Capital Leases) or of other
obligations that do not constitute Debt, in each case entered into in the ordinary course of business;
(w) Investments constituting Customer Support Transactions; provided , that, (i) the aggregate amount of CST Exposure after
giving effect to such Investment shall not exceed U.S.$250,000,000, (ii) the aggregate amount of Specified CST Exposure after giving
effect to such Investment shall not exceed U.S.$150,000,000, (iii) no Default or Event of Default shall exist or have occurred and be
continuing after giving effect to such Investment and (iv) the Administrative Agent shall have received (A) with respect to any such
Investment in an amount equal to or greater than U.S.$5,000,000, not less than two (2) Business Days’ prior written notice thereof setting
forth in reasonable detail the nature and terms thereof, (B) true, correct and complete copies of all agreements, documents and instruments
relating thereto and (C) such other information with respect thereto as the Administrative Agent may reasonably request, including a
report once each month on the outstanding balance of all such Investments under or made pursuant to Customer Support Transactions
(including the then outstanding amount of any such Investments); and
(x) Investments to the extent that payment for such Investments is made solely with Qualified Equity Interests.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Permitted Lien : as defined in Section 10.2.2 .
Permitted Purchase Money Debt : Purchase Money Debt of the Borrower Agent and its Subsidiaries that is secured only by a
Purchase Money Lien, as long as (i) the aggregate principal amount does not exceed the greater of (x) U.S. $300,000,000 and (y) 35.00% of
Consolidated EBITDA of the Borrowers and the Subsidiaries for the most recently ended period of four consecutive Fiscal Quarters
calculated on a pro forma basis, at any time outstanding and (ii) the Borrower Agent and its Subsidiaries do not incur Purchase Money Debt
with an aggregate principal amount that exceeds the greater of (x) U.S. $100,000,000 and (y) 12.00% of Consolidated EBITDA of the
Borrowers and the Subsidiaries for the most recently ended period of four consecutive Fiscal Quarters calculated on a pro forma basis, in any
Fiscal Year of the Borrower Agent.
Permitted Sale Leaseback : means any Sale Leaseback consummated by any Borrower or any of the Subsidiaries after the Closing
Date; provided , that any such Sale Leaseback that is not between (a) an Obligor and another Obligor or (b) a Subsidiary that is not an Obligor
and another Subsidiary that is not an Obligor must be, in each case, consummated for fair value as determined at the time of consummation in
good faith by (i) such Borrower or such Subsidiary and (ii) in the case of any Sale Leaseback (or series of related Sales Leasebacks) the
aggregate proceeds of which exceed $100,000,000, the board of managers or directors, as applicable, of such Borrower or such Subsidiary
(which such determination may take into account any retained interest or other Investment of such Borrower or such Subsidiary in connection
with, and any other material economic terms of, such Sale Leaseback).
Permitted Tax Restructuring : any reorganizations and other activities related to tax planning and tax reorganization (as determined by
the Borrower Agent in good faith) entered into on or after the date hereof so long as such Permitted Tax Restructuring does not materially
impair the guarantees or the security interests of the Lenders in the aggregate and is otherwise not materially adverse to the Lenders and after
giving effect to such Permitted Tax Restructuring, the Borrowers and the Subsidiaries otherwise comply with the Guarantee and Collateral
Requirement.
Person : any individual, corporation, limited liability company, partnership, joint venture, joint stock company, land trust, business
trust, unincorporated organization, Governmental Authority or other entity.
Pharmacy Receivables : as to each U.S. Borrowing Base Obligor, all present and future rights of such U.S. Borrowing Base Obligor
to payment from a Third Party Payor arising from the sale of prescription drugs by such Borrower (it being understood that the portion of the
purchase price for such prescription drugs payable by the purchaser of such prescription drugs or any Person other than a Third Party Payor
shall not be deemed to be a Pharmacy Receivable).
Pharmacy Receivables Dilution : the percent, determined for Borrowers’ most recent Fiscal Quarter, equal to (a) bad debt write-
downs or write-offs, discounts, returns, promotions, credits, credit memos and other dilutive items with respect to Pharmacy Receivables,
divided by (b) gross sales.
Pharmacy Scripts Availability : the lesser of: (a) eighty-five percent (85%) of the product of (i) the average per Prescription File “net
orderly liquidation value” of Eligible Prescription Files based on the most recent acceptable appraisal thereof received by Administrative
Agent in accordance with the requirements of this Agreement, net of operating expenses, liquidation expenses and commissions reasonably
anticipated in the disposition of such assets, multiplied by (ii) the number of Eligible Prescription Files, and (b) the amount equal to twenty-
five percent (25%) of the U.S. Revolver Borrowing Base (determined without regard to this limitation in this clause (b)).
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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Plan : any employee benefit plan (as defined in Section 3(3) of ERISA) established, maintained or contributed to by an Obligor or,
with respect to any such plan that is subject to Section 412 of the Code or Title IV of ERISA, an ERISA Affiliate.
Platform : as defined in Section 14.3.3 .
Pledged Collateral : as defined in the definition of “Guarantee and Collateral Requirement.”
Post-Acquisition Period : with respect to any Permitted Acquisition or the conversion of any Unrestricted Subsidiary into a Restricted
Subsidiary, the period beginning on the date such Permitted Acquisition or conversion is consummated and ending on the last day of the
fourth full consecutive fiscal quarter immediately following the date on which such Permitted Acquisition or conversion is consummated.
PPSA : the Personal Property Security Act of Ontario (or any successor statute), as amended, or similar legislation of any other
Canadian jurisdiction, including the Civil Code of Québec, the laws of which are required by such legislation to be applied in connection with
the issue, perfection, enforcement, opposability, enforceability, validity or effect of security interests or hypothecs.
Pre-Closing Commitment Termination Date : as defined in Section 6.1 .
Pre-Closing Commitment Termination Date Paragraph : as defined in Section 6.1 .
Prescription Files : as to each U.S. Borrowing Base Obligor, all of such U.S. Borrowing Base Obligor’s now owned or hereafter
existing or acquired retail customer files with respect to prescriptions for retail customers and other medical information related thereto,
maintained by the retail pharmacies of such U.S. Borrowing Base Obligor, wherever located.
Prime Rate : the rate of interest announced by Bank of America from time to time as its prime rate. Such rate is set by Bank of
America on the basis of various factors, including its costs and desired return, general economic conditions and other factors, and is used as a
reference point for pricing some loans, which may be priced at, above or below such rate. Any change in such rate publicly announced by
Bank of America shall take effect at the opening of business on the day specified in the announcement.
Prior Claims : all Liens created by Applicable Law (in contrast with Liens voluntarily granted) which rank or are capable of ranking
prior or pari passu with any Agent’s security interests (or interests similar thereto under Applicable Law) against all or part of the ABL
Priority Collateral, including for amounts owing for employee source deductions, goods and services taxes, sales taxes, harmonized sales
taxes, municipal taxes, workers’ compensation, Québec corporate taxes, pension fund obligations, Wage Earner Protection Program Act
obligations and overdue rents.
Pro Forma Adjustment : for the most recently ended period of four consecutive Fiscal Quarters that includes all or any part of a fiscal
quarter included in any Post-Acquisition Period, with respect to the Acquired EBITDA of the applicable Acquired Entity or Business or
Converted Restricted Subsidiary or the Consolidated EBITDA of the Borrowers and the Subsidiaries, (a) the pro forma increase or decrease
in such Acquired EBITDA or such Consolidated EBITDA, as the case may be, that is factually supportable and is expected to have a
continuing impact, in each case as determined on a basis consistent with Article 11 of Regulation S-X of the Securities Act, as interpreted by
the Securities and Exchange Commission and (b) additional good faith pro forma adjustments arising out of cost savings initiatives
attributable to such transaction and additional costs associated with the combination of the operations of
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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such Acquired Entity or Business or Converted Restricted Subsidiary with the operations of the Borrowers and the Subsidiaries, in each case
being given pro forma effect, that (i) have been realized or (ii) subject to the limitations set forth in clause (a)(viii) of the definition of
Consolidated EBITDA, will be implemented following such transaction and are supportable and quantifiable and expected to be realized
within the succeeding eighteen (18) months and, in each case, including, but not limited to, (w) reduction of costs related to administrative,
selling or production related activities, (x) incremental earnings from selling or production-related activities, (y) reductions of costs related to
leased or owned properties and (z) reductions from the consolidation of operations and streamlining of corporate overhead taking into
account, for purposes of determining such compliance, the historical financial statements of the Acquired Entity or Business or Converted
Restricted Subsidiary and the Consolidated financial statements of the Borrowers and the other Subsidiaries, assuming such Permitted
Acquisition or conversion, and all other Permitted Acquisitions or conversions that have been consummated during the period, and any Debt
or other liabilities repaid in connection therewith had been consummated and incurred or repaid at the beginning of such period (and
assuming that such Debt to be incurred bears interest during any portion of the applicable measurement period prior to the relevant
acquisition at the interest rate which is or would be in effect with respect to such Debt as at the relevant date of determination); provided ,
that, so long as such actions are initiated during such Post-Acquisition Period or such costs are incurred during such Post-Acquisition Period,
as applicable, for purposes of projecting such pro forma increase or decrease to such Acquired EBITDA or such Consolidated EBITDA, as
the case may be, it may be assumed that such cost savings will be realizable during the entirety of the most recently ended period of four
consecutive Fiscal Quarters, or such additional costs, as applicable, will be incurred during the entirety of the most recently ended period of
four consecutive Fiscal Quarters.
Pro Rata : (a) with respect to any U.S. Revolver Lender, a percentage (rounded to the ninth decimal place) determined (i) while the
U.S. Revolver Commitments are outstanding, by dividing the amount of such U.S. Revolver Lender’s U.S. Revolver Commitment by the
Aggregate U.S. Revolver Commitments; and (ii) at any other time, by dividing the amount of such U.S. Revolver Lender’s U.S. Revolver
Loans and U.S. LC Obligations by the aggregate amount of Total U.S. Revolver Outstandings, and (b) with respect to any Canadian Lender, a
percentage (rounded to the ninth decimal place) determined (i) while the Canadian Commitments are outstanding, by dividing the amount of
such Canadian Lender’s Canadian Commitment by the Aggregate Canadian Commitments; and (ii) at any other time, by dividing the amount
of such Canadian Lender’s Canadian Loans and Canadian LC Obligations by the aggregate amount of Total Canadian Outstandings.
Properly Contested : with respect to any obligation of an Obligor, (a) the obligation is being properly contested in good faith by
appropriate proceedings promptly instituted and diligently pursued and (b) appropriate reserves have been established in accordance with
GAAP.
Property : any interest in any kind of property or asset, whether real, personal or mixed, or tangible or intangible.
Protective Advances : a U.S. Revolver Protective Advance and/or a Canadian Protective Advance, as the context requires.
PSA : the Packers and Stockyards Act (7 USC § 196 et seq.).
PSA Claim : with respect to any Person, any right or claim of or for the benefit of such Person under PSA or any similar law enacted
by any other state or jurisdiction including any right, title or interest in or to any claims, remedies or trust assets or other benefits or any
proceeds thereof.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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PTE : a prohibited transaction class exemption issued by the U.S. Department of Labor, as any such exemption may be amended from
time to time.
Purchase Money Debt : (a) Debt (other than the Obligations) for payment of any of the purchase price of fixed or capital assets; (b)
Debt (other than the Obligations) incurred at the time of or within 270 days after acquisition, construction, repair, replacement or
improvement of any fixed or capital assets, for the purpose of financing any of the price thereof; (c) Debt (other than the Obligations)
incurred for the construction or acquisition or improvement of, or to finance or to refinance the construction, acquisition or improvement of,
any Real Estate owned by any Obligor (excluding any Debt incurred in connection with Sale Leaseback transaction permitted hereunder); and
(d) any renewals, extensions or refinancings (but not increases) thereof.
Purchase Money Lien : a Lien that secures (a) Capital Leases or any Refinancing Debt with respect thereto or (b) Purchase Money
Debt or any Refinancing Debt with respect thereto, in each case, encumbering only the fixed or capital assets acquired with such Debt (and
additions and accessions to such assets and the proceeds and the products thereof and customary security deposits) and constituting a
purchase money security interest under the UCC, in the case of clause (b), the PPSA or other Applicable Law.
Qualified Cash : as of any date of determination, as to any Person, the aggregate amount of unrestricted cash and Cash Equivalents of
such Person and its Subsidiaries as of such date that is (a) held in a Deposit Account (other than an account exclusively used for payroll,
payroll taxes or employee benefits), investment account, securities account or such other account, in each case, with the Administrative
Agent, (b) subject to the Applicable Agent’s first priority perfected Lien and (c) not subject to any other Lien, other than nonconsensual Liens
permitted under Section 10.2.2 having priority by operation of applicable Law, without limiting the ability of the Administrative Agent to
change, establish or eliminate any Availability Reserves in its Permitted Discretion on account of any such nonconsensual Liens; provided
that the Borrower Agent shall promptly notify the Administrative Agent of any such nonconsensual Lien after obtaining knowledge thereof.
Qualified ECP : an Obligor with total assets exceeding $10,000,000, or that constitutes an “eligible contract participant” under the
Commodity Exchange Act and can cause another Person to qualify as an “eligible contract participant” under Section 1a(18)(A)(v)(II) of such
act.
Qualified Equity Interests : any Equity Interests of UNFI that are not Disqualified Equity Interests.
Qualified Secured Bank Product Obligations : Debt, obligations and other liabilities with respect to Hedging Agreements owing by a
Borrower or Subsidiary to a Secured Bank Product Provider, that the Borrower Agent, in a written notice to the Administrative Agent, has
expressly requested be treated as Qualified Secured Bank Product Obligations for purposes hereof, up to the maximum amount (in the case of
any Secured Bank Product Provider other than Bank of America and its Affiliates or branches) specified by such provider and the Borrower
Agent in writing to the Administrative Agent, which amount may be established and increased or decreased by further written notice from
such provider and the Borrower Agent to the Administrative Agent from time to time as long as no Overadvance would result from
establishment of a Bank Product Reserve for such amount. The reasonably anticipated liabilities in respect of such obligations with respect to
Hedging Agreements owed to Bank of America and its Affiliates or branches shall constitute Qualified Secured Bank Product Obligations
unless otherwise agreed by Bank of America or such Affiliate or branch. Notwithstanding the foregoing, in no event shall Qualified Secured
Bank Product Obligations of an Obligor include its Excluded Swap Obligations.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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RCRA : the Resource Conservation and Recovery Act (42 U.S.C. §§ 6991-6991i).
Real Estate : all right, title and interest (whether as owner, lessor or lessee) in any real Property or any buildings, structures, parking
areas or other improvements thereon.
Recipient : any Agent, Issuing Bank, any Lender or any other recipient of a payment to be made by an Obligor under a Loan
Document or on account of an Obligation.
Refinancing Conditions : the following conditions for Refinancing Debt: (a) it is in an aggregate principal amount that does not
exceed the principal amount of the Debt being extended, renewed or refinanced except by an amount equal to unpaid accrued interest and
premium thereon, plus amounts that would otherwise be permitted under Section 10.2.1 (with such amounts being deemed utilization of the
applicable basket or exception under Section 10.2.1 ), plus other reasonable fees and expenses reasonably incurred in connection with such
refinancing, renewal or extension and by an amount equal to any existing commitments unutilized thereunder; (b) it has a final maturity no
sooner than, a weighted average life no less than, the Debt being extended, renewed or refinanced; (c) if applicable, it is subordinated to the
Obligations at least to the same extent as the Debt being extended, renewed or refinanced; (d) solely with respect to Debt permitted under
Section 10.2.1(c) , the representations, covenants and defaults applicable to it, taken as a whole, are not materially less favorable to the
applicable Borrower or Subsidiary than those applicable to the Debt being extended, renewed or refinanced; (e) no additional Lien is granted
to secure it; and (f) no additional Person is obligated on such Debt that is not an Obligor.
Refinancing Debt : Borrowed Money that is the result of an extension, renewal or refinancing of Permitted Purchase Money Debt or
Debt otherwise permitted under Section 10.2.1 .
Reimbursement Date : as defined in Section 2.3.2 .
Rent and Charges Reserve : the aggregate of (a) all past due rent and other amounts owing by an Obligor to any landlord,
warehouseman, processor, repairman, mechanic, shipper, freight forwarder, broker or other Person who possesses any ABL Priority
Collateral or could assert a Lien on any ABL Priority Collateral; and (b) a reserve at least equal to three months’ rent and other charges that
could be payable to any such Person, unless it has executed a Lien Waiver.
Report : as defined in Section 12.2.3 .
Reportable Event : with respect to any Pension Plan, any of the events set forth in Section 4043(c) of ERISA, other than events for
which the 30 day notice period has been waived.
Required Lenders : as of any date of determination, Lenders having more than 50.0% of the sum of the (a) Total Outstandings (with
the aggregate outstanding amount of each Lender’s risk participation and funded participation in LC Obligations and Swingline Loans being
deemed “held” by such Lender for purposes of this definition) and (b) aggregate unused U.S. Revolver Commitments and Canadian
Commitments; provided that the unused U.S. Revolver Commitments and Canadian Commitments of, and the portion of the Total
Outstandings held or deemed held by any Defaulting Lender shall be excluded for purposes of making a determination of Required Lenders
Restricted Investment : any Investment by a Borrower or Subsidiary other than a Permitted Investment; provided that any
contribution, sale, assignment, transfer or other disposition or investment of any Intellectual Property to or in any Unrestricted Subsidiary
shall constitute a Restricted Investment, notwithstanding any basket or other exception in the definition of “Permitted Investment” that would
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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otherwise permit any such contribution, sale, assignment, transfer, disposition or investment, except for any contribution, sale, assignment,
transfer, disposal or investment of any Intellectual Property to or in any Unrestricted Subsidiary that is otherwise permitted under the
definition of “Permitted Investment” and in the reasonable business judgment of the Borrower Agent is immaterial to, or no longer used in or
necessary for, the conduct of the business of the Borrower Agent or any Restricted Subsidiary.
Restricted Subsidiary : any Subsidiary of the Borrower Agent (other than a Borrower) other than an Unrestricted Subsidiary.
Restrictive Agreement : an agreement (other than a Loan Document) that conditions or restricts the right of (i) any Borrower,
Subsidiary or other Obligor to grant Liens on any assets for the benefit of the Secured Parties with respect to the Obligations or (ii) any
Borrower (other than UNFI), Subsidiary or other Obligor to declare or make Distributions or to repay any intercompany Debt.
Royalties : all royalties, fees, expense reimbursement and other amounts payable by a Borrower under a License.
S&P : Standard & Poor’s Financial Services LLC, a subsidiary of S&P Global, Inc., and any successor thereto.
Sale Leaseback : means any transaction or series of related transactions pursuant to which any Borrower or any of the Subsidiaries (a)
sells, transfers or otherwise disposes of any property, real or personal, whether now owned or hereafter acquired, and (b) as part of such
transaction, thereafter rents or leases such property or other property that it intends to use for substantially the same purpose or purposes as
the property being sold, transferred or disposed.
Sanctions : any international economic sanctions administered or enforced by the United States Government (including OFAC), the
Canadian government, the United Nations Security Council or the European Union, Her Majesty’s Treasury.
Scheduled Unavailability Date : as defined in Section 3.6 .
Secured Bank Product Obligations : Debt, obligations and other liabilities with respect to Bank Products owing by a Borrower or
Subsidiary to a Secured Bank Product Provider, that the Borrower Agent, in a written notice to the Administrative Agent, has expressly
requested be treated as Secured Bank Product Obligations and/or a Qualified Secured Bank Product Obligation for purposes hereof, up to the
maximum amount (in the case of any Secured Bank Product Provider other than Bank of America and its Affiliates or branches) specified by
such provider and the Borrower Agent in writing to the Administrative Agent, which amount may be established and increased or decreased
by further written notice from such provider and the Borrower Agent to the Administrative Agent from time to time as long as no Default or
Event of Default exists and no Overadvance would result from establishment of a Bank Product Reserve for such amount; provided , that
Secured Bank Product Obligations of an Obligor shall not include its Excluded Swap Obligations.
Secured Bank Product Provider : (a) Bank of America or any of its Affiliates or branches; and (b) any other Lender or Affiliate or
branch of a Lender that is providing a Bank Product, provided such provider and the Borrower Agent deliver written notice to Administrative
Agent, in form and substance satisfactory to Administrative Agent, within 10 days following the later of the Closing Date or the creation of
the Bank Product, (i) describing the Bank Product and setting forth the maximum amount of the related Secured Bank Product Obligations
(and, if all or any portion of such Secured Bank Product
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Obligations are to constitute Qualified Secured Bank Product Obligations, the maximum amount of such Qualified Secured Bank Product
Obligations) that are to be secured by the Collateral, and the methodology to be used in calculating such amount, and (ii) agreeing to be
bound by Section 12.13 .
Secured Parties : Agents, Issuing Banks, Lenders and Secured Bank Product Providers.
Security Agreements : (a) the Closing Date U.S. Security Agreement and (b) any other security agreement or joinder agreement that
may be entered into after the Closing Date with respect to a Subsidiary of the Borrowers formed or acquired after the Closing Date, in each
case, in form and substance reasonably satisfactory to the Administrative Agent.
Security Documents : the Guaranties, Security Agreements, Closing Date Canadian Security Documents, Deposit Account Control
Agreements, Credit Card Notifications and all other security agreements, deeds of hypothec, pledge agreements, or other collateral security
agreements, instruments or documents entered into or to be entered into by an Obligor pursuant to which such Obligor grants or perfects a
security interest in certain of its assets to the Applicable Agent, including PPSA and UCC financing statements and financing change
statements, as applicable, required to be executed or delivered pursuant to any Security Document, and in each case any applicable joinder
agreement to any of the foregoing.
Seller Note : any unsecured promissory note (and any guarantee thereof) issued by one or more Obligors (or any Subsidiary of an
Obligor organized for purposes of the corresponding Permitted Acquisition, which as a part of such Permitted Acquisition will
contemporaneously be merged with or into an Obligor or otherwise will become an Obligor promptly thereafter in accordance with this
Agreement) in favor of a seller in connection with a Permitted Acquisition in an aggregate principal amount not to exceed the purchase price
in respect of such Permitted Acquisition.
Senior Officer : each of the chairman of the board, president, chief executive officer, chief financial officer, chief accounting officer
and any senior vice president of a Borrower or, if the context requires, any other Obligor.
Settlement Report : a report summarizing (a) U.S. Revolver Loans and participations in U.S. LC Obligations outstanding as of a given
settlement date, allocated to U.S. Revolver Lenders on a Pro Rata basis in accordance with their U.S. Revolver Commitments and (b)
Canadian Loans and participations in Canadian LC Obligations outstanding as of a given settlement date, allocated to Canadian Lenders on a
Pro Rata basis in accordance with their Canadian Commitments.
Signing Date : August 30, 2018.
Sold Entity or Business : the meaning specified in the definition of the term “Consolidated EBITDA.”
Solvent : as to any Person, such Person (a) owns Property whose fair salable value is greater than the amount required to pay all of its
debts (including contingent, subordinated, unmatured and unliquidated liabilities); (b) owns Property whose present fair salable value (as
defined below) is greater than the probable total liabilities (including contingent, subordinated, unmatured and unliquidated liabilities) of such
Person as they become absolute and matured; (c) is able to pay all of its debts as they mature; (d) has capital that is not unreasonably small for
its business and is sufficient to carry on its business and transactions and all business and transactions in which it is about to engage; (e) is not
“insolvent” within the meaning of Section 101(32) of the Bankruptcy Code or, in the case of the Canadian
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Borrower or any Canadian Subsidiary, “insolvent” within the meaning of the Bankruptcy and Insolvency Act (Canada); and (f) has not
incurred (by way of assumption or otherwise) any obligations or liabilities (contingent or otherwise) under any Loan Documents, or made any
conveyance in connection therewith, with actual intent to hinder, delay or defraud either present or future creditors of such Person or any of
its Affiliates. “ Fair salable value ” means the amount that could be obtained for assets within a reasonable time, either through collection or
through sale under ordinary selling conditions by a capable and diligent seller to an interested buyer who is willing (but under no compulsion)
to purchase.
Specified Acquisition Agreement Representations : the representations and warranties made by Supervalu Inc. with respect to itself
and its subsidiaries in the Supervalu Acquisition Agreement as are material to the interests of the Lenders, but only to the extent that the
Borrower Agent (or any of its Affiliates) has the right (taking into account any applicable cure provisions) to terminate their respective
obligations under the Supervalu Acquisition Agreement or decline to consummate the Supervalu Acquisition (in each case, in accordance
with the terms of the Supervalu Acquisition Agreement) as a result of a breach of such representations and warranties in the Supervalu
Acquisition Agreement. Notwithstanding anything to the contrary contained herein, to the extent any of the Specified Acquisition Agreement
Representations are qualified or subject to “material adverse effect,” the definition thereof shall be “Material Adverse Effect” as defined in
the Supervalu Acquisition Agreement for purposes of any Specified Acquisition Agreement Representations made or to be made on, or as of,
the Closing Date.
Specified CST Exposure : CST Exposure with respect to all Customer Support Transactions of the type described in clause (a), (b),
(c), (e) or (g) of the definition thereof.
Specified Disposition : the disposition in whole or in part of (a) the retail and other non-wholesale business and (b) the tobacco
business, in each case, of Supervalu Inc. and its Subsidiaries.
Specified Obligor : an Obligor that is not then an “eligible contract participant” under the Commodity Exchange Act (determined
prior to giving effect to Section 5.11 ).
Specified Representations: the representations and warranties set forth in Sections 9.1.1 (with respect to the organizational existence
of the Obligors only), 9.1.2 (with respect to the first sentence thereof and clause (b) of the second sentence thereof only), 9.1.3 , 9.1.5 (with
respect to clause (b) thereof only and taking into account the last paragraph of Section 6.2 ), 9.1.23 , 9.1.28 and in the Closing Date Solvency
Certificate (with such representations in the Closing Date Solvency Certificate deemed to be made hereunder on the Closing Date by the
Borrower Agent).
Specified Transaction : any Permitted Acquisition or other similar Investment, Asset Disposition, incurrence or repayment of Debt,
Distributions or any other event that by the terms of this Agreement requires pro forma compliance with a test or covenant hereunder or
requires such test or covenant to be calculated on a pro forma basis.
Split Collateral Basis : an arrangement under an intercreditor arrangement whereby the Obligations are secured by U.S. ABL Priority
Collateral on a senior priority basis relative to the obligations under the Term Loan Facility, and the Obligations are secured by all other U.S.
Collateral on a junior priority basis relative to the obligations under the Term Loan Facility.
Spot Rate : as of any day, the exchange rate, as determined by the Applicable Agent, that is applicable to conversion of one currency
into another currency, that is (a) the exchange rate reported by Bloomberg (or other commercially available source designated by such Agent)
as of the end of the preceding business day in the financial market for the first currency; or (b) if such report is unavailable
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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for any reason, the spot rate for the purchase of the first currency with the second currency as in effect during the preceding business day in
the Applicable Agent’s principal foreign exchange trading office for the first currency.
Subsidiary : any entity at least 50% of whose voting securities or Equity Interests is owned by a Borrower or any combination of
Borrowers (including indirect ownership by a Borrower through other entities in which such Borrower directly or indirectly owns 50% of the
voting securities or Equity Interests). Notwithstanding the foregoing (and except for purposes of Sections, 9.1.13, 9.1.14, 9.1.18, 9.1.28,
9.1.29, 9.1.31, 9.2, 10.1.5, 10.1.6 and 10.1.12 and the definition of Unrestricted Subsidiary contained herein or as otherwise specified herein
or in any other Loan Document), an Unrestricted Subsidiary shall be deemed not to be a Subsidiary of the Borrower or any of its Subsidiaries
for purposes of this Agreement.
Supermajority Lenders : as of any date of determination, Lenders having more than 66.7% of the sum of the (a) Total Outstandings
(with the aggregate outstanding amount of each Lender’s risk participation and funded participation in LC Obligations and Swingline Loans
being deemed “held” by such Lender for purposes of this definition) and (b) aggregate unused U.S. Revolver Commitments and Canadian
Commitments; provided that the unused U.S. Revolver Commitments and Canadian Commitments of, and the portion of the Total
Outstandings held or deemed held by any Defaulting Lender shall be excluded for purposes of making a determination of Required Lenders.
Supervalu Acquisition : as defined in the recitals to this Agreement.
Supervalu Acquisition Agreement : as defined in the recitals to this Agreement.
Supervalu Borrowers : members of the Supervalu Group identified in writing to the Administrative Agent after the Signing Date (i)
that become U.S. Borrowers hereunder pursuant to Section 10.1.9 after the Closing Date (or on the Closing Date at the discretion of the
Administrative Agent) and (ii) that become U.S. Borrowing Base Obligors in accordance with the definition thereof.
Supervalu Group : the business of Supervalu Inc. and its Subsidiaries as conducted on the Signing Date, including the business
activities, business lines, operations and contractual arrangements related thereto.
Supervalu Group Discontinued Operations : any business activity, business line or operations (whether pursuant to contractual
arrangements or otherwise) of the Supervalu Group that, in each case, has actually been discontinued.
Supervalu Investment Grade Account Debtor : an Account Debtor that, at the time of determination, has a corporate credit rating
and/or family rating, as applicable, of BBB-or higher by S&P or Baa3 or higher by Moody’s.
Swap Obligations : with respect to an Obligor, its obligations under a Hedging Agreement that constitutes a “swap” within the
meaning of Section 1a(47) of the Commodity Exchange Act.
Swap Termination Value : in respect of any one or more Hedging Agreements, after taking into account the effect of any legally
enforceable netting agreement relating to such Hedging Agreements, (a) for any date on or after the date such Hedging Agreements have been
closed out and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date
referenced in clause (a) , the amount(s) determined as the mark to market value(s) for such Hedging
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Agreements, as determined by the Secured Bank Product Provider (or the Borrower Agent, if no Secured Bank Product Provider is party to
such Hedging Agreement) in accordance with the terms thereof and in accordance with customary methods for calculating mark-to-market
values under similar arrangements by the Secured Bank Product Provider (or the Borrower Agent, if no Secured Bank Product Provider is
party to such Hedging Agreement).
Swingline Lender : means any Canadian Swingline Lender and/or U.S. Swingline Lender, as the context requires.
Swingline Loan : any Borrowing of Applicable Floating Rate Loans funded with the Applicable Agent’s funds, until such Borrowing
is settled among the Applicable Lenders or repaid by the U.S. Borrowers or the Canadian Borrower, as the case may be.
Taxes : all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees
or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto. For the
avoidance of doubt, Taxes shall include all Taxes imposed pursuant to Part XIII of the ITA or any successor provisions thereto.
Term Loan Agreement : the Term Loan Agreement dated as of the Closing Date, by and among, inter alios, UNFI, the lenders party
thereto from time to time and the Term Loan Facility Agent, as such agreement may be amended, supplemented, modified, restated, renewed
or replaced (whether upon or after termination or otherwise) in whole or in part from time to time.
Term Loan Facility: a senior secured term loan facility made available to UNFI under the Term Loan Agreement.
Term Loan Facility Agent : Goldman Sachs Bank USA, in its capacity as administrative agent, its successors and assigns in such
capacity or any other collateral agent or similar representative of the secured parties under the Term Loan Agreement.
Term Loan Facility Documents : the Term Loan Agreement and all other “Loan Documents” (or analogous term) as defined in the
Term Loan Agreement.
Term Priority Collateral : as defined in the Intercreditor Agreement.
Third Party Payor : any Person, such as a Fiscal Intermediary, Blue Cross/Blue Shield, or private health insurance company, which is
obligated to reimburse or otherwise make payments to health care providers who provide medical care or medical assistance or other goods or
services for eligible patients under any private insurance contract.
Threshold Amount : U.S. $75,000,000.
Total Canadian Outstandings : an amount equal to the sum of (a) the principal balance of all Canadian Loans plus (b) the U.S. Dollar
Equivalent of the Canadian LC Obligations.
Total LC Obligations : the sum of (a) U.S. LC Obligations and (b) the U.S. Dollar Equivalent of the Canadian LC Obligations.
Total Outstandings : an amount equal to the sum of (a) the Total Canadian Outstandings plus (b) the Total U.S. Revolver
Outstandings.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Total U.S. Revolver Outstandings : an amount equal to the sum of (a) the principal balance of all U.S. Revolver Loans plus (b) the
U.S. LC Obligations.
Transaction : collectively, (a) the Supervalu Acquisition, (b) the execution and delivery of the Loan Documents and the funding of the
U.S. Revolver Loans and Canadian Loans and issuance of the Letters of Credit on the Closing Date, (c) the execution and delivery of the
Term Loan Facility Documents and the funding of the term loans under the Term Loan Agreement on the Closing Date, (d) the Closing Date
Refinancing and (e) the payment of Transaction Expenses.
Transaction Expenses : any fees or expenses incurred or paid by the Borrowers or any Subsidiary in connection with the Transaction
and the transactions contemplated in connection therewith.
Trigger Event:
(a) for purposes of Section 10.3.1 , the first date that Adjusted Aggregate Availability is less than the greater of (i)
U.S.$235,000,000 and (ii) 10% of the Aggregate Borrowing Base;
(b) for any other purpose hereunder, any of (i) the occurrence and continuance of an Event of Default, and (ii) the fifth
consecutive day that Adjusted Aggregate Availability is less than the greater of (x) 10% of the Aggregate Borrowing Base and (y)
U.S.$235,000,000; and
(c) for all purposes of this Agreement, (i) the Administrative Agent shall use its commercially reasonable efforts to notify
the Borrower Agent of the occurrence of any of the events set forth in clauses (a) and (b)(ii) above (it being understood that the
Administrative Agent’s failure to provide such notice shall not constitute a waiver of the Trigger Event), and (ii) the occurrence of a
Trigger Event shall be deemed continuing (x) if the Trigger Event arises under clause (a)(i) or clause (b)(ii)(y) above, until Adjusted
Aggregate Availability equals or exceeds U.S.$235,000,000 for thirty (30) consecutive days, as certified by the Borrowers in an
Aggregate Availability Certificate delivered to the Administrative Agent, in which case such Trigger Event shall be deemed to be no
longer continuing for purposes of this Agreement, (y) if the Trigger Event arises under clause (a)(ii) or clause (b)(ii)(x) above, until
Adjusted Aggregate Availability equals or exceeds 10% of the Aggregate Borrowing Base for thirty (30) consecutive days, as
certified by the Borrowers in an Aggregate Availability Certificate delivered to the Administrative Agent, in which case such Trigger
Event shall be deemed to be no longer continuing for purposes of this Agreement, and (z) if the Trigger Event arises under clause (b)
(i) above, so long as such Event of Default is continuing; provided , that to the extent two Trigger Events have occurred and have
been cured during any period of four consecutive Fiscal Quarters, any additional Trigger Event during such period shall be deemed
continuing at all times during such period.
Type : any type of Loan (i.e., Base Rate Loan or Applicable Offered Rate Loan) that has the same interest option and, in the case of
Applicable Offered Rate Loans, the same Interest Period.
UCC : the Uniform Commercial Code as in effect in the State of New York or, when the laws of any other jurisdiction govern the
perfection or enforcement of any Lien, the Uniform Commercial Code of such jurisdiction.
Unfunded Pension Liability : (a) with respect to a Pension Plan, the excess of a Pension Plan’s benefit liabilities under Section
4001(a)(16) of ERISA, over the current value of that Pension Plan’s assets, determined in accordance with the assumptions used for funding
the Pension Plan pursuant to the
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Code, ERISA or the Pension Protection Act of 2006 for the applicable plan year and (b) with respect to a Canadian Plan that is a registered
pension plan, the amount (if any) by which the present value of all vested and unvested accrued benefits under such a plan exceeds the fair
market value of assets allocable to such benefits, all determined as of the then most recent valuation date for such plan using customary
actuarial assumptions for such a plan.
Unintentional Overadvance : as defined in Section 2.1.5 .
Unrestricted Subsidiary : (i) any Subsidiary of UNFI designated by the Borrower Agent as an Unrestricted Subsidiary pursuant to
Section 10.1.12 ; provided that no Borrower may be designated as an Unrestricted Subsidiary and (ii) any Subsidiary of an Unrestricted
Subsidiary.
Unused Line Fee Rate : a per annum rate equal to (i) from and after the Closing Date through and including the day that is three
months after the Closing Date, 0.375% and (ii) thereafter (a) 0.375%, if the average daily Total Outstandings were less than 25% of the
Aggregate Commitments during the preceding Fiscal Quarter or (b) 0.25%, if such average daily Total Outstandings were 25% or more of the
Aggregate Commitments during the preceding Fiscal Quarter.
Upstream Payment : a Distribution by a Subsidiary to an Obligor or a wholly-owned Subsidiary of an Obligor or, in the case of a
Distribution by a non-wholly-owned Subsidiary, to each owner of Equity Interests of such Subsidiary based on their relative ownership
interests of the relevant class of Equity Interests).
U.S. ABL Priority Collateral : all ABL Priority Collateral of the U.S. Loan Parties.
U.S. Accounts Formula Amount : 90% of the Value of Eligible Accounts of each U.S. Borrowing Base Obligor; provided , however ,
that such percentage shall be reduced by 1.0% for each percentage point of Dilution.
U.S. Borrowers : as defined in the preamble to this Agreement.
U.S. Borrowing Base Obligor : (a) UNFI, (b) UNFW and (c) each other U.S. Borrower designated by the Borrower Agent as a U.S.
Borrowing Base Obligor and, subject to Section 10.1.1 , the Accounts and Inventory (and, where applicable, Credit Card Receivables,
Pharmacy Receivables and/or Prescription Files) of which have been subject to a field examination and appraisal with results satisfactory to
the Administrative Agent.
U.S. Collateral : all Collateral of the U.S. Loan Parties.
U.S. Credit Card Receivables Formula Amount : 90% of the Value of Eligible Credit Card Receivables of each U.S. Borrowing Base
Obligor; provided , however , that such percentage shall be reduced by 1.0% for each percentage point of Credit Card Receivables Dilution.
U.S. Dollar Equivalent : of any amount means, at the time of determination thereof, (a) if such amount is expressed in U.S. Dollars,
such amount and (b) if such amount is denominated in any other currency, the equivalent of such amount in U.S. Dollars as determined by the
Administrative Agent using the Spot Rate.
U.S. Dollars or U.S.$ : lawful money of the United States.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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U.S. Intellectual Property Security Agreements : any agreement executed on or after the Closing Date confirming or effecting the
grant of any Lien on Intellectual Property owned by any U.S. Loan Party to the Administrative Agent, for the benefit of the Secured Parties,
in accordance with this Agreement and the Closing Date U.S. Security Agreement.
U.S. Inventory Formula Amount : 90% of the NOLV Percentage of the Value of Eligible Inventory of each U.S. Borrowing Base
Obligor.
U.S. LC Conditions : the following conditions necessary for issuance of a Letter of Credit for the account or benefit of a U.S.
Borrower or any of its Subsidiaries: (a) each of the conditions set forth in Section 6 shall have been satisfied (or, solely with respect to any
such Letter of Credit issued on the Closing Date, the conditions set forth in Sections 6.2 only); (b) after giving effect to such issuance, Total
LC Obligations do not exceed U.S.$125,000,000, no Overadvance exists, no U.S. Revolver Overadvance exists, Total U.S. Revolver
Outstandings do not exceed the U.S. Revolver Borrowing Base, and Total Outstandings do not exceed the Aggregate Borrowing Base; (c) the
expiration date of such Letter of Credit is (i) no more than one year from issuance (or such longer period of time as may be agreed to by the
applicable Issuing Bank) in the case of standby Letters of Credit, and (ii) no more than 120 days from issuance (or such longer period of time
as may be agreed to by the applicable Issuing Bank) in the case of commercial Letters of Credit, (d) the Letter of Credit and payments
thereunder are denominated in U.S. Dollars, (e) the form of the proposed Letter of Credit is reasonably satisfactory to the Administrative
Agent and the applicable Issuing Bank in their reasonable discretion and (f) the Total LC Obligations with respect to Letters of Credit issued
by the applicable Issuing Bank would not exceed such Issuing Bank’s LC Commitment.
U.S. LC Obligations : the sum (without duplication) of (a) all amounts owing by U.S. Borrowers for any drawings under Letters of
Credit issued for the account or on behalf of any U.S. Borrower or any of its Subsidiaries; and (b) the amount available to be drawn under
outstanding Letters of Credit issued for the account or on behalf of any U.S. Borrower or any of its Subsidiaries, except to the extent Cash
Collateralized.
U.S. Loan Parties : all Obligors other than (i) the Canadian Borrower and (ii) any other Obligor that is not organized under the laws of
the United States, any state thereof or the District of Columbia.
U.S. Obligations : all Obligations that are not Canadian Obligations.
U.S. Person : “United States Person” as defined in Section 7701(a)(30) of the Code.
U.S. Pharmacy Receivables Formula : the lesser of (a) 90% of the Value of Eligible Pharmacy Receivables of each U.S. Borrowing
Base Obligor; provided , however , that such percentage shall be reduced by 1.0% for each percentage point of Pharmacy Receivables
Dilution and (b) 10% of the U.S. Revolver Borrowing Base (determined without giving regard to the limitation in this clause (b)).
U.S. Revolver Availability : the U.S. Revolver Borrowing Base minus the Total U.S. Revolver Outstandings.
U.S. Revolver Borrowing Base : on any date of determination, an amount equal to the lesser of (a) the Aggregate U.S. Revolver
Commitments and (b) subject to Section 10.1.1(c) , the sum of the U.S. Accounts Formula Amount, plus the U.S. Credit Card Receivables
Formula Amount, plus the U.S. Inventory Formula Amount, plus the U.S. Pharmacy Receivables Formula, plus Pharmacy Scripts
Availability, plus Qualified Cash of each U.S. Borrowing Base Obligor minus the Availability Reserve (it
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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being understood that the amount of the Availability Reserve shall be allocated, in the Permitted Discretion of the Administrative Agent and
without duplication, between the U.S. Revolver Borrowing Base and the Canadian Borrowing Base); provided , that, notwithstanding the
foregoing or anything else in this Agreement or the other Loan Documents to the contrary, regardless of the calculation of clause (b) of the
U.S. Revolver Borrowing Base on the Closing Date, clause (b) of the U.S. Revolver Borrowing Base shall be no less than
U.S.$1,500,000,000 on the Closing Date until the ninetieth (90 th ) day after the Closing Date; provided , further , that if the Administrative
Agent receives field examinations and appraisals prior to the Closing Date and if clause (b) of the U.S. Revolver Borrowing Base would,
without giving effect to the foregoing proviso, be less than or equal to U.S.$1,500,000,000, then clause (b) of the U.S. Revolver Borrowing
Base shall be deemed to be the greater of (x) clause (b) of the U.S. Revolver Borrowing Base without giving effect to the foregoing proviso
and (y) U.S.$1,300,000,000 on the Closing Date until the ninetieth (90th) day after the Closing Date. As used in this definition, “field
examinations and appraisals” shall be deemed to refer to field examinations and appraisals of Accounts and Inventory and, with respect to any
Supervalu Borrower, Credit Card Receivables, Pharmacy Receivables and Prescription Files.
U.S. Revolver Commitment : for any U.S. Revolver Lender, its obligation to make U.S. Revolver Loans and to participate in U.S. LC
Obligations up to the maximum principal U.S. Dollar amount shown on Schedule 1.1(a) , as hereafter modified pursuant to Section 2.1.7 or
an Assignment and Acceptance to which it is a party.
U.S. Revolver Commitment Termination Date : the earliest to occur of (a) the U.S. Revolver Termination Date; (b) the date on which
U.S. Borrowers terminate the Aggregate U.S. Revolver Commitments pursuant to Section 2.1.4 ; or (c) the date on which the Aggregate U.S.
Revolver Commitments are terminated pursuant to Section 11.2 .
U.S. Revolver Lenders : the Lenders indicated on Schedule 1.1(a) as the Lenders of U.S. Revolver Loans, the U.S. Swingline
Lenders, any Issuing Bank that issues a Letter of Credit for the account or on behalf of any U.S. Borrower and any other Person who hereafter
becomes a “U.S. Revolver Lender” pursuant to the terms hereof.
U.S. Revolver Loan : (a) a loan made to U.S. Borrowers pursuant to Section 2.1.1(a) , (b) any Swingline Loan for the account of a
U.S. Borrower, (c) any Overadvance Loan for the account of a U.S. Borrower deemed by the Administrative Agent to be a U.S. Revolver
Loan and (d) any U.S. Revolver Protective Advance.
U.S. Revolver Note : a promissory note executed by the U.S. Borrowers in favor of a U.S. Revolver Lender in the form of Exhibit A ,
in the amount of such Lender’s U.S. Revolver Commitment.
U.S. Revolver Overadvance : as defined in Section 2.1.5 .
U.S. Revolver Protective Advance : as defined in Section 2.1.6(a) .
U.S. Revolver Termination Date : the date that is five years after the Closing Date.
U.S. Swingline Lender : Bank of America, N.A. in its capacity as provider of Swingline Loans, or any successor swing line lender
hereunder that becomes a party hereto pursuant to documentation reasonably agreed between such U.S. Swingline Lender, the Administrative
Agent and the Borrower Agent.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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U.S. Tax Compliance Certificate : as defined in Section 5.10.2(b)(iii) .
Value : (a) for Inventory, its value determined on the basis of the lower of cost or market, calculated on a first-in, first‑out basis, and
excluding any portion of cost attributable to intercompany profit among Borrowers and their Affiliates; and (b) for an Account, Credit Card
Receivable or Pharmacy Receivable, its face amount, net of any returns, rebates, discounts (calculated on the shortest terms), credits,
allowances or Taxes (including sales, excise or other taxes) that have been or reasonably could be claimed by the Account Debtor or any
other Person.
Voting Stock : Equity Interests of any class or classes of a corporation the holders of which are ordinarily, in the absence of
contingencies, entitled to elect a majority of the corporate directors (or Persons performing similar functions).
Wage Earner Protection Program Act : the Wage Earner Protection Program Act (Canada).
Write-Down and Conversion Powers : with respect to any EEA Resolution Authority, the write-down and conversion powers of such
EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and
conversion powers are described in the EU Bail-In Legislation Schedule.
1.2. Accounting Terms . Under the Loan Documents (except as otherwise specified herein), all accounting terms shall be
interpreted, all accounting determinations shall be made, and all financial statements shall be prepared, in accordance with GAAP applied on
a basis consistent with the most recent audited financial statements of the Borrower Agent delivered to Administrative Agent before the
Signing Date and using the same inventory valuation method as used in such financial statements, except for any change required or
permitted by GAAP if the Borrower Agent’s certified public accountants concur in such change, the change is disclosed to Administrative
Agent, and any ratios or requirements affected by such change are amended in a manner satisfactory to Required Lenders to take into account
the effects of the change; provided , that until so amended, such ratio or requirement shall continue to be computed in accordance with GAAP
prior to such change therein. Anything in this Agreement to the contrary notwithstanding, any obligation of a Person under a lease (whether
existing as of the Closing Date or entered into in the future) that is not (or would not be) required to be classified and accounted for as a
capital lease on the balance sheet of such Person under GAAP as in effect at the time such lease is entered into shall not be treated as a
Capital Lease solely as a result of (a) the adoption of any changes in, or (b) changes in the application of, GAAP after such lease is entered
into.
1.3. Uniform Commercial Code . As used herein, the following terms are defined in accordance with the UCC in effect in the
State of New York from time to time: “Certificated Security,” “Chattel Paper,” “Commercial Tort Claim,” “Deposit Account,” “Document,”
“Equipment,” “General Intangibles,” “Goods,” “Instrument,” “Investment Property,” “Letter-of-Credit Right,” “Payment Intangibles,”
“Security Entitlement,” “Supporting Obligation,” and “Uncertificated Security.”
1.4. Certain Matters of Construction . The terms “herein,” “hereof,” “hereunder” and other words of similar import refer to this
Agreement as a whole and not to any particular section, paragraph or subdivision. Any pronoun used shall be deemed to cover all genders. In
the computation of periods of time from a specified date to a later specified date, “from” means “from and including,” and “to” and “until”
each mean “to but excluding.” The terms “including” and “include” shall mean “including, without limitation” and, for purposes of each Loan
Document, the parties agree that the rule of ejusdem generis shall not be applicable to limit any provision. Section titles appear as a matter of
convenience only and shall not affect the interpretation of any Loan Document. All references to (a) laws or statutes include all related rules,
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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regulations, interpretations, amendments and successor provisions; (b) any document, instrument, schedule or agreement (including this
Agreement) include any amendments, restatements, waivers and other modifications, supplements, extensions or renewals (to the extent
permitted by the Loan Documents); (c) any section mean, unless the context otherwise requires, a section of this Agreement; (d) any exhibits
or schedules mean, unless the context otherwise requires, exhibits and schedules attached hereto, which are hereby incorporated by reference;
(e) any Person include successors and assigns; (f) time of day means time of day at Administrative Agent’s notice address under Section
14.3.1 ; or (g) discretion of any Agent, any Issuing Bank or any Lender mean the sole and absolute discretion of such Person. All
determinations (including calculations of U.S. Revolver Borrowing Base, Canadian Borrowing Base and financial covenants) made from time
to time under the Loan Documents shall be made in light of the circumstances existing at such time. U.S. Revolver Borrowing Base and
Canadian Borrowing Base calculations shall be consistent with historical methods of valuation and calculation, and otherwise reasonably
satisfactory to Administrative Agent (and not necessarily calculated in accordance with GAAP). Borrowers shall have the burden of
establishing any alleged negligence, misconduct or lack of good faith by any Agent, any Issuing Bank or any Lender under any Loan
Documents. No provision of any Loan Documents shall be construed against any party by reason of such party having, or being deemed to
have, drafted the provision. Any reference herein to a merger, transfer, consolidation, amalgamation, consolidation, assignment, sale,
disposition or transfer, or similar term, shall be deemed to apply to a division of or by a limited liability company, or an allocation of assets to
a series of a limited liability company (or the unwinding of such a division or allocation), as if it were a merger, transfer, consolidation,
amalgamation, consolidation, assignment, sale or transfer, or similar term, as applicable, to, of or with a separate Person. Any division of a
limited liability company shall constitute a separate Person hereunder (and each division of any limited liability company that is a Subsidiary,
Restricted Subsidiary, Unrestricted Subsidiary, joint venture or any other like term shall also constitute such a Person or entity).
1.5. Conversions of Canadian Dollars . The Applicable Agent in good faith shall determine the U.S. Dollar Equivalent and
Canadian Dollar Equivalent of any amount as required hereby, and a determination thereof by the Applicable Agent shall be conclusive
absent manifest error. The Administrative Agent may, but shall not be obligated to, rely on any determination made by any Obligor in any
document delivered to any Agent. The Applicable Agent may determine or redetermine the U.S. Dollar Equivalent and Canadian Dollar
Equivalent of any amount on any date either in its own discretion or upon the request of any Lender or any Issuing Bank. The Applicable
Agent may set up appropriate rounding off mechanisms or otherwise round-off amounts hereunder to the nearest higher or lower amount in
whole U.S. Dollar, Canadian Dollar or whole cents to ensure amounts owing by any party hereunder or that otherwise need to be calculated or
converted hereunder are expressed in whole U.S. Dollars, Canadian Dollars or in whole cents, as may be necessary or appropriate. Wherever
in this Agreement in connection with (a) a Borrowing, conversion, continuation or prepayment of an Applicable Offered Rate Loan or
Applicable Floating Rate Loan, (b) the issuance, amendment or extension of a Letter of Credit, or (c) an amount, such as a required minimum,
maximum or multiple amount, is expressed in U.S. Dollars, but such Borrowing, Applicable Offered Rate Loan, Applicable Floating Rate
Loan, Letter of Credit or amount is denominated in Canadian Dollars, such amount shall be the Canadian Dollar Equivalent of such U.S.
Dollar amount (rounded to the nearest unit of Canadian Dollars, with 0.5 of a unit being rounded upward), as determined by the Applicable
Agent or the applicable Issuing Bank, as the case may be. Borrowers shall report Value and other U.S. Revolver Borrowing Base and
Canadian Borrowing Base components to the Administrative Agent in the currency invoiced by Borrowers or shown in Borrowers’ financial
records, and unless expressly provided otherwise, shall deliver financial statements and calculate financial covenants in U.S. Dollars.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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1.6. Collateral Located in the Province of Québec . For purposes of any Collateral located in the Province of Québec or charged
by any deed of hypothec (or any other Loan Document) and for all other purposes pursuant to which the interpretation or construction of a
Loan Document may be subject to the laws of the Province of Québec or a court or tribunal exercising jurisdiction in the Province of Québec,
(a) “personal property” shall be deemed to include “movable property”, (b) “tangible property” shall be deemed to include “corporeal
property”, (c) “intangible property” shall be deemed to include “incorporeal property”, (d) “security interest” and “mortgage” shall be deemed
to include a “hypothec”, (e) all references to filing, registering or recording under the UCC or the PPSA shall be deemed to include
publication under the Civil Code of Québec, (f) all references to “perfection” of or “perfected” Liens shall be deemed to include a reference to
the “opposability” of such Liens to third parties, (g) any “right of offset”, “right of setoff” or similar expression shall be deemed to include a
“right of compensation”, (h) an “agent” shall be deemed to include a “mandatary”, (i) “goods” shall be deemed to include “corporeal movable
property” other than chattel paper, documents of title, instruments, money and securities, (j) “construction liens” shall be deemed to include
“legal hypothecs in favor of persons having taken part in the construction or renovation of an immovable”; (k) “joint and several” shall be
deemed to include solidary; (l) “gross negligence or willful misconduct” shall be deemed to be “intentional or gross fault”; (m) “beneficial
ownership” shall be deemed to include “ownership”; (n) “easement” shall be deemed to include a servitude; (o) “priority” shall be deemed to
include “rank” or “prior claim”, as applicable; (p) “survey” shall be deemed to include “certificate of location and plan”; (q) “state” shall be
deemed to include “province”; (r) “fee simple title” shall be deemed to include “absolute ownership”; (s) “legal title” shall be deemed to
include “holding title as mandatary or prête-nom on behalf of an owner” (t) “leasehold interest” shall be deemed to include “rights resulting
from a lease”; and (u) “lease” shall be deemed to include a “contract of leasing ( crédit-bail )”.
1.7. Certain Calculations and Tests .
1.7.1. (a) Notwithstanding anything in this Agreement or any Loan Document to the contrary but subject to clause (b) of
this Section 1.7.1 , when calculating any applicable ratio or determining other compliance with this Agreement including the determination of
compliance with any provision of this Agreement which requires that no Default or Event of Default has occurred, is continuing or would
result therefrom) in connection with a Specified Transaction undertaken in connection with the consummation of a Limited Condition
Transaction, the date of determination of such ratio or other applicable covenant and determination of whether any Default or Event of
Default has occurred, is continuing or would result therefrom or other applicable covenant shall, at the option of the Borrower Agent (the
Borrower Agent’s election to exercise such option in connection with any Limited Condition Transaction, an “ LCA Election ”), be deemed
to be the date that the definitive agreements for such Limited Condition Transaction are entered into (in each case, the “ LCA Test Date ”)
and if, after such ratios and other provisions are measured on a pro forma basis after giving effect to such Limited Condition Transaction and
the other Specified Transactions to be entered into in connection therewith and the use of proceeds thereof as if they occurred at the beginning
of the four consecutive fiscal quarter period being used to calculate such financial ratio ending prior to the LCA Test Date, the Borrowers
could have taken such action on the relevant LCA Test Date in compliance with such ratios and provisions, such provisions shall be deemed
to have been complied with. For the avoidance of doubt, (x) if any of such ratios are exceeded as a result of fluctuations in such ratio
(including due to fluctuations in Consolidated EBITDA) at or prior to the consummation of the relevant Limited Condition Transaction, such
ratios and other provisions will not be deemed to have been exceeded as a result of such fluctuations solely for purposes of determining
whether the Limited Condition Transaction is permitted hereunder and (y) such ratios and other provisions shall not be tested at the time of
consummation of such Limited Condition Transaction or related Specified Transactions. If the Borrower Agent has made an LCA Election
for any Limited Condition Transaction, then in connection with any subsequent calculation of any ratio or basket availability with respect to
any other Specified Transaction on or following the relevant
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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LCA Test Date and prior to the earlier of the date on which such Limited Condition Transaction is consummated, such Limited Condition
Transaction is terminated or expires without consummation of such Limited Condition Transaction, any such ratio or basket shall be
calculated on a pro forma basis assuming such Limited Condition Transaction and other transactions in connection therewith (including any
incurrence of Debt and the use of proceeds thereof) have been consummated.
(b) Notwithstanding the foregoing, in no event shall Section 1.7.1(a) apply to any determination of compliance with
(including the calculation of any ratio or testing the absence of any Default or Event of Default in connection with) clause (i)
of the definition of Permitted Acquisition; clause (j) of the definition of Permitted Investment; Section 6.3 ; the final
paragraph of S ection 10.2.4 ; Section 10.2.8(f) ; or Section 10.3 .
1.7.2. Notwithstanding anything to the contrary herein, with respect to any amounts incurred or transactions entered into
(or consummated) in reliance on a provision of this Agreement that does not require compliance with a financial ratio or test (including,
without limitation, pro forma compliance with any Fixed Charge Coverage Ratio, any Consolidated Total Net Leverage Ratio test, any
Consolidated Secured Net Leverage Ratio test or Consolidated First Lien Net Leverage Ratio (any such amounts, the “ Fixed Amounts ”))
substantially concurrently with any amounts incurred or transactions entered into (or consummated) in reliance on a provision of this
Agreement that requires compliance with any such financial ratio or test (any such amounts, the “ Incurrence Based Amounts ”), it is
understood and agreed that (i) the Fixed Amounts (and any cash proceeds thereof) and (ii) any Debt resulting from borrowings under this
Agreement which occur concurrently or substantially concurrently with the incurrence of the Incurrence Based Amounts shall, in each case,
be disregarded in the calculation of the financial ratio or test applicable to the Incurrence Based Amounts in connection with such
substantially concurrent incurrence, except that incurrences of Debt and Liens constituting Fixed Amounts shall be taken into account for
purposes of Incurrence Based Amounts contained in Section 10.2.1 or Section 10.2.2.
1.8. Credit Agreement Schedules . In the event that the Borrower Agent reasonably determines that any of the representations and
warranties set forth in Section 9 required to be made on the Closing Date as they relate to Supervalu and its Subsidiaries (other than the
Specified Representations and representations and warranties that are not otherwise qualified by reference to a schedule) cannot be made on
the Closing Date or any of the negative covenants in Section 10.2 as they relate to Supervalu and its Subsidiaries (other than negative
covenants that are not qualified by reference to a schedule) would be breached on the Closing Date, the Borrower Agent, not later than ten
Business Days prior to the Closing Date (or such later date as agreed by the Administrative Agent in its discretion), may deliver to the
Administrative Agent schedules setting forth such matters as the Borrower Agent deems necessary to qualify such representations and
warranties and/or such negative covenants, as applicable, such that, after giving effect to such schedules, the Borrower Agent determines that
it can make such representations and warranties as of the Closing Date (it being understood and agreed that nothing in this paragraph shall be
construed as making the accuracy of any representation or warranty set forth herein (other than the Specified Representations and Specified
Acquisition Agreement Representations) a condition precedent to the obligations of the Lenders to make the credit extensions contemplated
by Section 6.2 ) and/or such negative covenants would not be breached on the Closing Date (such schedules, the “ Closing Date Schedules ”).
Notwithstanding anything in this Agreement to the contrary, the Closing Date Schedules shall become effective if the Administrative Agent
posts the Closing Date Schedules to the Lenders and the Required Lenders do not deliver notice in writing
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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to the Administrative Agent objecting to such Closing Date Schedules within five Business Days of the posting thereof.
SECTION 2. CREDIT FACILITIES
2.1. Commitments .
2.1.1. Loans .
(a) U.S. Revolver Loans . Each U.S. Revolver Lender agrees, severally on a Pro Rata basis up to its
U.S. Revolver Commitment, on the terms set forth herein, to make U.S. Revolver Loans in U.S. Dollars to the U.S.
Borrowers from time to time from the Closing Date through the U.S. Revolver Commitment Termination Date. The
U.S. Revolver Loans may be repaid and reborrowed as provided herein. In no event shall U.S. Revolver Lenders have
any obligation to honor a request for a U.S. Revolver Loan if the Total U.S. Revolver Outstandings at such time
(including the requested Loan) would exceed the U.S. Revolver Borrowing Base.
(b) Canadian Loans . Each Canadian Lender agrees, severally on a Pro Rata basis up to its
Canadian Commitment, on the terms set forth herein, to make Canadian Loans in Canadian Dollars to the Canadian
Borrower from time to time from the Closing Date through the Canadian Commitment Termination Date. The
Canadian Loans may be repaid and reborrowed as provided herein. In no event shall Canadian Lenders have any
obligation to honor a request for a Canadian Loan if the Total Canadian Outstandings at such time (including the
requested Loan) would exceed the Canadian Borrowing Base. Each Canadian Loan made under this Section 2.1.1(b)
shall be a BA Equivalent Rate Loan.
2.1.2. Notes . The Loans made by each Lender and interest accruing thereon shall be evidenced by the records of the
Applicable Agent and such Lender. At the request of any Lender, the U.S. Borrowers or the Canadian Borrower, as the case may be, shall
deliver a U.S. Revolver Note or Canadian Note, as the case may be, to such Lender.
2.1.3. Use of Proceeds . The proceeds of Loans shall be used by the applicable Borrowers solely (a) on the Closing Date, to
issue or cash collateralize any letters of credit or, to the extent necessary, to fund any increase to the upfront fees or original issue discount
arising in connection with the primary syndication of the Term Loan Facility, (b) on or after the Closing Date, to finance working capital and
general corporate purposes, including Permitted Acquisitions permitted under Section 10.2.5 , from time to time for the Borrower Agent and
its Subsidiaries, (c) on the Closing Date, to fund a portion of the purchase price in connection with the Supervalu Acquisition and (d) on the
Closing Date, to pay transaction fees, costs and expenses; provided , that the aggregate amount of Loans made on the Closing Date for
purposes set forth in clauses (b) through (d) above shall not exceed $1,200,000,000 in the aggregate plus , at the Borrower Agent’s election,
an amount sufficient to fund any increase to the upfront fees or original issue discount arising in connection with the primary syndication of
the Term Loan Facility. The Borrowers shall not, directly or indirectly, use the Loan proceeds or Letters of Credit (i) to fund any activities or
business of or with any Person that, at the time of such funding, is the target of Sanctions, or is located in any Designated Jurisdiction, in each
case, in violation of applicable Sanctions, or (ii) in a way that would result in a violation of any applicable Anti-Corruption Laws, Anti-
Terrorism Laws or Sanctions by the Borrowers or any of their
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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Subsidiaries or any other Person participating in the Loans or the Letters of Credit (whether as underwriter, advisor, investor, or otherwise).
2.1.4. Voluntary Reduction or Termination of Commitments .
(a) Voluntary Reduction or Termination of U.S. Revolver Commitments and Aggregate
Commitments .
(i) The U.S. Revolver Commitments shall terminate on the U.S. Revolver Termination Date, unless sooner
terminated in accordance with this Agreement.
(ii) Upon prior written notice to Administrative Agent, Borrowers may, at their option, terminate the
unused Aggregate Commitments and this credit facility; provided , that such notice must be received by the
Administrative Agent not later than 11:00 a.m. three Business Days prior to the date of termination. Any notice of
termination given by Borrowers shall be irrevocable ( provided , further , however, that the Borrowers may specify in
any such notice that such termination is conditioned upon the consummation of financing arrangements and the
Borrowers may rescind any notices of termination or reduction under this Section 2.1.4(a) if such termination or
reduction would have resulted from a refinancing of this credit facility, which refinancing shall not be consummated
or shall be delayed). On the termination date, Borrowers shall make Full Payment of all Obligations.
(iii) U.S. Borrowers may permanently reduce the unused U.S. Revolver Commitments, on a Pro Rata basis
for each U.S. Revolver Lender, upon prior written notice to Administrative Agent, which notice shall specify the
amount of the reduction and shall be irrevocable once given; provided , that such notice must be received by the
Administrative Agent not later than 11:00 a.m. three Business Days prior to the date of reduction. Each reduction
shall be in a minimum amount of U.S. $10,000,000, or an increment of U.S. $1,000,000 in excess thereof.
(b) Voluntary Reduction or Termination of Canadian Commitments .
(i) The Canadian Commitments shall terminate on the Canadian Termination Date, unless sooner
terminated in accordance with this Agreement. Upon prior written notice to the Administrative Agent, Canadian
Borrower may, at its option, terminate the Canadian Commitments; provided , that such notice must be received by
the Administrative Agent not later than 11:00 a.m. three Business Days prior to the date of termination. Any notice of
termination given by Canadian Borrower shall be irrevocable ( provided , further , however, that the Canadian
Borrower may specify in any such notice that such termination is conditioned upon the consummation of financing
arrangements and the Borrowers may rescind any notices of termination or reduction under this Section 2.1.4(b) if
such termination or reduction would have resulted from a refinancing of this credit facility, which
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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refinancing shall not be consummated or shall be delayed). On the termination date, Canadian Borrower shall make
Full Payment of all Canadian Obligations.
(ii) Canadian Borrower may permanently reduce the Canadian Commitments, on a Pro Rata basis for each
Canadian Lender, upon prior written notice to the Administrative Agent, which notice shall specify the amount of the
reduction and shall be irrevocable once given; provided , that such notice must be received by the Administrative
Agent not later than 11:00 a.m. three Business Days prior to the date of reduction. Each reduction shall be in a
minimum amount of U.S.$ 5,000,000, or an increment of U.S. $1,000,000 in excess thereof.
2.1.5. Overadvances . If the Total U.S. Revolver Outstandings exceed the U.S. Revolver Borrowing Base (“ U.S. Revolver
Overadvance ”) at any time, the excess amount shall be payable by U.S. Borrowers on demand by Administrative Agent, but all such U.S.
Revolver Loans shall nevertheless constitute Obligations secured by the Collateral and entitled to all benefits of the Loan Documents. If the
Total Canadian Outstandings exceed the Canadian Borrowing Base (“ Canadian Overadvance ”) at any time, the excess amount shall be
payable by Canadian Borrower on demand by Canadian Agent, but all such Canadian Loans shall nevertheless constitute Canadian
Obligations secured by the applicable Collateral and entitled to all benefits of the Loan Documents. The Applicable Agent may require the
Applicable Lenders to honor requests for Overadvance Loans and to forbear from requiring the applicable Borrowers to cure an Overadvance,
(a) when no other Event of Default is known to such Agent, as long as (i) the Overadvance does not continue for more than 30 consecutive
days (and no Overadvance may exist for at least five consecutive days thereafter before further Overadvance Loans are required), and (ii)(A)
if a U.S. Revolver Overadvance, the Overadvance is not known by the Administrative Agent to exceed 10% of the U.S. Revolver Borrowing
Base and (B) if a Canadian Overadvance, the Overadvance is not known by the Canadian Agent to exceed 10% of the Canadian Borrowing
Base; and (b) regardless of whether an Event of Default exists, if the Applicable Agent discovers an Overadvance not previously known by it
to exist (an “ Unintentional Overadvance ”), if (i)(A) with respect to a request for a U.S. Revolver Overadvance, the sum of (x) the aggregate
amount of the Unintentional Overadvance under the U.S. Revolver Borrowing Base and (y) the amount of the request for a U.S. Revolver
Overadvance does not exceed 10% of the U.S. Revolver Borrowing Base, and (B) with respect to a request for a Canadian Overadvance, the
sum of (x) the aggregate amount of the Unintentional Overadvance under the Canadian Borrowing Base and (y) the request for a Canadian
Overadvance does not exceed 10% of the Canadian Borrowing Base, and (ii) such Overadvance does not continue for more than 30
consecutive days. In no event shall Overadvance Loans be required that would cause (1) the Total U.S. Revolver Outstandings to exceed the
Aggregate U.S. Revolver Commitments and (2) the Total Canadian Outstandings to exceed the Aggregate Canadian Commitments. Any
funding of an Overadvance Loan or sufferance of a U.S. Revolver Overadvance or a Canadian Overadvance shall not constitute a waiver by
the Applicable Agent or Applicable Lenders of the Event of Default caused thereby. In no event shall any Borrower or other Obligor be
deemed a beneficiary of this Section nor authorized to enforce any of its terms. Required Lenders may at any time revoke the Applicable
Agent’s authority to make further Overadvance Loans by written notice to Applicable Agent.
2.1.6. Protective Advances .
(a) U.S. Revolver Protective Advances . The Administrative Agent shall be authorized, in its
discretion, at any time that any conditions in Section 6 are not satisfied, to make U.S. Revolver Loans as Base Rate
Loans (“ U.S. Revolver Protective Advances ”), (i) up to an aggregate amount not to exceed 7.50% of the U.S.
Revolver Borrowing Base at the time such U.S. Revolver Loans are made, if
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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the Administrative Agent deems such Loans necessary or desirable to preserve or protect Collateral, or to enhance the
collectibility or repayment of Obligations, as long as such Loans do not cause the Total U.S. Revolver Outstandings
to exceed the Aggregate U.S. Revolver Commitments; or (ii) to pay any other amounts chargeable to Obligors under
any Loan Documents, including interest, costs, fees and expenses. Each U.S. Revolver Lender shall participate in
each U.S. Revolver Protective Advance made to the U.S. Borrowers on a Pro Rata basis. Required Lenders may at
any time revoke Administrative Agent’s authority to make further U.S. Revolver Protective Advances under clause (i)
by written notice to Administrative Agent. Absent such revocation, the Administrative Agent’s determination that
funding of a U.S. Revolver Protective Advance is appropriate shall be conclusive.
(b) Canadian Protective Advances . The Canadian Agent shall be authorized, in its discretion, at
any time that any conditions in Section 6 are not satisfied, to make Canadian Loans as BA Equivalent Rate Loans (“
Canadian Protective Advances ”), (i) up to an aggregate amount of the Canadian Dollar Equivalent of U.S.$5,000,000
outstanding at any time, if the Canadian Agent deems such Loans necessary or desirable to preserve or protect
Collateral, or to enhance the collectibility or repayment of Canadian Obligations, as long as such Loans do not cause
the Total Canadian Outstandings to exceed the Aggregate Canadian Commitments; or (ii) to pay any other amounts
chargeable to the Canadian Borrower under any Loan Documents, including interest, costs, fees and expenses. Each
Canadian Lender shall participate in each Canadian Protective Advance made to the Canadian Borrower on a Pro
Rata basis. Required Lenders may at any time revoke Canadian Agent’s authority to make further Canadian
Protective Advances under clause (i) by written notice to Canadian Agent. Absent such revocation, the Canadian
Agent’s determination that funding of a Canadian Protective Advance is appropriate shall be conclusive.
2.1.7. Increase in U.S. Revolver Commitments or Canadian Commitments . Borrowers may request an increase in U.S.
Revolver Commitments or Canadian Commitments from time to time upon notice to Administrative Agent, and, if applicable, Canadian
Agent, as long as (a) the requested increase is in a minimum amount of U.S. $10,000,000 and is offered on the same terms as existing U.S.
Revolver Commitments or Canadian Commitments, except for a closing (or similar) fee agreed to among Administrative Agent, Borrowers
and the Lenders providing such increase, (b) subject to clause (e) below, increases under this Section do not exceed U.S. $600,000,000 in the
aggregate and no more than three increases are made, (c) no reduction in U.S. Revolver Commitments or Canadian Commitments pursuant to
Section 2.1.4 has occurred prior to the requested increase, (d) to the extent any such increase is made to the Canadian Commitments, such
increase shall result in an increase in the U.S. Revolver Commitments in an amount such that the ratio of the U.S. Revolver Commitments to
the Canadian Commitments immediately following such increase is not less than the ratio that existed immediately prior to such increase, and
(e) no Default or Event of Default exists at the time of any such increase. Administrative Agent shall promptly notify the Applicable Lenders
of the requested increase and, within 10 Business Days thereafter (or such shorter period as agreed to by the Administrative Agent in its
discretion), each Applicable Lender shall notify Administrative Agent if and to what extent such Lender commits to increase its U.S.
Revolver Commitment and/or Canadian Commitment, as the case may be. Any Lender not responding within such period shall be deemed to
have declined an increase. If Lenders fail to commit to the full requested increase, Eligible Assignees may issue additional U.S. Revolver
Commitments or Canadian Commitments and become Lenders
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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hereunder upon entering into joinder documentation reasonably acceptable to Administrative Agent. Administrative Agent may allocate, in its
discretion, the increased U.S. Revolver Commitments or Canadian Commitments among committing Applicable Lenders and, if necessary,
Eligible Assignees. Provided the conditions set forth in Section 6.2 are satisfied, total U.S. Revolver Commitments or Canadian
Commitments shall be increased by the requested amount (or such lesser amount committed by Applicable Lenders and Eligible Assignees)
on a date agreed upon by Administrative Agent and Borrower Agent, but no later than 45 days following Borrowers’ increase request.
Administrative Agent, Canadian Agent (if applicable), Borrowers, and new and existing Applicable Lenders shall execute and deliver such
documents and agreements (including legal opinions) as Administrative Agent deems appropriate to evidence or in connection with the
increase in and allocations of U.S. Revolver Commitments or Canadian Commitments. On the effective date of an increase, (i) all outstanding
applicable Loans, applicable LC Obligations and other exposures under the U.S. Revolver Commitments or Canadian Commitments shall be
reallocated among Applicable Lenders, and settled by the Applicable Agent if necessary, in accordance with Applicable Lenders’ adjusted
shares of such U.S. Revolver Commitments or Canadian Commitments and (ii) Borrowers shall pay all fees and expenses incurred in
connection with such increase (including any breakage costs).
2.2. [Intentionally Omitted.]
2.3. Letter of Credit Facility .
2.3.1. Issuance of Letters of Credit . Until 30 days prior to the Applicable Commitment Termination Date, from time to
time from the Closing Date (x) each Issuing Bank with a “U.S. Letter of Credit Commitment” on Schedule 1.1(a) shall issue Letters of Credit
for the account of the U.S. Borrowers or their Subsidiaries denominated in U.S. Dollars and (y) each Issuing Bank with a “Canadian Letter of
Credit Commitment” on Schedule 1.1(a) shall issue Letters of Credit for the account of the Canadian Borrower or its Subsidiaries
denominated in Canadian Dollars or U.S. Dollars, in each case, on the terms set forth herein, including the following:
(a) Each Borrower acknowledges that each Issuing Bank’s issuance of any Letter of Credit is
conditioned upon such Issuing Bank’s receipt of an LC Application with respect to the requested Letter of Credit, as
well as such other instruments and agreements as such Issuing Bank may customarily require for issuance of a letter
of credit of similar type and amount. No Issuing Bank shall have any obligation to issue any Letter of Credit unless (i)
such Issuing Bank receives an LC Request and LC Application at least three Business Days prior to the requested
date of issuance; (ii) each U.S. LC Condition or Canadian LC Condition, as the case may be, is satisfied; and (iii) if a
Defaulting Lender exists, such Lender or Borrowers have entered into arrangements satisfactory to the Applicable
Agent and the applicable Issuing Bank to eliminate any Fronting Exposure associated with such Lender. If, in
sufficient time to act, the applicable Issuing Bank receives written notice from Required Lenders that a U.S. LC
Condition or Canadian LC Condition, as the case may be, has not been satisfied, such Issuing Bank shall not issue the
requested Letter of Credit. Prior to receipt of any such notice, no Issuing Bank shall be deemed to have knowledge of
any failure of U.S. LC Conditions or Canadian LC Conditions.
(b) Letters of Credit may be requested by a U.S. Borrower or Canadian Borrower to support
obligations incurred in the Ordinary Course of Business, or as otherwise approved by the Applicable Agent in its
Permitted
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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Discretion. The extension of any Letter of Credit shall be treated as the issuance of a new Letter of Credit, except that
delivery of a new LC Application shall be required at the discretion of the applicable Issuing Bank, and any such
extension may be for up to one year after the then-current date.
(c) Borrowers assume all risks of the acts, omissions or misuses of any Letter of Credit by the
beneficiary. In connection with issuance of any Letter of Credit, no Agent, Issuing Bank or Lender shall be
responsible for the existence, character, quality, quantity, condition, packing, value or delivery of any goods
purported to be represented by any Documents; any differences or variation in the character, quality, quantity,
condition, packing, value or delivery of any goods from that expressed in any Documents; the form, validity,
sufficiency, accuracy, genuineness or legal effect of any Documents or of any endorsements thereon; the time, place,
manner or order in which shipment of goods is made; partial or incomplete shipment of, or failure to ship, any goods
referred to in a Letter of Credit or Documents; any deviation from instructions, delay, default or fraud by any shipper
or other Person in connection with any goods, shipment or delivery; any breach of contract between a shipper or
vendor and a Borrower; errors, omissions, interruptions or delays in transmission or delivery of any messages, by
mail, cable, telegraph, telex, telecopy, e-mail, telephone or otherwise; errors in interpretation of technical terms; the
misapplication by a beneficiary of any Letter of Credit or the proceeds thereof; or any consequences arising from
causes beyond the control of any Issuing Bank, any Agent or any Lender, including any act or omission of a
Governmental Authority. The rights and remedies of each Issuing Bank under the Loan Documents shall be
cumulative. Each Issuing Bank shall be fully subrogated to the rights and remedies of each beneficiary whose claims
against Borrowers are discharged with proceeds of any Letter of Credit.
(d) In connection with its administration of and enforcement of rights or remedies under any
Letters of Credit or LC Documents, the applicable Issuing Bank shall be entitled to act, and shall be fully protected in
acting, upon any certification, documentation or communication in whatever form believed by such Issuing Bank, in
good faith, to be genuine and correct and to have been signed, sent or made by a proper Person. Each Issuing Bank
may consult with and employ legal counsel, accountants and other experts to advise it concerning its obligations,
rights and remedies, and shall be entitled to act upon, and shall be fully protected in any action taken in good faith
reliance upon, any advice given by such experts. Each Issuing Bank may employ agents and attorneys-in-fact in
connection with any matter relating to Letters of Credit or LC Documents, and shall not be liable for the negligence or
misconduct of agents and attorneys-in-fact selected with reasonable care.
Notwithstanding anything to the contrary herein, no Issuing Bank (other than (x) any Issuing Bank referred to in clause (i) of
the definition thereof or (y) any Issuing Bank that otherwise agrees so in writing during the life of this Agreement) shall be required
to issue any Letters of Credit other than standby letters of credit. In addition, no Issuing Bank shall be required to issue any Letter of
Credit if it is determined that the applicant or the account party is considered an “affiliate” of the Issuing Bank as such term is defined
in Regulation W of the Federal Reserve.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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2.3.2. Reimbursement; Participations .
(a) If any Issuing Bank honors any request for payment under a Letter of Credit, the applicable
Borrower or Borrowers shall pay to such Issuing Bank, within one (1) Business Day (“ Reimbursement Date ”), the
amount paid by such Issuing Bank under such Letter of Credit, together with interest at the interest rate for (i) Base
Rate Loans, in the case of Letters of Credit issued in U.S. Dollars and (ii) BA Equivalent Rate Loans, in the case of
Letters of Credit issued in Canadian Dollars, from the Reimbursement Date until payment by such Borrower or
Borrowers. Regardless of whether Borrower Agent or the Canadian Borrower submits a Notice of Borrowing, the
applicable Borrower or Borrowers shall be deemed to have requested a Borrowing of (x) Base Rate Loans, in the case
of Letters of Credit issued in U.S. Dollars and (y) BA Equivalent Rate Loans, in the case of Letters of Credit issued in
Canadian Dollars, in an amount necessary to pay all amounts due to the applicable Issuing Bank on any
Reimbursement Date and each U.S. Revolver Lender and Canadian Lender, as the case may be, agrees to fund its Pro
Rata share of such Borrowing whether or not the U.S. Revolver Commitments or Canadian Commitments, as the case
may be, have terminated, a U.S. Revolver Overadvance or Canadian Overadvance, as the case may be, exists or is
created thereby, or the conditions in Section 6 are satisfied. The obligation of the applicable Borrower or Borrowers
to reimburse any Issuing Bank for any payment made under a Letter of Credit shall be (i) absolute, unconditional,
irrevocable, and shall be performed strictly in accordance with the terms of this Agreement under any and all
circumstances whatsoever and irrespective of (a) any lack of validity or enforceability of any Letter of Credit or this
Agreement, or any term or provision therein, (b) any draft or other document presented under a Letter of Credit
proving to be forged, fraudulent or invalid in any respect or any statement therein being untrue or inaccurate in any
respect, (c) payment by the Issuing Bank under a Letter of Credit against presentation of a draft or other document
that does not comply with the terms of such Letter of Credit or (d) any other event or circumstance whatsoever,
whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or
equitable discharge of, or provide a right of setoff against, the Borrower’s obligations hereunder, (ii) joint and several
and (iii) paid without regard to any lack of validity or enforceability of any Letter of Credit or the existence of any
claim, setoff, defense or other right that Borrowers may have at any time against the beneficiary.
(b) (i) In the case of a Letter of Credit issued for the account or benefit of a U.S. Borrower or a
Subsidiary of a U.S. Borrower, each U.S. Revolver Lender and (ii) in the case of a Letter of Credit issued for the
account or benefit of the Canadian Borrower or a Subsidiary of the Canadian Borrower, each Canadian Lender,
hereby irrevocably and unconditionally purchases from the applicable Issuing Bank, without recourse or warranty, an
undivided Pro Rata interest and participation in all applicable LC Obligations relating to the Letter of Credit. Each
Issuing Bank is issuing Letters of Credit in reliance upon this participation. If any Issuing Bank makes any payment
under a Letter of Credit and the applicable Borrower or Borrowers do not reimburse such payment on the
Reimbursement Date, the Applicable Agent shall promptly notify the Applicable Lenders and each such Lender shall
promptly (within one Business Day) and unconditionally pay to the
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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Applicable Agent, for the benefit of such Issuing Bank, the Lender’s Pro Rata share of such payment. Upon request
by a Lender, the applicable Issuing Bank shall furnish copies of any Letters of Credit and LC Documents in its
possession at such time.
(c) The obligation of each Lender to make payments to the Applicable Agent for the account of the
applicable Issuing Bank in connection with such Issuing Bank’s payment under a Letter of Credit shall be absolute,
unconditional and irrevocable, not subject to any counterclaim, setoff, qualification or exception whatsoever, and
shall be made in accordance with this Agreement under all circumstances, irrespective of any lack of validity or
unenforceability of any Loan Documents; any draft, certificate or other document presented under a Letter of Credit
having been determined to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being
untrue or inaccurate in any respect; any waiver by Issuing Bank of a requirement that exists for its protection (and not
a Borrower’s protection) or that does not materially prejudice a Borrower; any honor of an electronic demand for
payment even if a draft is required; any payment of an item presented after a Letter of Credit’s expiration date if
authorized by the UCC, the PPSA or applicable customs or practices; or any setoff or defense that any Obligor may
have with respect to any Obligations. No Issuing Bank assumes any responsibility for any failure or delay in
performance or any breach by any Borrower or other Person of any obligations under any LC Documents. No Issuing
Bank makes to Lenders any express or implied warranty, representation or guaranty with respect to the Collateral, LC
Documents or any Obligor. No Issuing Bank shall be responsible to any Lender for any recitals, statements,
information, representations or warranties contained in, or for the execution, validity, genuineness, effectiveness or
enforceability of any LC Documents; the validity, genuineness, enforceability, collectibility, value or sufficiency of
any Collateral or the perfection of any Lien therein; or the assets, liabilities, financial condition, results of operations,
business, creditworthiness or legal status of any Obligor.
(d) No Issuing Bank Indemnitee shall be liable to any Lender or other Person for any action taken
or omitted to be taken in connection with any Letter of Credit or LC Document except as a result of its gross
negligence or willful misconduct. Any Issuing Bank may refrain from taking any action with respect to a Letter of
Credit until it receives written instructions (and in its discretion, appropriate assurances) from the Lenders.
2.3.3. Cash Collateral . If any LC Obligations, whether or not then due or payable, shall for any reason be outstanding at
any time (a) that an Event of Default exists, (b) that U.S. Revolver Availability or Canadian Availability, as the case may be, is less than zero,
(c) after the Applicable Commitment Termination Date, or (d) within five (5) Business Days prior to the Applicable Termination Date, then
the applicable Borrower or Borrowers shall, at the applicable Issuing Bank’s or the Applicable Agent’s request, Cash Collateralize the stated
amount of all outstanding Letters of Credit issued for the account or benefit of such Borrower or Borrowers and pay to each applicable
Issuing Bank the amount of all other outstanding LC Obligations of such Borrower or Borrowers owed to such Issuing Bank. The applicable
Borrower or Borrowers shall, on demand by the applicable Issuing Bank or the Applicable Agent from time to time, Cash Collateralize the
Fronting Exposure of any Defaulting Lender that has not been Cash Collateralized by such Defaulting Lender. If any Borrower fails to
provide any Cash Collateral as required hereunder, the Applicable Lenders may (and shall upon direction of the Applicable Agent) advance,
as U.S. Revolver Loans
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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or Canadian Loans, as the case may be, the amount of the Cash Collateral required (whether or not the U.S. Revolver Commitments or
Canadian Commitments, as the case may be, have terminated, a U.S. Revolver Overadvance or Canadian Overadvance, as the case may be,
exists or the conditions in Section 6 are satisfied).
2.3.4. Resignation of Issuing Banks . Any Issuing Bank may resign at any time upon notice to the Applicable Agent and
the applicable Borrower or Borrowers. On and after the effective date of such resignation, such Issuing Bank shall have no obligation to issue,
amend, renew, extend or otherwise modify any Letter of Credit, but shall continue to have all rights and other obligations of an Issuing Bank
hereunder relating to any Letter of Credit issued by such Issuing Bank prior to such date. To the extent requested by the Borrower Agent, the
Applicable Agent shall use commercially reasonable efforts to promptly appoint a replacement Issuing Bank, which, as long as no Default or
Event of Default exists, shall be reasonably acceptable to the applicable Borrower or Borrowers.
SECTION 3. INTEREST, FEES AND CHARGES
3.1. Interest .
3.1.1. Rates and Payment of Interest .
(a) The Obligations shall bear interest (i) if a Base Rate Loan, at the Base Rate in effect from time
to time, plus the Applicable Margin; (ii) if a Canadian Prime Rate Loan, at the Canadian Prime Rate in effect from
time to time, plus the Applicable Margin; (iii) if a LIBOR Loan, at LIBOR for the applicable Interest Period, plus the
Applicable Margin; (iv) if a BA Equivalent Rate Loan, at the BA Equivalent Rate for the applicable Interest Period,
plus the Applicable Margin; and (v) if any other Obligation (including, to the extent permitted by law, interest not
paid when due), at the Applicable Floating Rate in effect from time to time, plus the Applicable Margin. Interest shall
accrue from the date the Loan is advanced or the Obligation is incurred or payable, until paid by the applicable
Borrower or Borrowers. If a Loan is repaid on the same day made, one day’s interest shall accrue.
(b) During an Insolvency Proceeding with respect to any Borrower, or during any other Event of
Default if Administrative Agent or Required Lenders in their discretion so elect, Obligations shall bear interest at the
Default Rate (whether before or after any judgment). Each Borrower acknowledges that the cost and expense to
Agents and Lenders due to an Event of Default are difficult to ascertain and that the Default Rate is fair and
reasonable compensation for this.
(c) Interest accrued on the Loans shall be due and payable in arrears, (i) (x) with respect to any
Applicable Offered Rate Loan, the last day of the Interest Period applicable to such Loan; provided , however , that if
any Interest Period for an Applicable Offered Rate Loan exceeds three (3) months, interest accrued on such Loan
shall also be due and payable on the respective dates that fall every three (3) months after the beginning of such
Interest Period and (y) with respect any Applicable Floating Rate Loan, on the first day of each month; (ii) on any
date of prepayment, with respect to the principal amount of Loans being prepaid; and (iii) on the Applicable
Commitment Termination Date. Interest accrued on any other Obligations shall be due and payable as provided in the
Loan Documents and, if no payment date is specified, shall be due and payable on demand .
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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Notwithstanding the foregoing, interest accrued at the Default Rate shall be due and payable on demand .
3.1.2. Application of Applicable Offered Rate to Outstanding Loans .
(a)
Borrowers may on any Business Day,
subject to delivery of a Notice of
Conversion/Continuation, elect to convert any portion of Base Rate Loans to, or to continue any Applicable Offered
Rate Loan at the end of its Interest Period as, an Applicable Offered Rate Loan. During any Default or Event of
Default, the Administrative Agent may (and shall at the direction of Required Lenders) declare that no Loan may be
made, converted or continued as an Applicable Offered Rate Loan.
(b) Whenever Borrowers desire to convert or continue Loans as Applicable Offered Rate Loans,
Borrower Agent or the Canadian Borrower, as the case may be, shall give Administrative Agent or the Canadian
Agent, as the case may be, a Notice of Conversion/Continuation, no later than 11:00 a.m. at least two Business Days
before the requested conversion or continuation date. Promptly after receiving any such notice, the Applicable Agent
shall notify each Applicable Lender thereof. Each Notice of Conversion/Continuation shall be irrevocable, and shall
specify the amount of Loans to be converted or continued, the conversion or continuation date (which shall be a
Business Day), and the duration of the Interest Period (which shall be deemed to be 30 days if not specified). If, upon
the expiration of any Interest Period in respect of any Applicable Offered Rate Loans, (i) Borrower Agent shall have
failed to deliver a Notice of Conversion/Continuation, it shall be deemed to have elected to convert such Loans into
Base Rate Loans and (ii) the Canadian Borrower shall have failed to deliver a Notice of Conversion/Continuation, it
shall be deemed to have elected to continue such Loan as a BA Equivalent Rate Loan with an Interest Period of one
month. Administrative Agent does not warrant or accept responsibility for, nor shall it have any liability with respect
to, administration, submission or any other matter related to any rate described in the definition of LIBOR.
3.1.3. Interest Periods . In connection with the making, conversion or continuation of any Applicable Offered Rate Loans,
Borrower Agent or the Canadian Borrower, as the case may be, shall select an interest period (“ Interest Period ”) to apply, which interest
period shall be a period of one month, two months, three months, six months or, with the approval of all affected Lenders, twelve months;
provided , however , that:
(a) the Interest Period shall commence on the date the Loan is made or continued as, or converted
into, an Applicable Offered Rate Loan, and shall expire on the numerically corresponding day in the applicable
calendar month at its end;
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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(b) if any Interest Period commences on a day for which there is no corresponding day in the
applicable calendar month at its end or if such corresponding day falls after the last Business Day of such month, then
the Interest Period shall expire on the last Business Day of such month; and if any Interest Period would otherwise
expire on a day that is not a Business Day, the period shall expire on the next Business Day; and
(c) no Interest Period shall extend beyond the Applicable Termination Date.
3.1.4. Interest Rate Not Ascertainable . If the Applicable Agent shall determine that on any date for determining LIBOR or
the BA Equivalent Rate, adequate and fair means do not exist for ascertaining such rate on the basis provided herein, then the Applicable
Agent shall immediately notify the applicable Borrower or Borrowers of such determination. Until the Applicable Agent notifies the
applicable Borrower or Borrowers that such circumstance no longer exists, the obligation of the Applicable Lenders to make Applicable
Offered Rate Loans shall be suspended, and no further Loans may be converted into or continued as Applicable Offered Rate Loans.
3.2. Fees .
3.2.1. Unused Line Fees .
(a) From and after the Closing Date, the U.S. Borrowers shall pay to Administrative Agent, for the
Pro Rata benefit of U.S. Revolver Lenders, a fee equal to the Unused Line Fee Rate times the amount by which the
U.S. Revolver Commitments exceed the average daily Total U.S. Revolver Outstandings during any Fiscal Quarter.
Such fee shall be payable in arrears, on the first day of each calendar quarter after the Closing Date and on the U.S.
Revolver Commitment Termination Date. For the avoidance of doubt, the outstanding amount of Swingline Loans
made to the U.S. Borrowers shall not be counted toward or considered usage of the U.S. Revolver Commitments for
purposes of determining the unused line fee.
(b) From and after the Closing Date, the Canadian Borrower shall pay to Canadian Agent, for the
Pro Rata benefit of Canadian Lenders, a fee equal to the Unused Line Fee Rate times the amount by which the
Canadian Commitments exceed the average daily Total Canadian Outstandings during any Fiscal Quarter. Such fee
shall be payable in arrears, on the first day of each calendar quarter after the Closing Date and on the Canadian
Commitment Termination Date. For the avoidance of doubt, the outstanding amount of Swingline Loans made to the
Canadian Borrower shall not be counted toward or considered usage of the Canadian Commitments for purposes of
determining the unused line fee.
3.2.2. LC Facility Fees . The applicable Borrower or Borrowers shall pay (a) to the Applicable Agent, for the Pro Rata
benefit of the Applicable Lenders, a fee equal to the Applicable Margin in effect for Applicable Offered Rate Loans times the average daily
amount available to be drawn under Letters of Credit issued for the account or benefit of such Borrower or Borrowers, which fee shall be
payable monthly in arrears, on the first day of each month; (b) to the applicable Issuing Bank, for its own account, a fronting fee equal to
0.125% per annum on the amount available to be drawn under each Letter of Credit issued by it for the account or benefit of such Borrower
or Borrowers (or such other amount as may be mutually agreed by such Borrower(s) and such Issuing Bank), which fee shall be payable
monthly in arrears,
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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on the first day of each month; and (c) to the applicable Issuing Bank, for its own account, all customary charges associated with the issuance,
amending, negotiating, payment, processing, transfer and administration of Letters of Credit issued for the account or benefit of such
Borrower or Borrowers, which charges shall be paid as and when incurred. During an Event of Default, the fee payable under clause (a) shall,
subject to the Interest Act (Canada), be increased by 2% per annum.
3.2.3. Administrative Agent Fees . Borrowers shall pay to the Administrative Agent, for its own account, the fees described
in the Fee Letter and any other fee letter executed in connection with this Agreement.
3.3. Computation of Interest, Fees, Yield Protection .
3.3.1. All computations of interest for Applicable Offered Rate Loans shall be made on the basis of a year of 360 days and
actual days elapsed. All other computations of interest, as well as fees and other charges calculated on a per annum basis, shall be computed
for the actual days elapsed, based on a year of 365 days. For the purposes of the Interest Act (Canada), (a) whenever a rate of interest or fee
rate hereunder is calculated on the basis of a year (the “deemed year”) that contains fewer days than the actual number of days in the calendar
year of calculation, such rate of interest or fee rate shall be expressed as a yearly rate by multiplying such rate of interest or fee rate by the
actual number of days in the calendar year of calculation (365) and dividing it by the number of days in the deemed year, (b) the principle of
deemed reinvestment of interest shall not apply to any interest calculation hereunder and (c) the rates of interest stipulated herein are intended
to be nominal rates and not effective rates or yields. Each determination by any Agent of any interest, fees or interest rate hereunder shall be
final, conclusive and binding for all purposes, absent manifest error. All fees shall be fully earned when due and shall not be subject to rebate,
refund or proration. All fees payable under Section 3.2 are compensation for services and are not intended to be, and to the extent permitted
by Applicable Law shall not be deemed to be, interest or any other charge for the use, forbearance or detention of money. A certificate as to
amounts payable by Borrowers under Section 3.4, 3.6, 3.7, 3.9 or 5.9 , submitted to Borrower Agent or the Canadian Borrower, as the case
may be, by the Applicable Agent or the affected Lender, as applicable, shall be final, conclusive and binding for all purposes, absent manifest
error, and the applicable Borrower or Borrowers shall pay such amounts to the appropriate party within 10 days following receipt of the
certificate.
3.3.2. EACH OF THE OBLIGORS CONFIRMS THAT IT FULLY UNDERSTANDS AND IS ABLE TO CALCULATE
THE RATE OF INTEREST APPLICABLE TO EACH OF THE LOANS BASED ON THE METHODOLOGY FOR CALCULATING PER
ANNUM RATES PROVIDED FOR IN THIS AGREEMENT. Each Agent agrees that if requested in writing by the Borrower Agent, it will
calculate the nominal and effective per annum rate of interest on any Loan outstanding at the time of such request and provide such
information to the Borrower Agent promptly following such request; provided , that any error in any such calculation, or any failure to
provide such information on request, shall not relieve the Borrowers or any other Obligors of any of its obligations under this Agreement or
any other Loan Document, nor result in any liability to the Administrative Agent or any Lender. EACH OBLIGOR HEREBY
IRREVOCABLY AGREES NOT TO PLEAD OR ASSERT, WHETHER BY WAY OF DEFENSE OR OTHERWISE, IN ANY
PROCEEDING RELATING TO THE LOAN DOCUMENTS, THAT THE INTEREST PAYABLE UNDER THE LOAN DOCUMENTS
AND THE CALCULATION THEREOF HAS NOT BEEN ADEQUATELY DISCLOSED TO THE OBLIGORS WHETHER PURSUANT
TO SECTION 4 OF THE INTEREST ACT (CANADA) OR ANY OTHER APPLICABLE LAW OR LEGAL PRINCIPLE.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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3.4. Reimbursement Obligations . Borrowers shall reimburse Agents and Lenders for all Extraordinary Expenses. Borrowers
shall also reimburse Agents for all reasonable legal, accounting, appraisal, consulting, and other fees, costs and expenses incurred by them in
connection with (a) negotiation and preparation of any Loan Documents, including any amendment or other modification thereof; (b)
administration of and actions relating to any Collateral, Loan Documents and transactions contemplated thereby, including (i) any actions
taken to perfect or maintain priority of each Agent’s Liens on any Collateral, to maintain any insurance required hereunder or to verify
Collateral and (ii) the Platform or any other dedicated agency web page on the internet to distribute to the Lenders and to other investors or
potential investors any required documentation and financial information regarding the Loan Documents and the Loans; and (c) subject to the
limits of Section 10.1.1(b) , each inspection, audit or appraisal with respect to any Obligor or Collateral, whether prepared by any Agent’s
personnel or a third party. Legal, accounting and consulting fees may be charged to Borrowers by Agents’ professionals at their usual and
customary hourly rates for similar services, regardless of any reduced or alternative fee billing arrangements that any Agent, any Lender or
any of their Affiliates may have with such professionals with respect to this or any other transaction. Borrowers acknowledge that counsel
may provide the Administrative Agent with a benefit, such as a discount, credit or other accommodation, based on counsel’s overall
relationship with the Administrative Agent, including fees paid hereunder. If, for any reason (including inaccurate reporting on financial
statements or a Compliance Certificate), it is determined that a higher Applicable Margin should have applied to a period than was actually
applied, then the proper margin shall be applied retroactively and Borrowers shall immediately pay to the Applicable Agent, for the Pro Rata
benefit of the Applicable Lenders, an amount equal to the difference between the amount of interest and fees that would have accrued using
the proper margin and the amount actually paid. All amounts payable by Borrowers under this Section 3.4 shall be due on demand .
3.5. Illegality . If any Lender determines that any Applicable Law has made it unlawful, or that any Governmental Authority has
asserted that it is unlawful, for any Lender to perform any of its obligations hereunder to make, maintain, fund or charge applicable interest or
fees with respect to any Loans or Letters of Credit, or to determine or charge interest rates based upon any Applicable Offered Rate, or any
Governmental Authority has imposed material restrictions on the authority of such Lender to purchase or sell, or to take deposits of, U.S.
Dollars or Canadian Dollars in the London interbank market, any other relevant interbank market or the position of such Lender in such
market then, on notice thereof by such Lender to the Applicable Agent, any obligation of such Lender to perform such obligations to make,
maintain or fund such Loans or participate in such Letters of Credit (or to charge interest or fees with respect thereto), or to continue
Applicable Offered Rate Loans or to convert Base Rate Loans to LIBOR Loans shall be suspended until such Lender notifies the Applicable
Agent that the circumstances giving rise to such determination no longer exist. Upon delivery of such notice, Borrowers shall prepay the
applicable Loans, Cash Collateralize the applicable LC Obligations or, in the case of the U.S. Borrowers and if applicable, convert all LIBOR
Loans of such Lender to Base Rate Loans, either on the last day of the Interest Period therefor, if such Lender may lawfully continue to
maintain such LIBOR Loans to such day, or immediately, if such Lender may not lawfully continue to maintain such Base Rate Loans. Upon
any such prepayment or conversion, Borrowers shall also pay accrued interest on the amount so prepaid or converted.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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3.6. Inability to Determine Rates . The Applicable Agent will promptly notify Borrower Agent and Lenders if, in connection with
any request for a Borrowing of, or conversion to or continuation of, an Applicable Offered Rate Loan (a) such Agent determines that (i)
deposits (whether in U.S. Dollars or Canadian Dollars) are not being offered to banks in the applicable offshore interbank market for such
currency for the applicable amount and Interest Period of such Loan, or (ii) adequate and reasonable means do not exist for determining
LIBOR or the BA Equivalent Rate for the requested Interest Period, or (b) such Agent or Required Lenders determine for any reason that
LIBOR or the BA Equivalent Rate for the requested Interest Period does not adequately and fairly reflect the cost to such Lenders of funding
such Loan. Thereafter, the obligation of the Applicable Lenders to make or maintain LIBOR Loans or BA Equivalent Rate Loans, as the case
may be, shall be suspended until the Applicable Agent (upon instruction by Required Lenders) withdraws such notice. Upon receipt of such
notice, Borrower Agent or the Canadian Borrower, as the case may be, may revoke any pending request for a Borrowing of, conversion to or
continuation of an Applicable Offered Rate Loan (and, in the case of the revocation of a request for a continuation of a BA Equivalent Rate
Loan, the Canadian Borrower shall prepay such BA Equivalent Rate Loan) or, failing that, solely with respect to the Borrower Agent, the
Borrower Agent will be deemed to have submitted a request for a Base Rate Loan.
Notwithstanding anything to the contrary in this Agreement or any other Loan Documents, if the Administrative Agent determines
(which determination shall be conclusive absent manifest error), or the Borrower Agent or Required Lenders notify the Administrative Agent
(with, in the case of the Required Lenders, a copy to Borrower Agent) that the Borrower Agent or Required Lenders (as applicable) have
determined, that:
(a) adequate and reasonable means do not exist for ascertaining LIBOR for any requested Interest
Period, including, without limitation, because the LIBOR Screen Rate is not available or published on a current basis
and such circumstances are unlikely to be temporary; or
(b) the administrator of the LIBOR Screen Rate or a Governmental Authority having jurisdiction
over the Administrative Agent has made a public statement identifying a specific date after which LIBOR or the
LIBOR Screen Rate shall no longer be made available, or used for determining the interest rate of loans (such specific
date, the “ Scheduled Unavailability Date ”), or
(c) syndicated loans currently being executed, or that include language similar to that contained in
this Section, are being executed or amended (as applicable) to incorporate or adopt a new benchmark interest rate to
replace LIBOR,
then, reasonably promptly after such determination by the Administrative Agent or receipt by the Administrative Agent of such
notice, as applicable, the Administrative Agent and the Borrower Agent may amend this Agreement to replace LIBOR with an alternate
benchmark rate (including any mathematical or other adjustments to the benchmark (if any) incorporated therein), giving due consideration to
any evolving or then existing convention for similar U.S. Dollar denominated syndicated credit facilities for such alternative benchmarks (any
such proposed rate, a “ LIBOR Successor Rate ”), together with any proposed LIBOR Successor Rate Conforming Changes and any such
amendment shall become effective at 5:00 p.m. (New York time) on the fifth Business Day after the Administrative Agent shall have posted
such proposed amendment to all Lenders and the Borrower Agent unless, prior to such time, Lenders comprising the Required Lenders have
delivered to the Administrative Agent written notice that such Required Lenders do not accept such amendment.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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If no LIBOR Successor Rate has been determined and the circumstances under clause (a) above exist or the Scheduled Unavailability
Date has occurred (as applicable), the Administrative Agent will promptly so notify the Borrower Agent and each Lender. Thereafter, (x) the
obligation of the Lenders to make or maintain LIBOR Loans shall be suspended, (to the extent of the affected LIBOR Loans or Interest
Periods), and (y) the LIBOR component shall no longer be utilized in determining the Base Rate. Upon receipt of such notice, the Borrower
Agent may revoke any pending request for a Borrowing of, conversion to or continuation of LIBOR Loans (to the extent of the affected
LIBOR Loans or Interest Periods) or, failing that, will be deemed to have converted such request into a request for a Borrowing of Base Rate
Loans (subject to the foregoing clause (y)) in the amount specified therein.
Notwithstanding anything else herein, any definition of LIBOR Successor Rate shall provide that in no event shall such LIBOR
Successor Rate be less than zero for purposes of this Agreement.
3.7. Increased Costs; Capital Adequacy .
3.7.1. Increased Costs Generally . If any Change in Law shall:
(a) impose, modify or deem applicable any reserve, liquidity, special deposit, compulsory loan,
insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or
participated in by, any Lender (except any reserve requirement reflected in LIBOR) or any Issuing Bank;
(b) subject any Recipient to Taxes (other than (i) Indemnified Taxes, (ii) Taxes described in
clauses (b) through (d) of the definition of Excluded Taxes, and (iii) Connection Income Taxes) with respect to any
Loan, Letter of Credit, U.S. Revolver Commitment, Canadian Commitment or other obligations, or its deposits,
reserves, other liabilities or capital attributable thereto; or
(c) impose on any Lender, any Issuing Bank or any interbank market any other condition, cost or
expense affecting any Loan, Loan Document, Letter of Credit, participation in LC Obligations, or U.S. Revolver
Commitment or Canadian Commitment;
and the result thereof shall be to increase the cost to such Lender of making or maintaining any Loan, U.S. Revolver Commitment or
Canadian Commitment, or converting to or continuing any interest option for a Loan, or to increase the cost to such Lender or such Issuing
Bank of participating in, issuing or maintaining any Letter of Credit (or of maintaining its obligation to participate in or to issue any Letter of
Credit), or to reduce the amount of any sum received or receivable by such Lender or such Issuing Bank hereunder (whether of principal,
interest or any other amount) then, upon request of such Lender or such Issuing Bank, the applicable Borrower or Borrowers will pay to such
Lender or such Issuing Bank, as applicable, such additional amount or amounts as will compensate such Lender or such Issuing Bank, as
applicable, for such additional costs incurred or reduction suffered.
3.7.2. Capital Requirements . If any Lender or any Issuing Bank determines that any Change in Law affecting such Lender
or such Issuing Bank or any Lending Office of such Lender or such Lender’s or such Issuing Bank’s holding company, if any, regarding
capital requirements has or would have the effect of reducing the rate of return on such Lender’s, such Issuing Bank’s or such holding
company’s capital as a consequence of this Agreement, or such Lender’s or such Issuing Bank’s U.S. Revolver Commitments, Canadian
Commitments, Loans, Letters of Credit or participations in LC Obligations, to a
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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level below that which such Lender, such Issuing Bank or such holding company could have achieved but for such Change in Law (taking
into consideration such Lender’s, such Issuing Bank’s and such holding company’s policies with respect to capital adequacy), then from time
to time the applicable Borrower or Borrowers will pay to such Lender or such Issuing Bank, as the case may be, such additional amount or
amounts as will compensate it or its holding company for any such reduction suffered.
3.7.3. Compensation . Failure or delay on the part of any Lender or any Issuing Bank to demand compensation pursuant to
this Section shall not constitute a waiver of its right to demand such compensation, but Borrowers shall not be required to compensate a
Lender or an Issuing Bank for any increased costs incurred or reductions suffered more than nine months prior to the date that the Lender or
the Issuing Bank notifies Borrower Agent or the Canadian Borrower, as the case may be, of the Change in Law giving rise to such increased
costs or reductions and of such Lender’s or such Issuing Bank’s intention to claim compensation therefor (except that, if the Change in Law
giving rise to such increased costs or reductions is retroactive, then the nine-month period referred to above shall be extended to include the
period of retroactive effect thereof).
3.8. Mitigation . If any Lender gives a notice under Section 3.5 or requests compensation under Section 3.7 , or if any Borrower is
required to pay additional amounts with respect to a Lender under Section 5.9 , then such Lender shall use reasonable efforts to designate a
different Lending Office or to assign its rights and obligations hereunder to another of its offices, branches or Affiliates, if, in the judgment of
such Lender, such designation or assignment (a) would eliminate the need for such notice or reduce amounts payable or to be withheld in the
future, as applicable; and (b) would not subject the Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous
to it or unlawful. Borrowers shall pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or
assignment.
3.9. Funding Losses . If for any reason (other than default by a Lender) (a) any Borrowing of, or conversion to or continuation of,
an Applicable Offered Rate Loan does not occur on the date specified therefor in a Notice of Borrowing or Notice of
Conversion/Continuation (whether or not withdrawn), (b) any repayment or conversion of an Applicable Offered Rate Loan occurs on a day
other than the end of its Interest Period, (c) the applicable Borrower or Borrowers fail to repay an Applicable Offered Rate Loan when
required hereunder (or any notice of prepayment is rescinded or withdrawn), or (d) a Lender (other than a Defaulting Lender) is required to
assign an Applicable Offered Rate Loan prior to the end of its Interest Period pursuant to Section 13.4 , then the applicable Borrower or
Borrowers shall pay to the Applicable Agent its customary administrative charge and to each Applicable Lender all resulting losses and
expenses, including loss of anticipated profits and any loss or expense arising from liquidation or redeployment of funds or from fees payable
to terminate deposits of matching funds. Lenders shall not be required to purchase U.S. Dollar or Canadian Dollar deposits in any interbank
or offshore U.S. Dollar or Canadian Dollar market to fund any Applicable Offered Rate Loan, but this Section shall apply as if each Lender
had purchased such deposits.
3.10. Maximum Interest . Notwithstanding anything to the contrary contained in any Loan Document, the interest paid or agreed
to be paid under the Loan Documents shall not exceed the maximum rate of non-usurious interest permitted by Applicable Law (“ maximum
rate ”). If any Agent or any Lender shall receive interest in an amount that exceeds the maximum rate, the excess interest shall be applied to
the principal of the Obligations or, if it exceeds such unpaid principal, refunded to Borrowers. In determining whether the interest contracted
for, charged or received by an Agent or a Lender exceeds the maximum rate, such Person may, to the extent permitted by Applicable Law, (a)
characterize any payment that is not principal as an expense, fee or premium rather than interest; (b) exclude voluntary prepayments and the
effects thereof; and (c) amortize, prorate, allocate and spread in equal or unequal parts the total amount of interest throughout
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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the contemplated term of the Obligations hereunder. In addition to the foregoing, if any provision of this Agreement or of any of the other
Loan Documents would obligate the Canadian Borrower or any other Obligor to make any payment of “interest” (as defined in Section 347
(the “ Criminal Code Section ”) of the Criminal Code (Canada)) or other amount payable to any Canadian Lender in an amount or calculated
at a rate that would exceed the effective annual rate of interest lawfully permitted under the Criminal Code Section on the “credit advanced”
(as defined in the Criminal Code Section) or would otherwise be prohibited by law or would result in a receipt by such Canadian Lender of
“interest” at a “criminal rate” (as such terms are defined in the Criminal Code Section) then, notwithstanding such provisions, such amount or
rate shall be deemed to have been adjusted with retroactive effect to the maximum amount or rate of interest, as the case may be, as would not
be so prohibited by law or so result in a receipt by such Canadian Lender of interest at a criminal rate, such adjustment to be effected, to the
extent necessary, as follows: (i) first, by reducing the amount or rate of interest required to be paid to such Canadian Lender under this
Agreement, and (ii) thereafter, by reducing any fees, commissions, premiums and other amounts required to be paid to such Canadian Lender
which would constitute “interest” for purposes of the Criminal Code Section. Any amount or rate of interest referred to in this Agreement
shall be determined in accordance with GAAP as an effective annual rate of interest over the term that the applicable Loan remains
outstanding on the assumption that any charges, fees or expenses that fall within the meaning of “interest” under the Criminal Code Section
shall, if they relate to a specific period of time, be pro-rated over that period of time and otherwise be pro-rated over the period from the
Closing Date to the Applicable Termination Date and, in the event of a dispute, a certificate of a Fellow of the Canadian Institute of Actuaries
appointed by Applicable Agent shall be conclusive, absent manifest error, for the purposes of such determination.
SECTION 4. LOAN ADMINISTRATION
4.1. Manner of Borrowing and Funding Loans .
4.1.1. Notice of Borrowing .
(a) Whenever (x) U.S. Borrowers desire funding of a Borrowing of U.S. Revolver Loans, Borrower
Agent shall give Administrative Agent, and (y) Canadian Borrower desires funding of a Borrowing of Canadian
Loans, Canadian Borrower shall give Canadian Agent, a Notice of Borrowing. Such notice must be received by the
Applicable Agent no later than 11:00 a.m. (i) on the Business Day of the requested funding date, in the case of Base
Rate Loans, and (ii) at least two Business Days prior to the requested funding date, in the case of Applicable Offered
Rate Loans. Notices received after 11:00 a.m. shall be deemed received on the next Business Day. Each Notice of
Borrowing shall be irrevocable and shall specify (A) the amount of the Borrowing, (B) the requested funding date
(which must be a Business Day), (C) whether the Borrowing is to be made as Base Rate Loans or LIBOR Loans, in
the case of U.S. Revolver Loans, and (D) in the case of LIBOR Loans or BA Equivalent Rate Loans, the duration of
the applicable Interest Period (which shall be deemed to be one month if not specified).
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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(b) Unless payment is otherwise timely made by Borrowers, the becoming due of any Obligations
(whether principal, interest, fees or other charges, including Extraordinary Expenses, LC Obligations, Cash Collateral
and Secured Bank Product Obligations) shall be deemed to be a request for Base Rate Loans on the due date, in the
amount of such Obligations. The proceeds of such Loans shall be disbursed as direct payment of the relevant
Obligation. In addition, the Applicable Agent may, at its option, charge such Obligations against any operating,
investment or other account of a U.S. Borrower or Canadian Borrower, as the case may be, maintained with such
Agent or any of its Affiliates.
(c) If any Borrower maintains any disbursement account with any Agent or any Affiliate of any
Agent, then presentation for payment of any Payment Item when there are insufficient funds to cover it shall be
deemed to be a request for a Base Rate Loan, in the case of the U.S. Borrowers, or a BA Equivalent Rate Loan, in the
case of the Canadian Borrower, on the date of such presentation, in the amount of the Payment Item. The proceeds of
such Loan may be disbursed directly to the disbursement account.
4.1.2. Fundings by Lenders . Each Applicable Lender shall timely honor its U.S. Revolver Commitment or Canadian
Commitment, as the case may be, by funding its Pro Rata share of each Borrowing of Loans that is properly requested hereunder. Except for
Borrowings to be made as Swingline Loans, the Applicable Agent shall endeavor to notify the Applicable Lenders of each Notice of
Borrowing (or deemed request for a Borrowing) by 12:00 noon on the proposed funding date for Base Rate Loans or by 3:00 p.m. at least two
Business Days before any proposed funding of Applicable Offered Rate Loans. Each Applicable Lender shall fund to the Applicable Agent
such Lender’s Pro Rata share of the Borrowing to the account specified by the Applicable Agent in immediately available funds not later than
2:00 p.m. on the requested funding date, unless the Applicable Agent’s notice is received after the times provided above, in which case the
Applicable Lender shall fund its Pro Rata share by 11:00 a.m. on the next Business Day. Subject to its receipt of such amounts from the
Applicable Lenders, the Applicable Agent shall disburse the proceeds of the Loans as directed by Borrower Agent or the Canadian Borrower,
as the case may be. Unless the Applicable Agent shall have received (in sufficient time to act) written notice from a Lender that it does not
intend to fund its Pro Rata share of a Borrowing, the Applicable Agent may assume that such Lender has deposited or promptly will deposit
its share with such Agent, and such Agent may disburse a corresponding amount to U.S. Borrowers or the Canadian Borrower, as the case
may be. If a Lender’s share of any Borrowing or of any settlement pursuant to Section 4.1.3(b) is not received by the Applicable Agent, then
the applicable Borrower or Borrowers agree to repay to the Applicable Agent on demand the amount of such share, together with interest
thereon from the date disbursed until repaid, at the rate applicable to the Borrowing. Subject to Section 3.8 , a Lender or Issuing Bank may
fulfill its obligations under Loan Documents through one or more Lending Offices, and this shall not affect any obligation of Obligors under
the Loan Documents or with respect to any Obligations.
4.1.3. Swingline Loans; Settlement .
(a) Subject to the terms and conditions set forth herein, on any Business Day from and after the
Closing until the Business Day prior to the Maturity Date, (i) the U.S. Swingline Lender shall advance Swingline
Loans to the U.S. Borrowers up to an aggregate outstanding amount equal to U.S. $100,000,000 (and notwithstanding
the fact that such Swingline Loans, when aggregated with the Total U.S. Revolver Outstandings of such Person in its
separate capacity as a U.S.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Revolver Lender, may exceed the amount of the U.S. Revolver Commitment of the U.S. Swingline Lender); provided
that, (x) after giving effect to any such Swingline Loan, the Total U.S. Revolver Outstandings at such time (including
the requested Swingline Loan) would not exceed the U.S. Revolver Borrowing Base and (y) subject to the
immediately preceding parenthetical, the Total U.S. Revolver Outstandings and other exposure with respect to the
U.S. Revolver Commitments (including its Pro Rata purchase of participations in Swingline Loans made by the U.S.
Swingline Lender) of any U.S. Revolver Lender shall not exceed its U.S. Revolver Commitment and (ii) the Canadian
Swingline Lender shall advance Swingline Loans to the Canadian Borrower up to an aggregate outstanding amount
equal to U.S. $3,500,000 (and notwithstanding the fact that such Swingline Loans, when aggregated with the Total
Canadian Outstandings of the Canadian Swingline Lender, may exceed the amount of the Canadian Commitment of
such Person in its separate capacity as a Canadian Lender), unless, in either case, the funding is specifically required
to be made by the Canadian Lenders hereunder; provided , that (x) after giving effect to any such Swingline Loan, the
Total Canadian Outstandings at such time (including the requested Swingline Loan) would not exceed the Canadian
Borrowing Base and (y) subject to the immediately preceding parenthetical, the Total Canadian Outstandings and
other exposure with respect to the Canadian Commitments (including its Pro Rata purchase of participations in
Swingline Loans made by the Canadian Swingline Lender) of any Canadian Lender shall not exceed its Canadian
Commitment; provided , further , that notwithstanding the foregoing, (i) after giving effect to any Swingline Loan the
aggregate outstanding amount of all Swingline Loans shall not exceed U.S. $100,000,000 at any time, (ii) no
Borrower shall use the proceeds of any Swingline Loan to refinance any outstanding Swingline Loan and (iii) no
Swingline Lender shall be under any obligation to make any Swingline Loan if it shall determine (which
determination shall be conclusive and binding absent manifest error) that there is, or after making such Swingline
Loan there may be, Fronting Exposure.
(b) Each Swingline Loan to the U.S. Borrowers shall constitute a Base Rate Loan and each
Swingline Loan to the Canadian Borrower shall constitute a Canadian Prime Rate Loan for all purposes, except that
payments thereon shall be made to the U.S. Swingline Lender or Canadian Swingline Lender, as applicable, for its
own account until Lenders have funded their participations therein as provided below. The obligation of Borrowers to
repay Swingline Loans shall be evidenced by the records of the applicable Swingline Lender and need not be
evidenced by any promissory note.
(c) Settlement among the Applicable Lenders and the applicable Swingline Lender with respect to
Swingline Loans and other Loans shall take place on a date determined from time to time by such Swingline Lender
(but at least weekly), on a Pro Rata basis in accordance with the Settlement Report delivered by the applicable
Swingline Lender to the Applicable Lenders. Between settlement dates, the applicable Swingline Lender may in its
discretion, if it is an Agent, apply payments on Loans to Swingline Loans, regardless of any designation by any
Borrower or any provision herein to the contrary. Each Lender hereby purchases, without recourse or warranty, an
undivided Pro Rata participation in all Swingline Loans outstanding from time to time until settled. If a Swingline
Loan
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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cannot be settled among Lenders, whether due to an Obligor’s Insolvency Proceeding or for any other reason, each
Lender shall pay the amount of its participation in the Loan to the applicable Swingline Lender, in immediately
available funds, within one Business Day after the applicable Swingline Lender’s request therefor. Lenders’
obligations to make settlements and to fund participations are absolute, irrevocable and unconditional, without offset,
counterclaim or other defense, and whether or not the U.S. Revolver Commitments or Canadian Commitments, as the
case may be, have terminated, a U.S. Revolver Overadvance or Canadian Overadvance exists or the conditions in
Section 6 are satisfied.
(d) Each Borrowing of Swingline Loans shall be made upon the applicable U.S. Borrower's or
Canadian Borrower’s irrevocable notice to the U.S. Swingline Lender or Canadian Swingline Lender, as applicable,
in each case with a copy to the Administrative Agent, which may be given by telephone. Each such notice must be
received by the Persons in the preceding sentence not later than 1:00 p.m. on the requested borrowing date, and shall
specify (i) the amount to be borrowed, which shall be a minimum of $100,000 (and any amount in excess thereof
shall be an integral multiple of $25,000), and (ii) the requested borrowing date, which shall be a Business Day. Each
such telephonic notice must be confirmed promptly by delivery to the U.S. Swingline Lender or Canadian Swingline
Lender, as applicable, of a written Notice of Borrowing. Promptly after receipt by the U.S. Swingline Lender or
Canadian Swingline Lender, as applicable, of any telephonic notice of Borrowing of Swingline Loans, the U.S.
Swingline Lender or Canadian Swingline Lender, as applicable, will, provided , that all applicable conditions in this
Section 4.1.3 and Section 6.3 are satisfied or waived in accordance with terms hereof, not later than 3:00 p.m. on the
borrowing date specified in such notice, make the amount of its Swingline Loans available to the U.S. Borrowers or
the Canadian Borrower, as applicable.
(e) Any Swingline Lender may resign at any time upon notice to the Applicable Agent and the
applicable Borrower or Borrowers. On and after the effective date of such resignation, such Swingline Lender shall
have no obligation to make Swingline Loans, but shall continue to have all rights and other obligations of a Swingline
Lender hereunder relating to any Swingline Loan issued by such Swingline Lender prior to such date. To the extent
requested by the Borrower Agent, the applicable Swingline Lender shall use commercially reasonable efforts to
promptly appoint a replacement Swingline Lender which, as long as no Default or Event of Default exists, shall be
reasonably acceptable to the applicable Borrower or Borrowers.
4.1.4. Notices . Borrowers may request, convert or continue Loans, select interest rates, and transfer funds based on
telephonic or e-mailed instructions to the Applicable Agent. Borrowers shall confirm each such request by prompt delivery to the Applicable
Agent of a Notice of Borrowing or Notice of Conversion/Continuation, if applicable, but if such notice differs materially from the action
taken by the Applicable Agent or the Applicable Lenders pursuant to the telephonic or e-mailed instructions from Borrowers, the records of
such Agent and such Lenders shall govern. No Agent or Lender shall have any liability for any loss suffered by a Borrower as a result of any
Agent or any Lender acting upon its understanding of telephonic or e-mailed instructions from a person believed in good faith by any Agent
or any Lender to be a person authorized to give such instructions on a Borrower’s behalf.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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4.2. Defaulting Lender .
4.2.1. Reallocation of Pro Rata Share; Amendments . For purposes of determining Lenders’ obligations or rights to fund,
participate in or receive collections with respect to Loans and Letters of Credit (including existing Swingline Loans, Protective Advances and
LC Obligations), each Agent may exclude the U.S. Revolver Commitments, Canadian Commitments and Loans of a Defaulting Lender from
the calculation of Pro Rata shares, it being understood, for the avoidance of doubt, that any such calculation relating to a Non-Defaulting
Lender’s obligations to fund and participate in respect of Loans and Letters of Credit shall not cause (a) the U.S. Revolver Loans and
participation in U.S. LC Obligations of any such Non-Defaulting Lender that is a U.S. Revolver Lender to exceed such Non-Defaulting
Lender’s U.S. Revolver Commitment, or (b) the Canadian Loans and participation in Canadian LC Obligations of any such Non-Defaulting
Lender that is a Canadian Lender to exceed such Non-Defaulting Lender’s Canadian Commitment. A Defaulting Lender shall have no right to
vote on any amendment, waiver or other modification of a Loan Document, except as provided in Section 14.1.1(c) .
4.2.2. Payments; Fees . Each Agent may, in its discretion, receive and retain any amounts payable to a Defaulting Lender
under the Loan Documents, and a Defaulting Lender shall be deemed to have assigned to such Agent such amounts until all Obligations
owing to such Agent, non-Defaulting Lenders and other Secured Parties have been paid in full. Each Agent may apply such amounts to the
Defaulting Lender’s defaulted obligations, use the funds to Cash Collateralize such Lender’s Fronting Exposure, or readvance the amounts to
Borrowers hereunder. A Lender shall not be entitled to receive any fees accruing hereunder during the period in which it is a Defaulting
Lender, and the unfunded portion of its U.S. Revolver Commitment and/or Canadian Commitment shall be disregarded for purposes of
calculating the unused line fee under Section 3.2.1 . To the extent any LC Obligations owing to a Defaulting Lender are reallocated to other
Lenders, Letter of Credit fees attributable to such LC Obligations under Section 3.2.2 shall be paid to such other Lenders. The Applicable
Agent shall be paid all Letter of Credit fees attributable to LC Obligations that are not so reallocated.
4.2.3. Reallocation of Pro Rata Shares to Reduce Fronting Exposure . All or any part of such Defaulting Lender’s
participation in LC Obligations and Swingline Loans shall be reallocated among the Non-Defaulting Lenders in accordance with their
respective Pro Rata shares (calculated without regard to such Defaulting Lender’s U.S. Revolver Commitment and/or Canadian Commitment,
as applicable) but only to the extent that (a) the conditions set forth in Section 6.2 are satisfied at the time of such reallocation (and, unless the
Borrower Agent shall have otherwise notified the Administrative Agent at such time, the Borrowers shall be deemed to have represented and
warranted that such conditions are satisfied at such time), and (b) such reallocation does not cause (i) the U.S. Revolver Loans and
participation in U.S. LC Obligations of any Non-Defaulting Lender that is a U.S. Revolver Lender to exceed such Non-Defaulting Lender’s
U.S. Revolver Commitment, or (ii) the Canadian Loans and participation in Canadian LC Obligations of any Non-Defaulting Lender that is a
Canadian Lender to exceed such Non-Defaulting Lender’s Canadian Commitment. Subject to Section 14.20, no reallocation hereunder shall
constitute a waiver or release of any claim of any party hereunder against a Defaulting Lender arising from that Lender having become a
Defaulting Lender, including any claim of a Non-Defaulting Lender as a result of such Non-Defaulting Lender’s increased exposure
following such reallocation.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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4.2.4. Cash Collateral, Repayment of Swingline Loans . If the reallocation described in Section 4.2.3 above cannot, or can
only partially, be effected, the Borrowers shall, subject to Section 4.5 , without prejudice to any right or remedy available to them hereunder
or under Applicable Law, (a) first, prepay Swingline Loans in an amount equal to the Fronting Exposure of the Lenders holding Swingline
Loans and (b) second, Cash Collateralize the Issuing Banks’ Fronting Exposure in accordance with the procedures set forth in Section 2.3.3 .
4.2.5. Status; Cure . The Applicable Agent may determine in its discretion that a Lender constitutes a Defaulting Lender
and the effective date of such status shall be conclusive and binding on all parties, absent manifest error. Borrowers, the Applicable Agent
and the applicable Issuing Bank may agree in writing that a Lender is no longer a Defaulting Lender, whereupon Pro Rata shares shall be
reallocated without exclusion of the reinstated Lender’s U.S. Revolver Commitments, Canadian Commitments and Loans, and all outstanding
Loans, LC Obligations and other exposures under the U.S. Revolver Commitments and Canadian Commitments shall be reallocated among
the Applicable Lenders and settled by the Applicable Agent (with appropriate payments by the reinstated Lender, including payment of any
breakage costs for reallocated LIBOR Loans) in accordance with the readjusted Pro Rata shares. Unless expressly agreed by Borrowers, the
Applicable Agent and the applicable Issuing Bank, no reallocation of Commitments and Loans to non-Defaulting Lenders and no
reinstatement of a Defaulting Lender shall constitute a waiver or release of claims against such Lender. The failure of any Lender to fund a
Loan, to make a payment in respect of LC Obligations or otherwise to perform its obligations hereunder shall not relieve any other Lender of
its obligations, and no Lender shall be responsible for default by another Lender.
4.3. Number and Amount of Applicable Offered Rate Loans; Determination of Rate . Each Borrowing of Applicable Offered
Rate Loans when made shall be in a minimum amount of U.S.$1,000,000, plus any increment of U.S.$1,000,000 in excess thereof. No more
than 16 Borrowings of Applicable Offered Rate Loans may be outstanding at any time, and all Applicable Offered Rate Loans having the
same length and beginning date of their Interest Periods shall be aggregated together and considered one Borrowing for this purpose. Upon
determining LIBOR or the BA Equivalent Rate, as the case may be, for any Interest Period requested by U.S. Borrowers or the Canadian
Borrower, as the case may be, the Applicable Agent shall promptly notify the applicable Borrower or Borrowers thereof by telephone or
electronically and, if requested by such Borrower or Borrowers, shall confirm any telephonic notice in writing.
4.4. Borrower Agent . Each Borrower hereby designates UNFI (“ Borrower Agent ”) as its representative and agent for all
purposes under the Loan Documents, including requests for Loans and Letters of Credit, designation of interest rates, delivery or receipt of
communications, preparation and delivery of Borrowing Base Certificates and financial reports, receipt and payment of Obligations, requests
for waivers, amendments or other accommodations, actions under the Loan Documents (including in respect of compliance with covenants),
and all other dealings with any Agent, any Issuing Bank or any Lender. Borrower Agent hereby accepts such appointment. Each Agent and
Lenders shall be entitled to rely upon, and shall be fully protected in relying upon, any notice or communication (including any notice of
borrowing) delivered by Borrower Agent on behalf of any Borrower. Each Agent and Lenders may give any notice or communication with a
Borrower hereunder to Borrower Agent on behalf of such Borrower. Each Agent, Issuing Bank and Lender shall have the right, in its
discretion, to deal exclusively with Borrower Agent for any or all purposes under the Loan Documents. Each Borrower agrees that any notice,
election, communication, representation, agreement or undertaking made on its behalf by Borrower Agent shall be binding upon and
enforceable against it.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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4.5. One Obligation; Limitation on Obligations of Canadian Borrower . The Loans, LC Obligations and other Obligations
constitute one general obligation of U.S. Borrowers and are secured by the Applicable Agent’s Lien on all Collateral; provided , however ,
that each Agent and each Lender shall be deemed to be a creditor of, and the holder of a separate claim against, each U.S. Borrower to the
extent of any Obligations jointly or severally owed by such U.S. Borrower. The Canadian Loans, Canadian LC Obligations and other
Canadian Obligations constitute one general obligation of the Canadian Borrower and are secured by Canadian Agent’s Lien on all Collateral
owned by Canadian Borrower. Notwithstanding anything set forth in this Agreement or any other Loan Document to the contrary, the
Canadian Borrower shall not at any time be liable, directly or indirectly, for any portion of the Obligations other than the Canadian
Obligations.
4.6. Effect of Termination . On the effective date of any termination of the Aggregate Commitments, all Obligations shall be
immediately due and payable, and each Secured Bank Product Provider may terminate its Bank Products in accordance with the terms
thereof. Until Full Payment of the Obligations, all undertakings of Borrowers contained in the Loan Documents shall continue, and the
Applicable Agent shall retain its Liens in the Collateral and all of its rights and remedies under the Loan Documents. No Agent shall be
required to terminate its Liens unless it receives Cash Collateral or a written agreement, in each case satisfactory to it, protecting Agents and
Lenders from the dishonor or return of any Payment Items previously applied to the Obligations. Sections 3.4, 3.7, 3.9, 5.5, 5.9, 5.10 , 12,
14.2 , this Section, and each indemnity or waiver given by an Obligor or Lender in any Loan Document, shall survive Full Payment of the
Obligations.
SECTION 5. PAYMENTS
5.1. General Payment Provisions .
5.1.1. Except with respect to principal of and interest on Loans denominated in Canadian Dollars, all payments of
Obligations shall be made in U.S. Dollars, without offset, counterclaim or defense of any kind, free of (and without deduction for) any Taxes,
except as required by Applicable Law, and in immediately available funds, not later than 12:00 noon on the due date. If any payment to be
made by any Borrower shall come due on a day other than a Business Day, payment shall be made on the next following Business Day, and
such extension of time shall be reflected in computing interest or fees, as the case may be. Except as otherwise expressly provided herein, all
payments by the Borrowers hereunder with respect to principal and interest on Loans denominated in Canadian Dollars shall be made to the
Canadian Agent, for the account of the Applicable Lenders to which such payment is owed, in Canadian Dollars in immediately available
funds, not later than 12:00 noon on the due date. Any payment after such time shall be deemed made on the next Business Day. Without
limiting the generality of the foregoing, the Administrative Agent may require that any payments due under this Agreement be made in the
United States. If, for any reason, any Borrower is prohibited by any law from making any required payment hereunder in Canadian Dollars,
such Borrower shall make such payment in U.S. Dollars in the U.S. Dollar Equivalent of the Canadian Dollar payment amount. Any payment
of an Applicable Offered Rate Loan prior to the end of its Interest Period shall be accompanied by all amounts due under Section 3.9 . Any
prepayment of Loans shall be applied first to Applicable Floating Rate Loans and then to Applicable Offered Rate Loans.
5.1.2. Notwithstanding anything to the contrary in any Loan Document, (a) payments (or portions thereof) made by a CFC
or a FSHCO or, in either case, a Subsidiary thereof, pursuant to any provision of any Loan Document shall not, in any event, be applied to
any U.S. Obligation and (b) no proceeds of Collateral that comprises the assets of a CFC or FSHCO or, in either case, a Subsidiary thereof,
shall be
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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used to satisfy any U.S. Obligation and (c) no more than 65% of the voting Equity Interests of a CFC or FSHCO, in each case, shall be used
to satisfy any U.S. Obligation.
5.2. Repayment of Loans . Loans shall be due and payable in full on the Applicable Termination Date, unless payment is sooner
as required hereunder. The Borrowers may, upon notice to the Administrative Agent, at any time or from time to time voluntarily prepay any
Loans in whole or in part without premium or penalty; provided , that (1) such notice must be received by the Administrative Agent not later
than 1:00 p.m. (A) two Business Days prior to any date of prepayment of Applicable Offered Rate Loans and (B) on the Business Day of the
date of prepayment of Base Rate Loans, (2) any prepayment of Applicable Offered Rate Loans shall be in a principal amount of $1,000,000
or a whole multiple of $100,000 in excess thereof or, in each case, the entire principal amount thereof then outstanding and (3) any
prepayment of Base Rate Loans shall be in a principal amount of $500,000 or a whole multiple of $100,000 in excess thereof or, in each case,
the entire principal amount thereof then outstanding. Each such notice shall specify the date and amount of such prepayment and whether
Applicable Offered Rate Loans or Base Rate Loans are to be prepaid; provided , that notwithstanding anything to the contrary contained in
this Agreement but subject to Section 3.9 , the Borrowers may rescind any notice of prepayment under this Section 5.2 if such prepayment
would have resulted from a refinancing of this credit facility, which refinancing shall not be consummated or shall otherwise be delayed.
Notwithstanding anything herein to the contrary, if a U.S. Revolver Overadvance or a Canadian Overadvance exists, U.S. Borrowers or
Canadian Borrower, as the case may be, shall, on the sooner of the Applicable Agent’s demand or the first Business Day after any U.S.
Borrower or the Canadian Borrower, as the case may be, has knowledge thereof, repay the outstanding applicable Loans in an amount
sufficient to reduce the Total U.S. Revolver Outstandings or the Total Canadian Outstandings, as the case may be, to the U.S. Revolver
Borrowing Base or the Canadian Borrowing Base, as the case may be.
5.3. [Intentionally Omitted.]
5.4. Payment of Other Obligations . Obligations other than Loans, including LC Obligations and Extraordinary Expenses, shall
be paid by Borrowers (subject to Section 4.5 ) as provided in the Loan Documents or, if no payment date is specified, on demand made to
the applicable Borrowers.
5.5. Marshaling; Payments Set Aside . None of Agents or Lenders shall be under any obligation to marshal any assets in favor of
any Obligor or against any Obligations. If any payment by or on behalf of Borrowers is made to any Agent, any Issuing Bank or any Lender,
or any Agent, any Issuing Bank or any Lender exercises a right of setoff, and such payment or the proceeds of such setoff or any part thereof
is subsequently invalidated, declared to be fraudulent or preferential, set aside or required (including pursuant to any settlement entered into
by such Agent, such Issuing Bank or such Lender in its discretion) to be repaid to a trustee, receiver, interim receiver, receiver manager or
any other Person, then to the extent of such recovery, the Obligation originally intended to be satisfied, and all Liens, rights and remedies
relating thereto, shall be revived and continued in full force and effect as if such payment had not been made or such setoff had not occurred.
5.6. Application and Allocation of Payments .
5.6.1. Application . Payments made by Borrowers hereunder shall be applied (a) first , as specifically required hereby; (b)
second , to Obligations then due and owing; (b) third , to other Obligations specified by Borrowers; and (c) fourth , as determined by the
Administrative Agent in its discretion.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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5.6.2. Post-Default Allocation . Notwithstanding anything in any Loan Document to the contrary, during an Event of
Default, monies to be applied to the Obligations, whether arising from payments by Obligors, realization on Collateral, setoff or otherwise,
shall be allocated, subject to Section 4.5 , as follows, subject to the Intercreditor Agreement:
(a) first , to all fees, indemnification, costs and expenses, including Extraordinary Expenses, owing
to any Agent;
(b) second , to all amounts owing to any Swingline Lender on Swingline Loans, Overadvances,
Protective Advances, and Loans and participations that a Defaulting Lender has failed to settle or fund;
(c) third , to all amounts owing to Issuing Bank;
(d) fourth , to all Obligations (other than Secured Bank Product Obligations) constituting fees,
indemnification, costs or expenses owing to Lenders;
(e) fifth , to all Obligations (other than Secured Bank Product Obligations) constituting interest;
(f) sixth , to Cash Collateralize all LC Obligations;
(g) seventh , to all Loans (other than Overadvances and Protective Advances), and to Qualified
Secured Bank Product Obligations to the extent a Bank Product Reserve has been established with respect thereto up
to and including the amount most recently specified to the Administrative Agent pursuant to the terms hereof, if
applicable; and
(h) last , to all other Obligations.
Amounts shall be applied to payment of each category of Obligations only after Full Payment of amounts payable from time to time
under all preceding categories. If amounts are insufficient to satisfy a category, they shall be paid ratably among outstanding Obligations in
the category. Monies and proceeds obtained from an Obligor shall not be applied to its Excluded Swap Obligations, but appropriate
adjustments shall be made with respect to amounts obtained from other Obligors to preserve the allocations in any applicable category.
Amounts distributed with respect to any Secured Bank Product Obligations or Qualified Secured Bank Product Obligations shall be the lesser
of (i) the maximum Secured Bank Product Obligations or Qualified Secured Bank Product Obligations, as the case may be, last reported to
the Administrative Agent, if applicable, and (ii) the actual Secured Bank Product Obligations or Qualified Secured Bank Product Obligations,
as the case may be, as calculated by the methodology reported to the Administrative Agent, if applicable, for determining the amount due.
The Administrative Agent shall have no obligation to calculate the amount to be distributed with respect to any Secured Bank Product
Obligations or Qualified Secured Bank Product Obligations, and may request a reasonably detailed calculation of such amount from the
applicable Secured Bank Product Provider. If the provider fails to deliver the calculation within five days following request, the
Administrative Agent may assume the amount is zero. The allocations set forth in this Section are solely to determine the rights and priorities
among Secured Parties, and may be changed by agreement of the affected Secured Parties, without the consent of any Obligor. This Section is
not for the benefit of or enforceable by any Obligor, and each Borrower irrevocably waives the right to direct the application of any payments
or Collateral proceeds subject to this Section.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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5.6.3. Erroneous Application . No Agent shall be liable for any application of amounts made by it in good faith and, if any
such application is subsequently determined to have been made in error, the sole recourse of any Lender or other Person to which such
amount should have been made shall be to recover the amount from the Person that actually received it (and, if such amount was received by
any Lender, such Lender hereby agrees to return it).
5.7. Application of Payments . While a Trigger Event is in effect, the ledger balance in the main Dominion Account for the
Obligors (other than the Canadian Borrower) as of the end of a Business Day shall be applied to the Obligations and the ledger balance in the
main Dominion Account for the Canadian Borrower as of the end of such Business Day shall be applied to the Canadian Obligations, in each
case at the beginning of the next Business Day. If, as a result of such application, a credit balance exists, the balance shall not accrue interest
in favor of U.S. Borrowers or Canadian Borrower, as the case may be, and shall be made available to U.S. Borrowers or Canadian Borrower,
as the case may be, as long as no Default or Event of Default exists. Each Borrower irrevocably waives the right to direct the application of
any payments or Collateral proceeds while a Trigger Event is in effect, and agrees that each Agent shall have the continuing, exclusive right
to apply and reapply same against the applicable Obligations, in such manner as such Agent deems advisable.
5.8. Loan Account; Account Stated .
5.8.1. Loan Account . The Applicable Agent shall maintain in accordance with its usual and customary practices an
account or accounts (“ Loan Account ”) evidencing the Debt of Borrowers resulting from each Loan or issuance of a Letter of Credit from
time to time. Any failure of such Agent to record anything in the Loan Account, or any error in doing so, shall not limit or otherwise affect
the obligation of Borrowers to pay any amount owing hereunder.
5.8.2. Entries Binding . Entries made in the Loan Account shall constitute presumptive evidence of the information
contained therein. If any information contained in the Loan Account is provided to or inspected by any Person, then such information shall be
conclusive and binding on such Person for all purposes absent manifest error, except to the extent such Person notifies the Applicable Agent
in writing within 30 days after receipt or inspection that specific information is subject to dispute.
5.9. Taxes . For purposes of this Section 5.9 and Section 5.10, the term “Lender” includes any Issuing Bank and the term
“applicable law” includes FATCA.
5.9.1. Payments Free of Taxes; Obligation to Withhold; Tax Payment .
(a) All payments of Obligations by Obligors shall be made without deduction or withholding for
any Taxes, except as required by Applicable Law. If Applicable Law (as determined by the Applicable Agent in its
good faith discretion) requires the deduction or withholding of any Tax from any such payment by an Agent or an
Obligor, then the Applicable Agent or such Obligor shall be entitled to make such deduction or withholding in
accordance with information and documentation provided pursuant to Section 5.10 and Applicable Law.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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(b) If any Agent or any Obligor is required by the Code to withhold or deduct Taxes, including
backup withholding and withholding taxes, from any payment, then (i) such Agent or Obligor, as applicable, to the
extent required by Applicable Law, shall timely pay the full amount that it determines is to be withheld or deducted to
the relevant Governmental Authority, and (ii) to the extent the withholding or deduction is made on account of
Indemnified Taxes, the sum payable by the applicable Obligor shall be increased as necessary so that the Recipient
receives an amount equal to the sum it would have received had no such withholding or deduction been made.
(c) If any Agent or any Obligor is required by any Applicable Law other than the Code to withhold
or deduct Taxes from any payment, then (i) such Agent or Obligor, as applicable, to the extent required by Applicable
Law, shall timely pay the full amount to be withheld or deducted to the relevant Governmental Authority, and (ii) to
the extent the withholding or deduction is made on account of Indemnified Taxes, the sum payable by the applicable
Obligor shall be increased as necessary so that the Recipient receives an amount equal to the sum it would have
received had no such withholding or deduction been made.
5.9.2. Payment of Other Taxes . Without limiting the foregoing, Borrowers shall timely pay to the relevant Governmental
Authority in accordance with Applicable Law, or at the Applicable Agent’s option, timely reimburse such Agent for payment of, any Other
Taxes.
5.9.3. Tax Indemnification .
(a) Subject to Section 5.1.2 and 4.5, each Borrower shall indemnify and hold harmless, on a joint
and several basis, each Recipient against any Indemnified Taxes (including those imposed or asserted on or
attributable to amounts payable under this Section) payable or paid by a Recipient in respect of, or required to be
withheld or deducted from a payment to a Recipient, and any penalties, interest and reasonable expenses arising
therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or
asserted by the relevant Governmental Authority. Each Borrower shall indemnify and hold harmless the Applicable
Agent against any amount that a Lender or Issuing Bank fails for any reason to pay indefeasibly to such Agent as
required pursuant to this Section. Each Borrower shall make payment within ten (10) days after demand for any
amount or liability payable under this Section. A certificate as to the amount of such payment or liability delivered to
Borrowers by a Lender or Issuing Bank (with a copy to the Applicable Agent), or by the Applicable Agent on its own
behalf or on behalf of any Recipient, shall be conclusive absent manifest error.
(b) Each Lender and Issuing Bank shall indemnify and hold harmless, on a several basis, (i) the
Applicable Agent against any Indemnified Taxes attributable to such Lender or Issuing Bank (but only to the extent
Borrowers have not already paid or reimbursed such Agent therefor and without limiting Borrowers’ obligation to do
so), (ii) Agents and Obligors, as applicable, against any Taxes attributable to such Lender’s failure to maintain a
Participant register as required hereunder, and (iii) Agents and Obligors, as applicable, against any Excluded Taxes
attributable to such Lender or Issuing Bank, in each case, that are payable or paid
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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by an Agent or an Obligor in connection with any Obligations, and any reasonable expenses arising therefrom or with
respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant
Governmental Authority. Each Lender and Issuing Bank shall make payment within ten (10) days after demand for
any amount or liability payable under this Section. A certificate as to the amount of such payment or liability
delivered to any Lender or Issuing Bank by the Applicable Agent shall be conclusive absent manifest error.
5.9.4. Evidence of Payments . If an Agent or an Obligor pays any Taxes pursuant to this Section, then upon request, such
Agent shall deliver to Borrower Agent or Borrower Agent shall deliver to such Agent, as applicable, a copy of a receipt issued by the
appropriate Governmental Authority evidencing the payment, a copy of any return required by Applicable Law to report the payment, or
other evidence of payment reasonably satisfactory to such Agent or Borrower Agent, as applicable.
5.9.5. Treatment of Certain Refunds . Unless required by Applicable Law, at no time shall any Agent have any obligation
to file for or otherwise pursue on behalf of a Lender or Issuing Bank, or to pay to any Lender or Issuing Bank, any refund of Taxes withheld
or deducted from funds paid for the account of a Lender or Issuing Bank. If a Recipient determines in its discretion, exercised in good faith,
that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section (including by the payment of additional
amounts pursuant to this Section 5.9), it shall pay the indemnifying party an amount equal to such refund (but only to the extent of indemnity
payments made, or additional amounts paid, by Borrowers with respect to the Taxes giving rise to such refund), net of all out-of-pocket
expenses (including Taxes) incurred by such Recipient, and without interest (other than any interest paid by the relevant Governmental
Authority with respect to such refund). Such indemnifying party, upon the request of such Recipient, shall repay to such Recipient the amount
paid over pursuant to this paragraph 5.9.5 (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in
the event that such Recipient is required to repay such refund to such Governmental Authority. Notwithstanding anything herein to the
contrary, no Recipient shall be required to pay any amount to an indemnifying party pursuant to this paragraph 5.9.5 if such payment would
place the Recipient in a less favorable net after-Tax position than it would have been in if the Tax subject to indemnification and giving rise to
such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to
such Tax had never been paid. In no event shall any Agent or any Recipient be required to make its tax returns (or any other information
relating to its taxes that it deems confidential) available to any Obligor or other Person.
5.9.6. Survival . Each party’s obligations under Sections 5.9 and 5.10 shall survive the resignation or replacement of any
Agent or any assignment of rights by or replacement of a Lender or Issuing Bank, the termination of the U.S. Revolver Commitments, the
Canadian Commitments and the repayment, satisfaction, discharge or Full Payment of any Obligations.
5.10. Lender Tax Information .
5.10.1. Status of Lenders . Any Lender that is entitled to an exemption from or reduction of withholding Tax with respect
to payments made under any Loan Document shall deliver to the Borrowers and the Applicable Agent, at the time or times reasonably
requested by the Borrowers or such Agent, such properly completed and executed documentation reasonably requested by the Borrowers or
such Agent as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition, any Lender, if
reasonably requested by Borrowers or the Applicable Agent, shall deliver such other documentation prescribed by Applicable Law or
reasonably requested by Borrowers or such Agent to enable
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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them to determine whether such Lender is subject to backup withholding or information reporting requirements. Notwithstanding the
foregoing, such documentation (other than documentation described in Sections 5.10.2(a), (b) and (d) ) shall not be required if a Lender
reasonably believes delivery of the documentation would subject it to any material unreimbursed cost or expense or would materially
prejudice its legal or commercial position.
5.10.2. Documentation . Without limiting the foregoing, if the applicable Borrower is a U.S. Person,
(a) Any Lender that is a U.S. Person shall deliver to Borrowers and the Applicable Agent on or
prior to the date on which such Lender becomes a Lender hereunder (and from time to time thereafter upon
reasonable request of Borrowers or such Agent), executed originals of IRS Form W-9, certifying that such Lender is
exempt from U.S. federal backup withholding Tax;
(b) Any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to Borrowers and
the Applicable Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on
which such Foreign Lender becomes a Lender hereunder (and from time to time thereafter upon reasonable request of
Borrowers or such Agent), whichever of the following is applicable:
(i) in the case of a Foreign Lender claiming the benefits of an income tax treaty to which the United States
is a party, (x) with respect to payments of interest under any Loan Document, executed originals of IRS Form W-
8BEN or W-8BEN-E, as applicable, establishing an exemption from or reduction of U.S. federal withholding Tax
pursuant to the “interest” article of such tax treaty, and (y) with respect to other payments under the Loan Documents,
IRS Form W-8BEN or W-8BEN-E, as applicable, establishing an exemption from or reduction of U.S. federal
withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;
(ii) executed originals of IRS Form W-8ECI;
(iii) in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under
Section 881(c) of the Code, (x) a certificate in form satisfactory to the Applicable Agent to the effect that such
Foreign Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10 percent shareholder” of
a Borrower within the meaning of Section 881(c)(3)(B) of the Code, or a “controlled foreign corporation” described
in Section 881(c)(3)(C) of the Code (“ U.S. Tax Compliance Certificate ”), and (y) executed originals of IRS Form
W-8BEN or W-8BEN-E, as applicable; or
(iv) to the extent a Foreign Lender is not the beneficial owner, executed originals of IRS Form W-8IMY,
accompanied by IRS Form W-8ECI, IRS Form W-8BEN or W-8BEN-E, as applicable, a U.S. Tax Compliance
Certificate in form satisfactory to the Applicable Agent, IRS Form W-9, and/or other certification documents from
each beneficial owner, as applicable; provided , that if the Foreign Lender is a partnership and one or more direct or
indirect partners of such Foreign Lender are claiming the portfolio interest exemption, such Foreign Lender may
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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provide a U.S. Tax Compliance Certificate on behalf of each such direct and indirect partner;
(c) any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to Borrowers and
the Applicable Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on
which such Foreign Lender becomes a Lender hereunder (and from time to time thereafter upon the reasonable
request of Borrowers or such Agent), executed originals of any other form prescribed by Applicable Law as a basis
for claiming exemption from or a reduction in U.S. federal withholding Tax, duly completed, together with such
supplementary documentation as may be prescribed by Applicable Law to permit Borrowers or such Agent to
determine the withholding or deduction required to be made; and
(d) if payment of an Obligation to a Lender would be subject to U.S. federal withholding Tax
imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA
(including those contained in Section 1471(b) or 1472(b) of the Code), such Lender shall deliver to Borrowers and the
Applicable Agent at the time(s) prescribed by law and otherwise as reasonably requested by Borrowers or such Agent
such documentation prescribed by Applicable Law (including Section 1471(b)(3)(C)(i) of the Code) and such
additional documentation reasonably requested by Borrowers or such Agent as may be necessary for them to comply
with their obligations under FATCA and to determine that such Lender has complied with its obligations under
FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (d),
“FATCA” shall include any amendments made to FATCA after the Signing Date.
5.10.3. Redelivery of Documentation . If any form or certification previously delivered by a Lender pursuant to this
Section expires or becomes obsolete or inaccurate in any respect, such Lender shall promptly update the form or certification or notify
Borrowers and the Applicable Agent in writing of its inability to do so.
5.11. Nature and Extent of Each Borrower’s Liability .
5.11.1. Joint and Several Liability . Each U.S. Borrower agrees that it is jointly and severally liable for, and absolutely and
unconditionally guarantees to Agents and Secured Parties the prompt payment and performance of, all Obligations, except its Excluded Swap
Obligations, and all agreements under the Loan Documents. Each U.S. Borrower agrees that its guaranty obligations hereunder constitute a
continuing guaranty of payment and not of collection, that such obligations shall not be discharged until Full Payment of the Obligations, and
that such obligations are absolute and unconditional, irrespective of (a) the genuineness, validity, regularity, enforceability, subordination or
any future modification of, or change in, any Obligations or Loan Document, or any other document, instrument or agreement to which any
Obligor is or may become a party or be bound; (b) the absence of any action to enforce this Agreement (including this Section) or any other
Loan Document, or any waiver, consent or indulgence of any kind by any Agent or any Secured Party with respect thereto; (c) the existence,
value or condition of, or failure to perfect a Lien or to preserve rights against, any security or guaranty for the Obligations or any action, or
the absence of any action, by any Agent or any Secured Party in respect thereof (including the release of any security or guaranty); (d) the
insolvency of any Obligor; (e) any election by any Agent or any Secured Party in an
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Insolvency Proceeding for the application of Section 1111(b)(2) of the Bankruptcy Code; (f) any borrowing or grant of a Lien by any other
Borrower, as debtor-in-possession under Section 364 of the Bankruptcy Code or otherwise; (g) the disallowance of any claims of any Agent
or any Secured Party against any Obligor for the repayment of any Obligations under Section 502 of the Bankruptcy Code or otherwise; or (h)
any other action or circumstances that might otherwise constitute a legal or equitable discharge or defense of a surety or guarantor, except
Full Payment of all Obligations.
5.11.2. Waivers .
(a) Each U.S. Borrower expressly waives all rights that it may have now or in the future under any
statute, at common law, in equity or otherwise, to compel Agents or Secured Parties to marshal assets or to proceed
against any Obligor, other Person or security for the payment or performance of any Obligations before, or as a
condition to, proceeding against such Borrower. Each U.S. Borrower waives all defenses available to a surety,
guarantor or accommodation co-obligor other than Full Payment of all Obligations and waives, to the maximum
extent permitted by law, any right to revoke any guaranty of any Obligations as long as it is a Borrower. It is agreed
among each U.S. Borrower, Agents and Secured Parties that the provisions of this Section 5.11 are of the essence of
the transaction contemplated by the Loan Documents and that, but for such provisions, Agents and Secured Parties
would decline to make Loans and issue Letters of Credit. Each U.S. Borrower acknowledges that its guaranty
pursuant to this Section is necessary to the conduct and promotion of its business, and can be expected to benefit such
business.
(b) Upon the occurrence and during the continuance of an Event of Default, Agents and Secured
Parties may, in their discretion, pursue such rights and remedies as they deem appropriate, including realization upon
Collateral by judicial foreclosure or non‑judicial sale or enforcement, without affecting any rights and remedies under
this Section 5.11 . If, in taking any action in connection with the exercise of any rights or remedies, any Agent or any
Secured Party shall forfeit any other rights or remedies, including the right to enter a deficiency judgment against any
Borrower or other Person, whether because of any Applicable Laws pertaining to “election of remedies” or otherwise,
each U.S. Borrower consents to such action and waives any claim based upon it, even if the action may result in loss
of any rights of subrogation that any Borrower might otherwise have had. Any election of remedies that results in
denial or impairment of the right of any Agent or any Secured Party to seek a deficiency judgment against any
Borrower shall not impair any U.S. Borrower’s obligation to pay the full amount of the Obligations. Each U.S.
Borrower waives all rights and defenses arising out of an election of remedies, such as non-judicial foreclosure with
respect to any security for the Obligations, even though that election of remedies destroys such Borrower’s rights of
subrogation against any other Person. The Applicable Agent may bid all or a portion of the Obligations at any
foreclosure, trustee’s or other sale, including any private sale, and the amount of such bid need not be paid by such
Agent but shall be credited against the Obligations. The amount of the successful bid at any such sale, whether any
Agent or any other Person is the successful bidder, shall be conclusively deemed to be the fair market value of the
Collateral, and the difference between such bid amount and the remaining balance of the Obligations shall be
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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conclusively deemed to be the amount of the Obligations guaranteed under this Section 5.11 , notwithstanding that
any present or future law or court decision may have the effect of reducing the amount of any deficiency claim to
which any Agent or any Secured Party might otherwise be entitled but for such bidding at any such sale.
5.11.3. Extent of Liability; Contribution .
(a) Notwithstanding anything herein to the contrary, each U.S. Borrower’s liability under this
Section 5.11 shall be limited to the greater of (i) all amounts for which such U.S. Borrower is primarily liable, as
described below, and (ii) such U.S. Borrower’s Allocable Amount.
(b) If any U.S. Borrower makes a payment under this Section 5.11 of any Obligations (other than
amounts for which such Borrower is primarily liable) (a “ Guarantor Payment ”) that, taking into account all other
Guarantor Payments previously or concurrently made by any other U.S. Borrower, exceeds the amount that such
Borrower would otherwise have paid if each U.S. Borrower had paid the aggregate Obligations satisfied by such
Guarantor Payments in the same proportion that such Borrower’s Allocable Amount bore to the total Allocable
Amounts of all Borrowers, then such Borrower shall be entitled to receive contribution and indemnification payments
from, and to be reimbursed by, each other U.S. Borrower for the amount of such excess, pro rata based upon their
respective Allocable Amounts in effect immediately prior to such Guarantor Payment. The “ Allocable Amount ” for
any U.S. Borrower shall be the maximum amount that could then be recovered from such Borrower under this
Section 5.11 without rendering such payment voidable under Section 548 of the Bankruptcy Code or under any
applicable state fraudulent transfer or conveyance act, or similar statute or common law.
(c) Section 5.11.3(a) shall not limit the liability of any Borrower to pay or guarantee Loans made
directly or indirectly to it (including Loans advanced hereunder to any other Person and then re-loaned or otherwise
transferred to, or for the benefit of, such Borrower), LC Obligations relating to Letters of Credit issued to support its
business, Secured Bank Product Obligations incurred to support its business, and all accrued interest, fees, expenses
and other related Obligations with respect thereto, for which such Borrower shall be primarily liable for all purposes
hereunder. Agents and Secured Parties shall have the right, at any time in their discretion, to condition Loans and
Letters of Credit upon a separate calculation of borrowing availability for each Borrower and to restrict the
disbursement and use of Loans and Letters of Credit to a Borrower based on that calculation.
(d) Each Obligor that is a Qualified ECP when its guaranty of or grant of Lien as security for a
Swap Obligation becomes effective hereby jointly and severally, absolutely, unconditionally and irrevocably
undertakes to provide funds or other support to each Specified Obligor with respect to such Swap Obligation as may
be needed by such Specified Obligor from time to time to honor all of its obligations under the Loan Documents in
respect of such Swap Obligation
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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(but, in each case, only up to the maximum amount of such liability that can be hereby incurred without rendering
such Qualified ECP’s obligations and undertakings under this Section 5.11 voidable under any applicable fraudulent
transfer or conveyance act). The obligations and undertakings of each Qualified ECP under this Section shall remain
in full force and effect until Full Payment of all Obligations. Each Obligor intends this Section to constitute, and this
Section shall be deemed to constitute, a guarantee of the obligations of, and a “keepwell, support or other agreement”
for the benefit of, each Obligor for all purposes of the Commodity Exchange Act.
5.11.4. Joint Enterprise . Each Borrower has requested that Agents and Secured Parties make this credit facility available to
Borrowers on a combined basis in order to finance Borrowers’ business most efficiently and economically. Borrowers’ business is a mutual
and collective enterprise, and the successful operation of each Borrower is dependent upon the successful performance of the integrated
group. Borrowers believe that consolidation of their credit facility will enhance the borrowing power of each Borrower and ease
administration of the facility, all to their mutual advantage. Borrowers acknowledge that Agents’ and Secured Parties’ willingness to extend
credit and to administer the Collateral of Borrowers on a combined basis hereunder is done solely as an accommodation to Borrowers and at
Borrowers’ request.
5.11.5. Subordination . Each Borrower (including Canadian Borrower) hereby subordinates any claims, including any
rights at law or in equity to payment, subrogation, reimbursement, exoneration, contribution, indemnification or setoff, that it may have at any
time against any other Obligor, howsoever arising, to the Full Payment of all Obligations.
SECTION 6. CONDITIONS PRECEDENT
6.1. Conditions Precedent to Effectiveness of this Agreement . The effectiveness of this Agreement and the occurrence of the
Signing Date is subject to satisfaction of the following conditions precedent or the waiver of such conditions precedent by the Required
Lenders (provided that, for purposes of such waiver, the Lead Arrangers must also waive such conditions precedent) in accordance with the
terms of this Agreement:
6.1.1. Execution and Delivery of Loan Agreement . The Administrative Agent shall have received this Agreement executed
and delivered by a duly authorized officer of (i) each Agent, (ii) each Borrower and (iii) each Lender (including each Issuing Bank).
6.1.2. Signing Date Certificate . The Administrative Agent shall have received a certificate of a Senior Officer, responsible
officer, secretary or assistant secretary of each Borrower, dated the Signing Date, with customary certifications and attaching (i) a copy of the
resolutions of the applicable governing body of each Borrower (or a duly authorized committee thereof) authorizing (x) the execution,
delivery, and performance of this Agreement and (y) the extensions of credit contemplated hereunder, (ii) the applicable Organic Documents
of each Borrower and, to the extent applicable in the jurisdiction of organization of such Borrower, a certificate as to its good standing or
compliance (or equivalent, if applicable) dated as of a recent date from an applicable Governmental Authority in such jurisdiction of
organization or
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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formation, as applicable, and (iii) signature and incumbency certificates (or other comparable documents evidencing the same) of the
authorized officers of each Borrower executing this Agreement.
6.1.3. Legal Opinions . The Administrative Agent shall have received customary favorable legal opinions from (a)
Skadden, Arps, Slate, Meagher & Flom LLP and (b) Osler, Hoskin & Harcourt LLP, as counsel to the Borrowers, in each case, dated as of the
Signing Date and addressed to the Lenders and the Administrative Agent.
6.1.4. Patriot Act, Know Your Customer Regulations . At least three (3) Business Days prior to the Signing Date, the
Administrative Agent shall have received all documentation and other information about each Borrower as has been reasonably requested in
writing at least ten (10) Business Days prior to the Signing Date by the Administrative Agent or the Lead Arrangers that is required by
regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including without limitation
the Patriot Act and the Beneficial Ownership Certification.
The Administrative Agent shall promptly notify the Lenders of the occurrence of the Signing Date.
Notwithstanding anything to the contrary herein:
(a) Upon the occurrence of the Signing Date, this Agreement shall be a legal, valid and binding obligation of each
of the parties party hereto (and their successors and assigns), enforceable against each such Person in accordance with its
terms, except as enforceability may be limited by bankruptcy, insolvency or similar laws affecting the enforcement of
creditors’ rights generally and general principles of equity.
(b) The obligation of each Lender and, if applicable, each Issuing Bank, to fund the initial Borrowings and to issue
the initial Letters of Credit, as applicable, on the Closing Date requested by the Borrowers are subject solely to satisfaction of
the conditions precedent set forth in Section 6.2 or the waiver of such conditions precedent in accordance with the terms of
this Agreement (subject, in each case, to the final paragraph of Section 6.2 ).
(c) The obligations and provisions under this Agreement that are specifically conditioned on the occurrence of the
Closing Date (including, without limitation, the obligations of the Borrowers under Section 10 ) shall become effective
automatically on, but only upon, the occurrence of the Closing Date.
(d) The occurrence of the Signing Date does not, and is not intended to, terminate or otherwise modify the terms
and conditions of the Existing UNFI ABL Credit Agreement, and the Borrowers agree that the Existing UNFI ABL Credit
Agreement shall remain in full force and effect pursuant to its terms (except as enforceability may be limited by bankruptcy,
insolvency or similar laws affecting the enforcement of creditors’ rights generally and general principles of equity) until
terminated in accordance with its terms.
(e) Upon the occurrence of the Signing Date and without the satisfaction of any other condition, all of the
commitments with respect to the ABL Facility under and as defined in the Commitment Letter (including, for the avoidance
of doubt, commitments with respect to both the “Backstop ABL Facility” and the “Incremental ABL Facility” referred to in
the Commitment Letter) shall automatically terminate and permanently be reduced to zero. The occurrence of the Signing
Date shall not reduce or otherwise impact the commitments with respect to the “Term Loan Facility” under and as defined in
the
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Commitment Letter, which commitments shall remain in full force and effect in accordance with the terms of the
Commitment Letter.
(f) In the event that (i) the initial Borrowings hereunder and under the Term Loan Facility do not occur on or before
the Original End Date (as defined in the Supervalu Acquisition Agreement as in effect on July 25, 2018) (or to the extent
extended pursuant to the proviso to Section 7.1(b) of the Supervalu Acquisition Agreement as in effect on July 25, 2018, the
Extended End Date (as defined in the Supervalu Acquisition Agreement as in effect on July 25, 2018)), (ii) the Supervalu
Acquisition closes without the use of the credit facility hereunder or under the Term Loan Facility or (iii) the Supervalu
Acquisition Agreement is validly terminated by the Borrower Agent prior to the closing of the Supervalu Acquisition, then
the Aggregate Commitments hereunder shall automatically terminate unless the Lenders shall, in their sole discretion, agree
to an extension (the date of any such termination, the “ Pre-Closing Commitment Termination Date ”). The Borrowers shall
notify the Administrative Agent and the Lenders promptly upon the occurrence of any event described in the preceding sub-
clauses (ii) and (iii); provided , that the failure to provide such notice shall not impact the termination of the Aggregate
Commitments as described in the immediately preceding sentence (this paragraph (f), the “ Pre-Closing Commitment
Termination Date Paragraph ”).
6.2. Conditions Precedent to All Credit Extensions on the Closing Date . The obligation of each Lender and, if applicable, each
Issuing Bank, to fund the initial Borrowings and to issue the initial Letters of Credit, as applicable, on the Closing Date requested by the
Borrowers are subject to the occurrence of the Signing Date and satisfaction of the following additional conditions precedent or the waiver of
such conditions precedent by the Required Lenders (provided that, for purposes of such waiver, the Lead Arrangers must also waive such
conditions precedent) in accordance with the terms of this Agreement (subject, in each case, to the final paragraph of this Section 6.2 ):
6.2.1. Loan Documents .
(a) Each Closing Date Security Document (i) shall have been duly executed and delivered by a
duly authorized officer of each applicable Obligor and (ii) shall satisfy the Guarantee and Collateral Requirement.
(b) Each other Closing Date Loan Document shall have been duly executed and delivered by a duly
authorized officer of each applicable Obligor.
6.2.2. Collateral .
(a) The Obligors shall have delivered all Pledged Collateral required to be pledged and delivered
pursuant to the Guarantee and Collateral Requirement to the Administrative Agent or, to the extent in accordance
with the terms of the Intercreditor Agreement, the Term Loan Facility Agent.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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(b) The Administrative Agent shall have received evidence that all other actions, recordings and
filings that the Administrative Agent may deem necessary to satisfy the Guarantee and Collateral Requirement shall
have been taken, completed or otherwise provided for. Subject to the last paragraph of this Section, all documents and
instruments required to grant and perfect the Administrative Agent’s security interests in the Collateral shall have
been executed and delivered by the Obligors and, if applicable, be in proper form for filing.
6.2.3. Supervalu Acquisition . The Supervalu Acquisition shall have been, or substantially concurrently with the initial
Borrowing hereunder shall be, consummated in all material respects in accordance with the Supervalu Acquisition Agreement. No provision
of the Supervalu Acquisition Agreement shall have been amended or otherwise modified, no provisions thereof shall have been waived by the
Borrower Agent and no consent shall have been granted by the Borrower Agent thereunder, in each case, in a manner material and adverse to
the Lenders as of the Closing Date (in their capacity as such) without the consent of the Lead Arrangers (not to be unreasonably withheld,
delayed, denied or conditioned); provided , that (i) any reduction in the purchase price for the Supervalu Acquisition set forth in the Supervalu
Acquisition Agreement of greater than 10% shall be deemed to be material and adverse to the interests of the Lenders as of the Closing Date,
and any reduction in the purchase price of 10% or less shall be deemed to be material and adverse to the interests of the Lenders as of the
Closing Date unless applied to reduce the commitments under the Term Loan Facility on a dollar-for-dollar basis, (ii) any increase in the
purchase price set forth in the Supervalu Acquisition Agreement shall be deemed to be not material and adverse to the interests of the Lenders
so long as such purchase price increase is not funded with additional Debt and (iii) any change to the definition of Material Adverse Effect (as
defined in the Supervalu Acquisition Agreement as in effect on July 25, 2018) shall be deemed materially adverse to the Lenders as of the
Closing Date and shall require the consent of the Lead Arrangers (not to be unreasonably withheld, delayed, denied or conditioned).
6.2.4. Financial Statements . The Lead Arrangers shall have received:
(i) copies of (A)(i) the audited consolidated balance sheet and related consolidated statements of operations, comprehensive
income, change in stockholders’ equity and cash flows for the fiscal years of the Borrower Agent ended August 1, 2015, July
30, 2016 and July 29, 2017 (which the Lead Arrangers have acknowledged receipt of such audited financial statements) and
for each subsequent fiscal year of the Borrower Agent ended at least 60 days before the Closing Date and (ii) the unaudited
consolidated balance sheet and related consolidated statements of operations, comprehensive income, change in stockholders’
equity and cash flows for each subsequent fiscal quarter (other than the fourth fiscal quarter of the Borrower Agent’s fiscal
year) ended at least 40 days before the Closing Date (which the Lead Arrangers have acknowledged receipt of the unaudited
consolidated financial statements in respect of the fiscal quarters ended October 28, 2017, January 27, 2018 and April 28,
2018) and (B)(i) the audited consolidated balance sheet and related consolidated statements of operations, comprehensive
income, change in stockholders’ equity and cash flows for the fiscal years of Supervalu Inc. ended February 27, 2016,
February 25, 2017 and February 24, 2018 (which the Lead Arrangers have acknowledged receipt of such audited financial
statements) and for each subsequent fiscal year of Supervalu Inc. ended at least 60 days before the Closing Date and (ii) the
unaudited consolidated balance sheet and related consolidated statements of operations, comprehensive income, change in
stockholders’ equity and cash flows for each subsequent fiscal quarter (other than the fourth fiscal quarter of Supervalu Inc.’s
fiscal year) ended at least 40 days before the Closing Date; and
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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(ii) an unaudited pro forma consolidated balance sheet and related unaudited pro forma consolidated statement of income of
the Borrower Agent and its Subsidiaries as of and for the twelve-month period ending on the last day of the most recently
completed four-fiscal quarter period ended at least 40 days (or 60 days if such four-fiscal quarter period is the end of the
Borrower Agent’s fiscal year) prior to the Closing Date, prepared after giving effect to the Supervalu Acquisition as if the
Supervalu Acquisition had occurred on such date (in the case of such pro forma balance sheet) or on the first day of such
period (in the case of such pro forma statement of income), as applicable (which need not be prepared in compliance with
Regulation S-X of the Securities Act of 1933, as amended, or include adjustments for purchase accounting (including
adjustments of the type contemplated by Financial Accounting Standards Board Accounting Standards Codification 805,
Business Combinations (formerly SFAS 141R))).
6.2.5. Patriot Act, Know Your Customer Regulations . The Administrative Agent shall have received (at least three (3)
Business Days prior to the Closing Date) all documentation and other information about each Obligor (other than the Borrowers as to which
such information was provided on or prior to the Signing Date) as has been reasonably requested in writing at least ten (10) Business Days
prior to the Closing Date by the Administrative Agent or the Lead Arrangers that is required by regulatory authorities under applicable “know
your customer” and anti-money laundering rules and regulations, including without limitation the Patriot Act and the Beneficial Ownership
Certification.
6.2.6. Specified Representations . The Specified Representations shall be true and correct in all material respects as of the
Closing Date.
6.2.7. Specified Acquisition Agreement Representations . The Specified Acquisition Agreement Representations shall be
true and correct in all material respects, but only to the extent that the Borrower Agent (or any of its Affiliates) has the right (taking into
account any applicable cure provisions) to terminate its obligations under the Supervalu Acquisition Agreement or decline to consummate the
Supervalu Acquisition (in each case, in accordance with the terms of the Supervalu Acquisition Agreement) as a result of a breach of such
Specified Acquisition Agreement Representation.
6.2.8. Closing Date Refinancing . The Closing Date Refinancing shall have been consummated prior to, or shall be made or
consummated substantially concurrently with, the initial Borrowing hereunder.
6.2.9. No Material Adverse Effect . Except (a) as disclosed in any form, document or report publicly filed with or publicly
furnished to the Securities and Exchange Commission by Supervalu Inc. or any of its Subsidiaries (for purposes of this section, as defined in
the Supervalu Acquisition Agreement as in effect on July 25, 2018) on or after February 27, 2016 and prior to July 25, 2018 (excluding any
disclosures set forth in any “risk factors”, “forward-looking statements” or “market risk” sections or in any other section to the extent they are
cautionary, predictive or forward-looking in nature) or (b) as disclosed in the Company Disclosure Schedule (as defined in the Supervalu
Acquisition Agreement as in effect on August July 25, 2018) delivered to the Lead Arrangers prior to or concurrently with the execution of
the Commitment Letter ( provided , that disclosure of any item in any section or subsection of the Company Disclosure Schedule shall be
deemed disclosed with respect to any other section or subsection to the extent that the relevance of any disclosed event, item or occurrence in
such section or subsection to such other section or subsection is reasonably apparent on its face), since February 24, 2018, there has not been
any change, occurrence or development that has had or would reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect (as defined in the Supervalu Acquisition Agreement).
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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6.2.10. Borrowing Base Certificate . If a Borrowing is made on the Closing Date, the Borrower Agent shall have delivered
to the Administrative Agent a Borrowing Base Certificate dated as of the Closing Date.
6.2.11. Closing Date Solvency Certificate . The Administrative Agent shall have received a certificate from the chief
financial officer, or other office with similar responsibilities of the Borrower Agent (or other officer of the Borrower Agent with similar
responsibilities) in the substantially similar form included as Annex I to Exhibit D to the Commitment Letter (the “ Closing Date Solvency
Certificate ”).
6.2.12. Legal Opinions . The Administrative Agent shall have received customary favorable legal opinions from (a)
Skadden, Arps, Slate, Meagher & Flom LLP, (b) Osler, Hoskin & Harcourt LLP and (c) to the extent reasonably requested by the
Administrative Agent, additional counsel in any jurisdiction in which an Obligor as of the Closing Date is organized to the extent not covered
by the legal opinions in clause (a) or (b), in each case as counsel to the Obligors, and in each case dated as of the Closing Date and addressed
to the Lenders and the Applicable Agents.
6.2.13. Closing Date Certificates . The Administrative Agent shall have received (a) a certificate of a Senior Officer,
responsible officer, secretary or assistant secretary of each Guarantor, dated the Closing Date, with customary certifications and attaching (i) a
copy of the resolutions of the applicable governing body of each Guarantor (or a duly authorized committee thereof) authorizing the
execution, delivery, and performance of the Loan Documents (and any agreements relating thereto) to which it is a party, (ii) unless already
delivered in connection with the occurrence of the Signing Date, the applicable Organic Documents of each Guarantor and, to the extent
applicable in the jurisdiction of organization of such Guarantor, a certificate as to its good standing or compliance (or equivalent, as
applicable) as of a recent date from an applicable Governmental Authority in such jurisdiction of organization and (iii) signature and
incumbency certificates (or other comparable documents evidencing the same) of the authorized officers of each Obligor executing the Loan
Documents to which it is a party and (b) a certificate of a Senior Officer of the Borrower Agent (or other officer of the Borrower Agent with
similar responsibilities), dated as of the Closing Date, certifying that the conditions specified in Sections 6.2.3, 6.2.6 , 6.2.7 and 6.2.8 have
been satisfied.
6.2.14. Fees and Expenses . All fees required to be paid on the Closing Date pursuant to the Fee Letter and reasonable and
documented out-of-pocket expenses required to be paid on the Closing Date pursuant to the Commitment Letter, in each case to the extent
invoiced at least three (3) Business Days prior to the Closing Date, shall have been paid, or shall be paid substantially concurrently with, the
initial Borrowing hereunder (which amounts may be offset against the proceeds of the initial Borrowing).
6.2.15. Notices of Borrowings . If a credit extension is made on the Closing Date, the Applicable Agent shall have received
a Notice of Borrowing with respect to the Loans to be made on the Closing Date meeting the requirements of Section 4.1.1 and, to the extent
a Letter of Credit is issued on the Closing Date, the applicable Issuing Banks shall have received an LC Request with respect to the Letters of
Credit to be issued on the Closing Date meeting the requirements of Section 2.3 and certifying that the Canadian LC Conditions or the U.S.
LC Conditions, as applicable, have been satisfied.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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6.2.16. Inside Date . The Closing Date shall not occur prior to September 8, 2018.
The Administrative Agent shall promptly notify the Lenders of the occurrence of the Closing Date. The Lenders authorize the
Administrative Agent and the Borrower Agent to date this Agreement as of the Closing Date and to make corresponding changes to this
Agreement to account for the actual date of the Closing Date.
Notwithstanding anything to the contrary herein, to the extent any lien search or Collateral or any security interests therein (including
the creation or perfection of any security interest) (other than to the extent that a lien on such Collateral may be perfected by the filing of a
financing statement under the UCC or the PPSA, as applicable, or, with respect to each material domestic wholly-owned Subsidiary of the
Borrower Agent, by the delivery of stock or other certificates of each material domestic wholly-owned Subsidiary of the Borrower that is part
of the Collateral and, with respect to Supervalu Inc. and material domestic wholly-owned Subsidiaries of Supervalu Inc., by the delivery of
stock or other certificates of Supervalu Inc. and material domestic wholly-owned Subsidiaries of Supervalu Inc., only to the extent such stock
or other certificates are received from Supervalu Inc. on or prior to the Closing Date after the Borrower Agent’s use of commercially
reasonable efforts to do so without undue burden or expense) is not or cannot be provided or perfected on the Closing Date after the Borrower
Agent’s use of commercially reasonable efforts to do so, or without undue burden or expense, the delivery of such lien search and/or
Collateral (and creation or perfection of security interests therein), as applicable, shall not constitute a condition precedent to the obligation of
each Lender and, if applicable, each Issuing Bank, to fund the initial Borrowings and to issue the initial Letters of Credit on the Closing Date,
but shall instead be required to be delivered or provided within 90 days after the Closing Date (or such later date as may be agreed to by the
Administrative Agent in its discretion) pursuant to arrangements to be mutually agreed by the Borrower Agent and the Administrative Agent.
6.3. Conditions Precedent to All Credit Extensions after the Closing Date . Agents, Issuing Banks and Lenders shall not be
required to fund any Loans, arrange for issuance of any Letters of Credit or grant any other extension of credit to or for the benefit of
Borrowers, in each case to the extent requested to be made after the Closing Date, unless the following conditions are satisfied:
(a) No Default or Event of Default shall exist at the time of, or result from, such funding, issuance
or grant;
(b) The representations and warranties of each Obligor in the Loan Documents shall be true and
correct in all material respects on the date of, and upon giving effect to, such funding, issuance or grant (except for
representations and warranties that are subject to materiality or material adverse effect qualifications, which
representations and warranties shall be true and correct in all respects, and except for representations and warranties
that expressly relate to an earlier date, which representations and warranties shall be true and correct in all material
respects as of such earlier date);
(c) With respect to a Borrowing, the Applicable Agent shall have received a Notice of Borrowing;
(d) With respect to the issuance of a Letter of Credit, the U.S. LC Conditions or the Canadian LC
Conditions, as the case may be, shall be satisfied;
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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(e) Solely with respect to a request of Canadian Loans or the issuance of a Letter of Credit for the
account or benefit of the Canadian Borrower, no request by the Canada Revenue Agency for payment pursuant to
Section 224(1.1) or any successor section of the ITA or any comparable provision of any other taxing statute shall
have been received by any Person in respect of the Borrowers; and
(f) Solely with respect to a request of Loans in Canadian Dollars or the issuance of a Letter of
Credit for the account or benefit of the Canadian Borrower, there shall not have occurred any change in national or
international financial, political or economic conditions or currency exchange rates or exchange controls that in the
reasonable opinion of the Canadian Agent, the Required Lenders (in the case of any Loans to be denominated in
Canadian Dollars) or the applicable Issuing Bank (in the case of any Letter of Credit to be denominated in Canadian
Dollars) would make it impracticable for such credit extension to be denominated in Canadian Dollars.
Other than with respect to any funding of a Loan, issuance of a Letter of Credit or grant of an accommodation made on the Closing
Date, each request (or deemed request) by Borrowers for funding of a Loan, issuance of a Letter of Credit or grant of an accommodation shall
constitute a representation by Borrowers that the foregoing conditions are satisfied on the date of such request and on the date of such
funding, issuance or grant.
6.4. Certain Funds Period . During the Certain Funds Period and notwithstanding (i) any failure by the Borrower to comply with
Section 10 , (ii) any provision to the contrary in this Agreement or the other Loan Documents or (iii) that any condition to the Signing Date
may subsequently be determined not to have been satisfied, none of the Administrative Agent, the Canadian Agent or any Lender shall be
entitled to (unless any Borrower is subject to an event described in Section 11.1(j) and such event constitutes an Event of Default thereunder)
(a) cancel any of its U.S. Revolver Commitments or Canadian Commitments, (b) rescind, terminate or cancel this Agreement or any other
Loan Document or any of its U.S. Revolver Commitments or Canadian Commitments thereunder or exercise any right or remedy under this
Agreement of any other Loan Document, to the extent to do so would prevent, limit or delay the making of its Loan, (c) refuse to participate
in making its Loan or (d) exercise any right of set-off or counterclaim in respect of its Loan to the extent to do so would prevent, limit or
delay the making of its Loan on the Closing Date; provided that (x) from the Closing Date after giving effect to the funding of the Loans on
such date, all of the rights, remedies and entitlements of the Administrative Agent, the Canadian Agent and the Lenders shall be available
notwithstanding that such rights were not available prior to such time as a result of the foregoing and (y) nothing in this Section 6.4 shall
override or modify the conditions precedent in Section 6.2 with respect to the obligation of each Lender and, if applicable, each Issuing Bank,
to fund the initial Borrowings and to issue the initial Letters of Credit, as applicable, on the Closing Date.
SECTION 7. [INTENTIONALLY OMITTED]
SECTION 8. COLLATERAL ADMINISTRATION
8.1. Borrowing Base Certificates . By the 20th day of each Fiscal Period (or, during any period during which (a) an Event of
Default has occurred and is continuing or (b) Aggregate Availability at any time is less than 10% of the Aggregate Borrowing Base (until
such time that Aggregate Availability equals or exceeds 10% of the Aggregate Borrowing Base for thirty (30) consecutive days), by the last
Business Day of each week), Borrowers shall deliver to Administrative Agent (and Administrative Agent shall promptly
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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deliver same to Lenders) a Borrowing Base Certificate prepared as of the close of business of the previous Fiscal Period or week, as the case
may be, and at such other times as Administrative Agent may reasonably request in its Permitted Discretion.
8.2. Administration of Accounts .
8.2.1. Records and Schedules of Accounts . Each Borrower shall, and shall cause each other Obligor to, keep accurate and
complete records of its Accounts, including all payments and collections thereon, and shall submit to Administrative Agent sales, collection,
reconciliation and other reports in form reasonably satisfactory to Administrative Agent, on such periodic basis as Administrative Agent
reasonably may request. Each Borrower shall also provide to Administrative Agent, on or before the 20th day of each Fiscal Period, a detailed
aged trial balance of all Accounts as of the end of the preceding Fiscal Period, specifying each Account’s Account Debtor name and address,
amount, invoice date and due date, showing any discount, allowance, credit, authorized return or dispute, and including such proof of
delivery, copies of invoices and invoice registers, copies of related documents, repayment histories, status reports and other information as
Administrative Agent may reasonably request.
8.2.2. Taxes . If an Account of any Obligor includes a charge for any unpaid Taxes, each Agent is authorized, in its
discretion, to pay the amount thereof to the proper taxing authority for the account of such Obligor and to charge Obligors therefor; provided ,
however , that no Agent nor any Lender shall be liable for any Taxes that may be due from Obligors or with respect to any Collateral.
8.2.3. Account Verification . Regardless of whether a Default or Event of Default exists, Administrative Agent shall have
the right at any time, in the name of Administrative Agent, any designee of Administrative Agent or any Obligor, to verify the validity,
amount or any other matter relating to any Accounts of Obligors by mail, telephone or otherwise. Borrowers shall, and shall cause each other
Obligor to, cooperate fully with Administrative Agent in an effort to facilitate and promptly conclude any such verification process.
8.2.4. Maintenance of Dominion Account . Borrowers shall, and shall cause each other Obligor to, maintain Dominion
Accounts pursuant to lockbox or other arrangements reasonably acceptable to Agents into which funds from any Obligor from Cash Receipts
are deposited (except provided in Section 8.5 ). Borrowers shall, and shall cause each other Obligor to, obtain an agreement (in form and
substance reasonably satisfactory to the Applicable Agent) from each lockbox servicer and Dominion Account bank, to the extent necessary
to establish the Applicable Agent’s control over and Lien in the lockbox or Dominion Account, which may be exercised by the Applicable
Agent at any time while a Trigger Event is in effect, requiring immediate deposit of all remittances received in the lockbox to a Dominion
Account, and waiving offset rights of such servicer or bank, except for customary administrative charges. If a Dominion Account is not
maintained with Bank of America, the Applicable Agent may, at any time while a Trigger Event is in effect, require immediate transfer of all
funds in such account to a Dominion Account maintained with Bank of America. Agents and Lenders assume no responsibility to Obligors
for any lockbox arrangement or Dominion Account, including any claim of accord and satisfaction or release with respect to any Payment
Items accepted by any bank.
8.2.5. Proceeds of Collateral . Borrowers shall, and shall cause each other Obligor to, request in writing and otherwise take
all necessary steps to ensure that all payments on Accounts or otherwise relating to ABL Priority Collateral (including all payments from
Credit Card Processors and Credit Card Issuers) are made directly to a Dominion Account (or a lockbox relating to a Dominion Account) or a
Deposit Account that is subject to a Deposit Account Control Agreement. If any Borrower or Subsidiary receives
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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cash or Payment Items with respect to any ABL Priority Collateral, it shall hold same in trust for the Applicable Agent and promptly (not
later than the next Business Day) deposit same into a Dominion Account or a Deposit Account that is subject to a Deposit Account Control
Agreement.
8.3. Administration of Inventory .
8.3.1. Records and Reports of Inventory . Each Borrower shall, and shall cause each other Obligor to, keep accurate and
complete records of its Inventory, including costs and daily withdrawals and additions, and shall submit to Administrative Agent inventory
and reconciliation reports in form reasonably satisfactory to Administrative Agent, on such periodic basis as Administrative Agent reasonably
may request, but at least once during each Fiscal Period, not later than the twentieth (20th) day of such Fiscal Period. Each Borrower shall
conduct a physical inventory at least once per calendar year (and on a more frequent basis if requested by Administrative Agent when an
Event of Default exists) and periodic cycle counts consistent with historical practices, and shall provide to Administrative Agent a report
based on each such inventory and count promptly upon completion thereof, together with such supporting information as Administrative
Agent may request. Administrative Agent may participate in and observe each physical count.
8.3.2. Returns of Inventory . No Borrower or Obligor shall return any Inventory to a supplier, vendor or other Person,
whether for cash, credit or otherwise, unless (a) such return is in the Ordinary Course of Business; (b) no Default, Event of Default, U.S.
Revolver Overadvance or Canadian Overadvance exists or would result therefrom; and (c) while a Trigger Event is in effect, any payment
received by an Obligor for a return is promptly remitted to the Applicable Agent for application to the applicable Obligations.
8.3.3. Acquisition, Sale and Maintenance . No Borrower shall, and each Borrower shall cause each other Obligor not to,
acquire or accept any Inventory on consignment or approval, and shall take all steps to assure that all Inventory is produced in accordance
with Applicable Law in all material respects, including the FLSA. No Borrower shall, and each Borrower shall cause each other Obligor not
to, sell any Inventory on consignment or approval or any other basis under which the customer may return or require a Borrower or other
Obligor to repurchase such Inventory. Borrowers shall, and shall cause each other Obligor to, use, store and maintain all Inventory with
reasonable care and caution, in accordance with applicable standards of any insurance and in conformity with all Applicable Law, and shall
make current rent payments (within applicable grace periods provided for in leases) at all material locations where any ABL Priority
Collateral is located.
8.4. [Intentionally Omitted.]
8.5. Cash Management; Administration of Deposit Accounts . All Deposit Accounts maintained by Obligors into which Cash
Receipts are deposited, including all Dominion Accounts, are set forth on the Perfection Certificates. To the extent any Deposit Accounts into
which Cash Receipts are deposited are not subject to a Deposit Account Control Agreement with the Administrative Agent on the Closing
Date, within 90 days of the Closing Date, each Borrower shall, and shall cause each other Obligor to, take all actions necessary to establish
the Administrative Agent’s control of each such Deposit Account into which Cash Receipts are deposited (other than (a) an account
exclusively used for payroll, payroll taxes or employee benefits, (b) an account containing not more than U.S. $1,000,000 at any time, (c) a
zero balance account, (d) an account that solely hold the proceeds of the sale of Term Priority Collateral, (e) an account into which funds are
solely deposited for the purpose of trust related activities or (f) that certain account held by the Canadian Borrower at Desjardin Bank as
further described on the Perfection Certificate for the Canadian Borrower; provided , that such account contains not more than CD$1,000,000
at any time and the funds in such account are swept at least weekly to a Deposit Account held by the Canadian Borrower that
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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is subject to a Deposit Account Control Agreement) by causing, to the extent necessary, each institution maintaining any such Deposit
Account for an Obligor to enter into a Deposit Account Control Agreement. Each Borrower shall, and shall cause each other Obligor to, be
the sole account holder of each Deposit Account into which Cash Receipts are deposited of such Obligor and shall not allow any other Person
(other than the Applicable Agent) to have control over such Deposit Account or any Property deposited therein. Each Borrower shall, and
shall cause each other Obligor to, promptly notify the Administrative Agent of any opening or closing of a Deposit Account into which Cash
Receipts are deposited and, with the consent of the Administrative Agent, will amend the applicable Perfection Certificate to reflect same
8.6. General Provisions .
8.6.1. Insurance of Collateral; Condemnation Proceeds .
(a) Each Borrower shall, and shall cause each other Obligor to, maintain insurance with respect to
the ABL Priority Collateral, covering casualty, hazard, theft, malicious mischief, flood and other risks, in amounts,
with endorsements and with reputable and financially sound insurers. All proceeds with respect to ABL Priority
Collateral under each policy shall be payable to the Applicable Agent, subject to the Intercreditor Agreement. From
time to time upon request, Borrowers shall, and shall cause each other Obligor to, deliver to Administrative Agent the
originals or certified copies of its insurance policies. Unless the Applicable Agent shall agree otherwise, each policy
shall include satisfactory endorsements (i) showing the Applicable Agent as loss payee; (ii) requiring 30 days’ prior
written notice to the Applicable Agent in the event of cancellation of the policy for any reason whatsoever; and (iii)
specifying that the interest of Applicable Agent shall not be impaired or invalidated by any act or neglect of any
Obligor or the owner of the Property, nor by the occupation of the premises for purposes more hazardous than are
permitted by the policy. If any Obligor fails to provide and pay for any insurance, each Agent may, at its option, but
shall not be required to, procure the insurance and charge Borrowers therefor. At the request of the Administrative
Agent, each Borrower agrees to deliver, and shall cause each other Obligor to deliver, to Applicable Agent, promptly
as rendered, copies of all reports made to insurance companies. While no Event of Default exists, Obligors may settle,
adjust or compromise any insurance claim, as long as the proceeds of any insurance with respect to Collateral are
delivered to Applicable Agent. If an Event of Default exists and subject to the Intercreditor Agreement, only Agents
shall be authorized to settle, adjust and compromise such claims.
(b) Subject to the Intercreditor Agreement, (i) any proceeds of insurance with respect to ABL
Priority Collateral and any awards arising from condemnation of any Collateral shall be paid to Applicable Agent and
(ii) any such proceeds or awards that relate to Inventory shall be applied to payment of the U.S. Revolver Loans (to
the extent such Inventory is owned by the U.S. Borrowers) or the Canadian Loans (to the extent such Inventory is
owned by the Canadian Borrower), and then to any other Obligations outstanding.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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8.6.2. Protection of Collateral . All expenses of protecting, storing, warehousing, insuring, handling, maintaining and
shipping any ABL Priority Collateral, all Taxes payable with respect to any Collateral (including any sale thereof), and all other payments
required to be made by any Agent to any Person to realize upon any ABL Priority Collateral, shall be borne and paid by Borrowers. No Agent
shall be liable or responsible in any way for the safekeeping of any ABL Priority Collateral, for any loss or damage thereto (except for
reasonable care in its custody while Collateral is in such Agent’s actual possession), for any diminution in the value thereof, or for any act or
default of any warehouseman, carrier, forwarding agency or other Person whatsoever, but the same shall be at Borrowers’ sole risk.
8.6.3. Defense of Title to Collateral . Each Borrower shall at all times defend its title to Collateral and each Agent’s Liens
therein against all Persons, claims and demands whatsoever, except Permitted Liens.
SECTION 9. REPRESENTATIONS AND WARRANTIES
9.1. General Representations and Warranties . To induce Agents and Lenders to enter into this Agreement and to make
available the U.S. Revolver Commitments, Canadian Commitments, Loans and Letters of Credit, Borrowers represent and warrant on the
Closing Date and on each other date on which the representations and warranties are made under the Loan Documents (including pursuant to
Section 6.3 ):
9.1.1. Organization and Qualification . Each Borrower and Subsidiary is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization. Each Borrower and Subsidiary is duly qualified, authorized to do business and
in good standing as a foreign corporation, partnership or limited liability company, as applicable, in each jurisdiction where failure to be so
qualified could reasonably be expected to have a Material Adverse Effect.
9.1.2. Power and Authority . Each Obligor has all requisite corporate power and authority and is duly authorized to
execute, deliver and perform its Loan Documents and has executed and delivered each Loan Document to which it is a party. The execution,
delivery and performance of the Loan Documents have been duly authorized by all necessary action, and do not (a) require any consent or
approval of any holders of Equity Interests of any Obligor, other than those already obtained; (b) contravene the Organic Documents of any
Obligor; (c) violate or cause a default under any Applicable Law or Material Contract that could reasonably be expected to have a Material
Adverse Effect; or (d) result in or require the imposition of any Lien (other than Permitted Liens) on any Property of any Obligor.
9.1.3. Enforceability . Each Loan Document is a legal, valid and binding obligation of each Obligor party thereto,
enforceable in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency or similar laws affecting the
enforcement of creditors’ rights generally and general principles of equity.
9.1.4. Capital Structure . Schedule 9.1.4 shows, as of the Signing Date, for each Borrower and Subsidiary, its name, its
jurisdiction of organization, its authorized and issued Equity Interests, the holders of its Equity Interests (other than with respect to UNFI),
and all agreements binding on such holders with respect to their Equity Interests. Except as disclosed on Schedule 9.1.4 , in the five years
preceding the Signing Date, no Borrower or Subsidiary has acquired all or substantially all of the assets of any other Person nor been the
surviving entity in a merger, amalgamation or combination. Each Borrower has good title to its Equity Interests in its Subsidiaries, and all
such Equity Interests are duly issued, fully paid and non-assessable. There are no outstanding purchase options, warrants, subscription rights,
agreements to issue or sell, convertible interests, phantom rights or powers of attorney relating to Equity Interests of any Borrower (other than
UNFI) or any Subsidiary.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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9.1.5. Title to Properties; Priority of Liens .
(a) Each Borrower and Subsidiary has good and marketable title to (or valid leasehold interests in)
all of its Real Estate, and good title to all of its material personal Property, including all Property reflected in any
financial statements delivered to Administrative Agent or Lenders, in each case free of Liens except Permitted Liens
and which failure to have such title or interest could not reasonably be expected to have a Material Adverse Effect.
Each Borrower and Subsidiary has paid and discharged all material lawful claims that, if unpaid, could become a Lien
on its Properties, other than Permitted Liens.
(b) (i) When all appropriate filings or recordings are made in the appropriate offices as may be
required under applicable Laws (which filings or recordings shall be made to the extent required by any Security
Document) and (ii) upon the taking of possession or control by the Administrative Agent of such Collateral with
respect to which a security interest may be perfected only by possession or control (which possession or control shall
be given to the Administrative Agent to the extent required by any Security Document or the Intercreditor
Agreement), the Liens created by such Security Documents will constitute so far as possible under relevant Law fully
perfected Liens on (with the priority set forth in the Intercreditor Agreement), and security interests in, all right, title
and interest of the Obligors in such Collateral to the extent perfection can be obtained by filing financing statements
or upon the taking of possession or control, in each case subject to no Liens other than Permitted Liens.
9.1.6. Accounts . Administrative Agent may rely, in determining which Accounts are Eligible Accounts, on all statements
and representations made by Borrowers with respect thereto. Borrowers warrant, with respect to each Account at the time it is shown as an
Eligible Account in a Borrowing Base Certificate, that:
(a) it is genuine and in all respects what it purports to be, and is not evidenced by a judgment;
(b) it arises out of a completed, bona fide sale and delivery of goods or rendition of services in the
Ordinary Course of Business, and substantially in accordance with any purchase order, contract or other document
relating thereto;
(c) it is for a sum certain, maturing as stated in the invoice covering such sale or rendition of
services, a copy of which has been furnished or is available to Administrative Agent on request;
(d) it is not subject to any offset, Lien (other than Applicable Agent’s Lien), deduction, defense,
dispute, counterclaim or other adverse condition except as arising in the Ordinary Course of Business and disclosed to
Administrative Agent; and it is absolutely owing by the Account Debtor, without contingency in any respect;
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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(e) no purchase order, agreement, document or Applicable Law restricts assignment of the Account
to any Agent (regardless of whether, under the UCC or PPSA, as applicable, the restriction is ineffective), and the
applicable Borrower is the sole payee or remittance party shown on the invoice;
(f) no extension, compromise, settlement, modification, credit, deduction or return has been
authorized with respect to the Account, except discounts or allowances granted in the Ordinary Course of Business
for prompt payment that are reflected on the face of the invoice related thereto and in the reports submitted to
Administrative Agent hereunder; and
(g) to the Borrowers’ knowledge, (i) there are no facts or circumstances that are reasonably likely
to impair the enforceability or collectibility of such Account; (ii) the Account Debtor had the capacity to contract
when the Account arose, continues to meet the applicable Borrower’s customary credit standards, is Solvent, is not
contemplating or subject to an Insolvency Proceeding, and has not failed, or suspended or ceased doing business; and
(iii) there are no proceedings or actions threatened or pending against any Account Debtor that could reasonably be
expected to have a material adverse effect on the Account Debtor’s financial condition.
9.1.7. Financial Statements . The consolidated balance sheets, and related statements of income, cash flow and
shareholder’s equity, of Borrowers and Subsidiaries that have been and are hereafter delivered to Administrative Agent and Lenders
(including the financial statements described in clause (i) of Section 6.2.4 ), are prepared in accordance with GAAP, and at the time of
delivery fairly present the financial positions and results of operations of Borrowers and Subsidiaries at the dates and for the periods indicated
(in the case of interim statements, subject to year-end adjustments and the absence of footnotes). All projections delivered from time to time
to the Administrative Agent and Lenders, in each case, have been prepared in good faith, based on assumptions believed by the management
of Borrowers to be reasonable in light of the circumstances at the time of preparation; it being understood that any such projections (i) are
subject to significant uncertainties and contingencies, many of which are beyond the control of the Borrower Agent and its Subsidiaries, that
no assurance can be given that any particular projections will be realized, that actual results may differ and that such differences may be
material and (ii) are not a guarantee of performance. Since August 1, 2017, there has been no change in the condition, financial or otherwise,
of any Borrower or Subsidiary that could reasonably be expected to have a Material Adverse Effect. On the Closing Date, the Borrower
Agent and its Subsidiaries are Solvent.
9.1.8. Surety Obligations . No Borrower or Subsidiary is obligated as surety or indemnitor under any bond or other contract
that assures payment or performance of any obligation of any other Person, except as permitted hereunder.
9.1.9. Taxes . Each Borrower and Subsidiary has (a) filed all federal, state, provincial, territorial and local tax returns and
other reports relating to taxes that it is required by law to file, except for any tax returns and reports relating to taxes (i) for which the failure
to file would not be material, individually or in the aggregate, or (ii) the amount, applicability or validity of which is currently being contested
in good faith by appropriate proceedings and with respect to which such Borrower or such Subsidiary, as the case may be, has established
adequate reserves in accordance with GAAP, and (b) paid, or made provision for the payment of, all Taxes upon it, its income and its
Properties that are due and payable, except to the extent being Properly Contested or the failure to pay would not result in a Material Adverse
Effect. The provision
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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for Taxes on the books of each Borrower and Subsidiary is adequate for all years not closed by applicable statutes, and for its current Fiscal
Year.
9.1.10. Brokers . There are no brokerage commissions, finder’s fees or investment banking fees payable in connection with
any transactions contemplated by the Loan Documents, other than fees payable to the Lead Arrangers and Lenders in connection with the
arrangement of this Agreement and funding of the initial Borrowings hereunder on the Closing Date.
9.1.11. Intellectual Property . Each Borrower and Subsidiary owns or has the lawful right to use all Intellectual Property
necessary for the conduct of its business, without conflict with any rights of others that could reasonably be expected to have a Material
Adverse Effect. There is no pending or, to any Borrower’s knowledge, threatened Intellectual Property Claim with respect to any Borrower,
any Subsidiary or any of their Property (including any Intellectual Property) that could reasonably be expected to have a Material Adverse
Effect. Except as disclosed on Schedule 9.1.11 , no Borrower or Subsidiary pays or owes any royalty to any Person with respect to any
Intellectual Property, other than de minimis amounts. All registered or applied-for patents, trademarks and copyrights, exclusive licenses of
registered copyrights and designs, included in the material Intellectual Property owned by any Borrower or Subsidiary on the Signing Date is
shown on Schedule 9.1.11 .
9.1.12. Governmental Approvals . Each Borrower and Subsidiary has, is in compliance with, and is in good standing with
respect to, all applicable Governmental Approvals necessary to conduct its business and to own, lease and operate its Properties, except where
noncompliance or the failure to be in good standing could not reasonably be expected to have a Material Adverse Effect. All necessary
import, export or other licenses, permits or certificates for the import or handling of any goods or other Collateral have been procured and are
in effect, and Borrowers and Subsidiaries have complied with all foreign and domestic laws with respect to the shipment and importation of
any goods or Collateral, except where noncompliance could not reasonably be expected to have a Material Adverse Effect.
9.1.13. Compliance with Laws . Each Borrower and Subsidiary has duly complied, and its Properties and business
operations are in compliance, in all material respects with all Applicable Law, except where noncompliance could not reasonably be expected
to have a Material Adverse Effect. There have been no citations, notices or orders of noncompliance issued to any Borrower or Subsidiary
under any Applicable Law, except where such noncompliance could not reasonably be expected to have a Material Adverse Effect. No
Inventory has been produced in violation of the FLSA.
9.1.14. Compliance with Environmental Laws . Except as disclosed on Schedule 9.1.14 , no Borrower’s or Subsidiary’s
past or present operations, Real Estate or other Properties are subject to any pending (or, to the knowledge of any Borrower or Subsidiary,
threatened) federal, state, provincial, territorial or local investigation to determine whether any remedial action is needed to address any
environmental pollution, Hazardous Material or environmental clean-up that, if such investigation is determined adversely to any Borrower or
Subsidiary, could reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect. No Borrower or Subsidiary has
received any Environmental Notice that could reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect, nor
to the knowledge of any Borrower or Subsidiary has any Environmental Notice been threatened. No Borrower or Subsidiary has any liability
(contingent or otherwise) arising under Environmental Law or with respect to any Environmental Release, environmental pollution or
Hazardous Material on any Real Estate now or previously owned, leased or operated by it, if the same could reasonably be expected to have a
Material Adverse Effect.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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9.1.15. Burdensome Contracts . No Borrower or Subsidiary is a party or subject to any contract, agreement or charter
restriction that could reasonably be expected to have a Material Adverse Effect.
9.1.16. Litigation . Except as shown on Schedule 9.1.16 , there are no proceedings or investigations pending or, to any
Borrower’s knowledge, threatened in writing against any Borrower or Subsidiary, or any of their businesses, operations, Properties or
condition (financial or otherwise), that (a) relate to any Loan Documents or transactions contemplated thereby; or (b) could reasonably be
expected to be determined adversely to such Borrower or Subsidiary, and if so determined, to have a Material Adverse Effect. Except as
shown on such Schedule or otherwise disclosed to the Administrative Agent in writing, no Obligor has a Commercial Tort Claim (other than,
as long as no Default or Event of Default exists, as of the Closing Date a Commercial Tort Claim for less than U.S.$1,000,000). No Borrower
or Subsidiary is in default with respect to any order, injunction or judgment of any Governmental Authority that could reasonably be expected
to have a Material Adverse Effect.
9.1.17. No Defaults . No event or circumstance has occurred or exists that constitutes a Default or Event of Default. No
Borrower or Subsidiary is in default, and no event or circumstance has occurred or exists that with the passage of time or giving of notice
would constitute a default, under any Material Contract if such default could reasonably be expected to result in a Material Adverse Effect.
9.1.18. ERISA; Canadian Plans . Except as disclosed on Schedule 9.1.18 :
(a) No Obligor has any Plan. Each Plan is in compliance in all material respects with the applicable
provisions of ERISA, the Code, and other federal, state, provincial and territorial laws except to the extent any such
noncompliance could not reasonably be expected to have a Material Adverse Effect. Each Plan that is intended to
qualify under Section 401(a) of the Code has received a favorable determination letter from the IRS or an application
for such a letter is currently being processed by the IRS with respect thereto and, to the knowledge of Borrowers,
nothing has occurred which would prevent, or cause the loss of, such qualification, in each case except to the extent
the failure to obtain such determination letter, make application therefor or retain such qualification could not
reasonably be expected to have a Material Adverse Effect. Each Obligor and ERISA Affiliate has in all material
respects met all applicable requirements under the Code and ERISA, and no application for a waiver of the minimum
funding standards or an extension of any amortization period has been made with respect to any Plan, except to the
extent such events or circumstances could not reasonably be expected to have a Material Adverse Effect.
(b) There are no pending or, to the knowledge of Borrowers, threatened claims, actions or lawsuits,
or action by any Governmental Authority, with respect to any Plan or any Canadian Plan that could reasonably be
expected to have a Material Adverse Effect. There has been no prohibited transaction or violation of the fiduciary
responsibility rules with respect to any Plan or any prohibited investment transaction or violation of any duty of an
administrator with respect to any Canadian Plan that has resulted in or could reasonably be expected to have a
Material Adverse Effect.
(c) (i) No ERISA Event has occurred or is reasonably expected to occur; (ii) no Pension Plan has
any Unfunded Pension Liability or has a “defined
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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benefit provision” as defined in the ITA; (iii) no Obligor or ERISA Affiliate has incurred, or reasonably expects to
incur, any material liability (and no event has occurred which, with the giving of notice under Section 4219 of
ERISA, would result in such liability) under Section 4201 of ERISA with respect to a Multiemployer Plan; (iv) no
Obligor or ERISA Affiliate has engaged in a transaction that could be subject to Section 4069 or 4212(c) of ERISA;
and (v) as of the most recent valuation date for any Pension Plan, the funding target attainment percentage (as defined
in Section 430(d)(2) of the Code) is at least 60%, and no Obligor or ERISA Affiliate knows of any fact or
circumstance that could reasonably be expected to cause the funding target attainment percentage for any such plan to
drop below 60% as of such date, except to the extent such events or circumstances could not reasonably be expected
to have a Material Adverse Effect.
(d) Each Canadian Plan, other than a Canadian MEPP (and, to the knowledge of the Canadian
Borrower and its Subsidiaries, each Canadian Plan that is a Canadian MEPP) is administered in compliance in all
material respects with Applicable Laws. Each Canadian Plan, other than a Canadian MEPP (and, to the knowledge of
the Canadian Borrower and its Subsidiaries, each Canadian Plan that is a Canadian MEPP) that is intended to qualify
for tax-preferred status is, to the extent applicable, duly registered under applicable pension standards laws and the
Income Tax Act (Canada), or is otherwise administered in such a manner as to qualify for such tax-preferred status,
and in all cases, to the knowledge of the Canadian Borrower and its Subsidiaries, nothing has occurred which would
prevent, or cause the loss of, such qualification. The Canadian Borrower and its Subsidiaries have made all required
contributions to each Canadian Plan, and no application for, or adoption of, solvency funding relief pursuant to the
Pension Benefits Act (Ontario) or applicable pension standards legislation of another Canadian jurisdiction has been
made with respect to any Canadian Plan.
(e) (i) No Canadian Pension Event has occurred or is reasonably expected to occur; (ii) no
Canadian Plan that is a registered pension plan, other than a Canadian MEPP, has any Unfunded Pension Liability;
(iii) neither the Canadian Borrower nor any of its Subsidiaries has incurred, or reasonably expects to incur, any
liability under the Pension Benefits Act (Ontario) or applicable pension standards legislation of another Canadian
jurisdiction or under the Income Tax Act (Canada) (other than contributions or premiums due and not delinquent to
such a plan or the Pension Benefits Guarantee Fund (Ontario)); and (iv) neither the Canadian Borrower nor any of its
Subsidiaries has incurred, or reasonably expects to incur, any liability (and no event has occurred which, with the
giving of notice under the Pension Benefits Act (Ontario) or applicable pension standards legislation of another
Canadian jurisdiction or under the Income Tax Act (Canada), would result in such liability) with respect to a
Canadian MEPP.
(f) With respect to any Foreign Plan, (i) all employer and employee contributions required by law
or by the terms of the Foreign Plan have been made, or, if applicable, accrued, in accordance with normal accounting
practices; (ii) the fair market value of the assets of each funded Foreign Plan, the liability of each insurer for any
Foreign Plan funded through insurance, or the book reserve established for any Foreign Plan, together with any
accrued contributions,
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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is sufficient to procure or provide for the accrued benefit obligations with respect to all current and former
participants in such Foreign Plan according to the actuarial assumptions and valuations most recently used to account
for such obligations in accordance with applicable generally accepted accounting principles; and (iii) it has been
registered as required and has been maintained in good standing with applicable regulatory authorities.
9.1.19. Trade Relations . Except to the extent that the same could not reasonably be expected to have a Material Adverse
Effect, (a) there exists no actual or threatened termination, limitation or modification of any business relationship between any Borrower or
Subsidiary and any customer or supplier, or any group of customers or suppliers and (b) there exists no condition or circumstance that could
reasonably be expected to impair the ability of any Borrower or Subsidiary to conduct its business at any time hereafter in substantially the
same manner as conducted on the Signing Date.
9.1.20. Labor Relations . Except as described on Schedule 9.1.20 , (a) as of the Closing Date no Borrower or Subsidiary is
party to or bound by any collective bargaining agreement, management agreement or consulting agreement and (b) there are no material
grievances, disputes or controversies with any union or other organization of any Borrower’s or Subsidiary’s employees, or, to any
Borrower’s knowledge, any asserted or threatened strikes, work stoppages or demands for collective bargaining, except those that could not
reasonably be expected to have a Material Adverse Effect.
9.1.21. Payable Practices . No Borrower or Subsidiary has made any material change in its historical accounts payable
practices from those in effect on the Signing Date that could reasonably be expected to result in a Material Adverse Effect.
9.1.22. Not a Regulated Entity . No Obligor is an “investment company” or a “person directly or indirectly controlled by or
acting on behalf of an investment company” within the meaning of the Investment Company Act of 1940.
9.1.23. Margin Stock . No Borrower or Subsidiary is engaged, principally or as one of its important activities, in the
business of extending credit for the purpose of purchasing or carrying any Margin Stock. No Loan proceeds or Letters of Credit will be used
by Borrowers to purchase or carry, or to reduce or refinance any Debt incurred to purchase or carry, any Margin Stock or for any related
purpose governed by Regulations T, U or X of the Board of Governors, except in compliance with applicable requirements of such
regulations.
9.1.24. PACA and PSA . No material PACA Claims or PSA Claims are pending or, to the Borrowers’ knowledge,
threatened, against any of the Borrowers or their Subsidiaries.
9.1.25. [Intentionally Omitted.]
9.1.26. Perfection Certificate . Each Borrower, for itself and on behalf of each other Obligor, represents and warrants to the
Secured Parties and the Administrative Agent as follows: (a) such Obligor’s exact legal name is that indicated on the most recent Perfection
Certificate delivered by such Obligor and on the signature page to such Perfection Certificate, (b) such Obligor is an organization of the type,
and is organized in the jurisdiction, set forth in such Perfection Certificate, (c) such Perfection Certificate accurately sets forth such Obligor’s
organizational identification number or accurately states that such Obligor has none, (d) such Perfection Certificate accurately sets forth such
Obligor’s place of business or, if more than one, its chief executive office, as well as such Obligor’s mailing address, if different, (e) all other
information set forth on such Perfection Certificate pertaining to such Obligor is accurate and complete, and
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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(f) except as disclosed to the Applicable Agent in writing, there has been no material change (it being understood that a change in the account
number of any deposit account, security account or investment account set forth therein shall be deemed to be a material change) in any of
such information since the date on which such Perfection Certificate was signed by such Obligor.
9.1.27. Sanctions . No Borrower, Subsidiary or, to the knowledge of any Borrower or Subsidiary, any director, officer,
employee or agent thereof, is an individual or entity that is currently the target of any Sanctions. No Borrower or Subsidiary is located,
organized or resident in a Designated Jurisdiction.
9.1.28. Patriot Act; Anti-Terrorism Laws . No proceeds of the Loans will be used by the Borrowers or their respective
Subsidiaries (a) in violation of United States Foreign Corrupt Practices Act of 1977, (b) in violation of any applicable provisions of the Patriot
Act, (c) in violation of applicable Sanctions or (d) in violation of the Investment Company Act of 1940.
9.1.29. HIPAA Compliance .
(a) To the extent that and for so long as any Obligor is a “covered entity” within the meaning of
HIPAA, such Obligor (i) has undertaken or will promptly undertake all appropriate surveys, audits, inventories,
reviews, analyses and/or assessments (including any necessary risk assessments) of all areas of its business and
operations required by HIPAA; (ii) has developed or will promptly develop an appropriate plan and time line for
becoming HIPAA Compliant (a “ HIPAA Compliance Plan ”); and (iii) has implemented or will implement those
provisions of such HIPAA Compliance Plan in all material respects necessary to ensure that such Obligor is or
becomes HIPAA Compliant.
(b) For purposes hereof, “HIPAA Compliant” shall mean that an Obligor (i) is or will be in
compliance in all material respects with each of the applicable requirements of the so-called “Administrative
Simplification” provisions of HIPAA on and as of each date that any part thereof, or any final rule or regulation
thereunder, becomes effective in accordance with its or their terms, as the case may be (each such date, a “ HIPAA
Compliance Date ”) and (ii) is not and would not reasonably be expected to become, as of any date following any
such HIPAA Compliance Date, the subject of any civil or criminal penalty, process, claim, action or proceeding, or
any administrative or other regulatory review, survey, process or proceeding (other than routine or mandated surveys
or reviews conducted by any Governmental Authority, government health plan or other accreditation entity) that has
had or would reasonably be expected to have a Material Adverse Effect.
(c) Each Obligor has entered into a business associate agreement with any third party acting on
behalf of the Obligor as a business associate as defined in 45 C.F.R. §160.103, where the failure to enter into such a
business associate agreement has had or would reasonably be expected to have a Material Adverse Effect.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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9.1.30. Compliance with Health Care Laws . Without limiting the representations and warranties set forth in Section
9.1.29. :
(a) Each Obligor is in compliance in all material respects with all applicable Health Care Laws,
including all Medicare and Medicaid program rules and regulations applicable to them. Without limiting the
generality of the foregoing, no Obligor has received notice by a Governmental Authority of any violation of any
provisions of the Medicare and Medicaid Anti-Fraud and Abuse or Anti-Kickback Amendments of the Social
Security Act (presently codified in Section 1128(B)(b) of the Social Security Act) or the Medicare and Medicaid
Patient and Program Protection Act of 1987.
(b) Each Obligor has maintained in all material respects all records required to be maintained by
the Food and Drug Administration, Drug Enforcement Agency and State Boards of Pharmacy, the Federal and State
Medicare and Medicaid programs and as otherwise required by applicable Health Care Laws and each Obligor has all
necessary permits, licenses, franchises, certificates and other approvals or authorizations of Governmental Authority
as are required under applicable Health Care Laws.
(c) Each Obligor who is a Certified Medicare Provider or Certified Medicaid Provider has in a
timely manner filed all requisite cost reports, claims and other reports required to be filed in connection with all
Medicare and Medicaid programs due on or before the date hereof, all of which are complete and correct in all
material respects. There are no known claims, actions or appeals pending before any Third Party Payor or
Governmental Authority, including any Fiscal Intermediary, the Provider Reimbursement Review Board or the
Administrator of the Centers for Medicare and Medicaid Services, with respect to any Medicare or Medicaid cost
reports or claims filed by any Obligor on or before the date hereof. There currently exist no restrictions, deficiencies,
required plans of correction actions or other such remedial measures with respect to federal and state Medicare and
Medicaid certifications or licensure.
9.1.31. EEA Financial Institutions . No Obligor is an EEA Financial Institution.
9.2. Complete Disclosure . All written information concerning the Borrower Agent and its Subsidiaries and their respective
businesses (other than projections, financial estimates, forecasts and budgets (collectively, “ Projections ”), other forward-looking information
and information of a general economic or industry nature) that has been furnished by or on behalf of the Borrower Agent or any of its
Subsidiaries to any Agent, any Lead Arranger or any Lender in connection with the transactions contemplated by this Agreement did not
when furnished, taken as a whole, contain any untrue statement of a material fact or omit to state a material fact necessary in order to make
the statements contained therein not materially misleading in light of the circumstances under which such statements are made, as
supplemented and updated from time to time, and (b) all Projections that have been furnished by or on behalf of the Borrower Agent or any of
its Subsidiaries to any Agent, any Lead Arranger or any Lender in connection with the transactions contemplated by this Agreement have
been prepared in good faith based upon assumptions believed to be reasonable by such furnishing party at the time of delivery thereof; it
being understood that such Projections (i) are subject to significant uncertainties and contingencies, many of which are beyond the control of
the furnishing party,
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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that no assurance can be given that any particular projections will be realized, that actual results may differ and that such differences may be
material and (ii) are not a guarantee of performance.
SECTION 10. COVENANTS AND CONTINUING AGREEMENTS
10.1. Affirmative Covenants . Commencing on the Closing Date and so long as any U.S. Revolver Commitments, Canadian
Commitments or Obligations are (other than Secured Bank Product Obligations and contingent indemnification and expense reimbursement
obligations as to which no claim has been made) outstanding, Borrowers shall, and shall cause each Subsidiary to:
10.1.1. Inspections; Appraisals .
(a) Permit any Agent from time to time, subject (except when a Default or Event of Default exists)
to reasonable notice and normal business hours, to visit and inspect the Properties of any Borrower or Subsidiary,
inspect, audit and make extracts from any Borrower’s or Subsidiary’s books and records, and discuss with its officers,
employees, agents, advisors and independent accountants such Borrower’s or Subsidiary’s business, financial
condition, assets and results of operations. Lenders may participate in any such visit or inspection, at their own
expense. No Agent or Lender shall have any duty to any Obligor to make any inspection, nor to share any results of
any inspection, appraisal or report with any Obligor. Borrowers acknowledge that all inspections, appraisals and
reports are prepared by Agents and Lenders for their purposes, and Borrowers shall not be entitled to rely upon them.
Each Obligor that keeps records relating to Collateral in the Province of Québec shall at all times keep a duplicate
copy thereof at a location outside the Province of Québec. Notwithstanding anything to the contrary in this Section
10.1.1(a) , none of the Borrowers or any Subsidiary will be required to disclose or permit the inspection or discussion
of, any document, information or other matter (i) that constitutes non-financial trade secrets or non-financial
proprietary information, (ii) in respect of which disclosure to the Administrative Agent or any Lender (or their
respective representatives or contractors) is prohibited by Law or any binding agreement or (iii) that is subject to
attorney client or similar privilege or constitutes attorney work product.
(b) Reimburse Agents for all charges, costs and expenses of Agents in connection with (i)
examinations of any Obligor’s books and records or any other financial or Collateral matters as Agents, in their
discretion, deem appropriate (including examinations with respect to Accounts, Credit Card Receivables and
Pharmacy Receivables), for one examination per Loan Year (or up to two examinations during any twelve month
period that begins on the first date that Adjusted Aggregate Availability is less than 17.5% of the Aggregate
Borrowing Base); and (ii) appraisals of Inventory and Prescription Files that Agents, in their discretion, deem
appropriate, for one appraisal per Loan Year (or up to two appraisals during any twelve month period that begins on
the first date that Adjusted Aggregate Availability is less than 17.5% of the Aggregate Borrowing Base); provided ,
however , that (x) if an examination or appraisal is initiated during a Default or Event of Default, all charges, costs
and expenses therefor shall be reimbursed by Borrowers without regard to such limits; (y) to the extent any
examinations or appraisals are conducted in connection with a Permitted Acquisition pursuant to clause (iii) of the
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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definition thereof, such examinations and appraisals shall not be included as examinations and appraisals subject to
the reimbursement limitations set forth in clauses (i) and (ii) above and (z) the Administrative Agent may elect, in
their Permitted Discretion, to conduct such appraisals once every other Loan Year if the Total Outstandings during
the 365-day period commencing with the date of the last such appraisal does not exceed $300,000,000 on any day
during such period. Borrowers agree to pay Agents’ then standard charges for examination activities, including the
standard charges of Agents’ internal examination and appraisal groups, as well as the charges of any third party used
for such purposes. This Section shall not be construed to limit Agents’ right to use third parties for such purposes.
(c) Prior to the Closing Date, the Borrower Agent will use commercially reasonable efforts to
deliver to the Administrative Agent a field examination and appraisal, which, for purposes of this clause (c), shall
include examinations of any books and records or any other financial or Collateral matters (including examinations
with respect to Accounts, Credit Card Receivables and Pharmacy Receivables) and appraisals of Inventory and
Prescription Files that, in each case, with respect to the Borrower Agent and its Subsidiaries (after giving effect to the
Supervalu Acquisition) as the Administrative Agent, in its Permitted Discretion, deems appropriate. In the event the
Administrative Agent has not received such field examinations and appraisals referenced to in the immediately
preceding sentence prior to the Closing Date, the Borrower Agent will use commercially reasonable efforts to provide
the Administrative Agent and its advisors and consultants with sufficient access and relevant information relating to
the Borrower Agent and its Subsidiaries (after giving effect to the Supervalu Acquisition) to complete such field
examinations and appraisals on or prior to the ninetieth (90th) day after the Closing Date as the Administrative Agent,
in its Permitted Discretion, deems appropriate. During the period from the Closing Date and until the Administrative
Agent’s receipt and reasonable opportunity to review such field examinations and appraisals, clause (b) of the U.S.
Revolver Borrowing Base (other than with respect to the Supervalu Borrowers) and clause (b) of the Canadian
Borrowing Base (and, in each case, the applicable components of clause (b) of the definition of Adjusted Aggregate
Availability) shall each be based on the most recently delivered Borrowing Base Certificate pursuant to the Existing
UNFI ABL Credit Agreement and, with respect to the Supervalu Borrowers, clause (b) of the definition of the U.S.
Revolver Borrowing Base (and the applicable components of clause (b) of the definition of Adjusted Aggregate
Availability) shall be based on the most recent borrowing base certificate delivered pursuant to the Existing Supervalu
Inc. Credit Agreement and such inputs shall be aggregated for the purpose of any U.S. Revolver Borrowing Base or
Canadian Borrowing Base calculations hereunder; and if the Administrative Agent does not receive such field
examinations and appraisals (and an updated Borrowing Base Certificate reflecting results of such examinations and
appraisals) on or prior to the ninetieth (90th) day after the Closing Date, clause (b) of each of the of the definition of
Canadian Borrowing Base and the definition of U.S. Revolver Borrowing Base, as applicable (and, in each case, the
applicable components of clause (b) of Adjusted Aggregate Availability) shall be zero on and after such ninetieth
(90th) until the Administrative Agent’s receipt and reasonable opportunity to review such field examinations and
appraisals (and
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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an updated Borrowing Base Certificate reflecting results of such examinations and appraisals).
10.1.2. Financial and Other Information . Keep adequate records and books of account with respect to its business
activities, in which proper entries are made in accordance with GAAP reflecting all financial transactions; and furnish to Administrative
Agent for prompt distribution to each Lender:
(a) as soon as available, and in any event within 120 days after the close of each Fiscal Year, the
Form 10-K of Borrower Agent as of the end of such Fiscal Year, as filed with the Securities and Exchange
Commission, which shall contain the unqualified, audited financial statements of Borrower Agent and its Subsidiaries
as of the end of such Fiscal Year, on a consolidated basis, certified (without qualification) by a firm of independent
certified public accountants of recognized standing selected by Borrowers and reasonably acceptable to
Administrative Agent (it being understood that any of the top eight U.S. accounting firms are acceptable to
Administrative Agent), and shall set forth in comparative form corresponding figures for the preceding Fiscal Year
and other information acceptable to the Administrative Agent;
(b) as soon as available, and in any event within 45 days after the end of each Fiscal Quarter, the
Form 10-Q of Borrower Agent as of the end of such Fiscal Quarter and the Fiscal Year to date, as filed with the
Securities and Exchange Commission, which shall contain unaudited, interim financial statements of Borrower Agent
and its Subsidiaries as of the end of such Fiscal Quarter and for the portion of the Fiscal Year then elapsed, on a
consolidated basis, and shall set forth in comparative form figures for the corresponding periods of the preceding
Fiscal Year, certified by the principal financial or accounting officer of Borrower Agent as having been prepared in
accordance with GAAP and fairly presenting the financial position and results of operations for such Fiscal Quarter
and the portion of the Fiscal Year then elapsed, subject to year‑end adjustments and the absence of footnotes;
(c) (i) concurrently with delivery of financial statements under clauses (a) and (b) above, or more
frequently if requested by Administrative Agent while a Default or Event of Default exists, a Compliance Certificate
executed by the principal financial or accounting officer of Borrower Agent, and (ii) if any Subsidiary has been
designated as an Unrestricted Subsidiary, concurrently with each delivery of financial statements under clause (a) or
(b) above, financial statements (in substantially the same form as the financial statements delivered pursuant to
clauses (a) and (b) above) prepared on the basis of consolidating the accounts of the Borrower Agent and its
Subsidiaries and treating any Unrestricted Subsidiaries as if they were not consolidated with the Borrower Agent or
accounted for on the basis of the equity method but rather accounted for as an investment and otherwise eliminating
all accounts of Unrestricted Subsidiaries, together with an explanation of reconciliation adjustments in reasonable
detail; provided that the financial statements pursuant to this clause (c)(ii) shall not be required to be delivered so long
as the combined aggregate amount of total assets as of the last day of any fiscal quarter for which financial statements
have been delivered pursuant to clause (a) or (b) above and the combined aggregate amount of gross revenues (net of
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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payroll, taxes, benefits and other deductions permitted under GAAP) for the fiscal quarter most recently ended in
each case of all Unrestricted Subsidiaries does not exceed 5.00% of the total assets of the Borrower Agent and its
Subsidiaries (including Unrestricted Subsidiaries) and 5.00% of the combined aggregate amount of such gross
revenues of the Borrower Agent and its Subsidiaries (including Unrestricted Subsidiaries), in each case excluding
intercompany assets and revenues for the fiscal quarter most recently ended;
(d) concurrently with delivery of financial statements under clause (a) above, copies of all
management letters and other material reports submitted to Borrower Agent by its accountants in connection with
such financial statements;
(e) as soon as available, and in any event within 30 days after the end of each Fiscal Quarter, or
more frequently if requested by Administrative Agent while a Default or Event of Default exists, an Aggregate
Availability Certificate executed by the principal financial or accounting officer of Borrower Agent;
(f) not later than the sixtieth (60th) day of each Fiscal Year, projections of Borrowers’ consolidated
balance sheets, results of operations, cash flow, Aggregate Availability, U.S. Revolver Availability and Canadian
Availability for such Fiscal Year, Fiscal Quarter by Fiscal Quarter and for the next three Fiscal Years, Fiscal Year by
Fiscal Year;
(g) promptly after the sending or filing thereof, copies of any proxy statements, financial
statements or reports that any Borrower has made generally available to its shareholders; copies of any regular,
periodic and special reports or registration statements or prospectuses that any Borrower files with the Securities and
Exchange Commission or any other Governmental Authority, or any securities exchange; and copies of any press
releases or other statements made available by a Borrower to the public concerning material changes to or
developments in the business of such Borrower; and
(h) promptly following any reasonable request therefor, information and documentation reasonably
requested by the Administrative Agent or any Lender for purposes of compliance with applicable “know your
customer” and anti-money laundering rules and regulations, including the Patriot Act and the Beneficial Ownership
Regulation.
(i) such other reports and information (financial or otherwise) as any Agent reasonably may request
from time to time in connection with any Collateral or any Borrower’s, Subsidiary’s or other Obligor’s financial
condition or business; provided , that such information is otherwise prepared by or available to the Borrowers or such
Subsidiary in the ordinary course of business, is of a type customarily provided to lenders in similar credit facilities
and is not subject to attorney-client or similar privilege.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Documents required to be delivered pursuant to Section 10.1.2(a) or (b) or Section 10.1.2(g) (to the extent any such documents are
included in materials otherwise filed with the Securities and Exchange Commission) may be delivered electronically and if so delivered, shall
be deemed to have been delivered on the date (i) on which the Borrower Agent posts such documents, or provides a link thereto on the
Borrower Agent’s website on the Internet at the website address listed on its signature page hereto; or (ii) on which such documents are
posted on the Borrower Agent’s behalf on an Internet or intranet website, if any, to which each Lender and the Administrative Agent have
access (whether a commercial, third-party website or whether sponsored by the Administrative Agent); provided , that: (A) the Borrowers
shall deliver paper copies of such documents to the Administrative Agent or any Lender upon its request to the Borrower Agent to deliver
such paper copies until a written request to cease delivering paper copies is given by the Administrative Agent or such Lender and (B) the
Borrower Agent shall notify the Administrative Agent and each Lender (by fax transmission or other electronic mail transmission) of the
posting of any such documents and provide to the Administrative Agent by electronic mail electronic versions (i.e., soft copies) of such
documents. The Administrative Agent shall have no obligation to request the delivery of or to maintain paper copies of the documents
referred to above, and in any event shall have no responsibility to monitor compliance by the Borrowers with any such request by a Lender
for delivery, and each Lender shall be solely responsible for requesting delivery to it or maintaining its copies of such documents.
10.1.3. Notices . Notify Administrative Agent and Lenders in writing, promptly after a Borrower’s obtaining knowledge
thereof, of any of the following that affects an Obligor: (a) the written threat or commencement of any proceeding or investigation, whether or
not covered by insurance, that reasonably could be expected to be determined adversely and, if so determined, to have a Material Adverse
Effect; (b) any pending or threatened labor dispute, strike or walkout, or the expiration of any material labor contract; (c) any default (if such
default could reasonably be expected to result in a termination of such Material Contract prior to the time that it otherwise would terminate in
the absence of such default) under, or termination of, a Material Contract; (d) the existence of any Default or Event of Default; (e) any
judgment in an amount exceeding U.S. $20,000,000; (f) the assertion of any Intellectual Property Claim, if an adverse resolution could
reasonably be expected to have a Material Adverse Effect; (g) any violation or asserted violation of any Applicable Law (including ERISA,
the Supplemental Pension Plans Act (Québec), the Pension Benefits Act (Ontario), OSHA, FLSA, or any Environmental Laws), if an adverse
resolution could reasonably be expected to have a Material Adverse Effect; (h) any Environmental Release by an Obligor or on any Property
owned, leased or occupied by an Obligor, or receipt of any Environmental Notice, if such occurrence could reasonably be expected to have a
Material Adverse Effect; (i) the occurrence of any ERISA Event or similar event with respect to any Canadian Plan; (j) the discharge of or
any withdrawal or resignation by Borrowers’ independent accountants; (k) the receipt or delivery of any material notices that any Borrower or
any Subsidiary gives or receives under or in connection with (i) PACA or any PACA Claim being asserted, (ii) PSA or any PSA Claim being
asserted, (iii) any claim of any Lien under the California Producer’s Lien Law or (iv) any claim under Section 81.1 or Section 81.2 of the
Bankruptcy and Insolvency Act (Canada) being asserted; (l) any change that causes any Borrower that had not previously so qualified to
qualify as a “legal entity customer” for purposes of the Beneficial Ownership Regulation; or (m) any change in the information provided in a
Beneficial Ownership Certification that would result in a change to the list of beneficial owners identified in parts (c) or (d) of such
certification.
10.1.4. Landlord and Storage Agreements . Upon request, provide Administrative Agent with copies of all existing
agreements, and promptly after execution thereof copies of all future agreements, between an Obligor and any landlord, warehouseman,
processor, shipper, bailee or other Person that owns any premises at which any ABL Priority Collateral may be kept or that otherwise may
possess or handle any ABL Priority Collateral.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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10.1.5. Compliance with Laws . Comply with all Applicable Laws, including ERISA, the Supplemental Pension Plans Act
(Québec), the Pension Benefits Act (Ontario), Environmental Laws, FLSA, OSHA, Anti-Terrorism Laws, Anti-Corruption Laws, Sanctions,
PACA, PSA and laws regarding collection and payment of Taxes, and maintain all Governmental Approvals necessary to the ownership of its
Properties or conduct of its business, unless failure to comply or maintain could not reasonably be expected to have a Material Adverse
Effect. Without limiting the generality of the foregoing, each Obligor shall and shall cause (a) each ERISA Affiliate to make prompt payment
of all contributions required to be made to satisfy the minimum funding standards set forth in ERISA with respect to any Pension Plan and (b)
its applicable Affiliates to make prompt payment of all contributions required to be made to satisfy the minimum funding standards set forth
in the Pension Benefits Act (Ontario) or under applicable pension standards legislation of another Canadian jurisdiction with respect to any
Canadian Plan. Without limiting the generality of the foregoing, if any Environmental Release occurs at or on any Properties of any Borrower
or Subsidiary, it shall act promptly and diligently to investigate and report to Administrative Agent and all appropriate Governmental
Authorities the extent of, and to take appropriate action to remediate, such Environmental Release, whether or not directed to do so by any
Governmental Authority unless a failure to do so could not reasonably be expected to have a Material Adverse Effect.
10.1.6. Taxes . Pay and discharge all Taxes prior to the date on which they become delinquent or penalties attach, unless
such Taxes are being Properly Contested.
10.1.7. Insurance . In addition to the insurance required hereunder with respect to Collateral, maintain insurance with
financially sound and reputable insurers, with respect to the Properties and business of Borrowers and Subsidiaries of such type (including
product liability, workers’ compensation and business interruption insurance), in such amounts, and with such coverages, self-insurance
(solely with respect to health, automobile and workers’ compensation coverages) and deductibles as are customary for companies similarly
situated.
10.1.8. Licenses . Keep each License affecting any Collateral (including the manufacture, distribution or disposition of
Inventory) or, to the extent the failure to do so could not reasonably result in a Material Adverse Effect, any other material Property of
Borrowers and Subsidiaries in full force and effect; and pay all Royalties when due.
10.1.9. Covenant to Guarantee Obligations and Give Security . At the Borrowers’ expense, take all action necessary or
reasonably requested by the Applicable Agent to ensure that the Guarantee and Collateral Requirement continues to be satisfied, including:
(a) to the extent that any condition set forth in Section 6.2.1 or Section 6.2.2 is not satisfied on the
Closing Date and is permitted to be satisfied after the Closing Date by the express terms of the final paragraph of
Section 6.2 , taking all actions necessary to satisfy the requirements set forth in 6.2.1 or Section 6.2.2 within 90 days
after the Closing Date (or such later date as agreed by the Administrative Agent in its discretion);
(b) solely to the extent not covered by the foregoing clause (a), upon (x) formation or acquisition of
any new direct or indirect wholly-owned Subsidiary of the Borrower Agent (other than any Excluded Obligor) or (y)
any Excluded Obligor ceasing to be an Excluded Obligor (including as a result of an Unrestricted Subsidiary ceasing
to be an Unrestricted Subsidiary), as applicable, promptly (i) notifying the Administrative Agent of such event and
(ii) within forty
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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five (45) days after such event (or such longer period as the Applicable Agent may agree in its reasonable discretion)
(a) causing each such Subsidiary to duly execute and deliver to the Applicable Agent all applicable Security
Documents or joinder agreements thereto (in each case, in a form approved by the Applicable Agent and the
Borrower Agent in their reasonable discretion without the further consent of any other party hereto so long as the
form thereof is not inconsistent with the requirements in the Guarantee and Collateral Requirement), which, when
taken together with the Security Documents delivered on the Closing Date pursuant to Section 6.2.1 and thereafter
pursuant to Section 10.1.9(a) , satisfy clause (c) of the Guarantee and Collateral Requirement, (b) causing each such
Subsidiary, or the parent company thereof, as applicable, to deliver all Pledged Collateral required to be pledged and
delivered pursuant to the Guarantee and Collateral Requirement to the Applicable Agent or, in accordance with the
terms of the Intercreditor Agreement, the Term Loan Facility Agent and (c) causing each such Subsidiary, or the
parent company thereof, as applicable, to provide evidence to the Applicable Agent that all other actions, recordings
and filings that the Applicable Agent may deem necessary to satisfy the Guarantee and Collateral Requirement shall
have been taken, completed or otherwise provided for in a manner reasonably satisfactory to the Applicable Agent
and, to the extent reasonably requested by the Applicable Agent, to deliver customary secretary’s certificates (with
customary attachments) with respect to such Subsidiary and customary legal opinions;
(c) solely to the extent such Person will be a U.S. Borrower, (x) such Person shall be a wholly-
owned Domestic Subsidiary and (y) other than with respect to any U.S. Borrower as of the Closing Date, the
Administrative Agent and Lenders shall have received at least five Business Days prior to the date on which such
Person is proposed to become a U.S. Borrower, and shall be satisfied with, all documentation and other information
about each such Person that is required by regulatory authorities under applicable “know your customer” and anti-
money laundering rules and regulations, including without limitation the Patriot Act and the Beneficial Ownership
Certification; and
(d) solely to the extent such Person will be a Borrower, entering into a joinder to this Agreement in
form and substance reasonably satisfactory to the Administrative Agent.
10.1.10. Records and Accounts . Maintain written records pertaining to (i) perishable agricultural commodities and by-
products and/or farm products in their possession to which a constructive trust under PACA or PSA or a Lien under the California Producer’s
Lien Law is applicable, (ii) goods supplied to the Canadian Borrower for which the supplier could assert a claim under Section 81.1. of the
Bankruptcy and Insolvency Act (Canada) and (iii) products supplied to the Canadian Borrower for which a farmer, fisherman or
aquaculturist, as applicable, could assert a claim under Section 81.2 of the Bankruptcy and Insolvency Act (Canada).
10.1.11. Post-Closing Deliverables . The Borrower Agent hereby agrees to deliver, or cause to be delivered, to the
Applicable Agent, in form and substance reasonably satisfactory to the Applicable Agent, the items described on Schedule 10.1.11 on or
before the dates specified with respect to such items, or such later dates as may be agreed to by, or as may be waived by, the Applicable
Agent in its reasonable discretion. All conditions precedent, covenants and representations and warranties contained in this
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Agreement and the other Loan Documents shall be deemed modified to the extent necessary to effect the foregoing (and to permit the taking
of the actions described on Schedule 10.1.11 within the time periods required by this Section 10.1.11 rather than as elsewhere provided in the
Loan Documents).
10.1.12. Designation of Subsidiaries .
(a) Subject to Section 10.1.12(b) below, the Borrower Agent may at any time after the Closing
Date designate any Subsidiary as an Unrestricted Subsidiary or any Unrestricted Subsidiary as a Subsidiary, in each
case in a written notice provided to the Administrative Agent. The designation of any Subsidiary as an Unrestricted
Subsidiary shall constitute an Investment by the applicable Obligor therein at the date of designation in an amount
equal to the fair market value of such Obligor’s investment therein. The designation of any Unrestricted Subsidiary
as a Subsidiary shall constitute the incurrence at the time of designation of any Debt or Liens of such Subsidiary
existing at such time.
(b) The Borrower Agent may not (x) designate any Subsidiary as an Unrestricted Subsidiary, or (y)
designate an Unrestricted Subsidiary as a Subsidiary, in each case unless:
(i)
(ii)
no Event of Default pursuant to Section 11(a), (i) or (j) (in the case of Section 11(i) or (j),
with respect to any Borrower) shall have occurred or be continuing; and
in the case of clause (x) only, (A) the Subsidiary to be so designated (i) does not (directly, or
indirectly through its Subsidiaries) own any Equity Interests or Debt of, or own or hold any
Lien on any property of, any Borrower or any Subsidiary (unless such Subsidiary is also
designated an Unrestricted Subsidiary) and does not own any Intellectual Property (other than
any Intellectual Property that, in the reasonable business judgment of the Borrower Agent, is
immaterial to, or no longer used in or necessary for, the conduct of the business of the
Borrower Agent or any Restricted Subsidiary) and (ii) is not, or substantially concurrently
with the designation hereunder will not be, a “restricted” Subsidiary under the Term Loan
Facility, (B) neither the Borrowers nor any Subsidiary shall at any time be directly or
indirectly liable for any Debt that provides that the holder thereof may (with the passage of
time or notice or both) declare a default thereon or cause the payment thereof to be
accelerated or payable prior to its stated maturity upon the occurrence of a default with
respect to any Debt, Lien or other obligation of any Unrestricted Subsidiary (including any
right to take enforcement action against such Unrestricted Subsidiary), (C) after giving effect
to such designation, the Total Outstandings would not exceed the Aggregate Borrowing Base,
(D) if more than 5.00% of the assets included in the
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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most recent calculation of the Borrowing Base are held by the Subsidiaries so designated, the
Borrower Agent shall have delivered to the Administrative Agent an updated Borrowing Base
Certificate giving pro forma effect to such designation on or prior to the date of such
designation, (E) immediately before and after giving effect to such designation, the Borrower
Agent could have satisfied the Distributions Payment Conditions and (F) the Borrower Agent
shall have delivered to the Administrative Agent and each Lender a statement, certified by the
principal financial or accounting officer of UNFI, that the conditions in this Section
10.1.12(b) have been complied with and setting forth, in reasonable detail, computations
evidencing satisfaction of the requirement set forth in clause (E) above.
10.2. Negative Covenants . Commencing on the Closing Date and so long as any U.S. Revolver Commitments, Canadian
Commitments or Obligations (other than Secured Bank Product Obligations and contingent indemnification and expense reimbursement
obligations as to which no claim has been made) are outstanding, Borrowers shall not, and shall cause each Subsidiary not to:
10.2.1. Permitted Debt . Create, incur, guarantee or suffer to exist any Debt, except:
(a) the Obligations;
(b) Permitted Purchase Money Debt;
(c) Debt outstanding on the Signing Date described on Schedule 10.2.1 ; provided that any Debt
listed or described in Section 2 of Schedule 10.2.1 that is Debt of an Obligor owing to any Person that is not an
Obligor shall be subject to subordination terms acceptable to the Administrative Agent; provided, further, that with
respect to any such Debt listed or described in Section 2 of Schedule 10.2.1 that is Debt attributable the Supervalu
Group, if the Borrower Agent is unable to so subordinate it on the Closing Date after its use of commercially
reasonable efforts to do so, then the Borrower Agent shall be required to cause the entry into such subordination
arrangements no later than 30 days after the Closing Date (or such later date as may be agreed to by the
Administrative Agent in its discretion);
(d) Debt with respect to Bank Products incurred in the Ordinary Course of Business;
(e) Permitted Contingent Obligations;
(f) Refinancing Debt as long as each Refinancing Condition is satisfied; provided , that (i) in the
case of Refinancing Debt with respect to Debt permitted or originally incurred under clause (b), (e), (h), (i), (j), (l),
(m), (n), (o), (p), (t), (u), (v), (w) or (x) of this Section 10.2.1 , the incurrence of such Refinancing Debt shall be
deemed to be incurred in reliance on the relevant clause noted above and not under this clause (f) and (ii) in the case
of any Debt listed or described in Section 2 of Schedule 10.2.1 that is Debt of the Borrower Agent or any of its
Subsidiaries owing to the Borrower Agent or any of its Subsidiaries, the lender or
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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other obligee under such Refinancing Debt shall be the Borrower Agent or one of its Subsidiaries;
(g) Debt representing an Investment that is not prohibited by Section 10.2.5 ;
(h) intercompany Debt permitted by Section 10.2.7 ;
(i) Debt represented by financed insurance premiums;
(j) Debt representing deferred compensation to current or former employees, officers and directors
of a Borrower or Subsidiary incurred in the Ordinary Course of Business;
(k) Debt under any Seller Note; provided , that (i) to the extent that such Debt becomes due and
payable and such payments are required to be made by the Borrower Agent or any Subsidiary, the Borrower Agent or
such Subsidiary shall make such payments within two (2) Business Days thereof and (ii) the terms of such Seller Note
shall be reasonably satisfactory to the Administrative Agent;
(l) Debt under the Term Loan Agreement in an aggregate principal amount not to exceed (x)
$2,150,000,000 plus (y) the aggregate principal amount of Debt permitted to be incurred as “Incremental Facilities”
under and as defined in the Term Loan Agreement as in effect on the Closing Date not to exceed at any time the
Maximum Incremental Facilities Amount (or pursuant to any comparable provisions to the extent such provisions are
not used to incur an aggregate principal amount of such Debt in excess of the Maximum Incremental Facilities
Amount);
(m) Debt in respect of Incremental Equivalent Debt;
(n) Debt that is not included in any of the clauses of this Section and does not exceed the greater of
(x) U.S. $125,000,000 and (y) 15.00% of Consolidated EBITDA of the Borrowers and the Subsidiaries for the most
recently ended period of four consecutive Fiscal Quarters calculated on a pro forma basis in the aggregate at any time;
provided , that if such Debt is secured by the Collateral, (A) any Liens on ABL Priority Collateral shall be junior to
the Liens on the ABL Priority Collateral securing the Obligations and (B) the representatives (or beneficiary or agent)
in respect of such Debt shall have entered into the Intercreditor Agreement;
(o) the Existing UNFI Term Loan Credit Agreement; provided , that the Existing UNFI Term Loan
Credit Agreement shall be permitted under this clause (o) only during the period from and after the Closing Date until
the date that is 45 days after the Closing Date;
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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(p) Debt to current or former officers, directors, partners, managers, consultants and employees,
their respective estates, spouses or former spouses to finance the purchase or redemption of Equity Interests of any
Borrower (or any direct or indirect parent thereof) permitted by Section 10.2.4 in an aggregate amount not to exceed
$15,000,000 at any one time outstanding;
(q) Debt in respect of netting services, automatic clearinghouse arrangements, overdraft protections
and similar arrangements in each case incurred in the ordinary course;
(r) Debt incurred by any Borrower or any of the Subsidiaries in respect of letters of credit, bank
guarantees, bankers’ acceptances, warehouse receipts or similar instruments issued or created in the ordinary course
of business, including in respect of workers compensation claims, health, disability or other employee benefits or
property, casualty or liability insurance or self-insurance or other Debt with respect to reimbursement-type obligations
regarding workers compensation claims;
(s) Debt supported by a Letter of Credit in a principal amount not to exceed the face amount of
such Letter of Credit;
(t) Debt incurred by a Subsidiary that is not an Obligor, and guarantees thereof by a Subsidiary that
is not an Obligor, in an aggregate principal amount not to exceed the greater of (x) $50,000,000 and (y) 5.00% of
Consolidated EBITDA of the Borrowers and the Subsidiaries for the most recently ended most recently ended period
of four consecutive Fiscal Quarters calculated on a pro forma basis at any one time outstanding;
(u) unsecured Contribution Debt;
(v) [ Intentionally Omitted ] ;
(w) Debt assumed in connection a Permitted Acquisition or other Investment not prohibited
hereunder and not created in contemplation thereof, so long as (i) in the case of any such Debt that is secured by a
Lien on the property of any Subsidiary of the Borrower Agent, the Consolidated Secured Net Leverage Ratio does not
exceed 4.00 to 1.00 and (ii) in the case of any such Debt that is unsecured, the Consolidated Total Net Leverage Ratio
does not exceed 4.50 to 1.00 (in each case, calculated on a pro forma basis, and after giving effect to any other
transactions consummated in connection therewith but assuming that any commitments thereunder are fully drawn as
of the date of assumption); provided , that Debt incurred by a Subsidiary that is not an Obligor pursuant to this clause
(w) of this Section 10.2.1 , and guarantees thereof by a Subsidiary that is not an Obligor, in an aggregate principal
amount not to exceed the greater of (x) $50,000,000 and (y) 5.00% of Consolidated EBITDA of the Borrowers and
the Subsidiaries for the most recently ended most recently ended period of four consecutive Fiscal Quarters calculated
on a pro forma basis at any one time outstanding;
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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(x) Debt of any Obligor pursuant to Customer Support Transactions; provided, that, (i) the
aggregate amount of CST Exposure after giving effect to the incurrence of such Debt shall not exceed
U.S.$250,000,000, (ii) the aggregate amount of Specified CST Exposure after giving effect to the incurrence of such
Debt shall not exceed U.S.$150,000,000, and (ii) no Default or Event of Default shall exist or have occurred and be
continuing after giving effect to the incurrence of such Debt; and
(y) all premiums (if any), interest (including post-petition interest), fees, expenses, charges and
additional or contingent interest on obligations described in clauses (a) through (x) above.
10.2.2. Permitted Liens . Create or suffer to exist any Lien upon any of its Property, except the following (collectively, “
Permitted Liens ”):
(a) Liens pursuant to any Loan Document;
(b) Purchase Money Liens securing Permitted Purchase Money Debt or any Refinancing Debt with
respect thereto;
(c) Liens for Taxes that are not delinquent or that are being Properly Contested;
(d) statutory Liens (other than (i) Liens for Taxes or imposed under ERISA, and (ii) except for
those liens in respect of contribution amounts not yet due or payable to the pension fund, Liens imposed under the
Pension Benefits Act (Ontario) or under applicable pension standards legislation of another Canadian jurisdiction)
arising in the Ordinary Course of Business, but only if payment of the obligations secured thereby is not delinquent
for a period of more than 30 days (or if more than thirty (30) days overdue, are unfiled (or if filed have been
discharged or stayed) and no other action has been taken to enforce such Lien) or is being Properly Contested;
(e) Liens incurred or pledges or deposits made in the Ordinary Course of Business to secure the
performance of tenders, bids, leases, contracts (except those relating to Borrowed Money), statutory obligations and
other similar obligations surety, stay, customs and appeal bonds, performance bonds and other obligations of a like
nature (including those to secure health, safety and environmental obligations), or arising as a result of progress
payments under government contracts, as long as such Liens are at all times junior to the Applicable Agent’s Liens on
ABL Priority Collateral;
(f) Liens arising in the Ordinary Course of Business that are subject to Lien Waivers;
(g) Liens arising by virtue of a judgment or judicial order against any Borrower or Subsidiary, or
any Property of a Borrower or Subsidiary, as long as such Liens do not constitute an Event of Default under Section
11.1(g) ;
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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(h) easements, rights-of-way, restrictions, covenants or other agreements of record, and other
similar charges or encumbrances on Real Estate, that do not secure any monetary obligation and do not interfere with
the Ordinary Course of Business;
(i) the reservations, limitations, provisos and conditions expressed in any original grants from Her
Majesty The Queen in Right of Canada of real or immoveable property, which do not materially impair the use of the
affected land for the purpose used or intended to be used by such Person;
(j) title defects or irregularities that are of a minor nature and that in the aggregate do not materially
impair the use of the affected property for the purpose for which it is used by such Person;
(k) normal and customary rights of setoff upon deposits in favor of depository institutions, and
Liens of a collecting bank on Payment Items in the course of collection;
(l) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or other like Liens arising
in the Ordinary Course of Business securing obligations that are not delinquent for more than 30 days (or if more than
thirty (30) days overdue, are unfiled (or if filed have been discharged or stayed) and no other action has been taken to
enforce such Lien) or that are being Properly Contested;
(m) (i) pledges, deposits or Liens in the Ordinary Course of Business in connection with workers’
compensation, payroll taxes, unemployment insurance and other social security legislation, other than any Lien
imposed by ERISA and (ii) pledges and deposits in the ordinary course of business securing liability for
reimbursement or indemnification obligations of (including obligations in respect of letters of credit or bank
guarantees for the benefit of) insurance carriers providing property, casualty or liability insurance to any Borrower or
any Subsidiary;
(n) Liens shown on Schedule 10.2.2 ;
(o) Liens granted pursuant to the Term Loan Facility Documents and in respect of any Refinancing
Debt in respect thereof ( provided , that such Liens shall be junior to the Liens on the ABL Priority Collateral
securing the Obligations in accordance with the Intercreditor Agreement);
(p) Liens in respect of Incremental Equivalent Debt and in respect of any Refinancing Debt in
respect thereof ( provided , that such Liens shall be junior to the Liens on the ABL Priority Collateral securing the
Obligations in accordance with the Intercreditor Agreement);
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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(q) Liens or rights of setoff against credit balances of any Borrower or any of the Subsidiaries with
Credit Card Issuers or Credit Card Processors or amounts owing by such Credit Card Issuers or Credit Card
Processors to any Borrower or any of the Subsidiaries in the ordinary course of business, but not Liens on or rights of
setoff against any other property or assets of the Obligors, pursuant to the Credit Card Agreements to secure the
obligations of the Obligors to such Credit Card Issuers or Credit Card Processors as a result of fees and chargebacks;
(r) Liens securing the Existing UNFI Term Loan Credit Agreement; provided , that the Liens
securing the Existing UNFI Term Loan Credit Agreement shall be permitted under this clause (r) only during the
period from and after the Closing Date until the date that is 45 days after the Closing Date;
(s) leases, licenses, subleases or sublicenses and Liens on the property covered thereby, in each
case, granted to others in the ordinary course of business which do not (i) interfere in any material respect with the
business of any Borrower or any Subsidiary, taken as a whole, or (ii) secure any Debt;
(t) Liens in favor of customs and revenue authorities arising as a matter of law to secure payment
of customs duties in connection with the importation of goods in the ordinary course of business;
(u) Liens (i) on cash advances in favor of the seller of any property to be acquired in an
Investment, to be applied against the purchase price for such Investment and (ii) consisting of an agreement to
dispose of any property in an Asset Disposition, in each case, solely to the extent such Investment or an Asset
Disposition, as the case may be, would have been permitted on the date of the creation of such Lien;
(v) Liens in favor of a Borrower or a Subsidiary securing Debt permitted under Section 10.2.1(h);
provided , that any Lien in favor of a Subsidiary that is not an Obligor shall be a Lien ranking junior to the Lien on
the Collateral securing the Obligations; and such Debt may not be secured by any assets that are not Collateral.
(w) Liens existing on property at the time of its acquisition or existing on the property of any
Person at the time such Person becomes a Subsidiary, in each case after the date hereof; provided, that (i) such Lien
was not created in contemplation of such acquisition or such Person becoming a Subsidiary, (ii) such Lien does not
extend to or cover any other assets or property (other than the proceeds or products thereof and other than after-
acquired property subjected to a Lien securing Debt and other obligations incurred prior to such time and which Debt
and other obligations are permitted hereunder that require, pursuant to their terms at such time, a pledge of after-
acquired property, it being understood that such requirement shall not be permitted to apply to any property to which
such requirement would not have applied but for such acquisition), (iii) the Debt secured thereby is permitted under
Section 10.2.2 and (iv) no such Lien may extend to or
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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cover any ABL Priority Collateral unless such Lien is junior to the Lien securing the Obligations;
(x) Liens, if any, arising out of conditional sale, title retention, consignment or similar
arrangements for sale of goods entered into by any Borrower or any Subsidiary in the ordinary course of business;
(y) Liens, if any, arising from precautionary Uniform Commercial Code or PPSA financing
statements;
(z) Liens on insurance policies and the proceeds thereof securing the financing of the premiums
with respect thereto;
(aa) Liens on specific items of inventory or other goods and the proceeds thereof securing such
Person’s obligations in respect of documentary letters of credit issued for the account of such Person to facilitate the
purchase, shipment or storage of such inventory or goods;
(bb) the modification, replacement, renewal or extension of any Lien permitted by this Section
10.2.2 ; provided , that (i) the Lien does not extend to any additional property other than (A) after-acquired property
that is affixed or incorporated into the property covered by such Lien or financed by Debt permitted under Section
10.2.1 , and (B) proceeds and products thereof; and (ii) the renewal, extension or refinancing of the obligations
secured or benefited by such Liens is permitted by Section 10.2.2 ;
(cc) ground leases in respect of real property on which facilities owned or leased by any Borrower
or any Subsidiary are located;
(dd) Liens on property of a Subsidiary that is not an Obligor securing Debt or other obligations of
such Subsidiary that is not an Obligor;
(ee) Liens solely on any cash earnest money deposits made by any Borrower or any Subsidiary in
connection with any letter of intent or purchase agreement permitted hereunder;
(ff) Liens securing Debt permitted pursuant to Section 10.2.1(d) ;
(gg) other Liens securing Debt or other obligations in an aggregate principal amount at any time
outstanding not to exceed the greater of (x) $125,000,000 and (y) 15.00% of Consolidated EBITDA of the Borrowers
and the Subsidiaries for the most recently ended most recently ended period of four consecutive Fiscal Quarters
calculated on a pro forma basis calculated on a pro forma basis; provided , that (i) any Liens on ABL Priority
Collateral shall be junior to the Liens on the ABL Priority Collateral securing the Obligations and (ii) the
representatives (or beneficiary or agent) in respect of such Debt or obligations shall have entered into the Intercreditor
Agreement;
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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(hh) with respect to any Foreign Subsidiary, other Liens and privileges arising mandatorily by
Law; and
(ii) Liens on the Equity Interests of joint ventures securing financing arrangements for the benefit
of the applicable joint ventures that are not otherwise prohibited under this Agreement.
10.2.3. [Intentionally Omitted] .
10.2.4. Distributions; Upstream Payments . Declare or make any Distributions, except:
(a) Upstream Payments; provided , that any Upstream Payments by a Subsidiary (other than a
Subsidiary that is a Subsidiary of the Canadian Borrower) to the Canadian Borrower shall not exceed in the aggregate
during any Fiscal Year the greater of (x) U.S.$10,000,000 (or its equivalent in other currencies) and (y) 1.00% of
Consolidated EBITDA of the Borrowers and the Subsidiaries for the most recently ended period of four consecutive
Fiscal Quarters calculated on a pro forma basis;
(b) payments by any Borrower or Subsidiary in respect of withholding or similar Taxes payable by
any future, present or former officer, director, manager or employee (or any spouse, former spouse, successor,
executor, administrator, heir, legatee or distributee of any of the foregoing) and any repurchases of Equity Interests in
consideration of such payments including deemed repurchases in connection with the exercise of stock options;
provided , that the aggregate amount of all cash payments made pursuant to this clause (b) shall not exceed in any
Fiscal Year the greater of (x) $25,000,000 and (y) 3.00% of Consolidated EBITDA of the Borrowers and the
Subsidiaries for the most recently ended period of four consecutive Fiscal Quarters calculated on a pro forma basis;
(c) UNFI may purchase or redeem in whole or in part any of its Equity Interests for another class of
Equity Interests or rights to acquire its Equity Interests or with proceeds from substantially concurrent equity
contributions or issuances of new Equity Interests of UNFI, provided , that any terms and provisions material to the
interests of the Lenders, when taken as a whole, contained in such other class of Equity Interests are at least as
advantageous to the Lenders as those contained in the Equity Interests redeemed thereby;
(d) to the extent constituting Distributions, the Borrowers and the Subsidiaries may enter into and
consummate transactions expressly permitted by any provision of Section 10.2.5 and Section 10.2.6 ;
(e) repurchases of Equity Interests in the ordinary course of business deemed to occur upon
exercise of stock options or warrants if such Equity Interests represent a portion of the exercise price of such options
or warrants;
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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(f) the Borrowers or any Subsidiary may pay any Distribution within 60 days after the date of
declaration thereof, if at the date of declaration such payment would have complied with the provisions of this
Agreement (it being understood that a distribution pursuant to this Section 10.2.4(f) shall be deemed to have utilized
capacity under such other provision of this Agreement);
(g) any Borrower or any Subsidiary may (a) pay cash in lieu of fractional Equity Interests in
connection with any dividend, split or combination thereof or any Permitted Acquisition and (b) honor any
conversion request by a holder of convertible Debt and make cash payments in lieu of fractional shares in connection
with any such conversion; and
(h) any Borrower or any Subsidiary may make additional Distributions in an amount not to exceed
the Available Equity Amount.
Notwithstanding the foregoing, and so long as no Event of Default shall exist before or after giving effect to the proposed
Distribution, UNFI may make Distributions to the extent (i)(A) daily average Adjusted Aggregate Availability for the 30 consecutive days
immediately before making the proposed Distribution, calculated on a pro forma basis after giving effect to such Distribution as if such
Distribution had been made at the beginning of such 30 day period, is at least 12.5% of the Aggregate Borrowing Base, and (B) Borrowers
have a Fixed Charge Coverage Ratio of at least 1.00:1.00 for the most recently completed period of four Fiscal Quarters for which financial
statements have been provided pursuant to Section 10.1.2 , calculated on a pro forma basis after giving effect to such Distribution as if such
Distribution had been made at the beginning of such period of four Fiscal Quarters; provided , that to the extent daily average Adjusted
Aggregate Availability for the 30 consecutive days immediately before making the proposed Distribution, calculated on a pro forma basis
after giving effect to such Distribution as if such Distribution had been made at the beginning of such 30 day period, is at least 17.5% of the
Aggregate Borrowing Base, this clause (B) shall not be applicable (the conditions in this clause (i), the “ Distributions Payment Conditions ”)
and (ii) UNFI shall have delivered to the Administrative Agent and each Lender a statement, certified by the principal financial or accounting
officer of UNFI, setting forth, in reasonable detail, computations (determined in a manner reasonably acceptable to the Administrative Agent)
evidencing satisfaction of the requirements set forth in clause (i) above.
10.2.5. Restricted Investments . Make any Restricted Investment.
10.2.6. Disposition of Property . Make any Asset Disposition, except:
(a) dispositions of obsolete, worn out or surplus property, whether now owned or hereafter
acquired, in the ordinary course of business and dispositions of property no longer used or useful in the conduct of the
business of the Borrowers and the Subsidiaries;
(b) dispositions of inventory and immaterial assets in the ordinary course of business (including
allowing any registrations or any applications for registration of any immaterial Intellectual Property that is no longer
economically practicable to maintain to lapse or go abandoned in the ordinary course of business);
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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(c) dispositions of property (other than ABL Priority Collateral) to the extent that (i) such property
is exchanged for credit against the purchase price of similar replacement property that is promptly purchased or (ii)
the proceeds of such disposition are promptly applied to the purchase price of such replacement property (which
replacement property is actually promptly purchased);
(d) dispositions of property to a Borrower or a Subsidiary; provided , that if the transferor of such
property is an Obligor (i) the transferee thereof must be an Obligor and, in the case of a transferor that is a U.S. Loan
Party, the transferee must be a U.S. Loan Party or (ii) to the extent such transaction constitutes an Investment, such
transaction is permitted under Section 10.2.5 ;
(e) dispositions permitted by Section 10.2.4 , Section 10.2.5 and Section 10.2.9 and Liens
permitted by Section 10.2.2 ;
(f) dispositions in the ordinary course of business of Cash Equivalents;
(g) leases, subleases, licenses or sublicenses, in each case in the ordinary course of business and
which do not materially interfere with the business of the Borrowers and the Subsidiaries, taken as a whole;
(h) transfers of property subject to casualty events;
(i) dispositions of Investments in joint ventures or non-wholly-owned Subsidiaries to the extent
required by, or made pursuant to, customary buy/sell arrangements between the parties to such joint venture or
shareholders of such non-wholly-owned Subsidiary set forth in the shareholders agreements, joint venture
agreements, organizational documents or similar binding agreements relating to such joint venture or non-wholly-
owned Subsidiary;
(j) dispositions of accounts receivable in the ordinary course of business in connection with the
collection or compromise thereof or pursuant to factoring arrangements, in each case, to the extent not constituting a
receivables financing; provided that, if requested by the Administrative Agent in its discretion, the Borrower Agent
shall cause the purchaser of such accounts receivable to be subject to a customary intercreditor agreement reasonably
satisfactory to the Administrative Agent, and to the extent not achieved, such dispositions shall not be permitted
pursuant to this clause (j);
(k) the unwinding of any Hedging Agreement pursuant to its terms;
(l) Permitted Sale Leasebacks;
(m) dispositions not otherwise permitted pursuant to this Section 10.2.6 ; provided , that (i) such
disposition shall be for fair market value as reasonably determined by the Borrower Agent in good faith, (ii) the
Borrower Agent shall deliver an updated Borrowing Base Certificate within ten (10) Business Days following the
disposition thereof if more than 5.00% of the assets included in the
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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most recent calculation of the Borrowing Base are being disposed of pursuant to this clause (m) and (iii) the
Borrowers or any applicable Subsidiary shall receive not less than 75% of such consideration in the form of cash or
Cash Equivalents (provided, however, that for the purposes of this clause (m)(iii), the following shall be deemed to be
cash: (A) the assumption by the transferee of Debt or other liabilities contingent or otherwise of any Borrower or any
of the Subsidiaries (other than subordinated debt) and the valid release of such Borrower or such Subsidiary, by all
applicable creditors in writing, from all liability on such Debt or other liability in connection with such disposition,
(B) securities, notes or other obligations received by any Borrower or any of the Subsidiaries from the transferee that
are converted by any Borrower or any of the Subsidiaries into cash or Cash Equivalents within 180 days following the
closing of such disposition, (C) Debt (other than subordinated debt) of any Subsidiary that is no longer an Obligor as
a result of such disposition, to the extent that each Borrower and each Subsidiary are released from any guarantee of
payment of such Debt in connection with such disposition and (D) the aggregate Designated Non-Cash Consideration
received by the Borrowers and the Subsidiaries for all dispositions under this clause (m) having an aggregate fair
market value (determined as of the closing of the applicable disposition for which such Designated Non-Cash
Consideration is received) not to exceed the greater of (x) $100,000,000 and (y) 12.5% of Consolidated EBITDA of
the Borrowers and the Subsidiaries for the most recently ended period of four consecutive Fiscal Quarters calculated
on a pro forma basis at any time outstanding (net of any Designated Non-Cash Consideration converted into cash and
Cash Equivalents received in respect of any such Designated Non-Cash Consideration and calculated on a pro forma
basis);
(n) the Borrowers and the Subsidiaries may surrender or waive contractual rights and settle or
waive contractual or litigation claims in the ordinary course of business;
(o) dispositions of non-core or obsolete assets acquired in connection with a Permitted Acquisition;
(p) any swap of assets in exchange for services or other assets in the ordinary course of business of
comparable or greater fair market value of usefulness to the business of the Borrowers and the Subsidiaries as a
whole, as determined in good faith by the Borrowers; provided that no such asset swaps may be made with ABL
Priority Collateral;
(q) any sale of Equity Interests in, or Debt or other securities of, a Subsidiary that is not an Obligor;
(r) Specified Dispositions and dispositions consummated in connection with a Permitted Tax
Restructuring; and
(s) dispositions by any Obligor constituting a Customer Support Transaction; provided, that, (i) the
aggregate amount of CST Exposure after giving effect to such disposition shall not exceed U.S.$250,000,000, (ii) the
aggregate amount of Specified CST Exposure after giving effect to such disposition
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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shall not exceed U.S.$150,000,000, (iii) no Default or Event of Default shall exist or have occurred and be continuing
after giving effect to such disposition, and (iv) to the extent that such disposition includes a Sale Leaseback of Real
Estate, (A) the consideration paid to such Obligor in connection therewith shall be paid contemporaneously with
consummation of the transaction (other than consideration received in connection with customary earn-out
arrangements in an amount (calculated as of the date of such disposition as the present value of expected future
payments in respect thereof) not to exceed twenty-five percent (25%) of the aggregate consideration therefor), and
shall be in an amount not less than the fair market value (as reasonably determined by the Borrower Agent in good
faith) of the property disposed of, and (B) the Administrative Agent shall have received from each such purchaser or
transferee a collateral access agreement on terms and conditions reasonably satisfactory to the Administrative Agent.
To the extent any Collateral is disposed of as expressly permitted by this Section 10.2.6 to any Person other
than the Borrowers or any Guarantor, such Collateral shall be sold free and clear of the Liens created by the Loan
Documents and, if requested by the Administrative Agent, upon the certification by the Borrower Agent that such
disposition is permitted by this Agreement, the Administrative Agent shall be authorized to take and shall take any
actions deemed appropriate in order to effect the foregoing.
10.2.7. Loans . Make any loans or other advances of money to any Person, except (a) loans or advances to an officer,
director or employee for salary, relocation expenses, travel and other business related expenses, commissions and similar items in the
Ordinary Course of Business; (b) prepaid expenses and extensions of trade credit made in the Ordinary Course of Business; (c) deposits with
financial institutions permitted hereunder; (d) intercompany loans and advances by an Obligor to another Obligor; provided , that (i) the
aggregate principal amount of intercompany loans and advances by an Obligor to the Canadian Borrower shall not exceed the greater of (x)
U.S. $100,000,000 and (y) 12.50 % of Consolidated EBITDA of the Borrowers and the Subsidiaries for the most recently ended period of
four consecutive Fiscal Quarters calculated on a pro forma basis (excluding any Investments received in respect of, or consisting of, the
transfer or contribution of Equity Interests in or Debt of any Foreign Subsidiary to any other Foreign Subsidiary) (in each case, plus any
additional amounts necessary to enable the Canadian Borrower to make any prepayments required pursuant to Section 3.6 ) and (ii) any
intercompany loans or advances by the Canadian Borrower to any other Obligor shall be subordinated to the Obligations on terms reasonably
satisfactory to the Administrative Agent; and (e) loans or advances constituting an Investment that is not prohibited by Section 10.2.5 .
10.2.8. Restrictions on Payment of Certain Debt . Make any payment (whether voluntary or mandatory, or a prepayment,
redemption, retirement, defeasance or acquisition) with respect to any Junior Debt (it being understood that payments of regularly scheduled
interest, AHYDO payments, customary payments of indemnitees and expense reimbursements and mandatory prepayments under any such
Junior Debt shall not be prohibited by this clause) prior to its due date other than:
(a) payments made with the proceeds of Refinancing Debt with respect thereto;
(b) payments in respect of any Seller Note, so long as such payments are made concurrently with
the expiration of such Seller Note;
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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(c) the conversion thereof to Equity Interests (other than Disqualified Equity Interests) of UNFI;
(d) payments made in an aggregate amount not to exceed the Available Equity Amount;
(e) payments made within one year of the maturity date of Junior Debt; provided that, no Event of
Default shall exist or have occurred and be continuing after giving effect to such payment; and
(f) other payments; so long as (i) both (A) daily average Adjusted Aggregate Availability for the 30
consecutive days immediately before making the proposed payment, calculated on a pro forma basis after giving
effect to such payment as if such payment had been made at the beginning of such 30 day period, is at least 10% of
the Aggregate Borrowing Base and (B) Borrowers have a Fixed Charge Coverage Ratio of at least 1.00:1.00 for the
most recently completed period of four Fiscal Quarters for which financial statements have been provided pursuant to
Section 10.1.2 , calculated on a pro forma basis after giving effect to such payment as if such payment had been made
at the beginning of such period of four Fiscal Quarters; provided , that to the extent daily average Adjusted Aggregate
Availability for the 30 consecutive days immediately before making the proposed payment, calculated on a pro forma
basis after giving effect to such payment as if such payment had been made at the beginning of such 30 day period, is
at least 15% of the Aggregate Borrowing Base, this clause (B) shall not be applicable, and (ii) UNFI shall have
delivered to the Administrative Agent and each Lender a statement, certified by the principal financial or accounting
officer of UNFI, setting forth, in reasonable detail, computations (determined in a manner reasonably acceptable to
the Administrative Agent) evidencing satisfaction of the requirements set forth in clause (i) above.
10.2.9. Fundamental Changes . (a) Without providing thirty (30) days’ prior written notice to the Administrative Agent (or
such other notice in the discretion of the Administrative Agent), change its (i) name, (ii) tax, charter or other organizational identification
number, or (iii) form or jurisdiction of organization; (b) liquidate, wind up its affairs or dissolve itself; or (c) merge, combine, amalgamate or
consolidate with any Person, whether in a single transaction or in a series of related transactions, except (i) any Subsidiary (other than the
Canadian Borrower) may merge, combine, amalgamate or consolidate with a U.S. Borrower or Guarantor so long as a U.S. Borrower or
Guarantor is the continuing or surviving Person, (ii) any Subsidiary that is not an Obligor may merge, combine, amalgamate or consolidate
with a Subsidiary that is not an Obligor, (iii) any Foreign Subsidiary (other than the Canadian Borrower) may (A) amalgamate under the laws
of Canada with the Canadian Borrower, or (B) merge, combine, amalgamate or consolidate with a Foreign Subsidiary (other than the
Canadian Borrower) ( provided that if such Foreign Subsidiary is a Loan Party, the continuing or surviving entity shall also be a Loan Party),
(iv) liquidations, winding-up of affairs or dissolutions of Immaterial Subsidiaries (and corresponding distributions of assets) shall be
permitted, (v) liquidations, winding-up of affairs or dissolutions of other Subsidiaries (and corresponding distributions of assets) shall be
permitted, so long as, in the case of an Obligor, all of the assets of such Subsidiaries are distributed to an Obligor, or (vi) in connection with
Permitted Acquisitions, Permitted Investments or an Asset Disposition expressly permitted by this Agreement.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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10.2.10. Subsidiaries . Form or acquire any Subsidiary after the Closing Date, except in accordance with the applicable
requirements set forth in Sections 10.1.9 , 10.2.5 and 10.2.9 .
10.2.11. Organic Documents . Amend, modify or otherwise change any of its Organic Documents as in effect on the
Closing Date in a manner that is adverse to the Lenders in any material respect, except in connection with a transaction permitted under
Section 10.2.9 .
10.2.12. Accounting Changes . Make any material change in accounting treatment or reporting practices, except as required
or permitted by GAAP and in accordance with Section 1.2 , or change its Fiscal Year; provided , that Borrower Agent may, upon written
notice to the Administrative Agent, change such fiscal year to any other fiscal year reasonably acceptable to the Administrative Agent, in
which case, the Borrowers and the Administrative Agent will, and are hereby authorized by the Lenders to, make any adjustments to this
Agreement and to the covenants contained herein that are reasonably necessary in order to reflect such change; and further provided , that
Supervalu Inc. and its Subsidiaries may change their respective Fiscal Years in order to align with the Fiscal Year of the Borrower Agent.
10.2.13. Restrictive Agreements . Become a party to any Restrictive Agreement, except a Restrictive Agreement (a) in
effect on the Signing Date; (b) relating to secured Debt permitted hereunder, as long as the restrictions apply only to collateral for such Debt;
or (c) constituting customary restrictions on assignment in leases, licenses and other contracts; provided , that the foregoing shall not apply to:
(i) restrictions and conditions imposed by (A) law, (B) any Loan Document or (C) the Term Loan
Facility;
(ii) customary restrictions and conditions arising in connection with any disposition permitted by
Section 10.2.5 ;
(iii) any restrictions or conditions set forth in any agreement in effect at any time any Person
becomes a Subsidiary (but not any modification or amendment expanding the scope of any such restriction or
condition), provided , that such agreement was not entered into in contemplation of such Person becoming a
Subsidiary and the restriction or condition set forth in such agreement does not apply to any Borrower or any
Subsidiary;
(iv) any restrictions or conditions in any Debt permitted pursuant to Section 10.2.1 to the extent
such restrictions or conditions are no more restrictive than the restrictions and conditions in the Loan
Documents or, in the case of subordinated debt, are market terms at the time of issuance or, in the case of
Debt of any Subsidiary that is not an Obligor, are imposed solely on such Subsidiary and its Subsidiaries,
provided , that any such restrictions or conditions permit compliance with the Guarantee and Collateral
Requirement;
(v) any restrictions on cash or other deposits imposed by agreements entered into in the ordinary
course of business;
(vi) customary provisions in shareholders agreements, joint venture agreements, organizational
documents or similar binding agreements relating to any joint venture or non-wholly-owned Subsidiary
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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and other similar agreements applicable to any joint venture and non-wholly-owned Subsidiaries permitted
under Section 10.2.5 and applicable solely to such joint venture or non-wholly-owned Subsidiary and the
Equity Interests issued thereby;
(vii) customary restrictions in leases, subleases, licenses or asset sale agreements and other similar
contracts otherwise permitted hereby so long as such restrictions relate only to the assets subject thereto;
(viii) customary net worth provisions contained in real property leases entered into by Subsidiaries
of UNFI, so long as UNFI has determined in good faith that such net worth provisions could not reasonably
be expected to impair the ability of any Borrower and the other Subsidiaries of any Borrower to meet their
ongoing obligation; and
(ix) restrictions imposed by any agreement governing Debt entered into on or after the Closing
Date and permitted under Section 10.2.1 that are, taken as a whole, in the good faith judgment of UNFI, no
more restrictive with respect to the Borrowers or any Subsidiary than customary market terms for Debt of
such type, so long as UNFI shall have determined in good faith that such restrictions will not adversely affect
in any material respect its obligation or ability to make any payments required hereunder.
10.2.14. Hedging Agreements . Enter into any Hedging Agreement, except in the Ordinary Course of Business for the
purpose of hedging risks and not for speculative purposes.
10.2.15. Conduct of Business . Engage in any business other than a Permitted Business.
10.2.16. Affiliate Transactions . Enter into or be party to any transaction with an Affiliate in excess of $2,000,000, except:
(a) transactions expressly permitted by the Loan Documents;
(b) payment of reasonable compensation to officers and employees for services actually rendered
and reasonable severance arrangements in the Ordinary Course of Business;
(c) Distributions permitted by Section 10.2.4 ;
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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(d) sales or issuances of Equity Interests of UNFI to Affiliates of UNFI which are otherwise
permitted or not restricted by the Loan Documents;
(e) loans and advances permitted by Section 10.2.7 ;
(f) payment of customary directors’ fees, reimbursement of expenses and indemnities in favor of
directors, officers and employees in the Ordinary Course of Business;
(g) transactions solely among Obligors or any Subsidiary or any entity that becomes a Subsidiary
as a result of such transaction, subject to the other restrictions set forth in this Agreement;
(h) transactions with Affiliates that were consummated prior to the Signing Date, as shown on
Schedule 10.2.17 ;
(i) [Intentionally Omitted];
(j) transactions with Affiliates, upon fair and reasonable terms no less favorable than would be
obtained in a comparable arm’s-length transaction with a non-Affiliate; and
(k) employment and severance arrangements between the Borrowers or any of their respective
Subsidiaries and their respective officers and employees in the ordinary course of business and transactions pursuant
to stock option plans and employee benefit plans and arrangements.
10.2.17. Employee Benefit Plans . Become party to any Multiemployer Plan, Canadian Plan that is a registered pension
plan or pension plan (within the meaning of the Pension Benefits Act (Ontario) or under applicable pension standards legislation of another
Canadian jurisdiction) or Foreign Plan, other than (a) any in existence on the Signing Date, (b) by reason of a Permitted Acquisition or any
other Permitted Investment or (c) that would not otherwise be reasonably expected to result in a Material Adverse Effect.
10.3. Financial Covenant . Commencing on the Closing Date and so long as any U.S. Revolver Commitments, Canadian
Commitments or Obligations (other than Secured Bank Product Obligations and contingent indemnification and expense reimbursement
obligations as to which no claim has been made) are outstanding, Borrowers shall:
10.3.1. Fixed Charge Coverage Ratio . Maintain a Fixed Charge Coverage Ratio of at least 1.00 to 1.00 as of the end of any
period of four Fiscal Quarters while a Trigger Event is in effect, commencing with the most recent period for which financial statements
were, or were required to be, delivered hereunder prior to the Trigger Event.
SECTION 11. EVENTS OF DEFAULT; REMEDIES ON DEFAULT
11.1. Events of Default . Each of the following shall be an “ Event of Default ” hereunder, if the same shall occur for any reason
whatsoever, whether voluntary or involuntary, by operation of law or otherwise:
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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(a) A Borrower fails to pay (i) any amount of any principal of any Loan or (ii) within three (3)
Business Days of the same becoming due, any interest or other amount payable hereunder or with respect to any Loan
Document, in each case, when due, whether at stated maturity, on demand, upon acceleration or otherwise, and in the
currency required hereunder;
(b) Any representation, warranty or other written statement of an Obligor made or deemed made by
or on behalf of any Obligor herein, in any other Loan Document, or in any certificate or document delivered in
connection herewith or therewith is incorrect or misleading in any material respect when given, and if capable of
being cured, remains so incorrect or misleading for thirty (30) days after receipt by the Borrower Agent of written
notice thereof by the Administrative Agent or the Required Lenders;
(c) A Borrower breaches or fail to perform any covenant contained in Section 8.1 , 8.2.4 , 8.2.5 ,
8.6.1 , 10.1.1 , 10.1.2 , 10.2 or 10.3 ;
(d) An Obligor breaches or fails to perform any other covenant contained in any Loan Documents,
and such breach or failure is not cured within 30 days after a Senior Officer of such Obligor has knowledge thereof or
receives notice thereof from Administrative Agent, whichever is sooner;
(e) A Guarantor repudiates, revokes or attempts to revoke its Guaranty; an Obligor or third party
denies or contests the validity or enforceability of any Loan Documents or Obligations (or, in the case of the
Canadian Borrower, the Canadian Obligations), or the perfection or priority of any Lien granted to any Agent; or any
Loan Document ceases to be in full force or effect for any reason (other than a waiver or release by the Applicable
Agent and the Applicable Lenders or as otherwise expressly permitted thereunder);
(f) Any breach or default of an Obligor or any of its Subsidiaries occurs (i) under any Hedging
Agreement to which it is a party or by which it is bound, if its liability upon termination would be in excess of the
Threshold Amount, or (ii) under any document, instrument or agreement to which it is a party or by which it or any of
its Properties is bound that relates to any Debt (other than the Obligations) in excess of the Threshold Amount, if the
maturity of or any payment with respect to such Debt may be accelerated or demanded due to such breach;
(g) Any judgment or order for the payment of money is entered against an Obligor or any of its
Subsidiaries in an amount that exceeds, individually or cumulatively with all unsatisfied judgments or orders against
all Obligors and Subsidiaries, the Threshold Amount (net of insurance coverage therefor that has not been denied by
the insurer), unless such judgement or order is paid or otherwise satisfied or a stay of enforcement of such judgment
or order is in effect, by reason of a pending appeal or otherwise;
(h) [Intentionally Omitted.];
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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(i) (i) an Obligor agrees to or commences any liquidation, dissolution or winding up of its affairs,
except as permitted by this Agreement; or (ii) the Obligors and their Subsidiaries (other than an Immaterial
Subsidiary), taken as a whole, are not Solvent;
(j) An Insolvency Proceeding is commenced by an Obligor or any of its Subsidiaries (other than an
Immaterial Subsidiary); an Obligor or any of its Subsidiaries (other than an Immaterial Subsidiary) makes an offer of
settlement, extension or composition to its unsecured creditors generally; a trustee is appointed to take possession of
any substantial Property of or to operate any of the business of an Obligor or any of its Subsidiaries (other than an
Immaterial Subsidiary); or an Insolvency Proceeding is commenced against an Obligor or any of its Subsidiaries
(other than an Immaterial Subsidiary) and: the Obligor or such Subsidiary consents to institution of the proceeding,
the petition commencing the proceeding is not timely contested by the Obligor or such Subsidiary, the petition is not
dismissed within 60 days after filing, or an order for relief is entered in the proceeding;
(k) (i) An ERISA Event occurs with respect to a Pension Plan or Multiemployer Plan that has
resulted or could reasonably be expected to result in liability of an Obligor in excess of an aggregate total amount
which could reasonably be expected to result in a Material Adverse Effect; or an Obligor or ERISA Affiliate fails to
pay when due any installment payment with respect to withdrawal liability assessed an aggregate total amount which
could reasonably be expected to result in a Material Adverse Effect under Section 4201 of ERISA under a
Multiemployer Plan; (ii) a Canadian Pension Event occurs with respect to a Canadian Plan that could, in the
Administrative Agent’s good faith judgment, subject the Canadian Borrower or any of its Subsidiaries to any tax,
penalty or other liabilities under the Pension Benefits Act (Ontario) or applicable pension standards legislation of
another Canadian jurisdiction or under the Income Tax Act (Canada) in excess of an aggregate total amount which
could reasonably be expected to result in a Material Adverse Effect, or if the Canadian Borrower or any of its
Subsidiaries is in default with respect to required payments to a Canadian Plan or any Lien arises (save for
contribution amounts not yet due or payable to a Canadian Plan) in connection with any Canadian Plan; or (iii) any
event similar to the foregoing occurs or exists with respect to a Foreign Plan;
(l) A Change of Control occurs; or
(m) (i) Any Credit Card Issuer or Credit Card Processor shall send notice to any Obligor that it is
ceasing to make or suspending payments to such Obligor of amounts due or to become due to such Obligor or shall
cease or suspend such payments, or shall send notice to such Obligor that it is terminating its arrangements with such
Obligor or such arrangements shall terminate as a result of any event of default under such arrangements, which
continues for more than the applicable cure period, if any, with respect thereto, unless such Obligor shall have entered
into arrangements with another Credit Card Issuer or Credit Card Processor, as the case may be, within sixty (60)
days after the date of any such notice or (ii) any Credit Card Issuer or Credit Card Processor withholds payment of
amounts
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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otherwise payable to an Obligor to fund a reserve account or otherwise hold as collateral, or shall require an Obligor
to pay funds into a reserve account or for such Credit Card Issuer or Credit Card Processor to otherwise hold as
collateral, or any Obligor shall provide a letter of credit, guarantee, indemnity or similar instrument to or in favor of
such Credit Card Issuer or Credit Card Processors such that in the aggregate all of such funds in the reserve account,
other than amounts held as collateral and the amount of such letters of credit, guarantees, indemnities or similar
instruments shall exceed an amount equal to or exceeding ten percent (10%) of the Credit Card Receivables processed
by such Credit Card Issuer or Credit Card Processor in the immediately preceding Fiscal Year.
11.2. Remedies upon Default . If an Event of Default described in Section 11.1(j) occurs, then to the extent permitted by
Applicable Law, all Obligations (other than Secured Bank Product Obligations) automatically shall become due and payable, all U.S.
Revolver Commitments and Canadian Commitments shall terminate and the obligation of the Obligors to Cash Collateralize LC Obligations
shall automatically become effective, in each case without any action by any Agent or notice of any kind. In addition, or if any other Event of
Default exists, the Applicable Agent may in its discretion (and shall upon written direction of Required Lenders) do any one or more of the
following from time to time:
(a) declare any Obligations (other than Secured Bank Product Obligations) immediately due and
payable, whereupon they shall be due and payable without diligence, presentment, demand, protest or notice of any
kind, all of which are hereby waived by Borrowers to the fullest extent permitted by law;
(b) terminate, reduce or condition any U.S. Revolver Commitment, Canadian Commitments or
make any adjustment to the U.S. Revolver Borrowing Base or the Canadian Borrowing Base;
(c) require Obligors to Cash Collateralize LC Obligations, Secured Bank Product Obligations and
other Obligations that are contingent or not yet due and payable, and, if Obligors fail promptly to deposit such Cash
Collateral, the Applicable Agent may (and shall upon the direction of Required Lenders) advance the required Cash
Collateral as U.S. Revolver Loans or Canadian Loans, as applicable (whether or not a U.S. Revolver Overadvance or
Canadian Overadvance exists or is created thereby, or the conditions in Section 6 are satisfied); and
(d) exercise any other rights or remedies afforded under any agreement, by law, at equity or
otherwise, including the rights and remedies of a secured party under the UCC or PPSA, as applicable. Such rights
and remedies include the rights to (i) take possession of any Collateral; (ii) require Borrowers to assemble Collateral,
at Borrowers’ expense, and make it available to the Applicable Agent at a place designated by the Applicable Agent;
(iii) enter any premises where Collateral is located and store Collateral on such premises until sold (and if the
premises are owned or leased by a Borrower, Borrowers agree not to charge for such storage); and (iv) sell or
otherwise dispose of any Collateral in its then condition, or after any further manufacturing or processing thereof, at
public or private sale, with such notice as may be required by Applicable Law, in lots or in bulk, at such locations, all
as the Applicable Agent, in its discretion, deems advisable.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Each Borrower agrees that 10 days’ notice of any proposed sale or other disposition of Collateral by the Applicable
Agent shall be reasonable, and that any sale conducted on the internet or to a licensor of Intellectual Property shall be
commercially reasonable. The Applicable Agent shall have the right to conduct such sales on any Obligor’s premises,
without charge, and any sales may be adjourned from time to time in accordance with Applicable Law. The
Applicable Agent shall have the right to sell, lease or otherwise dispose of any Collateral for cash, credit or any
combination thereof, and any Agent may purchase any Collateral at public or, if permitted by law, private sale and, in
lieu of actual payment of the purchase price, may credit bid and setoff the amount of such price against the
Obligations.
11.3. License . Solely for the purpose of enabling each Agent to exercise rights and remedies hereunder at such time as each Agent
shall be lawfully entitled to exercise such rights and remedies, each Borrower hereby grants each Agent an irrevocable, worldwide, non-
exclusive license or sub-license (as applicable) or other right to improve, sell, dispose of, modify, copy, perform, use, license or otherwise
exploit (without payment of royalty or other compensation to any Person) any or all Intellectual Property of Borrowers, computer hardware
and software, trade secrets, brochures, customer lists, promotional and advertising materials, labels, packaging materials and other Property,
in advertising for sale, marketing, selling, collecting, completing manufacture of, or otherwise exercising any rights or remedies with respect
to, any Collateral. Each Borrower’s rights and interests under Intellectual Property shall inure to each Agent’s benefit. The applicable
Licensor shall have rights of quality control and inspection which are reasonably necessary under Applicable Law to maintain the validity and
enforceability of the trademarks included in the Collateral.
11.4. Setoff . At any time during an Event of Default, Agents, Issuing Banks, Lenders, and any of their Affiliates are authorized, to
the fullest extent permitted by Applicable Law, to setoff and apply any and all deposits (general or special, time or demand, provisional or
final, in whatever currency) at any time held and other obligations (in whatever currency) at any time owing by such Agent, such Issuing
Bank, such Lender or such Affiliate to or for the credit or the account of an Obligor against any Obligations (subject to Section 4.5 ),
irrespective of whether or not such Agent, such Issuing Bank, such Lender or such Affiliate shall have made any demand under this
Agreement or any other Loan Document and although such Obligations may be contingent or unmatured or are owed to a branch or office of
such Agent, such Issuing Bank, such Lender or such Affiliate different from the branch or office holding such deposit or obligated on such
indebtedness. The rights of each Agent, each Issuing Bank, each Lender and each such Affiliate under this Section are in addition to other
rights and remedies (including other rights of setoff) that such Person may have.
11.5. Remedies Cumulative; No Waiver .
11.5.1. Cumulative Rights . All agreements, warranties, guaranties, indemnities and other undertakings of Borrowers under
the Loan Documents are cumulative and not in derogation of each other. The rights and remedies of Agents and Lenders are cumulative, may
be exercised at any time and from time to time, concurrently or in any order, and are not exclusive of any other rights or remedies available
by agreement, by law, at equity or otherwise. All such rights and remedies shall continue in full force and effect until Full Payment of all
Obligations.
11.5.2. Waivers . No waiver or course of dealing shall be established by (a) the failure or delay of any Agent or any Lender
to require strict performance by Borrowers with any terms of the Loan Documents, or to exercise any rights or remedies with respect to
Collateral or otherwise; (b) the making of
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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any Loan or issuance of any Letter of Credit during a Default, Event of Default or other failure to satisfy any conditions precedent; or (c)
acceptance by any Agent or any Lender of any payment or performance by an Obligor under any Loan Documents in a manner other than that
specified therein. It is expressly acknowledged by Borrowers that any failure to satisfy a financial covenant on a measurement date shall not
be cured or remedied by satisfaction of such covenant on a subsequent date.
SECTION 12. AGENTS
12.1. Appointment, Authority and Duties of Agents .
12.1.1. Appointment and Authority .
(a) Appointment and Authority of Administrative Agent . Each Secured Party appoints and
designates Bank of America as Administrative Agent under all Loan Documents. Administrative Agent may, and
each Secured Party authorizes Administrative Agent to, enter into all Loan Documents to which Administrative Agent
is intended to be a party and accept all applicable Security Documents, for the benefit of Secured Parties. Any action
taken by Administrative Agent in accordance with the provisions of the Loan Documents, and the exercise by
Administrative Agent of any rights or remedies set forth therein, together with all other powers reasonably incidental
thereto, shall be authorized by and binding upon all Secured Parties. Without limiting the generality of the foregoing,
Administrative Agent shall have the sole and exclusive authority to (i) act as the disbursing and collecting agent for
U.S. Revolver Lenders with respect to all payments and collections arising in connection with the Loan Documents;
(ii) execute and deliver as Administrative Agent each Loan Document, including any intercreditor or subordination
agreement, and accept delivery of each Loan Document; (iii) act as collateral agent for Secured Parties for purposes
of perfecting and administering Liens under the Loan Documents (other than Liens granted by the Canadian Borrower
or any Canadian Subsidiary), and for all other purposes stated therein; (iv) manage, supervise or otherwise deal with
Collateral (other than Collateral consisting of assets of the Canadian Borrower or any Canadian Subsidiary); and (v)
take any Enforcement Action or otherwise exercise any rights or remedies with respect to any Collateral (other than
Collateral consisting of assets of the Canadian Borrower or any Canadian Subsidiary) or under any Loan Documents
(other than any Canadian Security Documents), Applicable Law or otherwise. Administrative Agent alone shall be
authorized to determine whether any Account or Inventory constitutes an Eligible Account or Eligible Inventory,
whether to impose or release any reserve, or whether any conditions to funding or to issuance of a Letter of Credit for
the account or benefit of any U.S. Borrower have been satisfied, which determinations and judgments, if exercised in
good faith, shall exonerate Administrative Agent from liability to any Secured Party or other Person for any error in
judgment.
(b) Appointment and Authority of Canadian Agent . Each Secured Party also appoints and
designates Bank of America-Canada Branch as Canadian Agent under all Loan Documents. Canadian Agent may,
and each Secured Party authorizes Canadian Agent to, enter into all Loan Documents to which Canadian Agent is
intended to be a party and accept all applicable Security
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Documents, for the benefit of Secured Parties. Any action taken by Canadian Agent in accordance with the provisions
of the Loan Documents, and the exercise by Canadian Agent of any rights or remedies set forth therein, together with
all other powers reasonably incidental thereto, shall be authorized by and binding upon all Secured Parties. Without
limiting the generality of the foregoing, Canadian Agent shall have the sole and exclusive authority to (i) act as the
disbursing and collecting agent for Canadian Lenders with respect to all payments and collections arising in
connection with the Loan Documents in respect of the Canadian Borrower; (ii) execute and deliver as Canadian Agent
each Loan Document, including any intercreditor or subordination agreement, and accept delivery of each Loan
Document; (iii) act as collateral agent for Secured Parties for purposes of perfecting and administering Liens under
the Loan Documents granted by the Canadian Borrower or any Canadian Subsidiary, and for all other purposes stated
therein; (iv) manage, supervise or otherwise deal with Collateral consisting of assets of the Canadian Borrower or any
Canadian Subsidiary; and (v) take any Enforcement Action or otherwise exercise any rights or remedies with respect
to any Collateral consisting of assets of the Canadian Borrower or any Canadian Subsidiary or under any Canadian
Security Document, Applicable Law or otherwise. Canadian Agent alone shall be authorized to determine whether
any conditions to funding or to issuance of a Letter of Credit for the account or benefit of the Canadian Borrower
have been satisfied, which determinations and judgments, if exercised in good faith, shall exonerate Canadian Agent
from liability to any Secured Party or other Person for any error in judgment.
12.1.2. Duties . The titles of “Agent,” “Administrative Agent” and “Canadian Agent” are used solely as a matter of market
custom and the duties of each Agent are administrative in nature only. No Agent has any duties except those expressly set forth in the Loan
Documents, and in no event does any Agent have any agency, fiduciary or implied duty to or relationship with any Secured Party or other
Person by reason of any Loan Document or related transaction. The conferral upon any Agent of any right shall not imply a duty to exercise
such right, unless instructed to do so by Lenders in accordance with this Agreement.
12.1.3. Agent Professionals . Agents may perform their duties through agents and employees. Agents may consult with and
employ Agent Professionals, and shall be entitled to act upon, and shall be fully protected in any action taken in good faith reliance upon, any
advice given by an Agent Professional. No Agent shall be responsible for the negligence or misconduct of any agents, employees or Agent
Professionals selected by it with reasonable care.
12.1.4. Instructions of Required Lenders . The rights and remedies conferred upon any Agent under the Loan Documents
may be exercised without the necessity of joinder of any other party, unless required by Applicable Law. In determining compliance with a
condition for any action hereunder, including satisfaction of any condition in Section 6 , the Applicable Agent may presume that the
condition is satisfactory to a Secured Party unless such Agent has received notice to the contrary from such Secured Party before such Agent
takes the action. The Applicable Agent may request instructions from Required Lenders or other Secured Parties (or such other number of
Lenders as may be required) with respect to any act (including the failure to act) in connection with any Loan Documents or Collateral, and
may seek assurances to its satisfaction from Secured Parties of their indemnification obligations against Claims that could be incurred by such
Agent. Each Agent may refrain from any act until it has received such instructions or assurances, and shall not incur liability to any Person by
reason of so refraining. Instructions of Required Lenders (or such other number of Lenders as may be required) shall be binding upon all
Secured Parties, and no Secured Party shall
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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have any right of action whatsoever against any Agent as a result of such Agent acting or refraining from acting pursuant to instructions of
Required Lenders. Notwithstanding the foregoing, instructions by and consent of specific parties shall be required to the extent provided in
Section 14.1.1 . In no event shall any Agent be required to take any action that it determines in its discretion is contrary to Applicable Law or
any Loan Documents or could subject any Agent Indemnitee to liability.
12.1.5. Québec Collateral .
(a) For greater certainty, and without limiting the powers of the Canadian Agent or any other
Person acting as mandatary (agent) of the Canadian Agent, each of the Secured Parties hereby irrevocably appoints
the Canadian Agent as the hypothecary representative for all present and future Secured Parties pursuant to Article
2692 of the Civil Code of Québec in order to hold all hypothecs granted by any Obligor on property pursuant to the
laws of the Province of Québec. The execution by the Canadian Agent, acting as hypothecary representative, prior to
the Closing Date, of any deed of hypothec is hereby ratified and confirmed.
(b) The appointment of the Canadian Agent as hypothecary representative for the benefit of the
Secured Parties, shall be deemed to have been ratified and confirmed by each Person accepting an assignment of, a
participation in or an arrangement in respect of, all or any portion of any Secured Parties’ rights and obligations under
this Agreement by the execution of an assignment, including an assignment or other agreement pursuant to which it
becomes such assignee or participant, and by each successor Canadian Agent by the execution of an assignment or
other agreement, or by the compliance with other formalities, as the case may be, pursuant to which it becomes a
successor Canadian Agent under this Agreement. The Canadian Agent hereby confirms having accepted to act as
hypothecary representative of all present and future Secured Parties for all purposes of Article 2692 of the Civil Code
of Québec. Each successor Canadian Agent appointed in accordance with the terms of this Agreement shall
automatically (and without any further act or formality) become the successor hypothecary representative under each
deed of hypothec referred to above.
12.1.6. The Canadian Agent acting as hypothecary representative shall have the same rights, powers, immunities,
indemnities and exclusions from liability as are prescribed in favor of the Canadian Agent herein, which shall apply mutatis mutandis to the
Canadian Agent acting as hypothecary representative.
12.1.7. Promptly upon receiving any updates to the list of Disqualified Institutions from the Borrowers in accordance with
the definition thereof, the Administrative Agent shall make such updates available to all Lenders. In addition, upon request of any Lender, the
Administrative Agent shall make available to such Lender a full list of Disqualified Institutions. The limitations of liability set forth in the
definition of Disqualified Institution shall apply to any actions taken pursuant to this Section 12.1.7 , or the failure to take any such actions.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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12.2. Agreements Regarding Collateral and Borrower Materials .
12.2.1. Releases; Care of Collateral .
(a) Each Secured Party hereby further authorizes the Administrative Agent, on behalf of and for the
benefit of Secured Parties, to be the agent for and representative of the Secured Parties with respect to the Guaranty,
the Collateral and the Security Documents; provided , that the Administrative Agent shall not owe any fiduciary duty,
duty of loyalty, duty of care, duty of disclosure or any other obligation whatsoever to any holder of Secured Bank
Product Obligations and/or Obligations under Hedging Agreements. Subject to Section 14.1, without further written
consent or authorization from any Secured Party, the Administrative Agent may, and each Lender, on behalf of
themselves and their respective Affiliates as holders of Secured Bank Product Obligations and/or Obligations under
Hedging Agreements, irrevocably authorizes and directs the Administrative Agent to enter into the Security
Documents and any intercreditor agreement as required herein for the benefit of the Lenders and the other Secured
Parties, and to execute any documents or instruments necessary to (i) in connection with a sale or disposition of assets
to a person other than an Obligor permitted by this Agreement, release any Lien encumbering any item of Collateral
that is the subject of such sale or other disposition of assets or to which the Required Lenders (or such other Lenders
as may be required to give such consent under Section 14.1) have otherwise consented, or if the property subject to
such Lien is owned by an Obligor, upon release of such Obligor from its obligations under this Section 12.2, (ii)
release any Lien encumbering any property of any Obligor that does not constitute (or ceases to constitute) Collateral
as a result of a transaction permitted under the Loan Documents or otherwise, (iii) release any Obligor from the
Guaranty pursuant to the terms of the Guaranty or with respect to which the Required Lenders (or such other Lenders
as may be required to give such consent under Section 14.1) have otherwise consented or if such Person otherwise
ceases to be a Subsidiary as a result of a transaction permitted under the Loan Documents (including the designation
of a Subsidiary as an Unrestricted Subsidiary) or (iv) to subordinate any Lien on any property granted to or held by
the Administrative Agent under any Loan Document in lieu of any release permitted pursuant to this Section 12.2,
and the Administrative Agent may subordinate any such Liens on the Collateral to another Lien permitted under
Section 10.2.2 that the Administrative Agent determines in its commercially reasonable judgment was intended by
operation of Law or otherwise to be subordinate to another Lien permitted under Section 10.2.2;
(b) Notwithstanding anything to the contrary contained herein or any other Loan Document, when
Full Payment of all Obligations has occurred, all U.S. Revolver Commitments and Canadian Commitments have
terminated or expired and no Letter of Credit shall be outstanding (except to the extent cash collateralized,
backstopped or as to which other arrangements reasonably satisfactory to the Administrative Agent and the applicable
Issuing Bank shall have been made), all obligations under the Loan Documents and all security interests created by
the Loan Documents and the guarantees made herein shall automatically terminate and, upon request and at the
expense of the Borrower Agent but subject to paragraph (d) below, the Administrative Agent shall (without notice to,
or vote
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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or consent of, any holder of Secured Bank Product Obligations with respect to Bank Products consisting of Hedging
Agreements) take such actions as shall be required to release its security interest in all Collateral, and to release all
guarantee obligations provided for in any Loan Document, whether or not on the date of such release there may be
outstanding Secured Bank Product Obligations and/or Obligations under Hedging Agreements. Any such release of
guarantee obligations shall be deemed subject to the provision that such guarantee obligations shall be reinstated if
after such release any portion of any payment in respect of the Obligations guaranteed thereby shall be rescinded or
must otherwise be restored or returned upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of
any Obligor, or upon or as a result of the appointment of a receiver, intervenor or conservator of, or trustee or similar
officer for, any Obligor or any substantial part of its property, or otherwise, all as though such payment had not been
made; provided , that no such release shall occur if such Lien continues to secure any Debt which refinances the
Obligations hereunder;
(c) Anything contained in any of the Loan Documents to the contrary notwithstanding, each
Borrower, the Administrative Agent and each Secured Party hereby agree that (i) no Secured Party shall have any
right individually to realize upon any of the Collateral or to enforce any Guaranty, it being understood and agreed that
all powers, rights and remedies hereunder and under any of the Loan Documents may be exercised solely by the
Administrative Agent for the benefit of the Secured Parties in accordance with the terms hereof and thereof and all
powers, rights and remedies under the Security Documents may be exercised solely by the Administrative Agent for
the benefit of the Secured Parties in accordance with the terms thereof, and (ii) in the event of a foreclosure or similar
enforcement action by the Administrative Agent on any of the Collateral pursuant to a public or private sale or other
disposition (including, without limitation, pursuant to Section 363(k), Section 1129(b)(2)(a)(ii) or otherwise of the
Bankruptcy Code), the Administrative Agent (or any Lender, except with respect to a “credit bid” pursuant to Section
363(k), Section 1129(b)(2)(a)(ii) or otherwise of the Bankruptcy Code) may be the purchaser or licensor of any or all
of such Collateral at any such sale or other disposition and the Administrative Agent, as agent for and representative
of Secured Parties (but not any Lender or Lenders in its or their respective individual capacities) shall be entitled,
upon instructions from the Required Lenders, for the purpose of bidding and making settlement or payment of the
purchase price for all or any portion of the Collateral sold at any such sale or disposition, to use and apply any of the
Obligations as a credit on account of the purchase price for any collateral payable by the Administrative Agent at such
sale or other disposition; and
(d) prior to releasing or subordinating any Liens on Collateral or releasing guarantee obligations
under the Loan Documents, in each case as contemplated by this Section 12.2.1, upon request of the Applicable
Agent the Borrower Agent shall confirm in writing that the applicable conditions to release under this Agreement and
the other applicable Loan Documents have been satisfied and the Applicable Agent shall be entitled to rely, and shall
be fully protected in relying , upon any such certification.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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12.2.2. Possession of Collateral . Agents and Secured Parties appoint each Lender as agent (for the benefit of Secured
Parties) for the purpose of perfecting Liens in any Collateral held or controlled by such Lender, to the extent such Liens are perfected by
possession or control. If any Lender obtains possession or control of any Collateral, it shall notify Administrative Agent thereof and, promptly
upon Administrative Agent’s request, deliver such Collateral to the Applicable Agent or otherwise deal with it in accordance with
Administrative Agent’s instructions.
12.2.3. Reports . Administrative Agent shall promptly provide to Lenders, when complete, any field examination, audit or
appraisal report prepared for any Agent with respect to any Obligor or ABL Priority Collateral (“ Report ”). Reports and other Borrower
Materials may be made available to Lenders by providing access to them on the Platform, but Administrative Agent shall not be responsible
for system failures or access issues that may occur from time to time. Each Lender agrees (a) that Reports are not intended to be
comprehensive audits or examinations, and that any Agent or any other Person performing an audit or examination will inspect only specific
information regarding the Obligations or ABL Priority Collateral and will rely significantly upon Borrowers’ books, records and
representations; (b) that Administrative Agent makes no representation or warranty as to the accuracy or completeness of any Borrower
Materials and shall not be liable for any information contained in or omitted from any Borrower Materials, including any Report; and (c) to
keep all Borrower Materials confidential and strictly for such Lender’s internal use, not to distribute any Report or other Borrower Materials
(or the contents thereof) to any Person (except to such Lender’s Participants, attorneys, accountants and to the extent required or requested by
any regulatory authority purporting to have jurisdiction over such Lender or its Affiliates), and to use all Borrower Materials solely for
administration of the Obligations. Each Lender shall indemnify and hold harmless each Agent and any other Person preparing a Report from
any action such Lender may take as a result of or any conclusion it may draw from any Borrower Materials, as well as from any Claims
arising as a direct or indirect result of Administrative Agent furnishing same to such Lender, via the Platform or otherwise.
12.3. Reliance By Agents . Each Agent shall be entitled to rely, and shall be fully protected in relying, upon any certification,
notice or other communication (including those by telephone, telex, telegram, telecopy or e-mail) believed by it to be genuine and correct and
to have been signed, sent or made by the proper Person. Each Agent shall have a reasonable and practicable amount of time to act upon any
instruction, notice or other communication under any Loan Document, and shall not be liable for any delay in acting.
12.4. Action Upon Default . No Agent shall be deemed to have knowledge of any Default or Event of Default, or of any failure to
satisfy any conditions in Section 6 , unless it has received written notice from a Borrower or Required Lenders specifying the occurrence and
nature thereof. If any Lender acquires knowledge of a Default, Event of Default or failure of such conditions, it shall promptly notify
Administrative Agent and the other Lenders thereof in writing. Each Secured Party agrees that, except as otherwise provided in any Loan
Documents or with the written consent of Administrative Agent and Required Lenders, it will not take any Enforcement Action, accelerate
Obligations (other than Secured Bank Product Obligations), or exercise any right that it might otherwise have under Applicable Law to credit
bid at foreclosure sales, UCC and PPSA sales or other similar dispositions of Collateral or to assert any rights relating to any Collateral.
12.5. Ratable Sharing . If any Lender shall obtain any payment or reduction of any Obligation, whether through setoff or
otherwise, in excess of its share of such Obligation, determined on a Pro Rata basis or in accordance with Section 5.6.2 , as applicable, such
Lender shall forthwith purchase from the Applicable Agent, the applicable Issuing Bank and the other Applicable Lenders such participations
in the affected Obligation as are necessary to cause the purchasing Lender to share the excess payment or reduction on a Pro Rata basis or in
accordance with Section 5.6.2 , as applicable. If any of such payment or reduction is
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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thereafter recovered from the purchasing Lender, the purchase shall be rescinded and the purchase price restored to the extent of such
recovery, but without interest. Notwithstanding the foregoing, if a Defaulting Lender obtains a payment or reduction of any Obligation, it
shall immediately turn over the amount thereof to the Applicable Agent for application under Section 4.2.2 and it shall provide a written
statement to the Applicable Agent describing the Obligation affected by such payment or reduction. No Lender shall setoff against any
Dominion Account without the prior consent of the Applicable Agent.
12.6. Indemnification . EACH SECURED PARTY SHALL INDEMNIFY AND HOLD HARMLESS AGENT INDEMNITEES
AND ISSUING BANK INDEMNITEES, TO THE EXTENT NOT REIMBURSED BY OBLIGORS, ON A PRO RATA BASIS, AGAINST
ALL CLAIMS THAT MAY BE INCURRED BY OR ASSERTED AGAINST ANY SUCH INDEMNITEE, PROVIDED, THAT ANY
CLAIM AGAINST AN AGENT INDEMNITEE RELATES TO OR ARISES FROM ITS ACTING AS OR FOR ANY AGENT (IN THE
CAPACITY OF AN AGENT). In no event shall any Lender have any obligation to indemnify or hold harmless an Agent Indemnitee or
Issuing Bank Indemnitee with respect to a Claim that is determined in a final, non-appealable judgment by a court of competent jurisdiction to
result from the gross negligence or willful misconduct of such Indemnitee. In the Applicable Agent’s discretion, it may reserve for any
Claims made against an Agent Indemnitee or Issuing Bank Indemnitee, and may satisfy any judgment, order or settlement relating thereto,
from proceeds of Collateral prior to making any distribution of Collateral proceeds to Secured Parties. If any Agent is sued by any receiver,
interim receiver, receiver manager, bankruptcy trustee, debtor-in-possession or other Person for any alleged preference or fraudulent transfer,
then any monies paid by such Agent in settlement or satisfaction of such proceeding, together with all interest, costs and expenses (including
attorneys’ fees) incurred in the defense of same, shall be promptly reimbursed to such Agent by each Secured Party to the extent of its Pro
Rata share.
12.7. Limitation on Responsibilities of Agents . No Agent shall be liable to any Secured Party for any action taken or omitted to
be taken under the Loan Documents, except for losses directly and solely caused by such Agent’s gross negligence or willful misconduct. No
Agent assumes any responsibility for any failure or delay in performance or any breach by any Obligor, Lender or other Secured Party of any
obligations under the Loan Documents. No Agent makes any express or implied representation, warranty or guarantee to Secured Parties with
respect to any Obligations, Collateral, Liens, Loan Documents or Obligor. No Agent Indemnitee shall be responsible to Secured Parties for
any recitals, statements, information, representations or warranties contained in any Loan Documents or Borrower Materials; the execution,
validity, genuineness, effectiveness or enforceability of any Loan Documents; the genuineness, enforceability, collectibility, value,
sufficiency, location or existence of any Collateral, or the validity, extent, perfection or priority of any Lien therein; the validity,
enforceability or collectibility of any Obligations; or the assets, liabilities, financial condition, results of operations, business, creditworthiness
or legal status of any Obligor or Account Debtor. No Agent Indemnitee shall have any obligation to any Secured Party to ascertain or inquire
into the existence of any Default or Event of Default, the observance by any Obligor of any terms of the Loan Documents, or the satisfaction
of any conditions precedent contained in any Loan Documents.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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12.8. Successor Agents and Co-Agents .
12.8.1. Resignation; Successor Agents . Each Agent may resign at any time by giving at least 30 days’ written notice
thereof to the Applicable Lenders and Borrowers (the 30th day after such notice has so been provided, the “ Resignation Effective Date ”).
Upon receipt of such notice, Required Lenders shall have the right to appoint a successor Administrative Agent or Canadian Agent, as the
case may be, which shall be (a) a Lender or an Affiliate of a Lender; or (b) a financial institution reasonably acceptable to Required Lenders
and ( provided no Default or Event of Default exists) Borrowers; provided , that in no event shall any such successor Administrative Agent be
a Defaulting Lender or a Disqualified Institution. If no successor agent is appointed prior to the effective date of the resignation of
Administrative Agent or Canadian Agent, then Administrative Agent or Canadian Agent may appoint a successor agent that is a financial
institution reasonably acceptable to it, which shall be a Lender unless no Lender accepts the role or in the absence of such appointment,
Required Lenders shall on such date assume all rights and duties of such Agent hereunder; it being understood and agreed that, regardless of
whether or not a successor Agent has been appointed, such resignation shall become effective in accordance with such notice on the
Resignation Effective Date. Upon acceptance by a successor Administrative Agent or Canadian Agent of its appointment hereunder, such
successor Administrative Agent or Canadian Agent shall thereupon succeed to and become vested with all the powers and duties of the
retiring Administrative Agent or Canadian Agent without further act, and the retiring Administrative Agent or Canadian Agent shall be
discharged from its duties and obligations hereunder but shall continue to have all rights and protections under the Loan Documents with
respect to actions taken or omitted to be taken by it while Agent, including the benefits of the indemnification set forth in Sections 12.6 and
14.2 . Notwithstanding any Agent’s resignation, the provisions of this Section 12 shall continue in effect for its benefit with respect to any
actions taken or omitted to be taken by it while Administrative Agent or Canadian Agent. Any successor to Bank of America or Bank of
America-Canada Branch by merger, amalgamation or acquisition of stock or this loan shall continue to be Administrative Agent or Canadian
Agent, as the case may be, hereunder without further act on the part of any Secured Party or Obligor.
If the Person serving as Administrative Agent or Canadian Agent is a Defaulting Lender pursuant to clause (d) of the definition
thereof, the Required Lenders may, to the extent permitted by Applicable Law, by notice in writing to the Borrower Agent and such Person
remove such Person as Administrative Agent or Canadian Agent, as applicable, and, in consultation with the Borrower Agent, appoint a
successor. If no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within thirty
(30) days (or such earlier day as shall be agreed by the Required Lenders) (the “ Removal Effective Date ”), then such removal shall
nonetheless become effective in accordance with such notice on the Removal Effective Date.
12.8.2. Co-Collateral Agent . If necessary or appropriate under Applicable Law, any Agent may appoint a Person to serve
as a co-collateral agent or separate collateral agent under any Loan Document. Each right and remedy intended to be available to such Agent
under such Loan Document shall also be vested in such agent. Secured Parties shall execute and deliver any instrument or agreement that the
Applicable Agent may request to effect such appointment. If the Administrative Agent shall die, dissolve, become incapable of acting, resign
or be removed, then all the rights and remedies of such agent, to the extent permitted by Applicable Law, shall vest in and be exercised by the
Applicable Agent until appointment of a new agent.
12.9. Due Diligence and Non-Reliance . Each Lender acknowledges and agrees that it has, independently and without reliance
upon any Agent or any other Lenders, and based upon such documents, information and analyses as it has deemed appropriate, made its own
credit analysis of each Obligor and its
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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own decision to enter into this Agreement and to fund Loans and participate in LC Obligations hereunder. Each Secured Party has made such
inquiries as it feels necessary concerning the Loan Documents, Collateral and Obligors. Each Secured Party acknowledges and agrees that the
other Secured Parties have made no representations or warranties concerning any Obligor, any Collateral or the legality, validity, sufficiency
or enforceability of any Loan Documents or Obligations. Each Secured Party will, independently and without reliance upon any other
Secured Party, and based upon such financial statements, documents and information as it deems appropriate at the time, continue to make
and rely upon its own credit decisions in making Loans and participating in LC Obligations, and in taking or refraining from any action under
any Loan Documents. Except for notices, reports and other information expressly requested by a Lender, no Agent shall have any duty or
responsibility to provide any Secured Party with any notices, reports or certificates furnished to such Agent by any Obligor or any credit or
other information concerning the affairs, financial condition, business or Properties of any Obligor (or any of its Affiliates) which may come
into possession of such Agent or its Affiliates.
12.10. Remittance of Payments and Collections .
12.10.1. Remittances Generally . All payments by any Lender to the Applicable Agent shall be made by the time and on
the day set forth in this Agreement, in immediately available funds. If no time for payment is specified or if payment is due on demand by the
Applicable Agent and request for payment is made by the Applicable Agent by 11:00 a.m. on a Business Day, payment shall be made by
Lender not later than 2:00 p.m. on such day, and if request is made after 11:00 a.m., then payment shall be made by 11:00 a.m. on the next
Business Day. Payment by any Agent to any Secured Party shall be made by wire transfer, in the type of funds received by such Agent. Any
such payment shall be subject to such Agent’s right of offset for any amounts due from such payee under the Loan Documents.
12.10.2. Failure to Pay . If any Secured Party fails to pay any amount when due by it to the Applicable Agent pursuant to
the terms hereof, such amount shall bear interest from the due date until paid in full at the greater of the Federal Funds Rate or the rate
determined by such Agent as customary for interbank compensation for two Business Days and thereafter at the Default Rate for Base Rate
Loans. In no event shall Borrowers be entitled to receive credit for any interest paid by a Secured Party to any Agent, nor shall any Defaulting
Lender be entitled to interest on any amounts held by any Agent pursuant to Section 4.2 .
12.10.3. Recovery of Payments . If any Agent pays any amount to a Secured Party in the expectation that a related payment
will be received by such Agent from an Obligor and such related payment is not received, then such Agent may recover such amount from
each Secured Party that received it. If any Agent determines that an amount received by it must be returned or paid to an Obligor or other
Person pursuant to Applicable Law or otherwise, then, notwithstanding any other term of any Loan Document, such Agent shall not be
required to distribute such amount to any Secured Party. If any amounts received and applied by any Agent to any Obligations are later
required to be returned by such Agent pursuant to Applicable Law, each Lender shall pay to such Agent, on demand , such Lender’s Pro
Rata share of the amounts required to be returned.
12.11. Individual Capacities . As a U.S. Revolver Lender, Bank of America, and as a Canadian Lender, Bank of America-Canada
Branch, each shall have the same rights and remedies under the Loan Documents as any other U.S. Revolver Lender or Canadian Lender, as
the case may be, and the terms “Lenders,” “U.S. Revolver Lenders,” “Canadian Lenders,” “Required Lenders” or any similar term shall
include Bank of America in its capacity as a U.S. Revolver Lender and Bank of America-Canada Branch in its capacity as a Canadian Lender,
as the case may be. Agents, Lenders and their Affiliates may accept deposits
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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from, lend money to, provide Bank Products to, act as financial or other advisor to, and generally engage in any kind of business with,
Obligors and their Affiliates, as if they were not Agents or Lenders hereunder, without any duty to account therefor to any Secured Party. In
their individual capacities, Agents, Lenders and their Affiliates may receive information regarding Obligors, their Affiliates and their Account
Debtors (including information subject to confidentiality obligations), and shall have no obligation to provide such information to any
Secured Party.
12.12. Agent Titles . Each Lender, other than Bank of America and Bank of America-Canada Branch, that is designated (on the
cover page of this Agreement or otherwise) by Bank of America as an “Agent,” “Arranger” or “Bookrunner” of any type shall not have any
right, power, responsibility or duty under any Loan Documents other than those applicable to all Lenders, and shall in no event have any
fiduciary duty to any Secured Party.
12.13. Bank Product Providers . Each Secured Bank Product Provider, by delivery of a notice to Administrative Agent of a Bank
Product, agrees to be bound by the Loan Documents, including Sections 5.6 , 14.3.3 and this Section 12 . Each Secured Bank Product
Provider shall indemnify and hold harmless Agent Indemnitees, to the extent not reimbursed by Obligors, against all Claims that may be
incurred by or asserted against any Agent Indemnitee in connection with such provider’s Secured Bank Product Obligations.
12.14. Certain ERISA Matters . (a) Each Lender (x) represents and warrants, as of the date such Person became a Lender party
hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party
hereto, for the benefit of, the Administrative Agent and not, for the avoidance of doubt, to or for the benefit of the Borrowers or any other
Obligor, that at least one of the following is and will be true:
(i) such Lender is not using “plan assets” (within the meaning of Section 3(42) of ERISA or otherwise) of
one or more Benefits Plans with respect to such Lender’s entrance into, participation in, administration of and
performance of the Loans, the Letters of Credit, the U.S. Revolver Commitments, the Canadian Commitments or this
Agreement,
(ii) the transaction exemption set forth in one or more PTEs, such as PTE 84-14 (a class exemption for
certain transactions determined by independent qualified professional asset managers), PTE 95-60 (a class exemption
for certain transactions involving insurance company general accounts), PTE 90-1 (a class exemption for certain
transactions involving insurance company pooled separate accounts), PTE 91-38 (a class exemption for certain
transactions involving bank collective investment funds) or PTE 96-23 (a class exemption for certain transactions
determined by in-house asset managers), is applicable with respect to such Lender’s entrance into, participation in,
administration of and performance of the Loans, the Letters of Credit, the U.S. Revolver Commitments, the Canadian
Commitments and this Agreement,
(iii) (A) such Lender is an investment fund managed by a “Qualified Professional Asset Manager” (within
the meaning of Part VI of PTE 84-14), (B) such Qualified Professional Asset Manager made the investment decision
on behalf of such Lender to enter into, participate in, administer and perform the Loans, the Letters of Credit, the U.S.
Revolver Commitments, the Canadian Commitments and this Agreement, (C) the entrance into, participation in,
administration of and
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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performance of the Loans, the Letters of Credit, the U.S. Revolver Commitments, the Canadian Commitments and
this Agreement satisfies the requirements of sub-sections (b) through (g) of Part I of PTE 84- 14 and (D) to the best
knowledge of such Lender, the requirements of subsection (a) of Part I of PTE 84-14 are satisfied with respect to such
Lender’s entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the
U.S. Revolver Commitments, the Canadian Commitments and this Agreement, or
(iv) such other representation, warranty and covenant as may be agreed in writing between the
Administrative Agent, in its sole discretion, and such Lender.
(b)
In addition, unless either (1) sub-clause (i) in the immediately preceding clause (a) is true with respect to a Lender or
(2) a Lender has provided another representation, warranty and covenant in accordance with sub-clause (iv) in the
immediately preceding clause (a), such Lender further (x) represents and warrants, as of the date such Person became
a Lender party hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the date such
Person ceases being a Lender party hereto, for the benefit of, the Administrative Agent and not, for the avoidance of
doubt, to or for the benefit of the Borrower or any other Obligor, that the Administrative Agent is not a fiduciary with
respect to the assets of such Lender involved in such Lender’s entrance into, participation in, administration of and
performance of the Loans, the Letters of Credit, the U.S. Revolver Commitments, the Canadian Commitments and
this Agreement (including in connection with the reservation or exercise of any rights by the Administrative Agent
under this Agreement, any Loan Document or any documents related hereto or thereto).
12.15. Authorization to Enter into Loan Documents . By executing a signature page hereto or an Assignment and Acceptance,
as applicable, each Lender authorizes the Administrative Agent to enter into each of the Closing Date Loan Documents (including, without
limitation, the Intercreditor Agreement and each such agreement that constitutes a Security Document) and each Loan Document required to
be entered into after the Closing Date, subject solely (i) in the case of the Intercreditor Agreement, to the Intercreditor Agreement complying
with the requirements set forth in the definition thereof (which, as set forth more fully in such definition, requires the Administrative Agent to
post the Intercreditor Agreement to Lenders under the circumstances set forth therein) and (ii) in the case of the Closing Date Security
Documents, to the Closing Date Security Documents being consistent with the requirements set forth in the definition of Guarantee and
Collateral Requirement as determined by the Administrative Agent acting reasonably; provided , that, in the case of clause (ii), the
Administrative Agent may, but is not required to, post any Closing Date Security Document to the Lenders and if such Closing Date Security
Document is not objected to by the Required Lenders within five (5) Business Days thereafter, the entry into such Closing Date Security
Document by the Applicable Agent shall be deemed to fall within the scope of discretion provided to the Applicable Agent pursuant to this
Section 12.15 .
12.16. No Third Party Beneficiaries . This Section 12 is an agreement solely among Secured Parties and Agents, and shall
survive Full Payment of the Obligations. This Section 12 does not confer any rights or benefits upon Borrowers or any other Person. As
between Borrowers and any Agent, any action that any Agent may take under any Loan Documents or with respect to any Obligations shall
be conclusively presumed to have been authorized and directed by Secured Parties.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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SECTION 13. BENEFIT OF AGREEMENT; ASSIGNMENTS
13.1. Successors and Assigns . This Agreement shall be binding upon and inure to the benefit of Borrowers, Agents, Lenders,
Secured Parties, and their respective successors and assigns, except that (a) no Borrower shall have the right to assign its rights or delegate its
obligations under any Loan Documents; and (b) any assignment by a Lender must be made in compliance with Section 13.3 . Agents may
treat the Person which made any Loan as the owner thereof for all purposes until such Person makes an assignment in accordance with
Section 13.3 . Any authorization or consent of a Lender shall be conclusive and binding on any subsequent transferee or assignee of such
Lender.
13.2. Participations .
13.2.1. Permitted Participants; Effect . Subject to Section 13.3.3 , any Lender may sell to a financial institution or other
entity excluding Disqualified Institutions (“ Participant ”) a participating interest in the rights and obligations of such Lender under any Loan
Documents. Despite any sale by a Lender of participating interests to a Participant, such Lender’s obligations under the Loan Documents
shall remain unchanged, such Lender shall remain solely responsible to the other parties hereto for performance of such obligations, such
Lender shall remain the holder of its Loans, U.S. Revolver Commitments and Canadian Commitments for all purposes, all amounts payable
by Borrowers shall be determined as if such Lender had not sold such participating interests, and Borrowers and Agents shall continue to deal
solely and directly with such Lender in connection with the Loan Documents. Each Lender shall be solely responsible for notifying its
Participants of any matters under the Loan Documents, and Agents and the other Lenders shall not have any obligation or liability to any such
Participant. The Borrowers agree that each Participant shall be entitled to the benefits of Sections 3.7 and 3.9 and 5.9 to the same extent as if
it were a Lender and had acquired its interest by assignment pursuant to Section 13.1 (it being understood that the documentation required
under Section 5.10 shall be delivered to the Lender who sells the participation); provided that such Participant (A) agrees to be subject to the
provisions of Sections 3.8 and 13.4 as if it were an assignee under Section 13.1 and (B) shall not be entitled to receive any greater payment
under Section 3.7 or 5.9 , with respect to any participation, than the Lender from whom it acquired the applicable participation would have
been entitled to receive, except to the extent such entitlement to receive a greater payment results from a Change in Law that occurs after the
Participant acquired the applicable participation. A Participant that would be a Foreign Lender if it were a Lender shall not be entitled to the
benefits of Section 5.9 unless Borrowers agree otherwise in writing. A Participant that would be a Canadian Lender if it were a Lender, and
that is a non-resident of Canada for purposes of Part XIII of the Income Tax Act (Canada) (or lends to the Canadian Borrower hereunder from
a lending office outside Canada) shall not be entitled to the benefits of Section 5.9 unless the Canadian Borrower agrees otherwise in writing.
13.2.2. Voting Rights . Each Lender shall retain the sole right to approve, without the consent of any Participant, any
amendment, waiver or other modification of any Loan Documents other than that which forgives principal, interest or fees, reduces the stated
interest rate or fees payable with respect to any Loan, U.S. Revolver Commitment or Canadian Commitment in which such Participant has an
interest, postpones the Applicable Commitment Termination Date or any date fixed for any regularly scheduled payment of principal, interest
or fees on such Loan, U.S. Revolver Commitment or Canadian Commitment, or releases any Borrower, Guarantor or substantially all
Collateral.
13.2.3. Participant Register . Each Lender that sells a participation shall, acting as a non-fiduciary agent of Borrowers
(solely for tax purposes), maintain a register in which it enters the Participant’s name, address and interest in U.S. Revolver Commitments,
Canadian Commitments, Loans (and stated interest) and LC Obligations. Entries in the register shall be conclusive, absent manifest error,
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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and such Lender shall treat each Person recorded in the register as the owner of the participation for all purposes, notwithstanding any notice
to the contrary. No Lender shall have an obligation to disclose any information in such register except to the extent necessary to establish that
a Participant’s interest is in registered form under the Code .
13.2.4. Benefit of Setoff . Borrowers agree that each Participant shall have a right of setoff in respect of its participating
interest to the same extent as if such interest were owing directly to a Lender, and each Lender shall also retain the right of setoff with respect
to any participating interests sold by it. By exercising any right of setoff, a Participant agrees to share with Lenders all amounts received
through its setoff, in accordance with Section 12.5 as if such Participant were a Lender.
13.3. Assignments .
13.3.1. Permitted Assignments . A Lender may assign to an Eligible Assignee any of its rights and obligations under the
Loan Documents, as long as (a) each assignment is of a constant, and not a varying, percentage of the transferor Lender’s rights and
obligations under the Loan Documents and, in the case of a partial assignment, is in a minimum principal amount of U.S.$10,000,000 (unless
otherwise agreed by Administrative Agent in its discretion) and integral multiples of U.S.$5,000,000 in excess of that amount; (b) except in
the case of an assignment in whole of a Lender’s rights and obligations, the aggregate amount of (i) the U.S. Revolver Commitments retained
by the transferor Lender is at least U.S.$10,000,000 (unless otherwise agreed by Administrative Agent in its discretion) and (ii) the Canadian
Commitments retained by the transferor Lender is equal to an amount such that the ratio of the U.S. Revolver Commitments retained by the
transferor Lender to the Canadian Commitments retained by the transferor Lender is equal to the ratio that existed prior to such assignment;
and (c) the parties to each such assignment shall execute and deliver to Administrative Agent, for its acceptance and recording, an
Assignment and Acceptance. Nothing herein shall limit the right of a Lender to pledge or assign any rights under the Loan Documents to
secure obligations of such Lender, including a pledge or assignment to a Federal Reserve Bank; provided , however , that no such pledge or
assignment shall release such Lender from its obligations hereunder nor substitute the pledgee or assignee for such Lender as a party hereto;
provided , further , however, unless otherwise consented to by the Borrower Agent in writing, no assignment shall be made to a Disqualified
Institutions.
13.3.2. Effect; Effective Date . Upon delivery to Administrative Agent of an assignment notice in the form of Exhibit D
and a processing fee of U.S.$3,500 (unless otherwise agreed by Administrative Agent in its discretion), the assignment shall become effective
as specified in the notice, if it complies with this Section 13.3 . From such effective date, the Eligible Assignee shall for all purposes be a
Lender under the Loan Documents, and shall have all rights and obligations of a Lender thereunder. Upon consummation of an assignment,
the transferor Lender, Administrative Agent and Borrowers shall make appropriate arrangements for issuance of replacement and/or new
Notes, as applicable. The transferee Lender shall comply with Section 5.10 and deliver, upon request, an administrative questionnaire
satisfactory to Administrative Agent.
13.3.3. Certain Assignees . No assignment or participation may be made to a Borrower, Affiliate of a Borrower, Defaulting
Lender or natural person. Any assignment by a Defaulting Lender shall be effective only upon payment by the Eligible Assignee or
Defaulting Lender to the Applicable Agent of an aggregate amount sufficient, upon distribution (through direct payment, purchases of
participations, or other compensating actions as such Agent deems appropriate), to satisfy all funding and payment liabilities then owing by
the Defaulting Lender hereunder. If an assignment by a Defaulting Lender shall become effective under Applicable Law for any reason
without compliance with the foregoing sentence, then the assignee shall be deemed a Defaulting Lender for all purposes until such
compliance occurs.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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13.3.4. Register . The Administrative Agent, acting as a non-fiduciary agent of Borrowers (solely for tax purposes), shall
maintain at one of its offices in the United States (a) a copy (or electronic equivalent) of each Assignment and Acceptance delivered to it, and
(b) a register for recordation of the names and addresses of the Lenders, and the U.S. Revolver Commitments and Canadian Commitments of,
and principal amounts (and stated interest) of the Loans and LC Obligations owing to, each Lender pursuant to the terms hereof from time to
time (the “ Register ”). Entries in the register shall be conclusive, absent manifest error, and Borrowers, Agents, and Lenders shall treat each
Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes under the Loan
Documents, notwithstanding any notice to the contrary. The Register shall be available for inspection by the Borrowers and any Lender, at
any reasonable time and from time to time upon reasonable prior notice .
13.4. Replacement of Certain Lenders . If (a) any Lender gives a notice under Section 3.5 or requests compensation under
Section 3.7 , or if any Borrower is required to pay any Indemnified Taxes or additional amounts to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 5.9 and, in each case, such Lender has declined or is unable to designate a
different lending office in accordance with Section 3.8 , or (b) any Lender is a Defaulting Lender or a Non-Consenting Lender, then the
Borrower Agent may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign
and delegate, without recourse (in accordance with and subject to the restrictions contained in, and consents required by, Section 13.3 ), all of
its interests, rights (other than its existing rights to payments pursuant to Section 3.7 and Section 5.9 ) and obligations under this Agreement
and the related Loan Documents to an Eligible Assignee that shall assume such obligations (which assignee may be another Lender, if a
Lender accepts such assignment); provided , that:
(i) the Borrowers shall have paid to the Administrative Agent the processing fee (if any) specified in
Section 13.3.2 ;
(ii) such Lender shall have received payment of an amount equal to 100% of the outstanding principal of
its Loans and participations in unpaid drawings under Letters of Credit, accrued interest thereon, accrued fees and all
other amounts payable to it hereunder and under the other Loan Documents (including any amounts under Section 3.9
) from the assignee (to the extent of such outstanding principal and accrued interest and fees) or the Borrowers (in the
case of all other amounts);
(iii) in the case of any such assignment resulting from a claim for compensation under Section 3.7 or
payments required to be made pursuant to Section 5.9 , such assignment will result in a reduction in such
compensation or payments thereafter;
(iv) such assignment does not conflict with Applicable Law; and
(v) in the case of any assignment resulting from a Lender becoming a Non-Consenting Lender, the
applicable assignee shall have consented to the applicable amendment, waiver or consent.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such
Lender or otherwise, the circumstances entitling the Borrower Agent to require such assignment and delegation cease to apply.
SECTION 14. MISCELLANEOUS
14.1. Consents, Amendments and Waivers .
14.1.1. Amendment . No modification of any Loan Document, including any extension or amendment of a Loan Document
or any waiver of a Default or Event of Default, shall be effective unless in writing and signed by the Required Lenders and the Borrower
Agent or the other applicable Loan Parties, and acknowledged by the Administrative Agent, other than in the case of an amendment
contemplated by Section 3.6 or the penultimate paragraph of Section 6.2 ; and each Obligor party to such Loan Document; provided ,
however , that
(a) (i) without the prior written consent of the Applicable Agent, no modification shall be effective
with respect to any provision in a Loan Document that relates to any rights, duties or discretion of the Applicable
Agent and (ii) without the prior written consent of the Lender of any Swingline Loan, no modification shall be
effective with respect to any provision in a Loan Document that relates to any rights, duties or discretion of such
Lender of any Swingline Loan;
(b) without the prior written consent of the applicable Issuing Bank, no modification shall be
effective with respect to any LC Obligations, Section 2.3 or any other provision in a Loan Document that relates to
any rights, duties or discretion of such Issuing Bank;
(c) without the prior written consent of each affected Lender, including a Defaulting Lender, no
modification shall be effective that would (i) increase the U.S. Revolver Commitment or Canadian Commitment of
such Lender; (ii) reduce the amount of, or waive or delay payment of, any principal, interest or fees payable to such
Lender (except as provided in Section 4.2 ); provided , however , that for the purposes of this clause (ii), only the
consent of the Required Lenders shall be necessary to amend the definition of “Default Rate”; (iii) extend the U.S.
Revolver Termination Date or extend the Pre-Closing Commitment Termination Date or otherwise modify the Pre-
Closing Commitment Termination Date Paragraph; (iv) extend the Canadian Termination Date; or (v) amend this
clause (c);
(d) (i) without the prior written consent of all Lenders (except any Defaulting Lender), no
modification shall be effective that would (A) alter Sections 5.6.2 or 14.1.1; (B) amend the definitions of (x) Pro Rata,
(y) Required Lenders or (z) Supermajority Lenders; (C) release all or substantially all of the Collateral or subordinate
all or substantially all of the Liens securing the Obligations other than as expressly contemplated by the Intercreditor
Agreement; (D) except in connection with a merger, disposition or similar transaction expressly permitted hereby,
release substantially all of the Obligors from liability for any Obligations; (E) amend Section 14.19; (F) amend
provisions herein relating to the Pro Rata treatment of (x) payments or (y) reductions in the U.S. Revolver
Commitments or Canadian Commitments; or (G) increase any advance rate; and (ii) without the written consent of the
Supermajority Lenders, no modification shall be effective
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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that would amend the definitions of Aggregate Borrowing Base, U.S. Revolver Borrowing Base or Canadian
Borrowing Base (or any defined term used in such definitions) if as a result thereof the credit available to the
Borrowers would be increased, except that any increase to any advance rate used in or applicable to any such
definition shall be subject to clause (d)(i)(G) of this Section 14.1.1 ; (it being understood that this clause (d) shall not
(x) limit the adjustment by the Administrative Agent of the Availability Reserve in the Administrative Agent’s
administration of the Loans as otherwise permitted by this Agreement or (y) prevent the Administrative Agent, in its
administration of the Loans, from restoring any component of the U.S. Revolver Borrowing Base or the Canadian
Borrowing Base that had been lowered by the Administrative Agent back to the value of such component, as stated in
this Agreement, or to an intermediate value);
(e) without the prior written consent of a Secured Bank Product Provider, no modification shall be
effective that affects its relative payment priority under Section 5.6.2 ;
(f) the Administrative Agent and the applicable Obligors may amend, restate, amend and restate or
otherwise modify the Intercreditor Agreement as provided therein;
(g) if the Term Loan Agreement shall, on the Closing Date, include any covenant or event of
default, or any exception thereto or related definition, or any formulation of Consolidated EBITDA (including with
respect to any addback therein or any component definition thereof) that, in each case, is less favorable to the
Borrower Agent or any of its Subsidiaries in any material respect than the corresponding provision of this Agreement,
or includes any covenant or event of default (including through operation of any related definition) that is not
imposed in favor of the Lenders in this Agreement, or omits any exception that is included in this Agreement that is
not a de minimis exception as determined by the Administrative Agent in its discretion, then the Borrowers and the
Lenders agree that the Administrative Agent may, without any consent from any other party hereto, modify this
Agreement to reflect such additional or more favorable covenant or event of default or exception thereto or related
definition, and such modification shall be effective and binding on the parties hereto upon delivery thereof to the
Borrowers and the Lenders; provided , that, for the avoidance of doubt, covenants and events of default, or exceptions
thereto or related definitions, set forth herein that are customary for asset based lending facilities and not for term loan
facilities shall not be subject to this Section 14.1.1(g) ; and
(h) without the prior written consent of each Lead Arranger (in addition to the prior written consent
of the Required Lenders), no modification shall be effective that affects the calculation of the U.S. Revolver
Borrowing Base on the Closing Date.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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Notwithstanding anything herein or in any of the other Loan Documents to the contrary, (i) if the Administrative Agent and the
Borrower Agent have jointly identified any ambiguity, mistake, defect, inconsistency, obvious error or any error or omission of a technical
nature or any necessary or desirable technical change, in each case, in any provision of any Loan Document, then the Administrative Agent
and the Borrower Agent shall be permitted, without the consent of any other party hereto, to amend such provision solely to address such
matter as reasonably determined by them acting jointly and (ii) the Administrative Agent may amend any provision in this Agreement or in
any other Loan Document to make any necessary or desirable technical change (determined by the Administrative Agent acting reasonably)
to account for any matter arising from the consummation of the Supervalu Acquisition and the entry into the Closing Date Loan Documents
(including, without limitation, dating any Loan Document or updating the description thereof herein to more appropriately describe such Loan
Document) subject solely to the prior written consent of the Borrower Agent (not to be unreasonably withheld, conditioned or delayed) but
without the consent of any other party hereto; provided , that, in the case of clauses (i) and (ii), (x) the Administrative Agent may, but is not
required to, post any such amendment to the Lenders and if such amendment is not objected to by the Required Lenders within five (5)
Business Days thereafter such amendment shall be deemed to fall within the scope of discretion provided to the Administrative Agent and the
Borrower Agent under this paragraph and (y) any such amendment shall become binding on the parties hereto upon delivery to the Borrowers
and Lenders of a copy thereof executed by the Administrative Agent and acknowledged by the Borrower Agent.
14.1.2. Limitations . The agreement of Borrowers shall not be necessary to the effectiveness of any modification of a Loan
Document that deals solely with the rights and duties of Lenders, Agents and/or Issuing Banks as among themselves. Only the consent of the
parties to the Fee Letter or any other agreement relating to fees or a Bank Product shall be required for any modification of such agreement,
and no Bank Product provider (in such capacity) shall have any right to consent to modification of any Loan Document other than its Bank
Product agreement. Any waiver or consent granted by Agents or Lenders hereunder shall be effective only if in writing and only for the
matter specified.
14.1.3. Payment for Consents . No Borrower will, directly or indirectly, pay any remuneration or other thing of value,
whether by way of additional interest, fee or otherwise, to any Lender (in its capacity as a Lender hereunder) as consideration for agreement
by such Lender with any modification of any Loan Documents, unless such remuneration or value is concurrently paid, on the same terms, on
a Pro Rata basis to all Lenders providing their consent.
14.2. Indemnity . EACH BORROWER SHALL INDEMNIFY AND HOLD HARMLESS THE INDEMNITEES AGAINST
ANY CLAIMS INCURRED BY OR ASSERTED AGAINST ANY INDEMNITEE, INCLUDING CLAIMS ASSERTED BY ANY
OBLIGOR OR OTHER PERSON. In no event shall any party to a Loan Document have any obligation thereunder to indemnify or hold
harmless an Indemnitee with respect to a Claim that is the result from (i) the gross negligence or willful misconduct of such Indemnitee, (ii)
any material breach of the obligations of such Indemnitee or any of its Affiliates or related parties (as determined in a final non-appealable
judgment in a court of competent jurisdiction) or (iii) any dispute among Indemnitees (or their respective Affiliates or related parties) that
does not involve an act or omission by the Borrowers or any of the Subsidiaries (other than any claims against an Administrative Agent or a
Lead Arranger in their capacity as such). For the avoidance of doubt, this Section 14.2 shall not apply to any Claim on account of Taxes
governed by (or excluded from the application of) Sections 3.7 or 5.9 . Notwithstanding the foregoing, in no case shall a Canadian Loan Party
have any obligation to indemnify or hold harmless an Indemnitee with respect claims or liabilities of or against any U.S. Loan Party. Each
Indemnitee agrees (by accepting the benefits hereof), severally and not jointly, to refund and return any and
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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all amounts paid by any Borrower or any of the Subsidiaries under this Section 14.2 to such Indemnitee to the extent such Indemnitee is not
entitled to payment of such amounts in accordance with the terms hereof. Each Indemnitee shall, in consultation with the Borrower Agent,
take all reasonable steps to mitigate any losses, Claims, damages, liabilities and expenses and shall give (subject to confidentiality or legal
restrictions) such information and assistance to the Borrower Agent as it may reasonably request in connection with any proceedings.
14.3. Notices and Communications .
14.3.1. Notice Address . Subject to Section 4.1.4 , all notices and other communications by or to a party hereto shall be in
writing and shall be given to any Borrower, at Borrower Agent’s address shown on the signature pages hereof, and to any other Person at its
address shown on the signature pages hereof (or, in the case of a Person who becomes a Lender after the Closing Date, at the address shown
on its Assignment and Acceptance), or at such other address as a party may hereafter specify by notice in accordance with this Section 14.3 .
Each such notice or other communication shall be effective only (a) if given by facsimile transmission, when transmitted to the applicable
facsimile number, if confirmation of receipt is received; (b) if given by mail, three Business Days after deposit in the U.S. mail, with first-
class postage pre-paid, addressed to the applicable address; (c) if given by personal delivery, when duly delivered to the notice address with
receipt acknowledged or (d) if given by email, when sent absent receipt of a failure to deliver notice within 30 minutes of such notice or
communication being sent (it being understood that an “out of office” reply does not constitute a failure to deliver notice for this purpose).
Notwithstanding the foregoing, no notice to any Agent pursuant to Section 2.1.4, 2.3, 3.1.2 , or 4.1.1 shall be effective until actually received
by the individual to whose attention such notice is required to be sent. Any written notice or other communication that is not sent in
conformity with the foregoing provisions shall nevertheless be effective on the date actually received by the noticed party. Any notice
received by Borrower Agent shall be deemed received by all Borrowers.
14.3.2. Electronic Communications; Voice Mail . Electronic and telephonic communications (including e-mail, messaging,
voice mail and websites) may be used. Secured Parties make no assurance as to the privacy or security of electronic or telephonic
communications. Voice mail shall not be effective notices under the Loan Documents.
14.3.3. Platform . Borrower Materials shall be delivered pursuant to procedures approved by Administrative Agent,
including electronic delivery (if possible) upon request by Administrative Agent to an electronic system maintained by Administrative Agent
(“ Platform ”). Borrowers shall notify Administrative Agent of each posting of Borrower Materials on the Platform and the materials shall be
deemed received by Administrative Agent only upon its receipt of such notice. Borrower Materials and other information relating to this
credit facility may be made available to Secured Parties on the Platform, and Obligors and Secured Parties acknowledge that “public”
information is not segregated from material non-public information on the Platform. The Platform is provided “as is” and “as available.”
Administrative Agent does not warrant the accuracy or completeness of any information on the Platform nor the adequacy or functioning of
the Platform, and expressly disclaims liability for any errors or omissions in the Borrower Materials or any issues involving the Platform. NO
WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY,
FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS, OR FREEDOM FROM VIRUSES
OR OTHER CODE DEFECTS, IS MADE BY ANY AGENT WITH RESPECT TO BORROWER MATERIALS OR THE PLATFORM.
Secured Parties acknowledge that Borrower Materials may include material non-public information of Obligors and should not be made
available to any personnel who do not wish to receive such information or who may be engaged in investment or other market-related
activities
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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with respect to any Obligor’s securities. No Agent Indemnitee shall have any liability to Borrowers, Secured Parties or any other Person for
losses, claims, damages, liabilities or expenses of any kind (whether in tort, contract or otherwise) relating to use by any Person of the
Platform, including any unintended recipient, nor for delivery of Borrower Materials and other information via the Platform, internet, e-mail
or any other electronic platform or messaging system.
14.3.4. Non-Conforming Communications . Agents and Lenders may rely upon any communications purportedly given by
or on behalf of any Borrower even if they were not made in a manner specified herein, were incomplete or were not confirmed, or if the terms
thereof, as understood by the recipient, varied from a later confirmation. Each Borrower shall indemnify and hold harmless each Indemnitee
from any liabilities, losses, costs and expenses arising from any electronic or telephonic communication purportedly given by or on behalf of
a Borrower.
14.4. Performance of Borrowers’ Obligations . Following the occurrence and during the continuance of an Event of Default,
each Agent may, in its discretion at any time and from time to time, at Borrowers’ expense, pay any amount or do any act required of a
Borrower under any Loan Documents or otherwise lawfully requested by such Agent to (a) enforce any Loan Documents or collect any
Obligations; (b) protect, insure, maintain or realize upon any Collateral; or (c) defend or maintain the validity or priority of such Agent’s
Liens in any Collateral, including any payment of a judgment, insurance premium, warehouse charge, finishing or processing charge, or
landlord claim, or any discharge of a Lien. All reasonably documented, out-of-pocket payments, costs and expenses (including Extraordinary
Expenses and reasonable attorney costs of one counsel for all Indemnitees and, if necessary, one firm of local counsel in each appropriate
jurisdiction (which may include a single special counsel acting in multiple jurisdictions) for all Indemnitees (and, in the case of an actual or
perceived conflict of interest, where the Indemnitee affected by such conflict informs the Borrowers of such conflict and thereafter retains its
own counsel, of another firm of counsel for such affected Indemnitee)) of Agents under this Section shall be reimbursed to Agents by
Borrowers, on demand , with interest from the date incurred until paid in full, at the Default Rate applicable to Base Rate Loans. Any
payment made or action taken by Agents under this Section shall be without prejudice to any right to assert an Event of Default or to exercise
any other rights or remedies under the Loan Documents. Notwithstanding the foregoing, in no case shall a Canadian Loan Party have any
obligation to reimburse the Agents for any payments, costs or expenses incurred with respect to a U.S. Loan Party.
14.5. Credit Inquiries . Agents and Lenders may (but shall have no obligation to) respond to usual and customary credit inquiries
from third parties concerning any Obligor or Subsidiary.
14.6. Severability . Wherever possible, each provision of the Loan Documents shall be interpreted in such manner as to be valid
under Applicable Law. If any provision is found to be invalid under Applicable Law, it shall be ineffective only to the extent of such
invalidity and the remaining provisions of the Loan Documents shall remain in full force and effect.
14.7. Cumulative Effect; Conflict of Terms . The provisions of the Loan Documents are cumulative. The parties acknowledge
that the Loan Documents may use several limitations or measurements to regulate similar matters, and they agree that these are cumulative
and that each must be performed as provided. Except as otherwise provided in another Loan Document (by specific reference to the
applicable provision of this Agreement), if any provision contained herein is in direct conflict with any provision in another Loan Document,
the provision herein shall govern and control.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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14.8. Counterparts; Execution . Any Loan Document may be executed in counterparts, each of which shall constitute an original,
but all of which when taken together shall constitute a single contract. Delivery of a signature page of any Loan Document by telecopy or
other electronic means shall be effective as delivery of a manually executed counterpart of such agreement. Any electronic signature, contract
formation on an electronic platform and electronic record-keeping shall have the same legal validity and enforceability as a manually
executed signature or use of a paper-based recordkeeping system to the fullest extent permitted by Applicable Law, including the Federal
Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any similar state
law based on the Uniform Electronic Transactions Act. Upon request by any Agent, any electronic signature or delivery shall be promptly
followed by a manually executed or paper document.
14.9. Time is of the Essence . Except as otherwise expressly provided to the contrary herein or in another Loan Document, time is
of the essence with respect to all Loan Documents and Obligations.
14.10. Relationship with Lenders . The obligations of each Lender hereunder are several, and no Lender shall be responsible for
the obligations or U.S. Revolver Commitments or Canadian Commitments of any other Lender. Amounts payable hereunder to each Lender
shall be a separate and independent debt. It shall not be necessary for any Agent or any other Lender to be joined as an additional party in any
proceeding for such purposes. Nothing in this Agreement and no action of any Agent, Lenders or any other Secured Party pursuant to the
Loan Documents or otherwise shall be deemed to constitute any Agent and any Secured Party to be a partnership, association, joint venture or
any other kind of entity, nor to constitute control of any Obligor.
14.11. No Advisory or Fiduciary Responsibility . In connection with all aspects of each transaction contemplated by any Loan
Document, Borrowers acknowledge and agree that (a)(i) this credit facility and any related arranging or other services by any Agent, any
Lender, any of their Affiliates or any arranger are arm’s-length commercial transactions between Borrowers and their Affiliates, on one hand,
and any Agent, any Lender, any of their Affiliates or any arranger, on the other hand; (ii) Borrowers have consulted their own legal,
accounting, regulatory and tax advisors to the extent they have deemed appropriate; and (iii) Borrowers are capable of evaluating, and
understand and accept, the terms, risks and conditions of the transactions contemplated by the Loan Documents; (b) each of Agents, Lenders,
their Affiliates and any arranger is and has been acting solely as a principal and, except as expressly agreed in writing by the relevant parties,
has not been, is not, and will not be acting as an advisor, agent or fiduciary for Borrowers, any of their Affiliates or any other Person, and has
no obligation with respect to the transactions contemplated by the Loan Documents except as expressly set forth therein; and (c) Agents,
Lenders, their Affiliates and any arranger may be engaged in a broad range of transactions that involve interests that differ from those of
Borrowers and their Affiliates, and have no obligation to disclose any of such interests to Borrowers or their Affiliates. To the fullest extent
permitted by Applicable Law, each Borrower hereby waives and releases any claims that it may have against Agents, Lenders, their Affiliates
and any arranger with respect to any breach of agency or fiduciary duty in connection with any transaction contemplated by a Loan
Document.
14.12. Confidentiality . Each of Agents, Lenders and Issuing Banks shall maintain the confidentiality of all Information (as
defined below), except that Information may be disclosed (a) to its Affiliates, and to its and their respective directors, officers, agents,
employees, attorneys, accountants and advisors, and to their respective Affiliates involved in the Transaction on a “need to know” basis and
who are made aware of the confidential nature of such information and have been advised of this obligation to keep information of this type
confidential; provided , that such Agent, Lender or Issuing Bank shall remain liable for the breach of the provisions of this paragraph by such
directors, officers, agents, employees, attorneys, accountants and advisors, (b) on a confidential basis to any bona fide potential Lender,
prospective
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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participant or swap counterparty (in each case, other than a Disqualified Institution and other persons to whom the Borrower Agent has
affirmatively declined to consent to the syndication or assignment thereto prior to the disclosure of such confidential Information to such
Person) that agrees to keep such information confidential in accordance with (x) the provisions of this paragraph for the benefit of the
Borrower Agent or (y) other customary confidentiality language in a “click-through” arrangement, (c) as required by the order of any court or
administrative agency or in any pending legal, judicial or administrative proceeding, or otherwise as required by applicable law, regulation or
compulsory legal process (in which case the applicable Agent, Lender or Issuing Bank agrees to use commercially reasonable efforts to
inform the Borrower Agent promptly thereof to the extent lawfully permitted to do so (except with respect to any audit or examination
conducted by bank accountants or any self-regulatory authority or governmental or regulatory authority exercising examination or regulatory
authority)), (d) to the extent requested by any bank regulatory authority having jurisdiction over any Agent, Lender or Issuing Bank
(including in any audit or examination conducted by bank accountants or any self-regulatory authority or governmental or regulatory
authority exercising examination or regulatory authority), (e) to the extent such Information: (i) becomes publicly available other than as a
result of a breach of this Agreement or other confidential obligation owed by such Agent, Lender or Issuing Bank to the Borrowers or any of
the Subsidiaries, Supervalu or any of their respective Affiliates or (ii) becomes available to the Agent, Lender or Issuing Bank on a non-
confidential basis from a source other than the Borrower Agent or on its behalf that, to such Agent, Lender or Issuing Bank’s knowledge
(after due inquiry), is not in violation of any confidentiality obligation owed to any Borrower or any of the Subsidiaries, Supervalu or any of
their respective Affiliates, (f) to the extent the Borrower Agent shall have consented to such disclosure in writing (which may include through
electronic means), (g) financings for purposes of establishing any defense available under securities laws, including, without limitation,
establishing a “due diligence” defense or to defend any claim related to this Agreement, (h) to the extent independently developed by such
Agent, Lender or Issuing Bank without reliance on confidential Information, or (i), solely with respect to the existence of this credit facility,
to market data collectors, similar services providers to the lending industry, and service providers to the Agents and the Lenders in connection
with the administration and management of this credit facility. As used herein, “ Information ” means all information received from an
Obligor or Subsidiary relating to it or its business other than any such information that is available to any Agent or any Lender on a
nonconfidential basis. Any Person required to maintain the confidentiality of Information pursuant to this Section shall be deemed to have
complied if it exercises a degree of care similar to that which it accords its own confidential information.
14.13. Judgment Currency . If, for the purposes of obtaining judgment in any court, it is necessary to convert a sum due
hereunder or any other Loan Document in one currency into another currency, the rate of exchange used shall be that at which in accordance
with normal banking procedures the Applicable Agent could purchase the first currency with such other currency on the Business Day
preceding that on which final judgment is given. The obligation of each Borrower in respect of any such sum due from it to the Applicable
Agent or any Lender hereunder or under the other Loan Documents shall, notwithstanding any judgment in a currency (the “ Judgment
Currency ”) other than that in which such sum is denominated in accordance with the applicable provisions of this Agreement (the “
Agreement Currency ”), be discharged only to the extent that on the Business Day following receipt by the Applicable Agent or such Lender,
as the case may be, of any sum adjudged to be so due in the Judgment Currency, the Applicable Agent or such Lender, as the case may be,
may in accordance with normal banking procedures purchase the Agreement Currency with the Judgment Currency. If the amount of the
Agreement Currency so purchased is less than the sum originally due to the Applicable Agent or any Lender from any Borrower in the
Agreement Currency, such Borrower agrees, as a separate obligation and notwithstanding any such judgment, to indemnify the Applicable
Agent or such Lender, as the case may be, against such loss. If the amount of the Agreement Currency so purchased is greater than the sum
originally due to the Applicable Agent or any Lender in such
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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currency, the Applicable Agent or such Lender, as the case may be, agrees to return the amount of any excess to such Borrower (or to any
other Person who may be entitled thereto under Applicable Law).
14.14. GOVERNING LAW . THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS, UNLESS OTHERWISE
SPECIFIED, SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO ANY
CONFLICT OF LAW PRINCIPLES (BUT GIVING EFFECT TO FEDERAL LAWS RELATING TO NATIONAL BANKS).
14.15. CONSENT TO FORUM . EACH BORROWER HEREBY CONSENTS TO THE EXCLUSIVE JURISDICTION
OF ANY FEDERAL OR STATE COURT SITTING IN OR WITH JURISDICTION OVER NEW YORK, IN ANY PROCEEDING
OR DISPUTE RELATING IN ANY WAY TO ANY LOAN DOCUMENTS, AND AGREES THAT ANY SUCH PROCEEDING
SHALL BE BROUGHT BY IT SOLELY IN ANY SUCH COURT. EACH BORROWER IRREVOCABLY WAIVES ALL CLAIMS,
OBJECTIONS AND DEFENSES THAT IT MAY HAVE REGARDING SUCH COURT’S PERSONAL OR SUBJECT MATTER
JURISDICTION, VENUE OR INCONVENIENT FORUM. EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE
OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 14.3.1. Nothing herein shall limit the right of any Agent
or any Lender to bring proceedings against any Obligor in any other court, nor limit the right of any party to serve process in any other
manner permitted by Applicable Law. Nothing in this Agreement shall be deemed to preclude enforcement by any Agent of any judgment or
order obtained in any forum or jurisdiction.
RELEASE,
MATURITY,
SETTLEMENT,
COMPROMISE,
14.16. WAIVERS BY BORROWERS . TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, EACH
BORROWER WAIVES (A) THE RIGHT TO TRIAL BY JURY (WHICH EACH AGENT AND EACH LENDER HEREBY ALSO
WAIVES) IN ANY PROCEEDING OR DISPUTE OF ANY KIND RELATING IN ANY WAY TO ANY LOAN DOCUMENTS,
OBLIGATIONS OR COLLATERAL; (B) PRESENTMENT, DEMAND, PROTEST, NOTICE OF PRESENTMENT, DEFAULT,
NON-PAYMENT,
EXTENSION OR RENEWAL OF ANY
COMMERCIAL PAPER, ACCOUNTS, DOCUMENTS, INSTRUMENTS, CHATTEL PAPER AND GUARANTIES AT ANY
TIME HELD BY ANY AGENT ON WHICH A BORROWER MAY IN ANY WAY BE LIABLE, AND HEREBY RATIFIES
ANYTHING ANY AGENT MAY DO IN THIS REGARD; (C) NOTICE PRIOR TO TAKING POSSESSION OR CONTROL OF
ANY COLLATERAL; (D) ANY BOND OR SECURITY THAT MIGHT BE REQUIRED BY A COURT PRIOR TO ALLOWING
ANY AGENT TO EXERCISE ANY RIGHTS OR REMEDIES; (E) THE BENEFIT OF ALL VALUATION, APPRAISEMENT
AND EXEMPTION LAWS; (F) ANY CLAIM AGAINST ANY AGENT, ANY ISSUING BANK OR ANY LENDER, ON ANY
THEORY OF LIABILITY, FOR SPECIAL, INDIRECT, CONSEQUENTIAL, EXEMPLARY OR PUNITIVE DAMAGES (AS
OPPOSED TO DIRECT OR ACTUAL DAMAGES) IN ANY WAY RELATING TO ANY ENFORCEMENT ACTION,
OBLIGATIONS, LOAN DOCUMENTS OR TRANSACTIONS RELATING THERETO; AND (G) NOTICE OF ACCEPTANCE
HEREOF. EACH BORROWER ACKNOWLEDGES THAT THE FOREGOING WAIVERS ARE A MATERIAL INDUCEMENT
TO AGENTS, ISSUING BANKS AND LENDERS ENTERING INTO THIS AGREEMENT AND THAT THEY ARE RELYING
UPON THE FOREGOING IN THEIR DEALINGS WITH BORROWERS. EACH BORROWER HAS REVIEWED THE
FOREGOING WAIVERS WITH ITS LEGAL COUNSEL AND HAS KNOWINGLY AND VOLUNTARILY WAIVED ITS JURY
TRIAL AND OTHER RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION,
THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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14.17. Patriot Act Notice . Agents and Lenders hereby notify Borrowers that pursuant to the Patriot Act, Agents and Lenders are
required to obtain, verify and record information that identifies each Borrower, including its legal name, address, tax ID number and other
information that will allow Agents and Lenders to identify it in accordance with the Patriot Act. Agents and Lenders will also require
information regarding each personal guarantor, if any, and may require information regarding Borrowers’ management and owners, such as
legal name, address, social security number and date of birth. The Borrowers shall, promptly following a request by any Agent or any Lender,
provide all documentation and other information that such Agent or such Lender requests in order to comply with its ongoing obligations
under applicable “know your customer” and anti-money laundering rules and regulations, including the Patriot Act.
14.18. Waiver of Sovereign Immunity . To the extent the Canadian Borrower or any other Borrower that is a Canadian
Subsidiary has or hereafter may acquire any immunity from jurisdiction of any court or from any legal process (whether from service or
notice, attachment prior to judgment, attachment in aid of execution of a judgment, execution or otherwise), the Canadian Borrower (and any
other Borrower that is a Canadian Subsidiary) hereby irrevocably waives, to the fullest extent permissible under applicable law, such
immunity in respect of its obligations under the Loan Documents, and agrees not to assert any such right of immunity in any such proceeding,
whether in the United States and Canada or elsewhere. Without limiting the generality of the foregoing, each such Canadian Loan Party
further agrees that the waivers set forth in this Section 14.18 shall have the fullest extent permitted under the Foreign Sovereign Immunities
Act of 1976 of the United States and are intended to be irrevocable for purposes of such Act.
14.19. Pari Passu Treatment .
(a) Notwithstanding anything to the contrary set forth herein, the Administrative Agent may and,
upon the request of the Required Lenders, shall, upon notice to each Lender, effect the remaining provisions of this
Section 14.19 by causing each payment or prepayment of principal and interest received after the occurrence and
during the continuance of an Event of Default hereunder to be distributed pari passu among the Lenders, in
accordance with the aggregate outstanding principal amount of the Obligations owing to each Lender divided by the
Total Outstandings. Such notice shall also attach a schedule setting forth the Total Outstandings at such time
including a breakdown of the Total U.S. Revolver Outstandings and the Total Canadian Outstandings. Nothing in this
Section 14.19 shall constitute a guarantee by any Obligor of the obligations of any other Obligor.
(b) Following the occurrence and during the continuance of any Event of Default or acceleration of
the Loans pursuant to Section 11.2 and receipt of a notice from the Administrative Agent pursuant to clause (a)
above, each Lender agrees that if it shall, through the exercise of a right of banker’s lien, setoff or counterclaim
against any Borrower (pursuant to Section 11.4 or otherwise), including a secured claim under Section 506 of the
Bankruptcy Code of the United States or other security or interest arising from or in lieu of, such secured claim,
received by such Lender under the Bankruptcy Code, or any other insolvency, debtor relief or debt adjustment law or
otherwise, obtain payment (voluntary or involuntary) in respect of the Loans, Letters of Credit, LC Obligations and
other Obligations held by it as a result of which the unpaid principal portion of the Obligations held by it shall be
proportionately less than the unpaid principal portion of the Obligations held by any other Lender, it shall be deemed
to have simultaneously purchased from such other Lender a participation in the Obligations held by such other
Lender, so
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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that the aggregate unpaid principal amount of the Obligations and participations in Obligations held by each Lender
shall be in the same proportion to the aggregate unpaid principal amount of the Obligations then outstanding as the
principal amount of the Obligations held by it prior to such exercise of banker’s lien, setoff or counterclaim was to the
principal amount of all Obligations outstanding prior to such exercise of banker’s lien, setoff or counterclaim;
provided , however , that if any such purchase or purchases or adjustments shall be made pursuant to this Section
14.19 and the payment giving rise thereto shall thereafter be recovered, such purchase or purchases or adjustments
shall be rescinded to the extent of such recovery and the purchase price or prices or adjustments restored without
interest.
(c) Following the occurrence and during the continuance of any Event of Default or acceleration of
the Loans pursuant to Section 11.2 , each Lender agrees that, upon notice from the Administrative Agent to such
Lender, which notice shall be provided upon the request of the Required Lenders or may be provided by the
Administrative Agent in its sole discretion, such Lender shall be deemed to have purchased from each other Lender a
participation in the risk associated with the Obligations held by such other Lender, so that the aggregate principal
amount of the Obligations held by each Lender shall be equivalent to such Lender’s Pro Rata share of the Obligations.
Upon demand by the Administrative Agent, made at the request of the Required Lenders, each Lender that has
purchased such participation (a “ Purchasing Lender ”) shall pay the amount of such participation to the
Administrative Agent for the account of each Lender whose outstanding Loans and participations in LC Obligations
exceed their Pro Rata share of the Obligations. Any such participation may, at the option of such Purchasing Lender,
be paid in U.S. Dollars or Canadian Dollars, as the case may be (in an amount equal to the then applicable U.S. Dollar
Equivalent amount of such participation) and such payment shall be converted by the Administrative Agent at the
exchange rate into the currency of the Loan or LC Obligation in which such participation is being purchased. The
Borrowers agree to indemnify each Purchasing Lender for any loss, cost or expense incurred by such Purchasing
Lender as a result of any payment on account of such participation in a currency other than that funded by the
Purchasing Lender.
(d) Each Borrower expressly consents to the foregoing arrangements and agrees that any Person
holding such a participation in the Obligations deemed to have been so purchased may exercise any and all rights of
banker’s lien, setoff or counterclaim with respect to any and all moneys owing by such Borrower to such Person as
fully as if such Person had made a Loan directly to such Borrower in the amount of such participation.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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14.20. Acknowledgement and Consent to Bail-In of EEA Financial Institutions . Notwithstanding anything to the contrary in
any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that
any liability of any Lender that is an EEA Financial Institution arising under any Loan Document, to the extent such liability is unsecured,
may be subject to the write-down and conversion powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and
agrees to be bound by:
(a) the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to
any such liabilities arising hereunder which may be payable to it by any Lender that is an EEA Financial Institution;
(b) the effects of any Bail-in Action on any such liability, including, if applicable:
(c) a reduction in full or in part or cancellation of any such liability;
(d) a conversion of all, or a portion of, such liability into shares or other instruments of ownership
in such EEA Financial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise
conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with
respect to any such liability under this Agreement or any other Loan Document; or
(e) the variation of the terms of such liability in connection with the exercise of the write-down and
conversion powers of any EEA Resolution Authority.
14.21. Intercreditor Agreement . Notwithstanding anything to the contrary in this Agreement or in any other Loan Document: (a)
the Liens granted to the applicable Agent in favor of the Secured Parties pursuant to the Loan Documents and the exercise of any right related
to any Collateral shall be subject, in each case, to the terms of the Intercreditor Agreement and (b) in the event of any conflict between the
express terms and provisions of this Agreement or any other Loan Document, on the one hand, and of the Intercreditor Agreement, on the
other hand, the terms and provisions of such Intercreditor Agreement shall control.
14.22. NO ORAL AGREEMENT THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS
OR SUBSEQUENT ORAL AGREEMENTS BETWEEN THE PARTIES. THERE ARE NO UNWRITTEN AGREEMENTS BETWEEN
THE PARTIES.
[Remainder of page intentionally left blank; signatures begin on following page]
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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IN WITNESS WHEREOF, this Agreement has been executed and delivered as of the date set forth above.
BORROWERS :
UNITED NATURAL FOODS, INC.
By: /s/ Michael P. Zechmeister
Name: Michael P. Zechmeister
Title: Senior Vice President, Chief Financial Officer
& Treasurer
Address:
313 Iron Horse Way
Providence, RI 02908
Attn:Michael P. Zechmeister, Senior Vice President, Chief Financial
Officer and Treasurer
Telecopy: 877-566-8481
Email: mzechmeister@unfi.com
Website: www.unfi.com
UNITED NATURAL FOODS WEST, INC.
By: /s/ Michael P. Zechmeister
Name: Michael P. Zechmeister
Title: Senior Vice President, Chief Financial Officer
& Treasurer
Address:
313 Iron Horse Way
Providence, RI 02908
Attn:Michael P. Zechmeister, Senior Vice President, Chief Financial Officer and
Treasurer
Telecopy: 877-566-8481
Email: mzechmeister@unfi.com
Website: www.unfi.com
UNFI CANADA, INC.
By: /s/ Michael P. Zechmeister
Name: Michael P. Zechmeister
Title: Senior Vice President, Chief Financial Officer
& Treasurer
Address:
313 Iron Horse Way
Providence, RI 02908
Attn:Michael P. Zechmeister, Senior Vice President, Chief Financial Officer and
Treasurer
Telecopy: 877-566-8481
Email: mzechmeister@unfi.com
Website: www.unfi.com
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
[ Signature Page to ABL Credit Agreement]
AGENTS AND LENDERS :
BANK OF AMERICA, N.A. , as Administrative Agent, an Issuing Bank and a U.S.
Revolver Lender
By: /s/ Edgar Ezerins
Name: Edgar Ezerins
Title: Senior Vice President
Address:
CityPlace I
185 Asylum Street
Hartford, CT 06103
Attn: Edgar Ezerins
Telecopy: (860) 952-6830
E-mail: edgar.ezerins@baml.com
With a copy to:
Davis Polk and Wardwell LLP
450 Lexington Avenue
New York, NY 10017
Attn: Jason Kyrwood
Telecopy: 1-212-450-5425
E-Mail: jason.kyrwood@davispolk.com
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
[ Signature Page to ABL Credit Agreement]
BANK OF AMERICA, N.A. , acting through its Canada branch, as Canadian Agent,
an Issuing Bank and a Canadian Lender
By: /s/ Sylwia Durkiewicz
Name: Sylwia Durkiewicz
Title: Vice President
Address:
181 Bay Street
Toronto, Ontario, M5J2V8
For credit notices:
Attn: Medina Sales de Andrade
Telecopy: (312) 453-4041
For operations notices:
Attn: Teresa Tsui
Telecopy: (312) 453-4041
With a copy to:
Davis Polk and Wardwell LLP
450 Lexington Avenue
New York, NY 10017
Attn: Jason Kyrwood
Telecopy: 1-212-450-5425
E-Mail: jason.kyrwood@davispolk.com
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
[ Signature Page to ABL Credit Agreement]
WELLS FARGO BANK, NATIONAL ASSOCIATION, as U.S. Revolver Lender and an
Issuing Bank
By: /s/ Lynn Gosselin
Name: Lynn Gosselin
Title: Director
Address:
10 South Wacker, Suite 2600
Chicago, IL 60606
Attn: Peter Schuebler
Telecopy: 855-253-5362
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
[ Signature Page to ABL Credit Agreement]
WELLS FARGO CAPITAL FINANCE CORPORATION CANADA, as a Canadian Lender
By: /s/ David G. Phillips___________
Name: David G. Phillips
Title: Senior Vice President
Credit Officer, Canada
Wells Fargo Finance
Corporation Canada
Address: ______________________________________
______________________________________
______________________________________
Attn:
______________________________________
Telecopy:
_____________________________________
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
[ Signature Page to ABL Credit Agreement]
JP Morgan Chase Bank, N.A., as U.S. Revolver Lender, a Lead Arranger and an Issuing
Bank
By: /s/ Alicia Schreibstein
Name: Alicia Schreibstein
Title: Executive Director
Address:
Attention: United Natural Foods Account Executive
4 New York Plaza, 17 th Floor.
New York, NY 10004
T: 914-993-7926
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
[ Signature Page to ABL Credit Agreement]
JP Morgan Chase Bank, N.A., Toronto Branch, as a Canadian Lender
By: /s/ Deborah Booth
Name: Deborah Booth
Title: Executive Director
Address:
Attention: United Natural Foods Account Executive
4 New York Plaza, 17 th Floor.
New York, NY 10004
T: 914-993-7926
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
[ Signature Page to ABL Credit Agreement]
U.S. BANK NATIONAL ASSOCIATION , as a Lender and Issuing Bank
By: /s/ Nicole Manies
Name: Nicole Manies
Title: Vice President
Address:
10 North Hanley Road
St. Louis, MO 63105
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
[ Signature Page to ABL Credit Agreement]
U.S. BANK NATIONAL ASSOCIATION , acting through its Canada Branch as a
Canadian Lender
By: /s/ John P. Rehob
Name: John P. Rehob
Title: Vice President & Principal Officer
Address:
120 Adelaide Street West, Suite 2300
Toronto, Ontario
M5H 1T1
Attn:
______________________________________
Telecopy:
_____________________________________
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
[ Signature Page to ABL Credit Agreement]
GOLDMAN SACHS BANK USA, as a U.S. Revolver Lender, a Canadian Lender, and an
Issuing Bank
By: /s/ Robert Ehudin ______________
Name: Robert Ehudin
Title: Authorized Signatory
Address:
Goldman Sachs Bank USA
200 West Street
New York, NY 10282
Attn: ______________________________________
Telecopy: _____________________________________
Email: _____________________________________
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
[ Signature Page to ABL Credit Agreement]
BRANCH BANKING AND TRUST COMPANY , as a Canadian Lender and a U.S.
Revolver Lender
By: /s/ David Miller
Name: David Miler
Title: Vice President
Address:
200 W 2 nd St
Winston-Salem, NC 27106
Attn: David Miller
Telecopy: 336.733.2740
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
[ Signature Page to ABL Credit Agreement]
BMO Harris Financing, Inc. , as a U.S. Revolver Lender
By: /s/ Craig Thistlethwaite
Name: Craig Thistlethwaite
Title: Managing Director
Address:
111 W Monroe
Floor 20W
Chicago, IL, 60603
Attn: Craig Thistlethwaite
Telecopy: 312-461-2171
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
[ Signature Page to ABL Credit Agreement]
Bank of Montreal , as a Canadian Lender
By: /s/ Craig Thistlethwaite
Name: Craig Thistlethwaite
Title: Managing Director
Address:
111 W Monroe
Floor 20W
Chicago, IL, 60603
Attn: Craig Thistlethwaite
Telecopy: 312-461-2171
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
[ Signature Page to ABL Credit Agreement]
CITIZENS BANK , N.A., as a Canadian Lender and a U.S. Revolver Lender
By: /s/ Peter Yelle
Name: Peter Yelle
Title: VP
Address:
28 State Street
Boston, MA 02109
Attn: Peter Yelle
Telecopy: _____________________________________
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
[ Signature Page to ABL Credit Agreement]
TD Bank , N.A. as a U.S. Revolver Lender
By: /s/ Virginia Pulverenti
Name: Virginia Pulverenti
Title: Vice President
Title: 125 Park Avenue NY, NY 10022
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
[ Signature Page to ABL Credit Agreement]
THE TORONTO-DOMINION BANK, as a Canadian Lender
By: /s/ Sean Noonan
Name: Sean Noonan
Title: Manager Commercial Credit
By: /s/ Ryan Yee
Name: Ryan Yee
Title: Senior Analyst
Address:
TD Tower West
100 Wellington Street West, 29 th Floor
Toronto, Ontario, M5K 1A2
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
[ Signature Page to ABL Credit Agreement]
Royal Bank of Canada , as a Canadian Lender and a U.S. Revolver Lender
By: /s/ Anna Bernat _______________________
Name: Anna Bernat
Title: Attorney in Fact
By: /s/ Farhan Lodhi _______________________
Name: Farhan Lodhi
Title: Attorney in Fact
Address: Royal Bank Plaza - Asset Based Lending, North Tower, 12 th Floor
200 Bay Street, Toronto
Ontario, M5J SJS
Attn: Portfolio Manager
Telecopy: 416-842-5884
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
[ Signature Page to ABL Credit Agreement]
CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH , as a Canadian Lender and a U.S.
Revolver Lender
By: /s/ William O’Daly ______________
Name: William O’Daly
Title: Authorized Signatory
By: /s/ Christopher Zybrick ____________
Name: Christopher Zybrick
Title: Authorized Signatory
Address:
7033 Louis Stephens Drive
Research Triangle Park, NC 27560
Attn: marchin.krzyszkowski@credit-suisse.com
18664693871@docs.LDSPROD.com
Telecopy: +1 866 469 3871
Primary Phone Number: +48 71 748 4731
Back up Number: +1 919 994 6174
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
[ Signature Page to ABL Credit Agreement]
PNC BANK, NATIONAL ASSOCIATION , as a U.S. Revolver Lender
By: /s/ Biana Musiyenko _______________________
Name: Biana Musiyenko
Title: Vice President
Address: PNC Bank
340 Madison Avenue , 11 th Floor
New York, NY 10173
Attn: Biana Musiyenko
Telecopy: 212-303-0060
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
[ Signature Page to ABL Credit Agreement]
PNC BANK CANADA BRANCH , as a Canadian Lender
By: /s/James Bruce _________________________
Name: James Bruce
Title: Senior Vice President
Address: 130 King Street West
Suite 2140
Toronto ON, Canada
M5X 1E4
Attn: Portfolio Manager
Telecopy: 416-361-0085
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
[ Signature Page to ABL Credit Agreement]
Capital One, National Association , as a Canadian Lender and a U.S. Revolver Lender
By: /s/ Julianne Low _____________________
Name: Julianne Low
Title: Senior Director
Address: 275 Broadhollow Road
Melville, New York 11747
Attn: 631-531-2894
Telecopy: julianne.low@capitalone.com
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
[ Signature Page to ABL Credit Agreement]
Farm Credit East, ACA , as a Canadian Lender and a U.S. Revolver Lender
By: /s/ Eric W. Pohlman _________________
Name: Eric W. Pohlman
Title: Vice President
Address: 240 South Road
Enfield, CT 06082
Attn: Capital Markets
Telecopy: (888) 278-2955
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
[ Signature Page to ABL Credit Agreement]
COӦPERATIEVE RABOBANK U.A., NEW YORK BRANCH, as a Canadian Lender and
as U.S. Revolver Lender
By: /s/ Timothy J. Devane _______________
Name: Timothy J. Devane
Title: Executive Director
By: /s/ Pacella Lehane_______ ___________
Name: Pacella Lehane
Title: Vice President
Address: 245 Park Avenue
New York, NY 10167
Attn: William J. Binder - Executive Director
Phone: 312-408-8213
Telecopy: William.binder@rabobank.com
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
[ Signature Page to ABL Credit Agreement]
City National Bank, as a Canadian Lender and a U.S. Revolver Lender
By: /s/ Jack Lampert_______________
Name: Jack Lampert
Title: Senior Vice President
Address: 18111 Von Karman Avenue Suite 420
Irvine, CA 92612
Attn: Jack Lampert
Telecopy: 949-223-4050
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
[ Signature Page to ABL Credit Agreement]
EXHIBIT A
Loan Agreement
U.S. REVOLVER NOTE
[•], 2018
U.S.$___________________
New York City, New York
FOR VALUE RECEIVED , the undersigned, UNITED NATURAL FOODS, INC. , a
Delaware corporation (“UNFI”), UNITED NATURAL FOODS WEST, INC. , a California corporation (“UNFW”), and certain
Subsidiaries of UNFI party to the Loan Agreement (as defined below) from time to time that become borrowers under the Loan Agreement
(each such Subsidiary, together with UNFI and UNFW, collectively, “U.S. Borrowers”), hereby unconditionally promise to pay, on a joint
and several basis, to the order of ____________________________ (“Lender”), the principal sum of ______________________________
U.S. DOLLARS (U.S.$___________), or such lesser amount as may be advanced by Lender as U.S. Revolver Loans and owing as U.S. LC
Obligations from time to time under the Loan Agreement described below, together with all unpaid interest accrued thereon as provided in the
Loan Agreement. Capitalized terms used herein which are defined in the Loan Agreement shall have such defined meanings unless otherwise
defined herein.
This U.S. Revolver Note (this “Note”) is one of the notes referred to in, and is subject in all respects to, the Loan Agreement, dated as
of [•], 2018, among U.S. Borrowers, certain other borrowers thereunder, Bank of America, N.A., as Administrative Agent, Canadian Agent
and a Lender, and certain other financial institutions party thereto from time to time (as amended, restated, amended and restated,
supplemented or otherwise modified, renewed or extended from time to time in accordance with the terms thereof, “Loan Agreement”).
Principal of and interest on this U.S. Revolver Note (this “Note”) from time to time outstanding shall be due and payable as provided in the
Loan Agreement. This Note is issued pursuant to and evidences U.S. Revolver Loans and U.S. LC Obligations under the Loan Agreement, to
which reference is made for a statement of the rights and obligations of Lender and the duties and obligations of U.S. Borrowers. The Loan
Agreement contains provisions for acceleration of the maturity of this Note upon the happening of certain stated events, and for the
borrowing, prepayment and reborrowing of amounts upon specified terms and conditions. This Note is entitled to the benefit of the Guaranty
and is secured as provided for in the Security Documents.
The holder of this Note is hereby authorized by U.S. Borrowers to record on a schedule annexed to this Note (or on a supplemental
schedule) the amounts owing with respect to U.S. Revolver Loans and U.S. LC Obligations, and the payment thereof. Failure to make any
notation, however, shall not affect the rights of the holder of this Note or any obligations of U.S. Borrowers hereunder or under any other
Loan Documents.
Each U.S. Borrower and all endorsers, sureties and guarantors of this Note hereby severally waive demand, presentment for payment,
protest, notice of protest, notice of intention to accelerate the maturity of this Note, diligence in collecting, the bringing of any suit against any
party, and any notice of or defense on account of any extensions, renewals, partial payments, or changes in any manner of or in this Note or in
any of its terms, provisions and covenants, or any releases or substitutions of any security, or any delay, indulgence or other act of any trustee
or any holder hereof, whether before or after maturity.
In no contingency or event whatsoever shall the amount paid or agreed to be paid to the holder of this Note for the use, forbearance or
detention of money advanced hereunder exceed the highest lawful amount permitted under Applicable Law. If any such excess amount is
inadvertently paid by U.S. Borrowers or inadvertently received by the holder of this Note, such excess shall be returned to U.S.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91163047v5
Borrowers or credited as a payment of principal, in accordance with the Loan Agreement. It is the intent hereof that U.S. Borrowers
not pay or contract to pay, and that holder of this Note not receive or contract to receive, directly or indirectly in any manner whatsoever,
interest in excess of that which may be paid by U.S. Borrowers under Applicable Law.
THIS NOTE SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO
ANY CONFLICT OF LAW PRINCIPLES (BUT GIVING EFFECT TO FEDERAL LAWS RELATING TO NATIONAL BANKS).
IN WITNESS WHEREOF , this Note is executed as of the date set forth above.
UNITED NATURAL FOODS, INC.
By:____________________________________
Name:
Title:
UNITED NATURAL FOODS WEST, INC.
By:____________________________________
Name:
Title: 1
_______________________________
1 NTD: Names of additional U.S. Borrowers to be added as necessary.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91163047v5
EXHIBIT B
to
Loan Agreement
CANADIAN NOTE
[•], 2018
Canadian Dollar Equivalent of
U.S.$___________________
New York City, New York
the principal
FOR VALUE RECEIVED , the undersigned, UNFI CANADA, INC. , a corporation organized under the Canada Business
Corporations Act (“Canadian Borrower”), hereby unconditionally promises to pay to the order of ____________________________
(“Lender”),
DOLLARS
(U.S.$___________), or such lesser amount as may be advanced by Lender as Canadian Loans and owing as Canadian LC Obligations from
time to time under the Loan Agreement described below, together with all unpaid interest accrued thereon as provided in the Loan
Agreement. Capitalized terms used herein which are defined in the Loan Agreement shall have such defined meanings unless otherwise
defined herein.
of ______________________________ U.S.
sum of the Canadian Dollar Equivalent
This Canadian Note (this “Note”) is one of the notes referred to in, and is subject in all respects to, the Loan Agreement, dated as of
[•], 2018, among Canadian Borrower, certain other borrowers thereunder, Bank of America, N.A., as Administrative Agent, Canadian Agent
and a Lender, and certain other financial institutions party thereto from time to time (as amended, restated, amended and restated,
supplemented or otherwise modified, renewed or extended from time to time in accordance with the terms thereof, “Loan Agreement”). This
Note is issued pursuant to and evidences Canadian Loans and Canadian LC Obligations under the Loan Agreement, to which reference is
made for a statement of the rights and obligations of Lender and the duties and obligations of Canadian Borrower. The Loan Agreement
contains provisions for acceleration of the maturity of this Note upon the happening of certain stated events, and for the borrowing,
prepayment and reborrowing of amounts upon specified terms and conditions. This Note is entitled to the benefit of the Guaranty and is
secured as provided for in the Security Documents.
The holder of this Note is hereby authorized by Canadian Borrower to record on a schedule annexed to this Note (or on a
supplemental schedule) the amounts owing with respect to Canadian Loans and Canadian LC Obligations, and the payment thereof. Failure to
make any notation, however, shall not affect the rights of the holder of this Note or any obligations of Canadian Borrower hereunder or under
any other Loan Documents.
Canadian Borrower and all endorsers, sureties and guarantors of this Note hereby severally waive demand, presentment for payment,
protest, notice of protest, notice of intention to accelerate the maturity of this Note, diligence in collecting, the bringing of any suit against any
party, and any notice of or defense on account of any extensions, renewals, partial payments, or changes in any manner of or in this Note or in
any of its terms, provisions and covenants, or any releases or substitutions of any security, or any delay, indulgence or other act of any trustee
or any holder hereof, whether before or after maturity.
In no contingency or event whatsoever shall the amount paid or agreed to be paid to the holder of this Note for the use, forbearance or
detention of money advanced hereunder exceed the highest lawful amount permitted under Applicable Law. If any such excess amount is
inadvertently paid by Canadian Borrower or inadvertently received by the holder of this Note, such excess shall be returned to Canadian
Borrower or credited as a payment of principal, in accordance with the Loan Agreement. It is the intent
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91163047v5
B-1
hereof that Canadian Borrower not pay or contract to pay, and that holder of this Note not receive or contract to receive, directly or indirectly
in any manner whatsoever, interest in excess of that which may be paid by Canadian Borrower under Applicable Law.
THIS NOTE SHALL BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO ANY
CONFLICT OF LAW PRINCIPLES (BUT GIVING EFFECT TO FEDERAL LAWS RELATING TO NATIONAL BANKS).
IN WITNESS WHEREOF , this Note is executed as of the date set forth above.
UNFI CANADA, INC.
By:____________________________________
Name:
Title:
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91163047v5
B-2
EXHIBIT C
to
Loan Agreement
ASSIGNMENT AND ACCEPTANCE
Reference is made to the Loan Agreement dated as of [•], 2018, (as amended, restated, amended and restated, supplemented or
otherwise modified, renewed or extended from time to time in accordance with the terms thereof, “Loan Agreement”), by and among
UNITED NATURAL FOODS, INC. , a Delaware corporation (“UNFI”), UNITED NATURAL FOODS WEST, INC. , a California
corporation (“UNFW”), and certain Subsidiaries of UNFI party to the Loan Agreement from time to time that become borrowers under the
Loan Agreement (each such Subsidiary, together with UNFI and UNFW, collectively, “U.S. Borrowers”), UNFI CANADA, INC. , a
corporation organized under the Canada Business Corporations Act (“Canadian Borrower” and, together with U.S. Borrowers, collectively,
“Borrowers”), BANK OF AMERICA, N.A. , a national banking association, as administrative agent (“Administrative Agent”) for certain
financial institutions from time to time party to the Loan Agreement (“Lenders”), BANK OF AMERICA, N.A. ( ACTING THROUGH
ITS CANADA BRANCH) , as Canadian agent (“Canadian Agent”) for certain financial institutions from time to time party to the Loan
Agreement, and such Lenders. Capitalized terms used herein which are defined in the Loan Agreement shall have such defined meanings
unless otherwise defined herein.
________________________________ (“Assignor”) and _______________________________ (“Assignee”) agree as follows:
1. Assignor hereby irrevocably sells and assigns to Assignee and Assignee hereby irrevocably purchases and assumes from Assignor
[(a) a principal amount of U.S.$________ of Assignor’s outstanding U.S. Revolver Loans and U.S.$___________ of Assignor’s
participations in U.S. LC Obligations, (b) a principal amount of the Canadian Dollar Equivalent of U.S.$________ of Assignor’s outstanding
Canadian Loans and the Canadian Dollar Equivalent of U.S.$___________ of Assignor’s participations in Canadian LC Obligations, (c) the
amount of U.S.$__________ of Assignor’s U.S. Revolver Commitment (which represents ____% of the Aggregate U.S. Revolver
Commitments), and (d) the amount of U.S.$__________ of Assignor’s Canadian Commitment (which represents ____% of the Aggregate
Canadian Commitments)] (the foregoing items being, collectively, the “Assigned Interest”), together with an interest in the Loan Documents
corresponding to the Assigned Interest. This Agreement shall be effective as of the date indicated in the corresponding Assignment Notice
delivered to Administrative Agent (“Effective Date”), provided such Assignment Notice is executed by Assignor, Assignee, Administrative
Agent and Borrower Agent, as applicable. From and after the Effective Date, Assignee hereby expressly assumes, and undertakes to perform,
all of Assignor’s obligations in respect of the Assigned Interest, and all principal, interest, fees and other amounts which would otherwise be
payable to or for Assignor’s account in respect of the Assigned Interest shall be payable to or for Assignee’s account, to the extent such
amounts accrue on or after the Effective Date.
2. Assignor (a) represents that as of the date hereof, prior to giving effect to this assignment, (i) its U.S. Revolver Commitment is
U.S.$__________, (ii) its Canadian Commitment is U.S.$__________, (iii) the outstanding balance of its U.S. Revolver Loans and
participations in U.S. LC Obligations is U.S.$__________, and (iv) the outstanding balance of its Canadian Loans and participations in
Canadian LC Obligations is the Canadian Dollar Equivalent of U.S.$__________; (b) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations made in or in connection with the Loan Agreement or the
execution, legality, validity, enforceability, genuineness,
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91163047v5
C-1
sufficiency or value of the Loan Agreement, any other Loan Document or any other instrument or document furnished pursuant thereto, other
than that Assignor is the legal and beneficial owner of the interest being assigned by it hereunder and that such interest is free and clear of any
adverse claim; and (c) makes no representation or warranty and assumes no responsibility with respect to the financial condition of Borrowers
or the performance by Borrowers of their obligations under the Loan Documents. [Assignor is attaching the Note[s] held by it and requests
that Administrative Agent exchange such Note[s] for new Notes payable to Assignee [and Assignor].]
3. Assignee (a) represents and warrants that it is legally authorized to enter into this Assignment and Acceptance; (b) confirms that it
has received copies of the Loan Agreement, together with copies of the financial statements referred to Subsections 9.1.7 and 10.1.2 thereof,
and such other Loan Documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this
Assignment and Acceptance; (c) agrees that it shall, independently and without reliance upon Assignor and based on such documents and
information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan
Documents; (d) confirms that it is an Eligible Assignee; (e) appoints and authorizes Administrative Agent and Canadian Agent to take such
action as agent on its behalf and to exercise such powers under the Loan Agreement, the other Loan Documents or any other instrument or
document furnished pursuant hereto or thereto as are delegated to each such Agent by the terms thereof (including, without limitation,
pursuant to Section 12.15 thereof), together with such powers as are incidental thereto; (f) agrees that it will be bound by the provisions of
Loan Agreement and agrees that it will observe and perform all obligations that are required to be performed by it as a “Lender,” “U.S.
Revolver Lender” and/or “Canadian Lender,” as the case may be, under the Loan Documents; and (g) represents and warrants that the
assignment evidenced hereby will not result in a non-exempt “prohibited transaction” under Section 406 of ERISA.
4. This Agreement shall be governed by the laws of the State of New York. If any provision is found to be invalid under Applicable
Law, it shall be ineffective only to the extent of such invalidity and the remaining provisions of this Agreement shall remain in full force and
effect.
5. Each notice or other communication hereunder shall be in writing, shall be sent by messenger, by telecopy or facsimile
transmission, or by first-class mail, shall be deemed given when sent and shall be sent as follows:
(a) If to Assignee, to the following address (or to such other address as Assignee may designate from time to time):
__________________________
__________________________
__________________________
(b) If to Assignor, to the following address (or to such other address as Assignor may designate from time to time):
__________________________
__________________________
__________________________
__________________________
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91163047v5
C-2
Payments hereunder shall be made by wire transfer of immediately available U.S. Dollars as
follows:
If to Assignee, to the following account (or to such other account as Assignee may designate from
time to time):
______________________________
______________________________
ABA No._______________________
______________________________
Account No.____________________
Reference: _____________________
If to Assignor, to the following account (or to such other account as Assignor may designate from
time to time):
______________________________
______________________________
ABA No._______________________
______________________________
Account No.____________________
Reference: _____________________
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91163047v5
C-3
IN WITNESS WHEREOF , this Assignment and Acceptance is executed as of _____________.
_____________________________________
(“Assignee”)
By___________________________________
Title:
_____________________________________
(“Assignor”)
By___________________________________
Title:
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91163047v5
C-4
EXHIBIT D
to
Loan Agreement
ASSIGNMENT NOTICE
Reference is made to (1) the Loan Agreement dated as of [•], 2018, (as amended, restated, amended and restated, supplemented or otherwise
modified, renewed or extended from time to time in accordance with the terms thereof, “Loan Agreement”), by and among UNITED
NATURAL FOODS, INC. , a Delaware corporation (“UNFI”), UNITED NATURAL FOODS WEST, INC. , a California corporation
(“UNFW”), and certain Subsidiaries of UNFI party to the Loan Agreement from time to time that become borrowers under the Loan
Agreement (each such Subsidiary, together with UNFI and UNFW, collectively, “U.S. Borrowers”), UNFI CANADA, INC. , a corporation
organized under the Canada Business Corporations Act (“Canadian Borrower” and, together with U.S. Borrowers, collectively, “Borrowers”),
BANK OF AMERICA, N.A. , a national banking association, as administrative agent (“Administrative Agent”) for certain financial
institutions from time to time party to the Loan Agreement (“Lenders”), BANK OF AMERICA, N.A. ( ACTING THROUGH ITS
CANADA BRANCH) , as Canadian agent (“Canadian Agent”) for certain financial institutions from time to time party to the Loan
Agreement, and such Lenders; and (2) the Assignment and Acceptance dated as of ____________, 20__ (“Assignment Agreement”), between
__________________ (“Assignor”) and ____________________ (“Assignee”). Capitalized terms used herein which are defined in the Loan
Agreement shall have such defined meanings unless otherwise defined herein.
Assignor hereby notifies Borrowers and Administrative Agent of Assignor’s intent to assign to Assignee pursuant to the Assignment
Agreement [(a) a principal amount of U.S.$________ of Assignor’s outstanding U.S. Revolver Loans and U.S.$___________ of Assignor’s
participations in U.S. LC Obligations, (b) a principal amount of the Canadian Dollar Equivalent of U.S.$________ of Assignor’s outstanding
Canadian Loans and the Canadian Dollar Equivalent of U.S.$___________ of Assignor’s participations in Canadian LC Obligations, (c) the
amount of U.S.$__________ of Assignor’s U.S. Revolver Commitment (which represents ____% of the Aggregate U.S. Revolver
Commitments), and (d) the amount of U.S.$__________
of Assignor’s Canadian Commitment (which represents ____% of the Aggregate Canadian Commitments)] (the foregoing items being,
collectively, the “Assigned Interest”), together with an interest in the Loan Documents corresponding to the Assigned Interest. This
Agreement shall be effective as of the date indicated below (“Effective Date”), provided this Assignment Notice is executed by Assignor,
Assignee, Administrative Agent and Borrower Agent, as applicable. Pursuant to the Assignment Agreement, Assignee has expressly assumed
all of Assignor’s obligations under the Loan Agreement to the extent of the Assigned Interest, as of the Effective Date.
For purposes of the Loan Agreement, Agents shall deem [(a) Assignor’s U.S. Revolver Commitment to be reduced by U.S.$_________, (b)
Assignor’s Canadian Commitment to be reduced by U.S.$_________, (c) Assignee’s U.S. Revolver Commitment to be increased by
U.S.$_________ and (d) Assignee’s Canadian Commitment to be increased by U.S.$_________].
The address of Assignee to which notices and information are to be sent under the terms of the Loan Agreement is:
________________________
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
B-
________________________
________________________
________________________
The address of Assignee to which payments are to be sent under the terms of the Loan Agreement is shown in the Assignment and
Acceptance.
This Notice is being delivered to Borrowers and Administrative Agent pursuant to Section 13.3 of the Loan Agreement. Please
acknowledge your acceptance of this Notice by executing and returning to Assignee and Assignor a copy of this Notice.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#9116304v5
6
IN WITNESS WHEREOF , this Assignment Notice is executed as of _____________.
_____________________________________
(“Assignee”)
By___________________________________
Title:
_____________________________________
(“Assignor”)
By___________________________________
Title:
ACKNOWLEDGED AND AGREED,
AS OF THE DATE SET FORTH ABOVE:
BORROWER AGENT :*
_________________________________
By_______________________________
Title:
* No signature required if Assignee is a Lender, Affiliate of a Lender or Approved Fund, or if an
Event of Default exists.
BANK OF AMERICA, N.A. ,
as Administrative Agent
By_______________________________
Title:
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#9116304v5
7
EXHIBIT E
[Form of] INTERCREDITOR AGREEMENT
dated as of [ ], 2018 among
BANK OF AMERICA, N.A., as ABL Agent,
GOLDMAN SACHS BANK USA, as First Lien Term Loan Agent,
Each ADDITIONAL TERM LOAN DEBT AGENT from time to time party hereto, UNITED NATURAL FOODS, INC., and
and
UNITED NATURAL FOODS WEST, INC.,
each as a Borrower,
the other Grantors from time to time party hereto.
and
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91188051v13
TABLE OF CONTENTS
____________________________
ARTICLE 1
DEFINITIONS
PAGE
Section 1.01. Construction; Certain Defined Terms
ARTICLE 2
SUBORDINATION OF JUNIOR LIENS; CERTAIN AGREEMENTS
Section 2.01. Subordination of Junior Liens
Section 2.02. No Action With Respect to Junior Secured Obligations Collateral Subject to Senior Liens
Section 2.03. No Duties of Senior Representative
Section 2.04. No Interference; Payment Over; Reinstatement; Application of Proceeds
Section 2.05. Release of Liens; Automatic Release of Junior Liens
Section 2.06. Certain Agreements With Respect to Insolvency or, Liquidation Proceedings
Section 2.07. Reinstatement
Section 2.08. Entry Upon Premises by the ABL Agent and the ABL Secured Parties; Intellectual Property License
Section 2.09. Insurance
Section 2.10. Refinancing and Additional Secured Debt
Section 2.11. Modification; No Interference
Section 2.12. Legends
Section 2.13. Junior Secured Obligations Secured Parties Rights as Unsecured Creditors
Section 2.14. No New Liens
Section 2.15. Set-Off and Tracing of and Priorities in Proceeds
ARTICLE 3
GRATUITOUS BAILMENT FOR PERFECTION OF CERTAIN SECURITY
INTERESTS; RIGHTS UNDER PERMITS AND LICENSES
Section 3.01. General
Section 3.02. Deposit Accounts
Section 3.03. Rights under Permits and Licenses
ARTICLE 4
EXISTENCE AND AMOUNTS OF LIENS AND OBLIGATIONS
ARTICLE 5
CONSENT OF GRANTORS
ARTICLE 6
REPRESENTATIONS AND WARRANTIES
Section 6.01. Representations and Warranties of Each Party
Section 6.02. Representations and Warranties of Each Representative
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91188051v13
1
15
16
17
18
19
21
26
26
28
29
30
31
31
31
32
33
34
34
35
36
ARTICLE 7
MISCELLANEOUS
Section 7.01. Notices
Section 7.02. Waivers; Amendment
Section 7.03. Parties in Interest
Section 7.04. Survival of Agreement
Section 7.05. Counterparts
Section 7.06. Severability
Section 7.07. Governing Law; Jurisdiction; Consent to Service of Process
Section 7.08. WAIVER OF JURY TRIAL
Section 7.09. Headings
Section 7.10. Conflicts
Section 7.11. Provisions Solely to Define Relative Rights
Section 7.12. Certain Terms Concerning the ABL Agent and each Term Loan Debt Agent; Force Majeure
36
37
37
38
38
38
38
39
39
39
39
39
40
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
ii
#91188051v13
INTERCREDITOR AGREEMENT dated as of [ ], 2018 (as amended, restated, amended and restated, supplemented or
otherwise modified from time to time in accordance with the terms hereof, this “ Agreement
”), by and among BANK OF AMERICA,
N.A. , as administrative agent and collateral agent for the ABL Secured Parties referred to herein (in such capacity, and together with its
successors in such capacity, the “ Original
ABL
Agent
”), GOLDMAN SACHS BANK USA , as administrative agent and collateral agent
for the First Lien Term Loan Secured Parties referred to herein (in such capacity, and together with its successors in such capacity, the “
Original
First
Lien
Term
Loan
Agent
”), UNITED NATURAL FOODS, INC. , a Delaware corporation (the “ UNFI
”), UNITED
NATURAL FOODS WEST, INC. , a California corporation (“ UNFW
” and together with UNFI, the “ Borrowers
” and each a “
Borrower
”), and each of the Subsidiaries of the Borrowers listed on the signature pages hereto (the “ Subsidiary
Grantors
” and together
with the Borrowers, the “ Initial
Grantors
”).
Reference is made to (a) the ABL Credit Agreement (such term and each other capital- ized term used and not otherwise
defined herein having the meaning assigned to it in Article 1 ) and (b) the First Lien Term Loan Agreement.
In consideration of the mutual agreements herein contained and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the ABL Agent (for itself and on behalf of the ABL Secured Parties), the First Lien Term
Loan Agent (for itself and on behalf of the First Lien Term Loan Secured Parties) and each Additional Term Loan Debt Agent (on behalf of
the Additional Term Loan Debt Secured Parties of the applicable Series), if any, and the Grantors agree as follows:
ARTICLE 1
D EFINITIONS
Section 1.01. Construction; Certain Defined Terms .
(a) The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context
may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include,” “includes” and
“including” shall be deemed to be followed by the phrase “without limitation.” The word “will” shall be construed to have the same
meaning and effect as the word “shall.” Unless the context requires otherwise, (i) any definition of or reference to any agreement,
instrument, other document, statute or regulation herein or in any Annex or Exhibit of this Agreement shall be construed as referring to such
agreement, instrument, other document, statute or regulation as from time to time amended, restated, amended and restated, renewed,
extended, supplemented or otherwise modified from time to time, (ii) any reference herein to any Person shall be construed to include such
Person’s successors and assigns, but shall not be deemed to include the Subsidiaries of such Person unless express reference is made to such
Subsidiaries, (iii) the words “herein,” “hereof and “hereunder,” and words of similar import, shall be construed to refer to this Agreement in
its entirety and not to any particular provision hereof, (iv) all references herein to Articles, Sections, Exhibits and Annexes shall be
construed to refer to Articles, Sections and Annexes of this Agreement, (v) unless otherwise expressly qualified herein, the words “asset”
and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and
properties, including cash, securities, accounts and contract rights and (vi) the term “or” is not exclusive.
(b) All terms used in this Agreement that are defined in Article 1, 8 or 9 of the New York UCC (whether capitalized herein or not)
and not otherwise defined herein have the meanings assigned to
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
iii
#91188051v13
them in Article 1, 8 or 9 of the New York UCC. If a term is defined in Article 9 of the New York UCC and another Article of the UCC, such
term shall have the meaning assigned to it in Article 9 of the New York UCC.
(c) As used in this Agreement, the following terms have the meanings specified below:
“ ABL
Agent
” means the Original ABL Agent, and, from and after the date of execution and delivery of an ABL Substitute
Facility, the agent, collateral agent, trustee or other representative of the lenders or holders of the ABL Debt Obligations evidenced
thereunder or governed thereby, in each case, together with its successors in such capacity.
“ ABL
Credit
Agreement
” means the Loan Agreement, dated as of the Signing Date (as defined in the ABL Credit
Agreement), by and among the Borrowers, the Canadian Borrower, the Original ABL Agent, the lenders party thereto from time to time and
the other agents named therein, and any credit agreement, loan agreement, note agreement, promissory note, indenture or any other
agreement or instrument evidencing or governing the terms of any ABL Substitute Facility.
“ ABL
Debt
Documents
” means the ABL Credit Agreement, the ABL Security Documents, the other “Loan Documents”
(as defined in the ABL Credit Agreement) and all other loan documents, notes, guarantees, instruments and agreements governing or
evidencing, or executed or delivered in connection with, any ABL Substitute Facility.
“ ABL
Debt
Obligations
” means the “Obligations” as defined in the ABL Credit Agreement (or any similar term of any
ABL Substitute Facility) from time to time outstanding and, in any event, ABL Debt Obligations shall expressly include any and all interest
accruing and fees, costs, expenses and charges incurred after the date of any filing by or against any Grantor of any petition or complaint
initiating any Insolvency or Liquidation Proceeding, regardless of whether any ABL Secured Party’s claim therefor is enforceable, allowable
or allowed as a claim in the Insolvency or Liquidation Proceeding commenced by the filing of such petition or complaint.
“ ABL
Facility
Collateral
” means all assets and properties subject to Liens created by the ABL Security Documents to
secure the ABL Debt Obligations. The ABL Secured Parties party to the ABL Credit Agreement as of the date hereof elected not to take a
Lien on Real Estate Assets and, there- fore, Real Estate Assets shall not constitute ABL Facility Collateral unless and until a Lien on such
Real Estate Assets is granted pursuant to an amendment of the ABL Debt Documents or entry into an ABL Substitute Facility.
“ ABL
Liens
” means Liens on the ABL Facility Collateral created under the ABL Security Documents at any time upon
any property of any Grantor to secure the ABL Debt Obligations (including Liens on such Collateral under the security documents
associated with any ABL Substitute Facility).
“ ABL
Priority
Collateral
” means all present and future right, title and interest of the Grantors in and to the following types
of ABL Facility Collateral, whether now owned or hereafter ac- quired, existing or arising, and wherever located:
(a) (i) accounts (including Credit Card Receivables and Pharmacy Receivables (each as defined in the ABL Credit
Agreement)) and (ii) all other rights to payment arising from services rendered or from the sale, lease, use or other disposition of
inventory, whether such rights to payment constitute payment intangibles, letter-of-credit rights or any other classification of
property, or are evidenced in whole or in part by instruments, chattel paper or documents;
(b) inventory and documents relating to inventory;
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
1
(c) all rights of an unpaid vendor with respect to inventory;
(d) deposit accounts, commodity accounts, securities accounts and lockboxes, in- cluding all money and certificated
securities, uncertificated securities (other than Capital Stock of Subsidiaries of the Grantors), securities entitlements and investment
property credited thereto or deposited therein (including all cash, marketable securities and other funds held in or on deposit in any
deposit account, commodity account or securities account), and all cash and cash equivalents, including cash and cash equivalents
securing reimbursement obligations in respect of letters of credit or other ABL Debt Obligations;
(e) instruments, chattel paper and general intangibles pertaining to the other items of property included within clauses (a),
(b), (c), (d), (f), (g), (h) and (i) of this definition (other than any Capital Stock of Subsidiaries of the Grantors and Intellectual
Property);
(f) books and records, supporting obligations, documents and related letters of credit, letter-of-credit rights, commercial tort
claims or other claims and causes of action, in each case, to the extent arising out of, related to or given in exchange or settlement of
any of the foregoing;
(g) Prescription Files (as defined in the ABL Credit Agreement);
(h) Canadian Collateral; and
(i) all substitutions, replacements, accessions, products and proceeds (including, without limitation, insurance proceeds,
licenses, royalties, income, payments, claims, damages and proceeds of suit) of all or any of the foregoing;
provided that in no case shall ABL Priority Collateral include (i) any identifiable cash proceeds from a sale, lease, conveyance or other
disposition of any Term Priority Collateral that has been deposited in the Collateral Proceeds Account in accordance with the terms of the
Term Loan Debt Documents, until such time as such cash proceeds are released therefrom in accordance with the terms of the Term Loan
Debt Documents and (ii) the Existing UNFI Term Loan Credit Agreement Payoff Account or any cash deposit- ed therein in an amount up
to $[ ] 1 million, until the earliest of (x) the repayment in full (or the termina- tion, discharge or defeasance) of, and termination of
commitments under, all outstanding indebtedness (and the release of guarantees and liens securing such indebtedness) of UNFI and its
subsidiaries under the Existing UNFI Term Loan Credit Agreement (as defined in the ABL Credit Agreement) and (y) 45 days following the
Closing Date (as defined in the ABL Credit Agreement).
“ ABL
Secured
Parties
” means, at any time, the “Secured Parties” as defined in the ABL Credit Agreement (or any similar
term of any ABL Substitute Facility).
“ ABL
Security
Documents
” means each of the “Security Documents” as defined in the
ABL Credit Agreement (or any similar term in any ABL Substitute Facility).
“ ABL
Substitute
Facility
” means any facility with respect to which the requirements contained in Section 2.10(a) of this
Agreement have been satisfied and the proceeds or commitments of which are used, among other things, to Replace the ABL Credit
Agreement then in existence. For the avoidance of doubt, no ABL Substitute Facility shall be required to be a revolving or asset-based loan
facility and may be a facility evidenced or governed by a credit agreement, loan agreement, note agreement, promissory note, indenture or
any other agreement or instrument; provided that any ABL Lien securing such ABL Substitute Facility shall be subject to the terms of this
Agreement for all purposes (including the lien priorities as set forth herein as of the date hereof).
1 To be the aggregate principal amount of indebtedness outstanding under the Existing UNFI Term Loan Credit Agreement on the Closing Date
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
2
“ Account
Agreement
” means any lockbox account agreement, pledged account agree- ment, blocked account agreement,
deposit account control agreement, securities account control agree- ment, or any similar deposit or securities account agreements among
any Term Loan Debt Agent and/or the ABL Agent, one or more Grantors and the relevant financial institution depository or securities
intermediary.
“ Additional
Term
Loan
Debt
” means any secured debt ranking equal or junior in right of security with the First Lien Term
Loan Debt Obligations issued pursuant to an Additional Term Loan Debt Facility and permitted under the ABL Credit Agreement and each
Term Loan Debt Document.
“ Additional
Term
Loan
Debt
Agent
” means, with respect to any Series of Additional Term Loan Debt Obligations, the
person or entity that, pursuant to the Additional Term Loan Debt Documents relating to such Additional Term Loan Debt Obligations, holds
Liens on the Collateral on behalf of the Additional Term Loan Debt Secured Parties thereunder.
“ Additional
Term
Loan
Debt
Collateral
” means, with respect to any Series of Additional Term Loan Debt Obligations, all
assets and properties subject to Liens created by the Additional Term Loan Debt Security Documents to secure such Additional Term Loan
Debt Obligations.
“ Additional
Term
Loan
Debt
Documents
” means each Additional Term Loan Debt Facility and the Additional Term Loan
Debt Security Documents.
“ Additional
Term
Loan
Debt
Facility
” means one or more debt facilities, commercial paper facilities or indentures for
which the requirements of Section 2.10(b) of this Agreement have been satisfied, in each case with banks, other lenders or trustees,
providing for revolving credit loans, term loans, letters of credit, notes or other borrowings, in each case, as amended, restated, modified,
renewed, refunded, restated, restructured, increased, supplemented, replaced or refinanced in whole or in part from time to time in
accordance with each applicable Secured Document; provided that neither the ABL Credit Agreement nor the First Lien Term Loan
Agreement constitute an Additional Term Loan Debt Facility at any time.
“ Additional
Term
Loan
Debt
Lien
” means a Lien granted pursuant to any Additional Term Loan Debt Security Document
to an Additional Term Loan Debt Agent or Additional Term Loan Debt Secured Party at any time upon any property of any Grantor that is
Collateral to secure a Series of Additional Term Loan Debt Obligations.
“ Additional
Term
Loan
Debt
Obligations
” means, with respect to any Grantor, any obligations of such Grantor owed to
any Additional Term Loan Debt Secured Party under the Additional Term Loan Debt Documents.
“ Additional
Term
Loan
Debt
Secured
Parties
” means, with respect to any Series of Additional Term Loan Debt
Obligations, at any time, the Additional Term Loan Debt Agent and the other holders from time to time of Additional Term Loan Debt
Obligations of such Series.
“ Additional
Term
Loan
Debt
Security
Documents
” means the Additional Term Loan
Debt Facility (insofar as the same grants a Lien on any collateral) and all collateral trust agreements, security agreements, pledge
agreements, collateral assignments, mortgages, deeds of trust, control agreements, guarantees, notes and any other documents or instruments
now existing or entered into after the date hereof that create Liens on any assets or properties of any Grantor to secure any Additional Term
Loan Debt Obligations of the Grantors owed thereunder to any Additional Term Loan Debt Secured Parties.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
3
“ Agreement
” has the meaning assigned to that term in the preamble hereto.
“ Bankruptcy
Code
” means Title 11 of the United States Code, as now or hereinafter in effect.
“ Bankruptcy
Law
” means the Bankruptcy Code and any other liquidation, conserva- torship, bankruptcy, assignment for
the benefit of creditors, moratorium, rearrangement, receivership, insolvency, suspension of payments, reorganization or similar debtor relief
laws of the United States or other applicable jurisdictions from time to time in effect and affecting the rights of creditors generally.
“ Borrower
” has the meaning assigned to that term in the preamble hereto.
“ Business
Day
” means any day that is not a Saturday, Sunday or other day on which commercial banks in New York, New
York are authorized or required by law to remain closed.
“ Canadian
Borrower
” means UNFI Canada, Inc., a corporation organized under the
Canada Business Corporations Act.
“ Canadian
Collateral
” means all Collateral granted to the ABL Agent by the Canadian
Borrower and its Subsidiaries to secure any portion of the ABL Debt Obligations.
“ Capital
Stock
” means (a) in the case of a corporation, corporate stock, (b) in the case of an association or business entity,
any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock, (c) in the case of a
partnership or limited liability company, partnership or membership interests (whether general or limited) and (d) any other interest or
participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person.
“ Collateral
” means all of the assets and property of any Grantor, whether real, personal or mixed, to the extent constituting
ABL Facility Collateral and Term Loan Debt Collateral.
“ Collateral
Proceeds
Account
” means one or more deposit accounts or securities ac- counts established or maintained by
any Grantor or a Term Loan Debt Agent or its agent for the sole purpose of holding the proceeds of any sale or other disposition of any
Term Priority Collateral that are required to be held in trust in such account or accounts pursuant to the terms of any Term Loan Debt
Document.
“ Controlling
Term
Loan
Debt
Agent
” means (i) initially, the First Lien Term Loan Agent and (ii) thereafter, the
“Designated Senior Representative” as designated by a Term Loan Debt Agent in a notice to the ABL Agent in accordance with the
applicable Term Intercreditor Agreement.
“ Default
” means a “Default” under and as defined in the ABL Credit Agreement, the First Lien Term Loan Agreement or
any Additional Term Loan Debt Document, as the context may re- quire.
“ Deposit
Accounts
” has the meaning assigned to that term in Section 3.02(a) .
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
4
“ DIP
Financing
” has the meaning assigned to that term in Section 2.06(b) .
“ DIP
Financing
Liens
” has the meaning assigned to that term in Section 2.06(b) .
“ Discharge
of
Senior
Secured
Debt
Obligations
” means, with respect to any particular Senior Secured Obligations, the
occurrence of all of the following:
(a) termination or expiration of all commitments to extend credit (or, in the case of Secured ABL Bank Product Obligations
or similar Senior Secured Obligations, termination of arrangements giving rise to such debt or entering into other arrangements
reasonably satisfactory to the counterparties thereto) that would constitute such Senior Secured Obligations;
(b) payment in full in cash of the principal of, interest and premium (if any) on, fees and other charges comprising such
Senior Secured Obligations (other than any undrawn letters of credit) (including, in any event, all such interest, fees, expenses, and
other charges (including all such interest, fees, expenses, and other charges incurred or accruing following the commencement of
any Insolvency or Liquidation Proceeding, regardless of whether any portion of such interest, fees and other charges are enforceable,
allowed or allowable in any Insolvency or Liquidation Proceeding under Section 506 of the Bankruptcy Code or otherwise);
(c) discharge or cash collateralization (at the lower of (i) 105% of the aggregate un- drawn amount and (ii) the percentage of
the aggregate undrawn amount required for release of Liens under the terms of the applicable Senior Documents) of all outstanding
letters of credit constituting such Senior Secured Obligations; and
(d) payment in full in cash of all other such Senior Secured Obligations that are outstanding and unpaid at the time the
principal of and interest and premium on all such Senior Secured Obligations are paid in full in cash (other than any obligations for
taxes, costs, indemnification, reimbursements, damages and other liabilities in respect of which no claim or demand for payment has
been made at such time); provided that the Discharge of Senior Secured Debt Obligations shall not be deemed to have occurred in
connection with a Replacement as contemplated by Section 2.10(a) .
“ Enforcement
Notice
” means a written notice delivered, at a time when an Event of De- fault has occurred and is
continuing, by either the ABL Agent or any Term Loan Debt Agent to the other specifying the relevant Event of Default.
“ Event
of
Default
” means an “Event of Default” under and as defined in the ABL Credit Agreement, the First Lien Term
Loan Agreement or any Additional Term Loan Debt Document, as the context may require.
“ Existing
UNFI
Term
Loan
Credit
Agreement
” means the “Existing UNFI Term Loan Credit Agreement” as defined in
the ABL Credit Agreement.
“ Existing
UNFI
Term
Loan
Credit
Agreement
Payoff
Account
” means one or more deposit accounts or securities
accounts established or maintained by any Grantor or any of its agents or designees for the sole purpose of holding cash that will be used by
the applicable Grantors in connection with the repayment in full (or the termination, discharge or defeasance) of the Existing UNFI Term
Loan Credit Agreement.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
5
“ First
Lien
Term
Loan
Agent
” means the Original First Lien Term Loan Agent, and, from and after the date of execution
and delivery of a First Lien Term Loan Substitute Facility, the agent, collateral agent, trustee or other representative of the lenders or other
holders of the indebtedness and other obligations evidence thereunder or governed thereby, in each case, together with its successors in such
capacity.
“ First
Lien
Term
Loan
Agreement
” means the First Lien Term Loan Credit Agreement, dated as of the date hereof, by and
among UNFI, the Original First Lien Term Loan Agent and the lenders party thereto from time to time, and any credit agreement, loan
agreement, note agreement, promissory note, indenture or any other agreement or instrument evidencing or governing the terms of any First
Lien Term Loan Substitute Facility.
“ First
Lien
Term
Loan
Collateral
” means all assets and properties subject to Liens created by the First Lien Term Loan
Security Documents to secure the First Lien Term Loan Debt Obligations.
“ First
Lien
Term
Loan
Debt
Obligations
” means all “Obligations” as defined in the First Lien Term Loan Agreement (or
any similar term of any First Lien Term Loan Substitute Facility). First Lien Term Loan Debt Obligations shall expressly include any and all
interest accruing and fees, costs, expenses, and charges incurred after the date of any filing by or against any Grantor of any petition or
complaint initiating any Insolvency or Liquidation Proceeding, regardless of whether any First Lien Term Loan Secured Party’s claim
therefor is enforceable, allowable or allowed as a claim in the Insolvency or Liquidation Proceeding commenced by the filing of such
petition or complaint.
“ First
Lien
Term
Loan
Documents
” means the First Lien Term Loan Agreement, the First Lien Term Loan Security
Documents and all other loan documents, notes, guarantees, instruments and agreements governing or evidencing any First Lien Term Loan
Substitute Facility.
“ First
Lien
Term
Loan
Lien
” means a Lien created under the First Lien Term Loan Se- curity Documents at any time
upon any property of any Grantor to secure First Lien Term Loan Debt Ob- ligations.
“ First
Lien
Term
Loan
Secured
Parties
” means, at any time, the “Secured Parties” as defined in the First Lien Term Loan
Agreement (or any similar term of any First Lien Term Loan Substitute Facility).
“ First
Lien
Term
Loan
Security
Documents
” means each of the “Collateral Documents” as such term is defined in the
First Lien Term Loan Agreement (or any First Lien Term Loan Substitute Facility).
“ First
Lien
Term
Loan
Substitute
Facility
” means any facility with respect to which the requirements contained in Section
2.10(a) of this Agreement have been satisfied, the proceeds of which are used to, among other things, Replace the First Lien Term Loan
Agreement. For the avoidance of doubt, no First Lien Term Loan Substitute Facility shall be required to be evidenced by notes or other
instruments and may be a facility evidenced or governed by a credit agreement, loan agreement, note agreement, promissory note, indenture
or any other agreement or instrument (which may include a revolving credit facility); provided that any such First Lien Term Loan
Substitute Facility shall be subject to the terms of this Agreement for all purposes (including the lien priority as set forth herein as of the date
here- of) as the other Liens securing the First Lien Term Loan Debt Obligations are subject to under this Agreement.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
6
“ Grantor
” means the Initial Grantors and each other direct or indirect Subsidiary of any Borrower (other than any
Canadian Subsidiary (as defined in the ABL Credit Agreement)) that shall have granted any Lien, pursuant to the terms of the ABL Debt
Documents or the Term Loan Debt Documents, in favor of the ABL Agent or any Term Loan Debt Agent on any of its assets or properties
to secure both (i) the ABL Debt Obligations and (ii) any Term Loan Debt Obligations.
“ Grantor
Intercreditor
Agreement
Joinder
” means an agreement substantially in the form of Exhibit A .
“ Hedging
Agreement
” has the meaning ascribed to “Hedging Agreement” in the ABL Credit Agreement (or any similar
term of any ABL Substitute Facility).
“ Initial
Grantors
” has the meaning assigned to such term in the preamble hereto.
“ Insolvency
or
Liquidation
Proceeding
” means:
(a) any case commenced by or, against any Grantor under the Bankruptcy Code, any other proceeding for the reorganization,
recapitalization or adjustment or marshalling of the assets or liabilities of any Grantor, any receivership or assignment for the benefit
of creditors relating to any Grantor or any similar case or proceeding relative to any Grantor or its creditors, as such, in each case
whether or not voluntary;
(b) any liquidation, dissolution, marshalling of assets or liabilities or other winding up of or relating to any Grantor, in each
case whether or not voluntary and whether or not involving bankruptcy or insolvency, in each case to the extent not permitted under
the Senior Documents;
(c) any proceeding seeking the appointment of any trustee, receiver, liquidator, custodian or other insolvency official with
similar powers with respect to any Grantor or any of its assets; or
(d) any other proceeding of any type or nature in which substantially all claims of creditors of any Grantor are determined
and any payment or distribution is or may be made on account of such claims.
“ Intellectual
Property
” has the meaning assigned to such term in the applicable First Lien Security Document, dated as of
the date hereof.
“ Junior
Documents
” means (a) in respect of the Term Priority Collateral, the ABL Debt Documents and (b) in respect of
the ABL Priority Collateral, the Term Loan Debt Documents.
“ Junior
Liens
” means (a) in respect of the ABL Priority Collateral, the Term Loan Debt Liens on such Collateral (it being
acknowledged and agreed that the Term Loan Debt Agent does not, and shall not, have a Lien on the Canadian Collateral) and (b) in respect
of the Term Priority Collateral, the ABL Liens on such Collateral.
“ Junior
Representative
” means (a) with respect to the Term Priority Collateral, the ABL Agent and (b) with respect to the
ABL Priority Collateral, each Term Loan Debt Agent.
“ Junior
Secured
Obligations
” means (a) with respect to the Term Loan Debt Obligations (to the extent such Obligations
are secured, or intended to be secured, by the Term Priority Collateral), theABL Debt Obligations and (b) with respect to ABL Debt
Obligations (to the extent such
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
7
Obligations are secured, or intended to be secured, by the ABL Priority Collateral), the Term Loan Debt Obligations.
“ Junior
Secured
Obligations
Collateral
” means the Collateral in respect of which any Junior Representative (on behalf of
itself and the applicable Junior Secured Obligations Secured Parties) holds a Junior Lien (it being acknowledged and agreed that the Term
Loan Debt Agent does not, and shall not, have a Lien on the Canadian Collateral).
“ Junior
Secured
Obligations
Secured
Parties
” means (a) with respect to the Term Priority Collateral, the ABL Secured
Parties and (b) with respect to the ABL Priority Collateral, the Term Loan Debt Secured Parties.
“ Junior
Secured
Obligations
Security
Documents
” means (a) with respect to the ABL Priority Collateral, the Term Loan
Debt Security Documents and (b) with respect to the Term Priority Collateral, the ABL Security Documents.
“ Lien
” means, with respect to any asset, (a) any mortgage, deed of trust, lien (statutory or other), pledge, hypothecation,
encumbrance, charge, trust (deemed or statutory) or security interest in, on or of such asset, whether or not filed, recorded or otherwise
perfected under applicable law, (b) the inter- est of a vendor or a lessor under any conditional sale agreement, capital lease or title retention
agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset and (c) in the
case of securities, any purchase option, call or similar right of a third party with respect to such securities; provided that in no event shall an
operating lease be deemed to be a Lien.
“ Lien
Sharing
and
Priority
Confirmation
Joinder
” means an agreement substantially in the form of Exhibit B .
“ New
York
UCC
” means the Uniform Commercial Code as from time to time in effect in the State of New York.
“ Obligations
” means, with respect to any Secured Parties, any principal, interest, penal- ties, fees, expenses,
indemnifications, reimbursements, damages and other liabilities (including all interest, fees, expenses, and other charges accruing after the
commencement of any Insolvency or Liquidation Proceeding, even if such interest, fees, expenses, and other charges are not enforceable,
allowable or allowed as a claim in such proceeding) under the Secured Documents of such Secured Party.
“ Officer
” means the chief executive officer, the president, any vice president, the chief operating officer or any chief
financial officer, treasurer or controller of such Person and any other officer or similar official thereof responsible for the administration of
the obligations of such Person in respect of this Agreement. Any document delivered hereunder that is signed by an Officer of a Grantor
shall be conclusively presented to have been authorized by all necessary corporate, partnership and/or other action on the part of such
Grantor and such Officer shall be conclusively presumed to have acted on behalf of such Grantor.
“ Officer’s
Certificate
” means a certificate signed on behalf of applicable Grantor by an Officer of such Grantor, who must
be the principal executive officer, the principal financial officer, the treasurer or the principal accounting officer of such Grantor.
“ Original
ABL
Agent
” has the meaning assigned to that term in the preamble hereto.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
8
“ Original
First
Lien
Term
Loan
Agent
” has the meaning assigned to that term in the preamble hereto.
“ Permitted
Subordination
” has the meaning assigned thereto in Section 2.01(d) .
“ Person
” means any individual, sole proprietorship, partnership, limited liability company, joint venture, joint-stock
company, trust, unincorporated organization, association, corporation, government or any agency or political subdivision thereof or any
other entity.
“ Plan
of
Reorganization
” means any plan of reorganization, plan of liquidation, plan of arrangement, agreement for
composition, or other type of dispositive restructuring plan proposed in or in connection with any Insolvency or Liquidation Proceeding.
“ Real
Estate
Asset
” means, at any time of determination, any fee interest then owned by any Grantor in any real property.
“ Recovery
” has the meaning assigned to that term in Section 2.07 .
“ Replaces
” means, (a) in respect of any agreement with reference to the ABL Credit Agreement or the ABL Debt
Obligations or any ABL Substitute Facility, that such agreement refinances, replaces, exchanges or refunds the ABL Credit Agreement or
such ABL Substitute Facility in whole (in a transaction that is in compliance with Section 2.10(a) ) and that all commitments thereunder are
terminated; and (b) in respect of any indebtedness with reference to the Term Loan Debt Documents or the Term Loan Debt Facility, that
such indebtedness refinances, replaces, exchanges or refunds the Term Loan Debt Documents or such Term Loan Debt Facility (i) in whole
(in a transaction that is in compliance with Section 2.10(a) ) and that all commitments thereunder are terminated or (ii) to the extent
permitted by the terms of the Term Loan Debt Documents or such Term Loan Debt Facility, in part. “ Replace
,” “ Re-
placed
” and “
Replacement
” shall have correlative meanings.
“ Representative
” means (a) in the case of any Series of Term Loan Debt Obligations, the Term Loan Debt Agent for such
Series and (b) in the case of any ABL Debt Obligations, the ABL Agent.
“ Secured
ABL
Bank
Product
Obligations
” shall have the meaning ascribed to “Secured Bank Product Obligations” in the
ABL Credit Agreement (or any similar term of any ABL Substitute Fa- cility).
“ Secured
Debt
Obligations
” means the Term Loan Debt Obligations (including the Obligations incurred under each Series
of Term Loan Debt) and the ABL Debt Obligations.
“ Secured
Debt
Representative
” means (a) in the case of the ABL Debt Obligations, the
ABL Agent and (b) in the case of the Term Loan Debt Obligations, the Term Loan Debt Agents.
“ Secured
Documents
” means the Term Loan Debt Documents and the ABL Debt Docu-ments.
“ Secured
Parties
” means the Term Loan Debt Secured Parties and the ABL Secured Par-ties.
“ Security
Documents
” means the Term Loan Debt Security Documents and the ABL Security Documents.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
9
“ Senior
Documents
” means (a) in respect of the Term Priority Collateral, the Term Loan Debt Documents and (b) in
respect of the ABL Priority Collateral, the ABL Debt Documents.
“ Senior
Liens
” means (a) in respect of the ABL Priority Collateral, the ABL Liens on such Collateral and (b) in respect of
the Term Priority Collateral, the Term Loan Debt Liens on such Collateral.
“ Senior
Representative
” means (a) with respect to the Term Priority Collateral, the Controlling Term Loan Debt Agent and
(b) with respect to the ABL Priority Collateral, the ABL Agent.
“ Senior
Secured
Obligations
” means (a) with respect to the ABL Debt Obligations (to
the extent such obligations are secured, or are intended to be secured, by the Term Priority Collateral), the Term Loan Debt Obligations and
(b) with respect to any Term Loan Debt Obligations (to the extent such obligations are secured, or are intended to be secured, by the ABL
Priority Collateral), the ABL Debt Obligations.
“ Senior
Secured
Obligations
Collateral
” means the Collateral in respect of which the Senior Representative (on behalf of
itself and any applicable Senior Secured Obligations Secured Parties) holds a Senior Lien.
“ Senior
Secured
Obligations
Secured
Parties
” means (a) with respect to the Term Priori- ty Collateral, the Term Loan
Debt Secured Parties and (b) with respect to the ABL Priority Collateral, the ABL Secured Parties.
“ Senior
Secured
Obligations
Security
Documents
” means (a) with respect to the ABL Priority Collateral, the ABL
Security Documents and (b) with respect to the Term Priority Collateral, the Term Loan Debt Security Documents.
“ Series
” means each of (a) the First Lien Term Loan Debt Obligations and (b) each class or issuance of Additional Term
Loan Debt Obligations incurred under a single Additional Term Loan Debt Facility. “ Series
” when used with respect to any agent, person,
document, lien or other item with respect to any First Lien Term Loan Debt Obligations, or Term Loan Debt Obligations shall have a
correlative meaning.
“ Subsidiary
” means, with respect to any specified Person, any entity at least 50% of whose voting securities or Equity
Interests (as defined in the ABL Credit Agreement) is owned by a Bor- rower or any combination of Borrowers (including indirect
ownership by a Borrower through other enti- ties in which such Borrower directly or indirectly owns 50% of the voting securities or Equity
Interests).
“ Subsidiary
Grantors
” has the meaning assigned to that term in the preamble hereto.
“ Term
Intercreditor
Agreement
” means any customary intercreditor agreement in form and substance reasonably
acceptable to the ABL Agent and UNFI, the terms of which are reasonably satisfactory to the parties thereto, among, inter alios , the Term
Loan Debt Agents and the Grantors from time to time party thereto.
“ Term
Loan
Debt
Agents
” means the First Lien Term Loan Agent and each Additional
Term Loan Debt Agent.
“ Term
Loan
Debt
Collateral
” means the First Lien Term Loan Collateral and any Additional Term Loan Debt Collateral.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
10
“ Term
Loan
Debt
Documents
” means the First Lien Term Loan Documents and any Additional Term Loan Debt
“ Term
Loan
Debt
Facility
” means the First Lien Term Loan Agreement and any Additional Term Loan Debt Facility.
“ Term
Loan
Debt
Lien
” means the First Lien Term Loan Lien and each Additional Term Loan Debt Lien.
“ Term
Loan
Debt
Obligations
” means the First Lien Term Loan Debt Obligations and any Additional Term Loan Debt
Documents.
Obligations.
“ Term
Loan
Debt
Secured
Parties
” means the First Lien Term Loan Secured Parties and any Additional Term Loan Debt
Secured Parties.
“ Term
Loan
Debt
Security
Documents
” means the First Lien Term Loan Security Documents and the Additional Term
Loan Debt Security Documents.
“ Term
Priority
Collateral
” means all present and future right, title and interest of the Grantors, whether now owned or
hereafter acquired, existing or arising, and wherever located, in all of the assets and property of any Grantor, whether real, personal or mixed
(other than ABL Priority Collateral) included in the Term Loan Debt Collateral, including, without limitation, all: (a) Capital Stock of each
Borrower (other than UNFI) and each Subsidiary of any Borrower; (b) equipment; (c) Intellectual Property; (d) Real Estate Assets, (e) all
general intangibles and investment property that do not constitute ABL Priority Collateral; (f) documents of title related to equipment; (g)
books and records, supporting obligations and related letters of credit, commercial tort claims or other claims and causes of action, in each
case, to the extent related primarily to the foregoing; and (h) substitutions, replacements, accessions, products and proceeds (including,
without limitation, insurance proceeds, licenses, royalties, income, payments, claims, damages and proceeds of suit) of any or all of the
foregoing.
ARTICLE 2
S UBORDINATION OF J UNIOR L IENS ; C ERTAIN A GREEMENTS
Section 2.01. Subordination of Junior Liens .
(a) The grant of the ABL Liens pursuant to the ABL Security Documents and each grant of the Term Loan Debt Liens pursuant to
the Term Loan Debt Security Documents create separate and distinct Liens on the Collateral.
(b) All Junior Liens in respect of any Collateral are expressly subordinated and made junior in right, priority, operation and effect to
any and all Senior Liens in respect of such Collateral, notwithstanding anything contained in this Agreement, the First Lien Term Loan
Documents, the ABL Debt Documents, any Additional Term Loan Debt Documents, or any other agreement or instrument or operation of
law to the contrary, and irrespective of the time, date, order or method of creation, attachment or perfection of such Junior Liens and Senior
Liens or any failure, defect or deficiency or alleged failure, defect or deficiency in any of the foregoing.
(c) It is acknowledged that (i) the aggregate amount of the Senior Secured Obligations may be increased from time to time pursuant
to the terms of the Senior Documents, (ii) a portion of the Senior Secured Obligations consists or may consist of indebtedness that is
revolving in nature, and the amount thereof that may be outstanding at any time or from time to time may be increased or reduced and
subsequently reborrowed and (iii) the Senior Secured Obligations may be increased, extended,
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
11
renewed, replaced, restated, supplemented, restructured, repaid, refunded, refinanced or otherwise amended or modified from time to time,
all without affecting the subordination of the Junior Liens hereunder or the provisions of this Agreement defining the relative rights of the
ABL Secured Parties and the Term Loan Debt Secured Parties. The lien priorities provided for herein shall not be altered or otherwise
affected by any amendment, modification, supplement, extension, increase, renewal, restatement or Replacement of either the Junior
Secured Obligations (or any part thereof) or the Senior Secured Obligations (or any part there- of).
(d) If at any time the ABL Agent shall make a Permitted Subordination (as defined below) with respect to any ABL Priority
Collateral or any Term Loan Debt Agent shall make a Permitted Subordination with respect to Term Priority Collateral, in each case, to or in
favor of any Person, the priority of such Representative’s Liens vis-a-vis the Liens therein of the other Representative shall not be affected
thereby and the subordinating Representative’s Liens shall continue to be senior in priority to the other Representative’s Liens in the
affected Collateral as and to the extent provided in this Section 2 . As used herein, the term “ Permitted
Subordination
” shall mean a
voluntary subordination by the ABL Agent of its Liens with respect to any or all ABL Priority Collateral, or by any Term Loan Debt Agent
of its Liens with respect to any or all Term Priority Collateral, in favor of depository banks, securities or commodities intermediaries,
landlords, mortgagees, custom brokers, freight forwarders, carriers, warehousemen, factors, and other Persons who provide goods or
services to a Grantor in the ordinary course of business.
Section 2.02. No Action With Respect to Junior Secured Obligations Collateral Subject to Senior Liens . No Junior Representative
or other Junior Secured Obligations Secured Party shall commence or instruct any Junior Representative to commence any judicial or
nonjudicial foreclosure proceedings with respect to, seek to have a trustee, receiver, liquidator or similar official appointed for or over,
attempt any action to take possession of, exercise any right, remedy or power with respect to, or otherwise take any action to enforce its
interest in or realize upon, or take any other action available to it in respect of, any Junior Secured Obligations Collateral under any Junior
Secured Obligations Security Document, applicable law or otherwise until the associated Discharge of Senior Secured Debt Obligations
(including, without limitation, exercising any rights under any deposit or securities account control agreement constituting Junior Secured
Obligations Collateral), it being agreed that only the Senior Representative or any Person authorized by the Senior Representative, acting in
accordance with the applicable Senior Secured Obligations Security Documents, shall be entitled to take any such actions or exercise any
such remedies prior to the associated Discharge of Senior Secured Debt Obligations. Notwithstanding the foregoing, any Junior
Representative may, subject to Section 2.05 , take all such actions as it shall deem necessary to (i) perfect or continue the perfection of its
Junior Liens or (ii) to create, preserve or protect (but not en- force) the Junior Liens on any Collateral. In addition, any Junior Representative
may, with respect to any Junior Secured Obligations, in each case to the extent not otherwise inconsistent with the other provisions of this
Agreement:
(a) file a claim, proof of claim, or statement of interest with respect to such Obliga- tions; provided that an Insolvency or
Liquidation Proceeding has been commenced by or against any Grantor;
(b) file any necessary or appropriate responsive or defensive pleadings in opposition to any motion, claim, adversary
proceeding or other pleading made by any person objecting to or otherwise seeking the disallowance of the claims or Liens of the
Junior Secured Obligations Secured Parties, including any claims secured by the Junior Secured Obligations Collateral, in each case
in accordance with the terms of this Agreement;
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
12
(c) in accordance with Section 2.06 , file any pleadings, objections, motions or agreements which assert rights or interests
available to unsecured creditors of the Grantors arising under either any Insolvency or Liquidation Proceeding, in accordance with
applicable law (including the Bankruptcy Laws of any applicable jurisdiction); and
(d) vote on any plan of reorganization, make other filings and make any arguments and motions (including in support of or
opposition to, as applicable, the confirmation or approval of any plan of reorganization) that are, in each case, in accordance with the
terms of this Agreement.
Section 2.03. No Duties of Senior Representative . Each Junior Secured Obligations Secured Party acknowledges and agrees that
neither the Senior Representative nor any other Senior Secured Obligations Secured Party shall have any fiduciary or other duties or other
obligations to such Junior Secured Obligations Secured Party with respect to any Senior Secured Obligations Collateral, other than to trans-
fer to the Junior Representative (and in the case there is more than one Series of Term Loan Debt Obligations, to the Controlling Term Loan
Debt Agent that is a Junior Representative) any remaining Collateral that constitutes Junior Secured Obligations Collateral and any proceeds
of the sale or other disposition of any such Collateral that constitutes Junior Secured Obligations Collateral remaining in its possession
following the associated Discharge of Senior Secured Debt Obligations, in each case without representation or warranty on the part of the
Senior Representative or any Senior Secured Obligations Secured Party. In furtherance of the foregoing, each Junior Secured Obligations
Secured Party acknowledges and agrees that until the associated Discharge of Senior Secured Debt Obligations secured by any Collateral on
which such Junior Secured Obligations Secured Party holds a Junior Lien, the Senior Representative or any Person authorized by the Senior
Representative shall be entitled, for the benefit of the holders of such Senior Secured Obligations, to sell, transfer or otherwise dispose of or
deal with such Collateral, as provided herein and in the Senior Secured Obligations Security Documents, without regard to any Junior Lien,
or any rights to which the holders of the Junior Secured Obligations would otherwise be entitled as a result of such Junior Lien. Without
limiting the foregoing, each Junior Secured Obligations Secured Party agrees that neither the Senior Representative nor any other Senior
Secured Obligations Secured Party shall have any duty or obligation first to marshal or realize upon any type of Senior Secured Obligations
Collateral (or any other collateral securing the Senior Secured Obligations), or to sell, dispose of or otherwise liquidate all or any portion of
such Collateral (or any other collateral securing the Senior Secured Obligations), in any manner that would maximize the return to the Junior
Secured Obligations Secured Parties, notwithstanding that the order and timing of any such realization, sale, disposition or liquidation may
affect the amount of proceeds actually received by the Junior Secured Obligations Secured Parties from such realization, sale, disposition or
liquidation. Following the associated Discharge of Senior Secured Debt Obligations, the Junior Secured Obligations Secured Parties may,
subject to any other agreements binding on such Junior Secured Obligations Secured Parties, assert their rights under the New York UCC or
otherwise to any proceeds remaining following a sale, disposition or other liquidation of Collateral by, or on behalf of the Junior Secured
Obligations Secured Parties. Each of the Junior Secured Obligations Secured Parties waives any claim such Junior Secured Obligations
Secured Party may now or hereafter have against the Senior Representative or any other Senior Secured Obligations Secured Party (or their
representatives) arising out of any actions which the Senior Representative or the Senior Secured Obligations Secured Parties take or omit to
take (including actions with respect to the creation, perfection or continuation of Liens on any Collateral, actions with respect to the
foreclosure upon, sale, release or depreciation of, or failure to realize upon, any of the Collateral, and actions with respect to the collection
of any claim for all or any part of the Senior Secured Obligations from any account debtor, guarantor or any other party) in accordance with
this Agreement and the
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
13
Senior Secured Obligations Security Documents or any other agreement related thereto or to the collection of the Senior Secured
Obligations or the valuation, use, protection or release of any security for the Senior Secured Obligations.
Section 2.04. No Interference; Payment Over; Reinstatement; Application of Proceeds .
(a) Each Junior Secured Obligations Secured Party agrees that (i) it will not take or cause to be taken any action the purpose, or
effect of which is, or could be, to make any Junior Lien rank equal with, or to give such Junior Secured Obligations Secured Party any
preference or priority relative to, any Senior Lien with respect to the Collateral subject to such Senior Lien and Junior Lien or any part
thereof, (ii) it will not challenge or question in any proceeding (including any Insolvency or Liquidation Proceeding) the validity or
enforceability of any Senior Secured Obligations or Senior Secured Obligations Security Document, or the validity, attachment, perfection
or priority of any Senior Lien, or the validity or enforceability of the priorities, rights or duties established by or other provisions of this
Agreement, (iii) it will not take or cause to be taken any action the purpose or intent of which is, or could be, to interfere, hinder or delay, in
any manner, whether by judicial proceedings or otherwise, any sale, transfer or other disposition of the Collateral subject to any Junior Lien
by any Senior Secured Obligations Secured Parties secured by Senior Liens on such Collateral or any Senior Representative acting on their
behalf, (iv) it shall have no right to (A) direct any Senior Representative or any holder of Senior Secured Obligations to exercise any right,
remedy or power with respect to the Collateral subject to any Junior Lien or (B) consent to the exercise by any Senior Representative or any
other Senior Secured Obligations Secured Party of any right, remedy or power with respect to the Collateral subject to any Junior Lien, (v) it
will not institute any suit or assert in any suit or Insolvency or Liquidation Proceeding any claim against any Senior Representative or other
Senior Secured Obligations Secured Party seeking damages from or other relief by way of specif- ic performance, instructions or otherwise
with respect to, and neither any Senior Representative nor any other Senior Secured Obligations Secured Party shall be liable for, any action
taken or omitted to be taken by such Senior Representative or other Senior Secured Obligations Secured Party with respect to any Collateral
securing such Senior Secured Obligations that is subject to any Junior Lien, (vi) it will not seek, and hereby waives any right, to have any
Senior Secured Obligations Collateral subject to any Junior Lien or any part thereof marshaled upon any foreclosure or other disposition of
such Collateral and (vii) it will not attempt, directly or indirectly, whether by judicial proceedings or otherwise, to challenge the
enforceability of any provision of this Agreement.
(b) Each Junior Representative and each other Junior Secured Obligations Secured Party here- by agrees that if it shall obtain
possession of any Senior Secured Obligations Collateral or shall realize any proceeds or payment in respect of any such Collateral, pursuant
to any Junior Secured Obligations Security Document or by the exercise of any rights available to it under applicable law or in any
Insolvency or Liquidation Proceeding or through any other exercise of remedies, at any time prior to the associated Discharge of Senior
Secured Debt Obligations secured, or intended to be secured, by such Collateral, then it shall hold such Collateral, proceeds or payment in
trust for the applicable Senior Secured Ob- ligations Secured Parties and transfer such Collateral, proceeds or payment, as the case may be,
to the Senior Representative reasonably promptly after obtaining actual knowledge or notice from the Senior Secured Obligations Secured
Parties that it has possession of such Senior Secured Obligations Collateral or proceeds or payments in respect thereof. Each Junior Secured
Obligations Secured Party agrees that if, at any time, it obtains actual knowledge or receives notice that all or part of any payment with
respect to any Senior Secured Obligations previously made shall be rescinded for any reason whatsoever, such Junior Secured Obligations
Secured Party shall promptly
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
14
pay over to the Senior Representative any payment received by it and then in its possession or under its control in respect of any Collateral
subject to any Senior Lien securing such Senior Secured Obligations and shall promptly turn any Collateral subject to any such Senior Lien
then held by it over to the Senior Representative, and the provisions set forth in this Agreement shall be reinstated as if such payment had
not been made, until the payment and satisfaction in full of the Senior Secured Obligations. All Junior Liens will remain attached to and
enforceable against all proceeds so held or remitted. Anything contained herein to the contrary notwithstanding, this Section 2.04(b) shall
not apply to any proceeds of Senior Secured Obligations Collateral realized in a transaction not prohibited by the Senior Documents and as
to which the possession or receipt thereof by the Junior Representative or other Junior Secured Obligations Secured Party is otherwise
permitted by the Senior
Documents.
(c) So long as the Discharge of Senior Secured Debt Obligations has not occurred, whether or not any Insolvency or Liquidation
Proceeding has been commenced by or against any Grantor, any Col- lateral in which a Senior Secured Obligations Secured Party has a
Senior Lien or any proceeds (whether in cash or otherwise) thereof received in connection with any enforcement action or other exercise of
rights or remedies by any Senior Secured Obligations Secured Party with respect to such Collateral or any Insolvency or Liquidation
Proceeding, shall be applied by the Senior Representative to the Senior Secured Obligations in accordance with the terms of the Senior
Documents, including any other intercreditor agreement among the Senior Secured Obligations Secured Parties. Upon the Discharge of
Senior Secured Debt Obligations, the Senior Representative shall deliver to the Junior Representative any remaining Col- lateral (other than
Canadian Collateral, as applicable) in which a Senior Secured Obligations Secured Party has a Senior Lien and proceeds thereof then held
by it in the same form as received, with any necessary endorsements (such endorsements shall be without recourse and without
representation or warranty) to the Junior Representative, or as a court of competent jurisdiction may otherwise direct, to be applied by the
Junior Representative to the Junior Secured Obligations in accordance with the terms of the Junior Documents, including any intercreditor
agreement among the Junior Secured Obligations Secured Parties.
Section 2.05. Release of Liens; Automatic Release of Junior Liens .
(a) Each Junior Representative and each other Junior Secured Obligations Secured Party agrees that in the event of a sale, transfer or
other disposition of Senior Secured Obligations Collateral subject to any Junior Lien (regardless of whether or not an Event of Default has
occurred and is continuing under the Junior Documents at the time of such sale, transfer or other disposition), such Junior Lien on such
Collateral shall terminate and be released automatically and without further action if the applicable Senior Liens on such Collateral are
released and if such sale, transfer or other disposition either (A) is then not prohibited by the Junior Documents (either pursuant to the terms
of the Junior Documents or pursuant to a consent issued thereunder) or (B) occurs in connection with the foreclosure upon or other exercise
of rights and remedies with respect to such Senior Secured Obligations Collateral (including, if the Senior Secured Obligations Collateral is
ABL Priority Collateral, in connection with any liquidation of ABL Facility Collateral consented to by the ABL Agent); provided that such
Junior Lien shall remain in place with respect to any proceeds of a sale, transfer or other disposition under this clause (a) that remain after
the associated Discharge of Senior Secured Debt Obligations. In addition, for the avoidance of doubt, the Junior Representative and each
Junior Secured Obligations Secured Party agree that, with respect to any Deposit Account that would otherwise constitute Senior Secured
Obligations Collateral, the requirement that a Junior Lien be perfected by control with respect to, such property or assets shall be waived
automatically and without further action so long as the requirement that a Senior Lien attach to, or be perfected with respect to,
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
15
such property or assets is waived by the Senior Secured Obligations Secured Parties (or the Senior Representative) in accordance with the
Senior Documents.
(b) The ABL Agent and each Term Loan Debt Agent agrees that, with respect to the release of any Collateral, if the ABL Agent or
such Term Loan Debt Agent, as applicable, at any time receives:
(i) an Officer’s Certificate from the relevant Grantor stating that the conditions precedent in this Agreement and all other
Secured Documents, (in each case) if any, relating to the release of such Collateral have been complied with;
(ii) the proposed instrument or instruments releasing such Lien as to such property in recordable form, if applicable; and
(iii) prior to the associated Discharge of Senior Secured Debt Obligations, the written confirmation of the applicable Senior
Representative (or, at any time after the associated Discharge of Senior Secured Debt Obligations, each Junior Representative) (such
confirmation to be given promptly following receipt of, and based solely on, the Officer’s Certificate described in clause (i) above)
that, in its view, such release is permitted by Section 2.05(a) and the respective Secured Documents governing the Term Loan Debt
Obligations or the ABL Debt Obligations, as applicable, the holders of which such Representative represents;
then the ABL Agent or each Term Loan Debt Agent, as applicable, will execute (with such acknowledgements and/or notarizations as are
required) and promptly deliver such release to the applicable Grantor after the date of receipt of the items required by this Section 2.05(b) by
the applicable Representative.
(c) Each Junior Representative agrees to execute and deliver (at the sole cost and expense of the Grantors) all such releases and other
instruments as shall reasonably be requested by the Senior Representative to evidence and confirm any release of Junior Secured Obligations
Collateral provided for in this Section 2.05 .
Section 2.06. Certain Agreements With Respect to Insolvency or Liquidation Proceedings .
(a) This Agreement shall continue in full force and effect, notwithstanding the commencement of any Insolvency or Liquidation
Proceeding by or against any Borrower, any of any Borrower’s Subsidiaries or any other Grantor. Without limiting the generality of the
foregoing, the provisions of this Agreement are intended to be and shall be enforceable as a “subordination agreement” under Section 510(a)
of the Bankruptcy Code. All references to any Borrower or any other Grantor shall include any Borrower or any other Grantor as debtor and
debtor-in-possession and any receiver or trustee for such person in any Insolvency or Liquidation Proceeding.
(b) If any Grantor shall become subject to a case under the Bankruptcy Code and shall, as debtor(s)-in-possession, move for approval
of financing (a “ DIP
Financing
”) to be provided by one or more lenders under Section 364 of the Bankruptcy Code or the use of cash
collateral under Section 363 of the Bankruptcy Code, each Junior Secured Obligations Secured Party agrees that it will raise no objection,
and will waive any claim such Person may now or hereafter have, to any such financing or to the Liens on the Senior Secured Obligations
Collateral securing the same (“ DIP
Financing
Liens
”),
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
16
or to any use of cash collateral that constitutes Senior Secured Obligations Collateral or to any grant of administrative expense priority under
Section 364 of the Bankruptcy Code, unless (i) the Senior Secured Obligations Secured Parties, or Senior Representative, does not consent
to or shall then oppose or object to such DIP Financing or such DIP Financing Liens or such use of cash collateral or (ii) such DIP Financing
Liens are neither senior to, nor rank equal with, the Senior Liens upon any property of the estate in such Insolvency or Liquidation
Proceeding. To the extent such DIP Financing Liens are senior to, or rank equal with, the Senior Liens, the Junior Representative will, for
itself and on behalf of the other Junior Secured Obligations Secured Parties of the applicable Series, subordinate the Junior Liens on the
Senior Secured Obligations Collateral to (i) the Senior Liens (and all adequate protection liens on the Senior Secured Obligations Collateral
granted to the Senior Secured Obligations Secured Parties) and the DIP Financing Liens and (ii) any “carve out” for professional fees and
United States Trustee fees and other payments from the Senior Secured Obligations Collateral agreed to by the Senior Representative, so
long as the Junior Secured Obligations Secured Parties retain their valid, perfected and unvoidable Liens on all (1) the Junior Secured
Obligations Collateral, including proceeds thereof arising after the commencement of any Insolvency or Liquidation Proceeding, with the
same priority as existed prior to the commencement of the case under the Bankruptcy Code, and (2) the Senior Secured Obligations
Collateral, as subordinated to the ex- tent set forth herein.
(c) Each Junior Secured Obligations Secured Party agrees that it will not object to or oppose (i) a sale or other disposition of any
Senior Secured Obligations Collateral (or any portion thereof) under Section 363 of the Bankruptcy Code or any other provision of the
Bankruptcy Code if the Senior Secured Obligations Secured Parties shall have consented to such sale or disposition of such Senior Secured
Obligations Collateral and all Senior Liens and Junior Liens will attach to the proceeds of the sale or other disposition with the same
priorities set forth herein or (ii) any lawful exercise by any holder of claims in respect of any Senior Secured Obligations of the right to
credit bid such claims under Section 363(k) of the Bankruptcy Code or any other applicable provision of the Bankruptcy Code or in any sale
in foreclosure of Collateral that is Senior Secured Obligations Collateral with respect to such claims.
(d) (i) No Term Loan Debt Secured Party shall oppose (or support the opposition of any other Person) in any Insolvency or
Liquidation Proceeding to (A) any motion or other request by any ABL Secured Party for adequate protection with respect to ABL Agent’s
Liens upon the ABL Priority Collateral, including any claim of any ABL Secured Party to post-petition interest, fees, or expenses as a result
of the ABL Lien on the ABL Priority Collateral (so long as any post-petition interest, fees, or expenses paid as a result thereof is not paid
from the proceeds of Term Priority Collateral), a request for the application of proceeds of ABL Priority Collateral to the ABL Debt
Obligations, and request for additional or replacement Liens on post-petition assets of the same type as the ABL Priority Collateral and/or a
superpriority administrative claim, or (B) any objection by any ABL Secured Party to any motion, relief, action or proceeding based on such
ABL Secured Party claiming a lack of adequate protection with respect to the ABL Liens in the ABL Priority Collateral. In addition, the
ABL Agent, for itself and on behalf of the ABL Secured Parties, may seek adequate protection of its junior interest in the Term Priority
Collateral in the form of an additional or replacement Lien on post-petition assets of the same type as the Term Priority Collateral and/or a
superpriority administrative claim, subject to the provisions of this Agreement; provided , that each Term Loan Debt Agent is also granted
adequate protection in the same form that is grant- ed to the ABL Agent, which additional or replacement Lien on post-petition assets of the
same type as the Term Priority Collateral or superpriority administrative claim (as applicable) is senior to that granted to the ABL Agent in
respect of the Term Priority Collateral. Such Lien on post-petition assets of the same type as the Term Priority Collateral and/or
superpriority administrative claim, if granted to the ABL Agent, will be subordinated to the adequate
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
17
protection Liens and/or superpriority administrative claims (as applicable) granted in favor of each Term Loan Debt Agent on such post-
petition assets, and, if applicable, to the DIP Financing Liens of each Term Loan Debt Agent or any other Term Loan Debt Secured Party on
such post-petition assets of the same type as the Term Priority Collateral. If the ABL Agent, for itself and on behalf of the ABL Secured
Parties, seeks or requires (or is otherwise granted) adequate protection of its junior interest in the Term Priority Collateral in the form of an
additional or replacement Lien on post-petition assets of the same type as the Term Priority Collateral and/or a superpriority administrative
claim, then the ABL Agent, for itself and the ABL Secured Parties, agrees that each Term Loan Debt Agent shall also be granted an
additional or replacement Lien on such post-petition assets and/or a superpriority administrative claim as adequate protection of its senior
interest in the Term Priority Collateral and that the ABL Agent’s additional or replacement Lien on post-petition assets of the same type as
the Term Priority Collateral and/or superpriority administrative claim (as applicable) shall be subordinated to the additional or replacement
Lien on post-petition assets of the same type as the Term Priority Col- lateral and/or superpriority administrative claim of each Term Loan
Debt Agent on the same basis as the Liens of the ABL Agent on, and claims with respect to, the Term Priority Collateral are subordinated to
the Liens of each Term Loan Debt Agent on, and claims with respect to, the Term Priority Collateral under this Agreement. If the ABL
Agent or any ABL Secured Party receives as adequate protection a Lien on post-petition assets of the same type as the ABL Priority
Collateral, then such post-petition assets shall also constitute ABL Priority Collateral to the extent of any allowed claim of the ABL Secured
Parties secured by such adequate protection Lien and shall be subject to this Agreement. Notwithstanding anything herein to the contrary,
the ABL Agent shall have irrevocably agreed, pursuant to Section 1129(a)(9) of the Bankruptcy Code, on behalf of itself and the ABL
Secured Parties, in any stipulation or order granting adequate protection of its junior interest in the Term Priority Collateral, that such junior
super-priority claims may be paid under any plan of reorganization in any combination of cash, debt, equity or other property having a value
on the effective date of such plan equal to the allowed amount of such claims.
(ii) No ABL Secured Party shall oppose (or support the opposition of any other Person) in any Insolvency or Liquidation
Proceeding to (A) any motion or other request by any Term Loan Debt Secured Party for adequate protection of any Term Loan Debt
Agent’s Liens upon any of the Term Priority Collateral, including any claim of any Term Loan Debt Secured Party to post-petition interest,
fees, or expenses as a result of any Term Loan Debt Liens on the Term Priority Collateral (so long as any post-petition interest, fees, or
expenses paid as a result thereof is not paid from the proceeds of ABL Priority Collateral), a request for the application of proceeds of Term
Priority Collateral to the Term Loan Debt Obligations, and request for additional or replacement Liens on post-petition assets of the same
type as the Term Priority Collateral and/or a superpriority administrative claim or (B) any objection by any Term Loan Debt Secured Party
to any motion, relief, action or proceeding based on such Term Loan Debt Secured Party claiming a lack of adequate protection, with respect
to any Term Loan Debt Agent’s Liens in the Term Priority Collateral. In addition, any Term Loan Debt Agent, for itself and on behalf of the
applicable Term Loan Debt Secured Parties, may seek adequate protection of its junior interest in the ABL Priority Collateral (other than the
Canadian Collateral) in the form of an additional or replacement Lien on post-petition assets of the same type as the ABL Priority Collateral
and/or a superpriority administrative claim, subject to the provisions of this Agreement; provided , that the ABL Agent is also granted
adequate protection in the same form that is granted to the applicable Term Loan Debt Agent, which additional or replacement Lien on post-
petition assets of the same type as the ABL Priority Collateral and/or superpriority administrative claim (as applicable) granted in favor of
the ABL Agent is senior to that granted to the applicable Term Loan Debt Agent in respect of the ABL Priority Collateral. Such Lien on
post-petition assets of the same type as the ABL Priority Collateral and/or superpriority administrative claim, if granted to any Term Loan
Debt Agent, will be
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
18
subordinated to the adequate protection Liens and/or superpriority administrative claims (as applicable) granted in favor of the ABL Agent
on such post-petition assets, and, if applicable, to the DIP Financing Liens of the ABL Agent or any other ABL Secured Party on such post-
petition assets of the same type as the ABL Priority Collateral. If any Term Loan Debt Agent, for itself and on behalf of any Term Loan
Debt Secured Parties, seeks or requires (or is otherwise granted) adequate protection of its junior interest in the ABL Priority Collateral
(other than the Canadian Collateral) in the form of an additional or replacement Lien on the post-petition assets of the same type as the ABL
Priority Collateral and/or a superpriority administrative claim, then such Term Loan Debt Agent, for itself and the applicable Term Loan
Debt Secured Parties, agrees that the ABL Agent shall also be granted an additional or replacement Lien on such post-petition assets and/or
a super- priority administrative claim as adequate protection of its senior interest in the ABL Priority Collateral and that such Term Loan
Debt Agent’s additional or replacement Lien on such post-petition assets of the same type as the ABL Priority Collateral and/or
superpriority administrative claim shall be subordinated to the additional or replacement Lien and/or superpriority administrative claim of
the ABL Agent on the same basis as the Liens of such Term Loan Debt Agent on and claims with respect to the ABL Priority Collateral are
subordinated to the Liens of the ABL Agent on and claims with respect to the ABL Priority Collateral under this Agreement. If any Term
Loan Debt Agent or any Term Loan Debt Secured Party receives as adequate protection a Lien on post-petition assets of the same type as
the Term Priority Collateral, then such post-petition assets shall also constitute Term Priority Collateral to the extent of any allowed claim of
the applicable Term Loan Debt Secured Parties secured by such adequate protection Lien and shall be subject to this Agreement.
Notwithstanding anything herein to the contrary, each Term Loan Debt Agent shall have irrevocably agreed, pursuant to Section 1129(a)(9)
of the Bankruptcy Code, on behalf of itself and the Term Loan Debt Secured Parties, in any stipulation or order granting adequate protection
of its junior interest in the ABL Priority Collateral (other than the Canadian Collateral), that such junior super-priority claims may be paid
under any plan of reorganization in any combination of cash, debt, equity or other property having a value on the effective date of such plan
equal to the allowed amount of such claims.
(e) Each of the Junior Secured Obligations Secured Parties waives any claim such Junior Secured Obligations Secured Party may
now or hereafter have against the Senior Representative or any other Senior Secured Obligations Secured Party (or their representatives)
arising out of any election by the Senior Representative or any Senior Secured Obligations Secured Parties, in any proceeding instituted
under the Bankruptcy Code, of the application of Section 1111(b) of the Bankruptcy Code with respect to such party’s Senior Secured
Obligations Collateral.
(f) Prior to any Discharge of Senior Secured Debt Obligations and any DIP Financing provided by the Senior Secured Obligations
Secured Parties, no Junior Secured Obligations Secured Party shall seek relief from the automatic stay in any Insolvency or Liquidation
Proceeding with respect to any Senior Secured Obligations Collateral unless (i) otherwise consented to by the Senior Representative or (ii)
the Senior Representative or Senior Secured Obligations Secured Parties shall seek relief from the automatic stay with respect to such
Collateral to commence a lien enforcement action with respect to such Senior Secured Obligations Collateral. No Junior Secured
Obligations Secured Party will object to or otherwise contest: any motion for relief from the automatic stay or from any injunction against
foreclosure or enforcement in respect of the Senior Secured Obligations made by the Senior Representative or any other Senior Secured
Obligations Secured Party (or their representatives).
(g) Each of the Junior Secured Obligations Secured Parties hereby agrees that (i) it will not oppose or seek to challenge any claim by
the Senior Representative or any other Senior Secured
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
19
Obligations Secured Party (or their representatives) for allowance of Senior Secured Obligations consisting of post-petition interest, fees or
expenses to the extent of the value of the Senior Representative’s Lien on the Senior Secured Obligations Collateral, without regard to the
existence of the Lien of the Junior Secured Obligations Secured Parties on the Senior Secured Obligations Collateral; and (ii) prior to any
Discharge of Senior Secured Debt Obligations, will not assert or enforce any claim under Section 506(c) of the Bankruptcy Code senior to
or on a parity with the Liens on the Senior Secured Obligations Collateral securing the Senior Secured Obligations for costs or expenses of
preserving or disposing of any Collateral.
(h) Each Term Loan Debt Agent, for itself and on behalf of the Term Loan Debt Secured Par- ties under the applicable Series, and
the ABL Agent, for itself and on behalf of the ABL Secured Parties, acknowledge and intend that: the grants of Liens pursuant to the Term
Loan Debt Security Documents, on the one hand, and the ABL Security Documents, on the other hand, constitute separate and distinct
grants of Liens, and because of, among other things, their differing rights in the Collateral, the ABL Debt Obligations are fundamentally
different from the Term Loan Debt Obligations and must be separately classified in any plan of reorganization or liquidation proposed or
confirmed (or approved) in an Insolvency or Liquidation Proceeding. To further effectuate the intent of the parties as provided in the
immediately preceding sentence, if it is held that the claims of the ABL Secured Parties and the claims of the Term Loan Debt Secured
Parties in respect of any Collateral constitute claims in the same class (rather than separate classes of secured claims), then the ABL Secured
Parties and the Term Loan Debt Secured Parties hereby acknowledge and agree that all distributions from the Collateral shall be made as if
there were separate classes of ABL Debt Obligations and Term Loan Debt Obligations against the Grantors (with the effect being that, to the
extent that the aggregate value of the ABL Priority Collateral or the Term Priority Collateral is sufficient (for this purpose ignoring all
claims held by the other Secured Parties for whom such Collateral is Junior Secured Obligations Collateral), the ABL Secured Parties or the
Term Loan Debt Secured Parties, respectively, shall be entitled to receive, in addition to amounts distributed to them in respect of principal,
pre-petition interest and other claims, all amounts owing in respect of post-petition interest, fees, expenses, and other charges that are
available from the applicable Senior Secured Obligations Collateral for each of the ABL Secured Parties and the Term Loan Debt Secured
Parties (regardless of whether any such claims for post-petition interest, fees, expenses, or other charges may or may not be enforceable,
allowed or allowable in whole or in part as against UNFI or any of the other Grantors in the applicable Insolvency or Liquidation
Proceeding(s) pursuant to Section 506(b) of the Bankruptcy Code or otherwise), respectively, before any distribution is made in respect of
any claims in respect of the Junior Secured Obligations from, or with respect to, such applicable Senior Secured Obligations Collateral, with
the holder of such claims hereby acknowledging and agreeing to turn over to the respective other Secured Parties amounts otherwise
received or receivable by them from, or with respect to, such applicable Senior Secured Obligations Collateral to the extent necessary to
effectuate the intent of this sentence, even if such turnover has the effect of reducing their aggregate recoveries. This Section 2.06(h) is
intended to govern the relationship between the classes of claims held by the ABL Secured Par- ties, on the one hand, and a collective class
of claims comprised of each series of claims of the Term Loan Debt Secured Parties (as opposed to separate classes of each such series of
claims), on the other hand,
and, for the avoidance of doubt, nothing set forth herein shall in any way alter or modify the relationship of each series of such separate
claims held by the holders of the Term Loan Debt Obligations, including as set forth in any Term Intercreditor Agreement, or otherwise
cause such different claims to be combined into one or more classes or otherwise classified in a manner that violates such Term Intercreditor
Agreement.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
20
(i) If, in any Insolvency or Liquidation Proceeding, debt obligations of the reorganized debtor secured by Liens upon any property of
the reorganized debtor are distributed pursuant to a plan of reorganization or similar dispositive restructuring plan, both on account of the
ABL Debt Obligations and on account of the Term Loan Debt Obligations, then, to the extent the debt obligations distributed on account of
the ABL Debt Obligations and on account of the Term Loan Debt Obligations are secured by Liens upon the Collateral, the provisions of
this Agreement will survive the distribution of such debt obligations pursuant to such plan and will apply with like effect to the debt
obligations so distributed, to the Liens securing such debt obligations and the distribution of proceeds thereof.
(j) To the extent that any Junior Representative or any Junior Secured Obligations Secured Party has or acquires rights under Section
363 or Section 364 of the Bankruptcy Code or any similar pro- vision of any other Bankruptcy Law with respect to any of the Collateral
with respect to which it has a Junior Lien, such Junior Representative, on behalf of itself and each Junior Secured Obligations Secured Party
under its Junior Documents, agrees not to assert any such rights without the prior written consent of the Senior Representative; provided that
if requested by the Senior Representative, such Junior Representative shall timely exercise such rights in the manner requested by the Senior
Representative, including any rights to payments in respect of such rights.
(k) No Junior Representative or any other Junior Secured Obligations Secured Party may support or vote in favor of any plan of
reorganization (and each shall be deemed to have voted to reject any Plan of Reorganization) that is inconsistent with the terms of this
Agreement.
Section 2.07. Reinstatement . If any Senior Secured Obligations Secured Party is required in any Insolvency or Liquidation
Proceeding or otherwise to disgorge, turn over or otherwise pay any amount to the estate of UNFI or any other Grantor (or any trustee,
receiver or similar Person therefor), because the payment of such amount was declared to be fraudulent or preferential in any respect or for
any other reason, any amount (a “ Recovery
”), whether received as proceeds of security, enforcement of any right of setoff, recoupment or
otherwise, then the Senior Secured Obligations shall be reinstated to the extent of such Recovery and deemed to be outstanding as if such
payment had not occurred, and the Senior Secured Obligations Secured Parties shall be entitled to a future Discharge of Senior Secured Debt
Obligations with respect to all such recovered amounts. If this Agreement shall have been terminated prior to such Recovery, this
Agreement shall be reinstated in full force and effect, and such prior terminationshall not diminish, release, discharge, impair or otherwise
affect the obligations of the parties hereto. Each Junior Representative, for itself and on behalf of each Junior Secured Obligations Secured
Party under its Junior Documents, hereby agrees that none of them shall be entitled to benefit from any avoidance action affecting or
otherwise relating to any distribution or allocation made in accordance with this Agreement, whether by preference or otherwise, it being
understood and agreed that the benefit of such avoidance action otherwise allocable to them shall instead be allocated and turned over for
application in accordance with the priorities set forth in this Agreement.
Section 2.08. Entry Upon Premises by the ABL Agent and the ABL Secured Parties; Intellectual Property License .
(a) If the ABL Agent takes any enforcement action with respect to the ABL Priority Collateral, the Term Loan Debt Secured Parties
(i) shall reasonably cooperate with the ABL Agent (at the sole cost and expense of the ABL Agent and subject to the condition that the Term
Loan Debt Secured Parties shall have no obligation or duty to take any action or refrain from taking any action that could reasonably be
expected to result in the incurrence of any liability or damage to the Term Loan
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
21
Debt Secured Parties unless the ABL Secured Parties fully indemnify such Term Loan Debt Secured Parties for such liability or damage) in
its efforts to enforce its security interest in the ABL Priority Collateral and to finish any work- in-process and assemble the ABL Priority
Collateral, (ii) shall not take any action designed or intended to hinder or restrict in any respect the ABL Agent from enforcing its security
interest in the ABL Priority Collateral or from finishing any work-in-process or assembling the ABL Priority Collateral, and (iii) subject to
the rights of any landlords under real estate leases, shall permit the ABL Agent, its employees, agents, advisers and representatives, at the
sole cost and expense of the ABL Secured Parties and upon reasonable advance notice, to enter upon and use the Term Priority Collateral
(including equipment, processors, computers and other machinery related to the storage or processing of records, documents or files), for a
period of at least 180 days after the taking of such enforcement action, for purposes of (1) assembling and storing the ABL Priority
Collateral and completing the processing of and turning into finished goods of any ABL Priority Collateral consisting of work-in-process,
(2) selling any or all of the ABL Priority Collateral located on such Term Priority Collateral, whether in bulk, in lots or to customers in the
ordinary course of business or otherwise, (3) removing any or all of the ABL Priority Collateral located on such Term Priority Collateral, or
(4) taking reasonable actions to protect, secure and otherwise enforce the rights of the ABL Secured Parties in and to the ABL Priority
Collateral; provided , however , that nothing contained in this Agreement shall restrict the rights of any Term Loan Debt Agent from selling,
assigning or otherwise transferring any Term Priority Collateral prior to the expiration of such 180- day period if the purchaser, assignee or
transferee thereof agrees to be bound by the provisions of this Section. If any stay or other order prohibiting the exercise of remedies with
respect to the ABL Priority Collateral has been entered by a court of competent jurisdiction, such 180-day period shall be tolled during the
pendency of any such stay or other order. If the ABL Agent conducts a public auction or private sale of the ABL Priority Collateral at any of
the real property included within the Term Priority Collateral, the ABL Agent shall provide each Term Loan Debt Agent with reasonable
notice and use reasonable efforts to hold such auction, or sale in a manner which would not unduly disrupt such Term Loan Debt Agent’s
use of such real property.
(b) Notwithstanding any limitation set forth in Section 2.08(a) , no Term Loan Debt Secured Party shall in any manner interfere with
ABL Agent’s right to use any Intellectual Property pursuant to any license or other right of use granted by a Grantor or pursuant to any
applicable law, and any sale or other disposition of such Intellectual Property whether by a lien enforcement action or otherwise shall be
made expressly subject to such license or other right of use until the soonest to occur of the following: (i) the Discharge of Senior Secured
Debt Obligations of the ABL Secured Parties, or (ii) all ABL Priority Collateral consisting of inventory has been sold or otherwise disposed
of after the occurrence and during the continuance of an Event of Default under the ABL Debt Documents, whether pursuant to a lien
enforcement action by ABL Secured Parties, by a trustee or other representative of creditors in an Insolvency or Liquidation Proceeding or
by one or more Grantors in an orderly liquidation of such ABL Priority Collateral, to repay the ABL Debt Obligations. Nothing in this
Section shall be deemed to modify, waive, condition, limit or otherwise adversely affect any right ABL Agent may have to sell or otherwise
dispose of any inventory (including inventory bearing any trademarks or tradenames forming a part of the Term Priority Collateral), whether
by lien enforcement action or otherwise, after any sale or other disposition of any intellectual property by any Term Loan Debt Agent or any
other Term Loan Debt Secured Party.
(c) During the period of actual occupation, use or control by the ABL Secured Parties or their agents or representatives of any Term
Priority Collateral, the ABL Secured Parties shall (i) be responsible for the ordinary course third-party expenses related thereto, including
costs with respect to heat, light, electricity, water and real property taxes with respect to that portion of any premises so used
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
22
or occupied, and (ii) be obligated to repair at their expense any physical damage to such Term Priority Collateral or other assets or property
resulting from such occupancy, use or control, and to leave such Term Priority Collateral or other assets or property in substantially the
same condition as it was at the commencement of such occupancy, use or control, ordinary wear and tear excepted. The ABL Secured
Parties severally (on a pro rata basis) agree to pay, indemnify and hold each Term Loan Debt Agent and their respective officers, directors,
employees and agents harmless from and against any liability, cost, expense, loss or damages, including legal fees and expenses, resulting
from the gross negligence or willful misconduct of the ABL Agent or any of its agents, representatives or invitees in its or their operation of
such facilities. Notwithstanding the foregoing, in no event shall the ABL Secured Parties have any liability to the Term Loan Debt Secured
Parties pursuant to this Section as a result of any condition (including any environ- mental condition, claim or liability) on or with respect to
the Term Priority Collateral existing prior to the date of the exercise by the ABL Secured Parties of their rights under this Section and the
ABL Secured Parties shall have no duty or liability to maintain the Term Priority Collateral in a condition or manner better than that in
which it was maintained prior to the use thereof by the ABL Secured Parties, or for any diminution in the value of the Term Priority
Collateral that results solely from ordinary wear and tear resulting from the use of the Term Priority Collateral by the ABL Secured Parties
in the manner and for the time periods specified under this Section 2.08 . Without limiting the rights granted in this paragraph, ABL Agent,
to the extent that rights have been exercised under this Section 2.08 by ABL Agent, shall cooper- ate with the Term Loan Debt Secured
Parties in connection with any efforts made by the Term Loan Debt Secured Parties to sell the Term Priority Collateral.
(d) Each Term Loan Debt Agent and each Term Loan Debt Secured Party, in its capacity as a secured party (or as a purchaser,
assignee or transferee, as applicable), and to the extent of its interest therein, hereby grants to the ABL Agent and the ABL Secured Parties a
nonexclusive, irrevocable, royalty-free, worldwide license to use, license or sublicense any and all Intellectual Property now owned or
hereafter acquired included as part of the Term Loan Debt Collateral (and including in such license access to all media in which any of the
licensed items may be recorded or stored and to all computer software and programs used for the compilation or printout thereof) as is or
may be necessary or advisable in the ABL Agent's reasonable judgment for the ABL Agent to process, ship, produce, store, supply, lease,
complete, sell, liquidate or otherwise deal with the ABL Priority Collateral, or to collect or otherwise realize upon any Accounts (as defined
in the ABL Credit Agreement as of the date hereof) comprising ABL Priority Collateral, in each case solely in connection with any exercise
of remedies available to the ABL Secured Parties; provided that (i) any such license shall terminate upon the sale of the applicable ABL
Priority Collateral and shall not extend or transfer to the purchaser of such ABL Priority Collateral, (ii) the ABL Agent's use of such
Intellectual Property shall be reasonable and lawful, and (iii) any such license is granted on an “AS IS” basis, without any representation or
warranty whatsoever. Furthermore, each Term Loan Debt Agent agrees that, in connection with any exercise of remedies available to any
Term Loan Debt Agent in respect of Term Loan Debt Collateral, such Term Loan Debt Agent shall provide written notice to any purchaser,
assignee or transferee of Intellectual Property pursuant to such exercise of remedies, that the applicable Intellectual Property is subject to
such license.
Section 2.09. Insurance . Unless and until written notice by the ABL Agent to each Term Loan Debt Agent that the Discharge of
Senior Secured Debt Obligations in respect of the ABL Debt Obligations has occurred, as between the ABL Agent, on the one hand, and any
Term Loan Debt Agent, on the other hand, only the ABL Agent will have the right (subject to the rights of the Grantors under the ABL Debt
Documents and the Term Loan Debt Documents) to adjust or settle any insurance policy or claim covering or constituting ABL Priority
Collateral in the event of any loss thereunder and to
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
23
approve any award granted in any condemnation or similar proceeding affecting the ABL Priority Collateral. Unless and until written notice
by each Term Loan Debt Agent to the ABL Agent that the Term Loan Debt Obligations have been paid in full, as between the ABL Agent,
on the one hand, and any Term Loan Debt Agent, on the other hand, only Term Loan Debt Agents will have the right (subject to the rights
of the Grantors under the ABL Debt Documents and the Term Loan Debt Documents) to adjust or settle any insurance policy covering or
constituting Term Priority Collateral in the event of any loss thereunder and to approve any award granted in any condemnation or similar
proceeding solely affecting Term Priority Collateral. To the extent that an insured loss covers or constitutes both ABL Priority Collateral
and Term Priority Collateral, then the ABL Agent and each Term Loan Debt Agent will work jointly and in good faith to collect, adjust or
settle (subject to the rights of the Grantors under the ABL Debt Documents and the Term Loan Debt Documents) under the relevant
insurance policy.
Section 2.10. Refinancing and Additional Secured Debt .
(a) The ABL Debt Obligations and the Term Loan Debt Obligations may be Replaced by any ABL Substitute Facility or First Lien
Term Loan Substitute Facility, as the case may be, in each case, without notice to or the consent of any Secured Party, all without affecting
the Lien priorities provided for herein or the other provisions hereof; provided , however , that each Term Loan Debt Agent and the ABL
Agent shall receive on or prior to the incurrence of the Replacement of an ABL Substitute Facility or First Lien Term Loan Substitute
Facility (i) an Officer’s Certificate from UNFI stating that (A) the Replacement is permitted by each applicable Secured Document to be
incurred, or to the extent a consent is otherwise required to permit the Replacement under any Secured Document, each Grantor has obtained
the requisite consent and (B) the requirements of Section 2.12 have been satisfied, and (ii) a Lien Sharing and Priority Confirmation Joinder
from the holders or lenders of any indebtedness that Replaces the ABL Debt Obligations or the applicable Term Loan Debt Obligations (or
an authorized agent, trustee or other representative on their behalf).
Each of the then-existing ABL Agent and Term Loan Debt Agent shall be authorized to execute and deliver such documents
and agreements (including amendments or supplements to this Agreement) as such holders, lenders, agent, trustee or other representative
may reasonably request to give effect to such Replacement, it being understood that the ABL Agent and each Term Loan Debt Agent,
without the consent of any other Secured Party, may amend, supplement, modify or restate this Agreement to the extent reasonably
necessary or appropriate to facilitate such amendments or supplements to effect such Replacement all at the expense of UNFI. Upon the
consummation of such Replacement and the execution and delivery of the documents and agreements contemplated in the preceding
sentence, the holders or lenders of such indebtedness and any authorized agent, trustee or other representative thereof shall be entitled to the
benefits of this Agreement.
(b) Each Grantor will be permitted to designate as an additional holder of Senior Secured Ob- ligations hereunder each Person who is or
who becomes the registered holder of Additional Term Loan Debt Obligations incurred by such Grantor after the date of this Agreement in
accordance with the terms of all applicable Secured Documents. Each Grantor may effect such designation by delivering to each Term Loan
Debt Agent and the ABL Agent, each of the following:
(i) an Officer’s Certificate stating that such Grantor intends to incur Additional
Term Loan Debt Obligations which will be permitted by each applicable Secured Document to be incurred and secured by a Term
Loan Debt Lien, and
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
24
(ii) the Additional Term Loan Debt Agent, on behalf of itself and the Additional
Term Loan Debt Secured Parties of the applicable Series must, prior to such designation, sign and deliver a Lien Sharing and
Priority Confirmation Joinder.
(c) Notwithstanding the foregoing, nothing in this Agreement will be construed to allow any Grantor to incur additional indebtedness
unless otherwise permitted by the terms of each applicable Se- cured Document.
(d) Subject to any Term Intercreditor Agreement among any Term Loan Debt Secured Parties, any Series of Additional Term Loan
Debt Obligations shall rank equal in right of security with the Term Loan Debt Obligations and any other Series of Additional Term Loan
Debt Obligations.
Section 2.11. Modification; No Interference .
(a) The ABL Secured Parties may agree to modify the terms of any of the ABL Debt Obligations and grant extensions of the time of
payment or performance to and make compromises (including releases of Liens on the ABL Priority Collateral or of guaranties) and
settlements with any and all Grantors and all other Persons, in each case, without the consent of the Term Loan Debt Secured Parties and
without affecting agreements of the Term Loan Debt Secured Parties in this Agreement. No ABL Secured Party may amend or waive any
provisions of the ABL Debt Documents in a manner that would result in a Default or an Event of Default under any Term Loan Debt
Documents; provided that in no event shall the ABL Secured Parties have any liability to any Term Loan Debt Secured Parties as a result of
such breach and, without limiting generality of the foregoing, the ABL Secured Parties shall not have any liability for tortious interference
with contractual relations or for inducement by the ABL Secured Parties of any Grantor to breach any contract or otherwise. Nothing
contained in this Section 2.11(a) shall limit, impair or waive any right that the Term Loan Debt Secured Parties have to enforce any of the
provisions of the Term Loan Debt Documents against any Grantor and the provisions of this Agreement against any ABL Secured Party.
(b) The Term Loan Debt Secured Parties may agree to modify the terms of any of their respective Term Loan Debt Obligations and
grant extensions of the time of payment or performance to and make compromises (including releases of Liens on Term Priority Collateral
or of guaranties) and settlements with any and all Grantors and all other Persons, in each case, without the consent of the ABL Secured
Parties and without affecting the agreements of the ABL Secured Parties in this Agreement. No Term Loan Debt Secured Party may amend
or waive any provisions of its respective Term Loan Debt Documents in a manner that would result in a Default or an Event of Default
under any ABL Debt Documents; provided that in no event shall the Term Loan Debt Secured Parties have any liability to any ABL Secured
Party as a result of such breach and, without limiting generality of the foregoing, the Term Loan Debt Secured Parties shall not have any
liability for tortious interference with contractual relations or for inducement by the Term Loan Debt Secured Parties of any Grantor to
breach any contract or otherwise. Nothing contained in this Section 2.11(b) shall limit, impair or waive any right that the ABL Secured
Parties have to enforce any of the provisions of the ABL Debt Documents against any Grantor and the provisions of this Agreement against
any Term Loan Debt Secured Party.
Section 2.12. Legends . Each Security Document shall (and, to the extent already in existence, shall be amended to) include a
legend, substantially in the form of Annex I , describing this Agreement.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
25
Section 2.13. Junior Secured Obligations Secured Parties Rights as Unsecured Creditors . Notwithstanding the provisions of
Sections 2.02 , 2.04(a) and 2.06(b) , (c) and (d) or otherwise, both before and during an Insolvency or Liquidation Proceeding, any of the
Junior Secured Obligations Secured Par- ties may take any actions and exercise any and all rights that would be available to a holder of
unsecured claims, including, without limitation, the commencement of an Insolvency or Liquidation Proceeding against any Grantor in
accordance with applicable law (including the Bankruptcy Laws of any applicable jurisdiction); provided that, the Junior Secured
Obligations Secured Parties may not take any of the actions prohibited by Section 2.02 , clauses (i) through (vii) of Section 2.04(a) or
Section 2.06(b) , (c) , (d)
and (e) ; provided further , that in the event that any of the Junior Secured Obligations Secured Parties be- comes a judgment lien creditor in
respect of any Collateral as a result of its enforcement of its rights as an unsecured creditor with respect to the Junior Secured Obligations,
such judgment lien shall be subject to the terms of this Agreement for all purposes (including in relation to the Senior Secured Obligations)
as the other Liens securing the Junior Secured Obligations are subject to this Agreement.
Section 2.14. No New Liens . So long as the Discharge of Senior Secured Debt Obligations with respect to any Senior Secured
Obligation has not occurred, whether or not any Insolvency or Liquidation Proceeding has been commenced by or against any Grantor, the
parties hereto agree that UNFI shall not, and shall not permit any other Grantor to, grant any Lien on any of its property, or permit any of its
Subsidiaries to grant a Lien on any of its property, to secure Junior Secured Obligations unless it, or such Subsidiary, has granted (or offered
to grant with a reasonable opportunity for such Lien to be accepted) a corresponding Lien on such property in favor of the holders of the
Senior Secured Obligations with respect to such property; provided , however , notwithstanding the foregoing, the refusal of any such holder
of Senior Secured Obligations to accept a Lien on any property of any Grantor shall not prohibit the taking of a Lien on such property by the
holders of Junior Secured Obligations. If any Secured Party shall acquire any Lien on any property of any Grantor or any of their respective
Subsidiaries constituting Junior Secured Obligations Collateral securing any Junior Secured Obligations which property is not also subject to
the Lien of the holders of Senior Secured Obligations with respect to such property, then such holders of Junior Secured Obligations shall,
without the need for any further consent of any other Person and notwithstanding anything to the contrary in any other Junior Document (x)
hold and be deemed to have held such Lien and security interest on such property for the benefit of the holders of Senior Secured
Obligations with respect to such property as security for the Senior Secured Obligations, or (y) if directed by the holders of the Senior
Secured Obligations with respect to such property constituting Senior Secured
Obligations Collateral, take any actions that are necessary to make such Lien subject to this Agreement
and provide the benefit of such Lien to the holders of the Senior Secured Obligations with respect to such property. To the extent any
additional Liens are granted on any asset or property pursuant to this Section 2.14 , the priority of such additional Liens shall be determined
in accordance with Section 2.01 . In addition, to the extent that the foregoing provisions are not complied with for any reason, and without
limiting any other rights and remedies available under this Agreement, the ABL Agent, each Term Loan Debt Agent and the Secured Parties
agree that any amounts received by or distributed to any of them pursuant to or as a result of Liens granted in contravention of this Section
2.14 shall be subject to Section 2.04(b) . Notwithstanding anything to the contrary in this Section 2.14, nothing in this Section shall require
any Grantor or Senior Secured Obligations Party to provide, or to facilitate providing, (x) a Junior Lien on any Real Estate Assets or
Collateral Proceeds Account in favor of the ABL Agent or (y) a Junior Lien on any Canadian Collateral or any Deposit Account that does
not constitute a Collateral Proceeds Account in favor of any Term Loan Debt Agent.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
26
Section 2.15. Set-Off and Tracing of and Priorities in Proceeds . Each Term Loan Debt Agent, on behalf of the Term Loan Debt Secured
Parties under the applicable Series, acknowledges and agrees that, to the extent any Term Loan Debt Agent or any Term Loan Debt Secured
Party exercises any rights of set-off against any ABL Priority Collateral (it being acknowledged and agreed that the Term Loan Debt Agent
does not, and shall not, have a Lien on the Canadian Collateral), the amount of such set-off shall be held and distributed pursuant to Section
2.04(b) . The ABL Agent, on behalf of the ABL Secured Parties, acknowledges and agrees that, to the extent the ABL Agent or any ABL
Secured Party exercises any rights of set-off against any Term Priority Collateral, the amount of such set-off shall be held and distributed
pursuant to Section 2.04(b) . The ABL Agent, for itself and on behalf of the ABL Secured Parties, and the Term Loan Debt Agents, for
themselves and on behalf of the Term Loan Debt Secured Par- ties under the applicable Series, further agree that prior to an issuance of any
Enforcement Notice with respect to the Senior Secured Obligations Collateral or the commencement of any Insolvency or Liquidation
Proceeding, any proceeds of Collateral, whether or not deposited under Account Agreements, which are used by any Grantor to acquire
other property which is Collateral shall not (solely as between the ABL Agent, the ABL Secured Parties, the Term Loan Debt Agents and
the Term Loan Debt Secured Parties) be treated as proceeds of Collateral for purposes of determining the relative priorities in the Collateral
which was so acquired. In addition, unless and until the Discharge of Senior Secured Debt Obligations occurs, the Term Loan Debt Agents
and the Term Loan Debt Secured Parties each hereby consents to the application, prior to the receipt by the ABL Agent of an Enforcement
Notice issued by any Term Loan Debt Agent, of cash or other proceeds of Collateral, deposited under Account Agreements to the repayment
of ABL Debt Obligations pursuant to the ABL Debt Documents; provided that after the receipt by the ABL Agent of an Enforcement Notice
from any Term Loan Debt Agent, any identifiable proceeds of Term Priority Collateral (whether or not deposited under Account
Agreements with the ABL Agent) shall be treated as Term Priority Collateral.
Section 2.16. Mixed Collateral Proceeds . Notwithstanding anything to the contrary in this Agreement (including in the definitions of ABL
Priority Collateral and Term Priority Collateral), in the event that proceeds of Collateral are received from (or are otherwise attributable to the
value of) a sale or other disposition of Collateral that involves a combination of ABL Priority Collateral and Term Priority Collateral, the
portion of such proceeds that shall be allocated as proceeds of ABL Priority Collateral for purposes of this Agreement shall be an amount
equal to the greater of (x) the net book value of such ABL Priority Collateral and (y) the liquidation or appraisal value of such ABL Priority
Collateral (except in the case of accounts and cash, which amount shall be equal to the face amount of such accounts and cash). In addition,
notwithstanding anything to the contrary contained above or in the definition of ABL Priority Collateral or Term Priority Collateral, to the
extent proceeds of Collateral are proceeds received from (or are otherwise attributable to the value of) the sale or disposition of all or
substantially all of the Capital Stock of any Subsidiary of a Borrower which is a Grantor, or all or substantially all of the assets of any such
Subsidiary, such proceeds shall constitute (1) first, in an amount equal to (x) the face amount of the accounts and cash owned by such
Subsidiary at the time of such sale and (y) the greater of the net book value and the liquidation or appraisal value of the inventory owned by
such Subsidiary at the time of such sale, ABL Priority Collateral and (2) second, to the extent in excess of the amounts described in preceding
clause (1) , Term Priority Collateral. In the event that amounts are received in respect of Capital Stock of or intercompany loans issued to any
Grantor in an Insolvency or Liquidation Proceeding, such amounts shall be deemed to be proceeds received from a sale or disposition of ABL
Priority Collateral and Term Priority Collateral and shall be allocated as proceeds of ABL Priority Collateral and Term Priority Collat- eral in
proportion to the ABL Priority Collateral and Term Priority Collateral owned at such time by the issuer of such Capital Stock.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
27
ARTICLE 3
G RATUITOUS B AILMENT FOR P ERFECTION OF C ERTAIN S ECURITY
I NTERESTS ; R IGHTS U NDER P ERMITS AND L ICENSES
Section 3.01. General . The ABL Agent and each Term Loan Debt Agent agrees and acknowl- edges that if it shall at any time hold
a Senior Lien on any Junior Secured Obligations Collateral that can be perfected by the possession or control of such Collateral or of any
account in which such Collateral is held, and if such Collateral or any such account is in fact in the possession or under the control of the
Senior Representative, the Senior Representative shall also hold such Collateral as gratuitous bailee for the Junior Representatives for the
sole purpose of perfecting the Junior Lien of the Junior Representatives on such Collateral. It is agreed that the obligations of the Senior
Representative and the rights of the Junior Representatives and the other Junior Secured Obligations Secured Parties in connection with any
such bailment arrangement will be in all respects subject to the provisions of Article 2 . Notwithstanding anything to the contrary herein, the
ABL Agent and each Term Loan Debt Agent will be deemed to make no representation as to the adequacy of the steps taken by it to perfect
the Junior Lien on any such Collateral and shall have no responsibility, duty, obligation or liability to the Junior Representatives or other
Junior Secured Obligations Secured Party or any other person for such perfection or failure to perfect, it being understood that the sole
purpose of this Article is to enable the Junior Secured Obligations Secured Par- ties to obtain a perfected Junior Lien in such Collateral to
the extent, if any, that such perfection results from the possession or control of such Collateral or any such account by the ABL Agent or any
Term Loan Debt Agent. Subject to Section 2.07 and to the ABL Agent or any Term Loan Debt Agent receiving such indemnifications as
shall be required by such ABL Agent or any Term Loan Debt Agent, from and after the associated Discharge of Senior Secured Debt
Obligations, the ABL Agent or any Term Loan Debt Agent, as applicable, shall take all such actions in its power as shall reasonably be
requested by any Junior Representative (at the sole cost and expense of the Grantors) to transfer possession of such Collateral in its
possession (in each case to the extent such Junior Representative has a Lien on such Collateral after giving effect to any prior or concurrent
releases of Liens) to such Junior Representative (and with respect to any Collateral constituting ABL Priority Collateral (other than
Canadian Collateral), to each Term Loan Debt Agent for the benefit of all applicable Junior Secured Obligations Secured Parties).
Section 3.02. Deposit Accounts .
(a) The Grantors, to the extent required by the ABL Credit Agreement, may from time to time establish deposit accounts (the “ Deposit
Accounts
”) with certain depositary banks in which collections from Inventory (as defined in the ABL Credit Agreement as of the date
hereof) and Accounts (as defined in the ABL Credit Agreement as of the date hereof) and other ABL Priority Collateral may be deposited.
To the extent that any such Deposit Account is under the control of the ABL Agent at any time and to the extent that any Term Loan Debt
Agent (on behalf of the applicable Term Loan Debt Secured Parties) has been granted a Lien on the property in such Deposit Account, the
ABL Agent will act as agent and gratuitous bailee for each such Term Loan Debt Agent for the purpose of perfecting the Liens of such Term
Loan Debt Secured Parties in such Deposit Accounts and the cash and other assets therein as provided in Section 3.01 (but will have no
duty, responsibility or obligation to such Term Loan Debt Secured Parties (including, without limitation, any duty, responsibility or
obligation as to the maintenance of such control, the effect of such arrangement or the establishment of such perfection). Unless the Junior
Liens on such ABL Priority Collateral shall have been or concurrently are released, after the occurrence of any Discharge of Senior Secured
Debt Obligations, the ABL Agent shall, to the extent that the same are then under the sole dominion and control of the ABL Agent and that
such action is otherwise within the power and authority of the ABL Agent pursuant to the ABL Debt Documents and to the extent that any
Term Loan Debt Agent (on
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#9116304v5
28
behalf of the applicable Term Loan Debt Secured Parties) has been granted a Lien on such property, at the request of any such Term Loan
Debt Agent, cooperate with Grantors and the other applicable Term Loan Debt Agents (at the expense of the Grantors) in permitting control
of any Deposit Accounts to be transferred to the Controlling Term Loan Debt Agent (or for other arrangements with respect to each such
Deposit Accounts satisfactory to each applicable Term Loan Debt Agent to be made). For the avoidance of doubt, this Section 3.02(a) shall
not apply to any Deposit Account, or property therein, that constitutes Canadian Collateral.
(b) The Grantors, the Representatives, the Secured Parties and all other parties hereto agree that only proceeds of the Term Priority
Collateral may be deposited in the Collateral Proceeds Account and agree to take all other actions necessary to give effect to the intent of
this Section 3.02(b) . Without limiting the generality of the foregoing, each Term Loan Debt Agent hereby agrees that if the Collateral
Proceeds Account contains any proceeds of the ABL Priority Collateral, it shall hold such proceeds in
trust for the ABL Secured Parties and transfer such proceeds the ABL Secured Parties reasonably promptly after obtaining actual knowledge
or notice from the ABL Secured Parties that it has possession of such proceeds in accordance with Section 2.04(b) . Each Term Loan Debt
Agent shall give written notice to the ABL Agent identifying the Collateral Proceeds Account.
Section 3.03. Rights under Permits and Licenses .
Each Term Loan Debt Agent agrees that if the ABL Agent shall require rights available under any permit or license
controlled by such Term Loan Debt Agent (as certified to such Term Loan Debt Agent by the ABL Agent, upon which such Term Loan
Debt Agent may rely) in order to realize on any ABL Priority Collateral, such Term Loan Debt Agent shall (subject to the terms of the Term
Loan Debt Documents, including such Term Loan Debt Agent’s rights to indemnification thereunder) take all such actions as shall be
available to it (at the sole expense of the Grantors subject to the reimbursement obligations set forth in the Term Loan Debt Documents),
consistent with applicable law and reasonably requested by the ABL Agent in writing, to make such rights available to the ABL Agent,
subject to the Term Loan Debt Liens. The ABL Agent agrees that if any Term Loan Debt Agent shall require rights available under any
permit or license controlled by the ABL Agent (as certified to the ABL Agent by such Term Loan Debt Agent, upon which the ABL Agent
may rely) in order to realize on any Term Priority Collateral, the ABL Agent shall (subject to the terms of the ABL Debt Documents,
including such ABL Agent’s rights to indemnification thereunder) take all such actions as shall be available to it (at the sole expense of the
Grantors subject to the reimbursement obligations set forth in the ABL Debt Documents), consistent with applicable law and reasonably
requested by such Term Loan Debt Agent in writing, to make such rights available to such Term Loan Debt Agent, subject to the ABL
Liens.
ARTICLE 4
E XISTENCE AND A MOUNTS OF L IENS AND O BLIGATIONS
Whenever a Representative shall be required, in connection with the exercise of its rights or the performance of its
obligations hereunder, to determine the existence or amount of any Senior Secured Obligations (or the existence of any commitment to
extend credit that would constitute Senior Se- cured Obligations) or Junior Secured Obligations (or the existence of any commitment to
extend credit that would constitute Junior Secured Obligations), or the existence of any Lien securing any such obligations, or the Collateral
subject to any such Lien, it may request that such information be furnished to it in writing by the other Representative or Representatives
and shall be entitled to make such determination on the basis of the information so furnished; provided , however , that if a Representative
shall fail or refuse reasonably promptly to provide the requested information, the
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#9116304v5
29
requesting Representative shall be entitled to make any such determination by such method as it may, in the exercise of its good faith
judgment, determine, including by reliance upon a certificate of UNFI, if any. Each Representative may rely conclusively, and shall be fully
protected in so relying, on any determination made by it in accordance with the provisions of the preceding sentence (or as otherwise
directed by a court of competent jurisdiction) and shall have no liability to the Grantors or any of their Subsidiaries, any Secured Party or
any other person as a result of such determination.
ARTICLE 5
C ONSENT OF G RANTORS
Each Grantor hereby consents to the provisions of this Agreement and the intercreditor arrangements provided for herein
and agrees that the obligations of the Grantors under the Security Documents will in no way be diminished or otherwise affected by such
provisions or arrangements (except as expressly provided herein).
ARTICLE 6
R EPRESENTATIONS AND W ARRANTIES
Section 6.01. Representations and Warranties of Each Party . Each party hereto represents and warrants to the other parties hereto
as follows:
(a) Such party is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization
and has all requisite power and authority to enter into and perform its obligations under this Agreement.
(b) This Agreement has been duly executed and delivered by such party.
(c) The execution, delivery and performance by such party of this Agreement (i) do not require any consent or approval of,
registration or filing with or any other action by any governmental authority of which the failure to obtain could reasonably be
expected to have a Material Adverse Effect (as defined in the ABL Credit Agreement as of the date hereof), (ii) will not violate any
applicable law or regulation or any order of any governmental authority or any indenture, agreement or other instrument binding
upon such party which could reasonably be expected to have a Material Adverse Effect and (iii) will not violate the charter, by-laws
or other organizational documents of such party.
Section 6.02. Representations and Warranties of Each Representative . Each of the Term Loan Debt Agents and the ABL Agent
represents and warrants to the other parties hereto that it is authorized under their respective Term Loan Debt Documents and the ABL
Credit Agreement, as the case may be, to enter into this Agreement.
ARTICLE 7
M ISCELLANEOUS
Section 7.01. Notices . All notices and other communications provided for herein shall be in writing and shall be delivered
by hand or overnight courier service, mailed by certified or registered mail or sent by telecopy, as follows:(a) if to the Original ABL
Agent, to Bank of America, N.A. at City Place I, 185 Asylum Street, Hartford, CT 06103, Attn: Edgar Ezerins, Telecopy: (860) 952-
6830, with a copy to Davis Polk and Wardwell LLP, 450 Lexington Avenue, New York, New York 10017, Attn: Jason Kyrwood,
Telecopy: (212) 450-5425;
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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(b) if to the Original First Lien Term Loan Agent, to it at Goldman Sachs Bank USA, [ ], with a copy to Davis Polk and
Wardwell LLP, 450 Lexington Avenue, New York, New York 10017, Attn: Jason Kyrwood, Telecopy: (212) 450-5425;
(c) if to the Grantors, to [ ]; with a copy to: Skadden, Arps, Slate, Meagher & Flom LLP, 4 Times Square, New York, New
York 10036, Attn: Steven M. Messina, Telecopy: (917) 777-3509; and
(d) if to any other Secured Debt Representative, to such address as specified in the
Lien Sharing and Priority Confirmation Joinder.
Any party hereto may change its address or telecopy number for notices and other communications here-under by notice to the other parties
hereto (and for this purpose a notice to UNFI shall be deemed to be a written notice to each Grantor). All notices and other communications
given to any party hereto in accordance with the provisions of this Agreement shall be deemed to have been given on the date of receipt (if a
Business Day) and on the next Business Day thereafter (in all other cases) at the address of such party as provided in this Section 7.01 or in
accordance with the latest unrevoked direction from such party given in accordance with this Section 7.01 . As agreed to in writing by and
among UNFI, on behalf of the Grantors, each Term Loan Debt Agent and the ABL Agent from time to time, notices and other
communications may also be delivered by e-mail to the e-mail address of a representative of the applicable person provided from time to
time by such person.
Section 7.02. Waivers; Amendment .
(a) No failure or delay on the part of any party hereto in exercising any right or power hereunder shall operate as a waiver thereof,
nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or
power, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of the parties
hereto are cumulative and are not exclusive of any rights or remedies that they would otherwise have. No waiver of any provision of this
Agreement or consent to any departure by any party therefrom shall in any event be effective unless the same shall be permitted by
paragraph (b) of this Section, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which
given. No notice or demand on any party hereto in any case shall entitle such party to any other or further notice or demand in similar or
other circumstances.
(b) Neither this Agreement nor any provision hereof may be terminated, waived, amended or modified except pursuant to an
agreement or agreements in writing entered into by each Representative and UNFI, on behalf of the Grantors (it being understood that the
consent of UNFI to any amendment or modification of this Agreement or any provision thereof shall only be required to the extent such
amendment or modification adversely affects or impairs the rights of any Borrower or any Grantor (including rights hereunder, under the
ABL Debt Documents and under the Term Loan Debt Documents) or imposes any additional, or modifies any existing, obligation or
liability upon any Borrower or any Grantor); provided , however , that this Agreement may be amended from time to time (x) as provided in
Section 2.10 and (y) at the sole request and expense of UNFI, and without the consent of any Representative, to add, pursuant to the Grantor
Intercreditor Agreement Joinder, additional Grantors whereupon such Person will be bound by the terms hereof to the same extent as if it
had executed and delivered this Agreement as of the date hereof. Any amendment of this Agreement that is proposed to be effected without
the consent of a Representative as permitted by the proviso to
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
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the preceding sentence shall be submitted to such Representative for its review at least 5 Business Days (or such shorter period as shall be
acceptable to such Representative) prior to the proposed effectiveness of such amendment; provided that no prior review shall be required
for the joinder of a Grantor pursuant to a joinder in the form of Exhibit A .
Section 7.03. Parties in Interest . This Agreement shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns, as well as the other Secured Parties, all of whom are intended to be bound by, and to be third party
beneficiaries of, this Agreement.
Section 7.04. Survival of Agreement . All covenants, agreements, representations and warran- ties made by any party in this
Agreement shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of this
Agreement.
Section 7.05. Counterparts . This Agreement may be executed in counterparts, each of which shall constitute an original but all of
which when taken together shall constitute a single contract. Delivery of an executed signature page to this Agreement by facsimile
transmission (or other electronic trans- mission) shall be as effective as delivery of a manually signed counterpart of this Agreement.
Section 7.06. Severability . Any provision of this Agreement held to be invalid, illegal or unenforceable in any jurisdiction shall, as
to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and
enforceability of the remaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate
such provision in any other jurisdiction. The parties shall endeavor in good-faith negotiations to replace the invalid, illegal or unenforceable
provisions with valid provisions the economic effect of which comes as close as possible to that of the invalid, illegal or unenforceable
provisions.
Section 7.07. Governing Law; Jurisdiction; Consent to Service of Process .
(a) This Agreement shall be construed in accordance with and governed by the laws of the State of New York.
(b) Each party hereto hereby irrevocably and unconditionally submits, for itself and its proper- ty, to the exclusive jurisdiction of the
Supreme Court of the State of New York sitting in New York, New York and of the United States District Court of the Southern District of
New York, and any appellate
court from any thereof, in any action or proceeding arising out of or relating to this Agreement, or for recognition or enforcement of any
judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such New York State or, to the extent permitted by law, in such federal court. Each of the
parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law. Nothing in this Agreement shall affect any right that any party hereto may
otherwise have to bring any action or proceeding relating to this Agreement in the courts of any jurisdiction.
(c) Each party hereto hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any
objection which it may now or hereafter have to the laying of
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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venue of any suit, action or proceeding arising out of or relating to this Agreement in any court referred to in paragraph (b) of this Section.
Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court. (d) Each party to this Agreement irrevocably consents to service of process in
the manner provided for notices in Section 7.01 . Nothing in this Agreement will affect the right of any party to this Agreement to serve
process in any other manner permitted by law.
Section 7.08. WAIVER OF JURY TRIAL . EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING
DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT. EACH PARTY HERETO (a) CERTIFIES
THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR
OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (b) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO
ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION.
Section 7.09. Headings . Article, Section and Annex headings used herein are for convenience of reference only, are not part of this
Agreement and are not to affect the construction of, or to be taken into consideration in interpreting, this Agreement.
Section 7.10. Conflicts .
(a) In the event of any conflict or inconsistency between the provisions of this Agreement and the provisions of any Secured
Documents, the provisions of this Agreement shall control.
(b) The parties hereto acknowledge, authorize and consent to the entry by the Term Loan Debt Agents into a Term Intercreditor
Agreement. In the event of any conflict or inconsistency between the provisions of this Agreement and the provisions of any Term
Intercreditor Agreement solely with respect to the rights and obligations of the Term Loan Debt Secured Parties to each other in respect of
the Term Loan Debt Collateral, the provisions of such Term Intercreditor Agreement shall control.
Section 7.11. Provisions Solely to Define Relative Rights . The provisions of this Agreement are and are intended solely for the
purpose of defining the relative rights of the ABL Secured Parties, on the one hand, and the Term Loan Debt Secured Parties, on the other
hand. None of the Grantors or any other creditor thereof shall have any rights or obligations hereunder, except as expressly provided in this
Agreement ( provided that nothing in this Agreement is intended to or will amend, waive or otherwise modify the provisions of the ABL
Debt Documents or the Term Loan Debt Documents), and no Grantor may rely on the terms hereof (other than Sections 2.05 , 2.06 , 2.10 ,
Article 3 , Article 6 and Article 7 ). Nothing in this Agreement is intended to or shall impair the obligations of Grantors, which are absolute
and unconditional, to pay the Obligations under the Secured Documents as and when the same shall be- come due and payable in accordance
with their terms. Notwithstanding anything to the contrary herein or in any Secured Document, the Grantors shall not be required to act or
refrain from acting (a) pursuant to this Agreement or any Term Loan Debt Document with respect to any ABL Priority Collateral in any
manner that would cause a default under any ABL Debt Document, or (b) pursuant to this
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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Agreement or any ABL Debt Document with respect to any Term Priority Collateral in any manner that would cause a default under any
Term Loan Debt Document.
Section 7.12. Certain Terms Concerning the ABL Agent and each Term Loan Debt Agent; Force Majeure .
(a) Neither the ABL Agent nor any Term Loan Debt Agent shall have any liability or respon- sibility for the actions or omissions of
any other Secured Party, or for any other Secured Party’s compli- ance with (or failure to comply with) the terms of this Agreement. Neither
the ABL Agent nor any Term Loan Debt Agent shall have individual liability to any Person if it shall mistakenly pay over or distribute to
any Secured Party (or the Grantors) any amounts in violation of the terms of this Agreement, so long as the ABL Agent or such Term Loan
Debt Agent, as the case may be, is acting in good faith. Neither the ABL Agent nor any Term Loan Debt Agent shall be responsible for or
liable for any failure or delay in the performance of its obligations under this Agreement arising out of or caused by, directly or indirectly,
forces beyond its reasonable control, including without limitation, strikes, work stoppages, accidents, acts of war or terrorism, civil or
military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or
computer (software or hardware) services.
(b) Each of the Term Loan Debt Agents and the ABL Agent is executing and delivering this Agreement solely in its capacity as agent
and in so doing, neither such Term Loan Debt Agent nor the ABL Agent shall be responsible for the terms or sufficiency of this Agreement
for any purpose. None of the Term Loan Debt Agents or the ABL Agent shall have any duties or obligations under or pursuant to this
Agreement other than such duties as may be expressly set forth in this Agreement as duties on its part to be performed or observed. In
entering into this Agreement, or in taking (or forbearing from) any action under or pursuant to this Agreement, each Term Loan Debt Agent
and the ABL Agent shall have and be protected by all of the rights, immunities, indemnities and other protections granted to it under the
ABL Debt Documents and the applicable Term Loan Debt Documents, as applicable.
Section 7.13. Canadian Loan Parties, Canadian Collateral and Real Estate Assets . This Agree- ment is intended to define the rights
and obligations of the parties with respect to Collateral held by both the ABL Agent on behalf of the ABL Secured Parties and the Term
Loan Debt Agent on behalf of the Term Loan Debt Secured Parties from any Borrower and any Grantor organized under the laws of the
United States of America. Nothing contained herein shall limit, modify or impair any rights that the ABL Agent and the ABL Secured
Parties may have with respect to the Canadian Loan Parties and the Canadian Collateral, each of which rights may be exercised by the ABL
Agent and the ABL Secured Parties with- out the consent of, or interference from, the Term Loan Debt Secured Parties and, in that regard,
the Term Loan Debt Agent and the Term Loan Debt Secured Parties shall not be entitled to any of the benefits of this Agreement in
connection therewith and the ABL Agent and ABL Secured Parties shall have no obligations to any Term Loan Debt Agent or the Term
Loan Debt Secured Parties with respect thereto. In addition, nothing contained herein shall limit, modify or impair any rights that the Term
Loan Debt Agent and the Term Loan Debt Secured Parties may have with respect to Real Estate Assets (except to the extent that any Real
Estate Assets become ABL Facility Collateral), each of which rights may be exercised by the Term Loan Debt Agent and the Term Loan
Debt Secured Parties without the consent of, or interference from, the ABL Secured Parties (except to the extent that any Real Estate Assets
become ABL Facility Collateral) and, in that regard (and except to the extent that any Real Estate Assets become ABL Facility Collateral),
the ABL Agent and the ABL Secured Parties shall not be entitled to any of the benefits of this Agreement in connection therewith and the
Term Loan Debt
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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Agent and the Term Loan Debt Secured Parties shall have no obligations to any ABL Agent or the ABL Secured Parties with respect
thereto.
[Remainder of this page intentionally left blank]
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly exe- cuted by their respective
authorized officers as of the day and year first above written.
BANK OF AMERICA, N.A. , as Original ABL Agent
By:______________________________
Name:
Title:
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91188051v13
Signature Page – Intercreditor Agreement
GOLDMAN SACHS BANK USA ,
as Original First Lien Term Loan Agent
By:______________________________
Name:
Title:
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91188051v13
Signature Page – Intercreditor Agreement
ACKNOWLEDGED AND AGREED :
UNITED NATURAL FOODS, INC. , as a Borrower and as a Grantor
By:______________________________
Name:
Title:
UNITED NATURAL FOODS WEST, INC. , as a Borrower and a Grantor
By:______________________________
Name:
Title:
as a Borrower and a Grantor
[ ] ,
By:______________________________
Name:
Title:
[ ] ,
as a Grantor
By:______________________________
Name:
Title:
[ ] ,
as a Grantor
By:______________________________
Name:
Title:
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91188051v13
Signature Page – Intercreditor Agreement
ANNEX I
Provision for the ABL Credit Agreement, the First Lien Term
Loan Agreement and any Additional Term Loan Debt Facility
Reference is made to the Intercreditor Agreement, dated as of [ ], 2018, by and among Bank of America, N.A., as Original ABL
Agent (as defined in the Intercreditor Agreement) for the ABL Se- cured Parties referred to therein, Goldman Sachs Bank USA, as
Original First Lien Term Loan Agent (as defined in the Intercreditor Agreement) for the First Lien Term Loan Secured Parties
referred to therein, each Additional Term Loan Debt Agent (as defined in the Intercreditor Agreement) for the Additional Term
Loan Debt Secured Parties referred to therein, United Natural Foods, Inc., United Natural Foods West, Inc., [ ], and the respective
Subsidiaries of United Natural Foods, Inc., United National Foods West, Inc. and [ ] party thereto (the “ Intercreditor
Agreement
”).
Each Lender (a) consents to the subordination of Liens provided for in the Intercreditor Agreement, (b) agrees that it will be bound
by, and will take no actions contrary to, the provisions of the Intercreditor Agreement and (c) authorizes and instructs the
Collateral Agent to enter into the Intercreditor Agreement on behalf of such Lender. The foregoing provisions are intended as an
inducement to the Lenders to extend credit to Borrowers or to acquire any notes or other evidence of any debt obligation owing
from the Borrowers and such Lenders are intended third party beneficiaries of such provisions and the provisions of the
Intercreditor Agreement.
Provision for all ABL Security Documents, Initial First Lien Term Loan Security Documents that Grant a Security Interest in Collateral
Reference is made to the Intercreditor Agreement, dated as of [ ], 2018, by and among Bank of America, N.A., as Original ABL
Agent (as defined in the Intercreditor Agreement) for the ABL Se- cured Parties referred to therein, Goldman Sachs Bank USA, as
Original First Lien Term Loan Agent (as defined in the Intercreditor Agreement) for the First Lien Term Loan Secured Parties
referred to therein, each Additional Term Loan Debt Agent (as defined in the Intercreditor Agreement) for the Additional Term
Loan Debt Secured Parties referred to therein, United Natural Foods, Inc., United Natural Foods West, Inc., [ ], and the respective
Subsidiaries of United Natural Foods, Inc., United National Foods West, Inc. and [ ] party thereto (the “ Intercreditor
Agreement
”)Intercreditor Agreement. Each Person that is secured hereunder, by accepting the benefits of the security provided hereby, (i)
consents (or is deemed to consent), to the subordination of Liens provided for in the Intercreditor Agreement, (ii) agrees (or is
deemed to agree) that it will be bound by, and will take no actions contrary to, the provisions of the Intercreditor Agreement, (iii)
authorizes (or is deemed to authorize) the Administrative Agent on behalf of such Person to enter into, and perform under, the
Intercreditor Agreement and (iv) acknowledges (or is deemed to acknowledge) that a copy of the Intercreditor Agreement was
delivered, or made available, to such Person.
Notwithstanding any other provision contained herein, this Agreement, the Liens created hereby and the rights, remedies, duties
and obligations provided for herein are subject in all respects to the provisions of the Intercreditor Agreement and, to the extent
provided therein, the applicable Security Documents (as defined in the Intercreditor Agreement). In the event of any conflict or
inconsistency between the provisions of this Agreement and the Intercreditor Agreement, the provisions of the Intercreditor
Agreement shall control.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91188051v13
Ann. I- 1
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-10.2.2- A-1
EXHIBIT A
to Intercreditor Agreement
[FORM OF]
GRANTOR INTERCREDITOR AGREEMENT JOINDER
[ ], 20[ ]
The undersigned, , a , hereby agrees to become party as a Grantor under (a) the Intercreditor Agreement, dated as of [ ], 2018, by and among
Bank of America, N.A., as Original ABL Agent (as defined in the Intercreditor Agreement) for the ABL Secured Parties referred to therein,
Goldman Sachs Bank USA, as Original First Lien Term Loan Agent (as de- fined in the Intercreditor Agreement) for the First Lien Term
Loan Secured Parties referred to therein, each Additional Term Loan Debt Agent (as defined in the Intercreditor Agreement) for the
Additional Term Loan Debt Secured Parties referred to therein, United Natural Foods, Inc., United Natural Foods West, Inc., [ ], and the
respective Subsidiaries of United Natural Foods, Inc., United National Foods West, Inc. and [ ] party thereto (as amended, restated, amended
and restated, supplemented or otherwise modified from time to time in accordance with the terms thereof, the “ Intercreditor
Agreement
”),
and (b) the Additional Term Loan Debt Security Documents (as defined therein), if any; for all purposes thereof on the terms set forth
therein, and to be bound by the terms of the Intercreditor Agreement as fully as if the undersigned had executed and delivered the
Intercreditor Agreement as of the date thereof.
The provisions of Article 7 of the Intercreditor Agreement will apply with like effect to this Grantor Intercreditor Agreement Joinder.
IN WITNESS WHEREOF, the parties hereto have caused this Intercreditor Agreement Joinder to be executed by their respective officers or
representatives as of the day and year first above written.
[ ]
By:______________________________
Name:
Title:
[Notice Address]
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
A-1
#91188051v13
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91188051v13
Signature Page – Intercreditor Agreement
EXHIBIT B
to Intercreditor Agreement
[FORM OF]
LIEN SHARING AND PRIORITY CONFIRMATION JOINDER
[ ], 20[ ]
Reference is made to the Intercreditor Agreement, dated as of [ ], 2018 (as amended, restated, amended and restated, supplemented or
otherwise modified from time to time in accordance with the terms thereof, the “ Intercreditor
Agreement
”) by and among Bank of
America, N.A., as Original ABL Agent for the ABL Secured Parties referred to therein; Goldman Sachs Bank USA, as Original First Lien
Term Loan Agent for the First Lien Term Loan Secured Parties referred to therein; each Additional Term Loan Debt Agent for the
Additional Term Loan Debt Secured Parties referred to therein; United Natural Foods, Inc., United Natural Foods West, Inc., [ ] and [ ].
Capitalized terms used but not otherwise defined herein shall have meaning set forth in the Intercreditor Agreement. This Lien Sharing and
Priority Confirmation Joinder is being executed and delivered pursuant to Section 2.10[a][b] of the Intercreditor Agreement as a condition
precedent to the debt for which the undersigned is acting as representative being entitled to the rights and obligations of being additional se-
cured debt under the Intercreditor Agreement.
1. Joinder . The undersigned, [ ], a [ ], (the “ New
Representative
”) as [trustee] [collateral trustee] [administrative agent] [collateral agent]
under that certain [ described applicable indenture, credit agreement or other document governing the additional secured debt ] hereby:
(a) represents that the New Representative has been authorized to become a party to the Intercreditor Agreement on behalf
of the [ABL Secured Parties under an ABL Substitute Facility] [Term Loan Debt Secured Parties under the First Lien Term Loan
Substitute Facility] [Additional Term Loan Debt Secured Parties under the Additional Term Loan Debt Facility] as [an ABL Agent
under an ABL Substitute Facility] [a Term Loan Debt Agent under a First Lien Term Loan Substitute Facility] [an Additional Term
Loan Debt Agent under an Additional Term Loan Debt Facility] under the Intercreditor Agreement for all purposes thereof on the
terms set forth therein, and to be bound by the terms of the Intercreditor Agreement as fully as if the undersigned had executed and
delivered the Intercreditor Agreement as of the date thereof; and
(b) agrees that its address for receiving notices pursuant to the Intercreditor Agreement shall be as follows:
[Address]
2. Lien Sharing and Priority Confirmation .
[ Option A: to be used if Additional Debt constitutes ABL Debt Obligations ] The undersigned New Representative, on behalf of
itself and each holder of ABL Debt Obligations for which the under- signed is acting as [collateral agent] hereby agrees, for the benefit of all
Secured Parties and each future Representative, and as a condition to being treated as ABL Debt Obligations under the Intercreditor
Agreement, that the New Representative is bound by the provisions of the Intercreditor Agreement, in-
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91163047v5
C-1
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91188051v13
Signature Page – Intercreditor Agreement
cluding the provisions relating to the ranking of ABL Liens and the order of application of proceeds from enforcement of Term Loan Debt
Liens [or]
[ Option B: to be used if Additional Debt constitutes a Series of Term Loan Debt Obligations ] The undersigned New
Representative, on behalf of itself and each holder of Obligations in respect of the Series of Term Loan Debt Obligations or Additional Term
Loan Debt Obligations [that constitutes a First Lien Term Loan Substitute Facility] for which the undersigned is acting as a Term Loan Debt
Agent hereby agrees, for the benefit of all Secured Parties and each future Secured Debt Representative, and as a condition to being treated
as Term Loan Debt Obligations under the Intercreditor Agreement, that the New Representative and each holder of Obligations in respect of
the Series of Term Loan Debt Obligations for which the undersigned is acting as Term Loan Debt Agent are bound by the provisions of the
Intercreditor Agreement, including the provisions relating to the ranking of Term Loan Debt Liens and the order of application of proceeds
from enforcement of Term Loan Debt Liens.
3. Governing Law and Miscellaneous Provisions . The provisions of Article 7 of the Intercreditor
Agreement will apply with like effect to this Lien Sharing and Priority Confirmation Joinder.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91163047v5
C-2
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91188051v13
Signature Page – Intercreditor Agreement
IN WITNESS WHEREOF, the parties hereto have caused this Lien Sharing and Priority Confirmation Joinder to be executed by their
respective officers or representatives as of the day and year first above written.
[insert name of New Representative]
By:______________________________
Name:
Title:
The Original Term Loan Debt Agent hereby acknowledges receipt of this Lien Sharing and Priority Confirmation Joinder and agrees to act
as a Term Loan Debt Agent for the New Representative and the holders of the Obligations represented thereby:
______________________________ ,
as Original Term Loan Debt Agent
By:______________________________
Name:
Title:
The Original ABL Agent hereby acknowledges receipt of this Lien Sharing and Priority Confirmation Joinder and agrees to act as ABL
Agent for the New Representative and the holders of the Obligations represented thereby:
______________________________ ,
as Original ABL Agent
By:______________________________
Name:
Title:
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91163047v5
C-3
EXHIBIT F
[ Ÿ
], 2018
[Name and Address of Obligor]
[BY CERTIFIED MAIL - RETURN RECEIPT REQUESTED & UPS NEXT DAY AIR]
To:
[Name and Address of Credit Card
Issuer/Processor] (the “ Processor ”)
Re: [OBLIGOR]
Merchant Account Numbers: [ Ÿ
]
Dear Sir/Madam:
[OBLIGOR], a [ Ÿ
] 1 with its principal executive offices at [ Ÿ
] 2 (the “ Company ”), among others, has entered into
separate financing agreements with each of (a) BANK OF AMERICA, N.A., a national banking association, with offices at
CityPlace I, 185 Asylum Street, Hartford, CT 06103, Attn: Edgar Ezerins, as administrative agent (in such capacity, together with
its successors and assigns, and any replacement agent pursuant to a replacement asset-based revolving credit financing, the “
Revolving Loan Agent ”) for its own benefit and the benefit of a syndicate of revolving loan lenders (together with their successors
and assigns, and any replacement credit parties pursuant to a replacement asset-based revolving credit financing, the “ Revolving
Loan Credit Parties ”), which are making loans or furnishing other financial accommodations to the Company and certain of its
affiliates (the “ Revolving Loan Facility ”), and (b) GOLDMAN SACHS BANK USA, having an office at 2001 Ross Ave., Dallas,
TX 75201, c/o Goldman Sachs Group, Inc., as administrative agent and collateral agent (in such capacities, together with its
successors and assigns, and any replacement agent pursuant to a replacement term loan credit financing, the “ Term Loan Agent ”)
for its own benefit and the benefit of a syndicate of term loan lenders (together with their successors and assigns, and any
replacement credit parties pursuant to a replacement term loan credit financing, the “ Term Loan Credit Parties ”), which are
making loans to UNITED NATURAL FOODS, INC., a Delaware corporation (the “ Lead Borrower ”) (the “ Term Loan Facility ”,
and together with the Revolving Loan Facility, the “ Facilities ”). Pursuant to the Facilities, the Company, among others, has
granted to the Revolving Loan Agent, for its own benefit and the benefit of the other Revolving Loan Credit Parties, and to the
Term Loan Agent, for its own benefit and the benefit of the other Term Loan Credit Parties, a security interest in and to certain of
the assets of the Company (the “ Collateral ”), including, among others, all credit and debit card charges submitted by the Company
to the Processor for processing and all amounts which the Processor owes to the Company on account thereof (the “ Credit Card
Proceeds ”).
________________________________
1 NTD: Insert corporate jurisdiction/organization.
2 NTD: Insert principal executive office address.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91163047v5
Pursuant to the [[ Ÿ
] dated [ Ÿ
]] 3 , (as amended, modified, supplemented or otherwise modified, and together with any
replacement agreement thereto, the “ Card Processing Agreement ”), between the Processor and the Company, the Processor acts as
the credit card processing service provider to the Company, and certain of its affiliates, in connection with sales that use credit
cards and debit cards.
For purposes of this credit card notification (the “ Credit Card Notification ”), the term “Lender Representative” shall mean
the Revolving Loan Agent until such time as the Revolving Loan Agent notifies the Processor in writing (at the Processor’s address
above or as otherwise designated by the Processor) that the Lender Representative shall be the Term Loan Agent, and on and after
delivery of such notice, the term “Lender Representative” shall mean the Term Loan Agent.
Notwithstanding anything to the contrary contained in the Card Processing Agreement, any other credit card notifications
delivered prior to the date hereof or any other prior instructions which may have been given to the Processor, effective as of the date
hereof, and until such time the Processor receives written instructions from the Lender Representative to the contrary, the Credit Car
Proceeds, pursuant to the Card Processing Agreement or otherwise, shall be transferred only as follows:
a.
By electronic wire transfer to one of the deposit accounts described on Schedule I hereto (and as such Schedule I may
be amended, modified, supplemented or otherwise modified from time to time in writing by an officer or director of
the Company and confirmed in writing by an officer or director of the Lender Representative), or
b.
As the Processor may be otherwise instructed from time to time in writing by an officer of the Lender Representative.
Upon written request by the Revolving Loan Agent or the Term Loan Agent, a copy of each periodic statement provided or
made available by the Processor to the Company shall be provided to the Lender Representative at the following address (which
address may be changed upon seven (7) days written notice given to the Processor by the Revolving Loan Agent or the Term Loan
Agent, as applicable):
If to Revolving Loan Agent :
Bank of America, N.A.
CityPlace I
185 Asylum Street
Hartford, CT 06103
Attn: Edgar Ezerins
Telecopy: (860) 952-6830
E-mail: edgar.ezerins@baml.com
_________________________
3 NTD: Insert title and date of applicable Credit Card Processing agreement.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91163047v5
Re: [ Ÿ
] 4
If to Term Loan Agent :
Goldman Sachs Bank USA
2001 Ross Ave. Dallas, TX 75201
c/o Goldman Sachs Group, Inc. Re: [ Ÿ
] 5
The Processor shall be fully protected in acting on any order or direction by the Lender Representative given in accordance
with the terms of this Credit Card Notification and with respect to the Credit Card Proceeds. The Processor shall not be required to
make any inquiry whatsoever as to either the Revolving Loan Agent’s or the Term Loan Agent’s right or authority to give such order
or direction or as to the application of any payment made pursuant thereto.
This Credit Card Notification may be amended solely by written notice executed by both the Company and the Lender
Representative, and may be terminated either by written notice executed by any officer or director of the Lender Representative, or
with respect to the Revolving Loan Facility, by written notice executed by the Company and consented to by the Revolving Loan
Agent.
[[ Ÿ
], as lender representative under that certain credit card notification, dated as of [ Ÿ
] (the “ Prior Credit Card
Notification ”), a copy of which has been delivered by the Company to the Processor, hereby terminates the Prior Credit Card
Notification.] 6
This Credit Card Notification may be executed and delivered by one or more of the parties to this Credit Card Notification on
any number of separate counterparts, including by facsimile, telecopier or other methods of electronic transmission, and all of said
counterparts taken together shall be deemed to constitute one and the same instrument.
THIS CREDIT CARD NOTIFICATION AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
__________________________________
4 NTD: Insert Obligor name.
5 NTD: Insert Obligor name.
6 NTD: Include if same accounts are subject to a previous Credit Card Notification.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91163047v5
Very truly yours, [OBLIGOR]
By: __________________________________
Name:
Title:
[[ Ÿ
]
as Lender Representative under the Prior
Credit Card Notification
By: __________________________________
Name:
Title:] 7
Acknowledged and agreed:
BANK OF AMERICA, N.A.
By: __________________________________
Name:
Title:
GOLDMAN SACHS BANK USA
By: __________________________________
Name: Title:
_______________________________________
7 NTD: Include if subject accounts are subject to a previous Credit Card Notification.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91163047v5
Schedule I
to
Credit Card Notification
Deposit Accounts
Bank
ABA#
Name on Account
Account #
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91207851v4
SCHEDULE 1.1(a)
COMMITMENTS OF LENDERS 1
U.S. Revolver
Commitment
$341,250,000.00
Canadian
Commitment
---
U.S. Letter of
Credit
Commitment
$35,000,000.00
Canadian
Letter of
Credit
Commitment
---
Commitment for
Swingline
Loans to U.S.
Borrowers
$100,000,000.00
Commitment
for Swingline
Loans to
Canadian
Borrower
---
---
$8,750,000.00
---
$5,000,000.00
---
$3,500,000.00
$341,250,000.00
---
$35,000,000.00
---
$8,750,000.00
---
$243,750,000.00
---
$25,000,000.00
---
---
---
---
---
---
---
---
---
Lender
Bank of
America, N.A.
Bank of
America, N.A.,
acting through
its Canada
Branch
Well Fargo
Bank, National
Association
Wells Fargo
Capital Finance
Corporation
Canada
JPMorgan
Chase Bank,
___________________
1 All amounts are in U.S. Dollars.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
1
$243,750,000.00
$48,750,000.00
N.A.
JPMorgan
Chase Bank,
N.A., Toronto
Branch
U.S. Bank
National
Association
U.S. Bank
National
Association,
acting through
its Canada
branch
Goldman Sachs
Bank USA
Branch
Banking and
Trust Company
BMO Harris
Financing, Inc.
Bank of
Montreal
Citizens Bank,
N.A.
TD Bank, N.A. $97,500,000.00
The Toronto-
Dominion
Bank
Royal Bank of
Canada
$97,500,000.00
$78,000,000.00
$97,500,000.00
$97,500,000.00
--- $6,250,000.00
---
--- $25,000,000.00
--- $6,250,000.00
---
$1,250,000.00
$5,000,000.00
$2,500,000.00
---
--- $2,500,000.00
$2,500,000.00
---
$2,500,000.00
$2,000,000.00
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
2
Credit Suisse
AG, Cayman
Islands Branch
PNC Bank,
National
Association
PNC Bank
Canada Branch
Capital One,
National
Association
Farm Credit
East, ACA
Coöperatieve
Rabobank
U.A., New
York Branch
City National
Bank
Total:
$48,750,000.00
$1,250,000.00
$48,750,000.00
---
---
$1,250,000.00
$48,750,000.00
$1,250,000.00
$48,750,000.00
$1,250,000.00
$48,750,000.00
$1,250,000.00
$19,500,000.00
$500,000.00
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
$1,950,000,000.00 $50,000,000.00
$125,000,000.00
$5,000,000.00
$100,000,000.00
$3,500,000.00
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91162358v46
3
SCHEDULE 1.1(b)
FISCAL PERIODS AND FISCAL QUARTERS
Fiscal 2019
9/1/2018
9/29/2018
10/27/2018
12/1/2018
12/29/2018
1/26/2019
3/2/2019
3/30/2019
4/27/2019
6/1/2019
6/29/2019
8/3/2019
Fiscal 2020
9/7/2019
10/5/2019
11/2/2019
12/7/2019
1/4/2020
2/1/2020
3/7/2020
4/4/2020
5/2/2020
6/6/2020
7/4/2020
8/1/2020
Fiscal 2021
9/5/2020
10/3/2020
Fiscal
2023
9/3/2022
10/1/2022
Q1
10/31/2020
Q1
10/29/2022
Q1
12/5/2020
1/2/2021
12/3/2022
12/31/2022
Q2
1/30/2021
Q2
1/28/2023
Q2
Q3
3/6/2021
4/3/2021
5/1/2021
6/5/2021
7/3/2021
3/4/2023
4/1/2023
Q3
4/29/2023
Q3
6/3/2023
7/1/2023
Q4
7/31/2021
Q4
7/29/2023
Q4
Fiscal 2022
9/4/2021
10/2/2021
Fiscal
2024
9/2/2023
9/30/2023
Q1
10/30/2021
Q1
10/28/2023
Q1
12/4/2021
1/1/2022
12/2/2023
12/30/2023
Q2
1/29/2022
Q2
1/27/2024
Q2
3/5/2022
4/2/2022
Q3
4/30/2022
Q3
6/4/2022
7/2/2022
3/2/2024
3/30/2024
4/27/2024
6/1/2024
6/29/2024
Q3
Q4
7/30/2022
Q4
8/2/2024
Q4
SCHEDULE 9.1.4
NAMES AND CAPITAL STRUCTURE
1. For, each Borrower and Subsidiary, the name, jurisdiction of organization, authorized and issued Equity Interests and record
holders of such Equity Interests (with the exception of the Equity Interests in UNFI) are as follows:
Jurisdiction
Number / Class
of Authorized Shares
Number / Class of Issued
Shares
Record Owner
Percent Ownership of
Issued Shares
Name
Borrowers
United Natural Foods,
Inc.
United Natural Foods
West, Inc.
UNFI Canada, Inc.
Subsidiaries
Delaware
California
Common – 100,000,000
Preferred – 5,000,000
Common – 50,410,808 2
Preferred – 0
N/A
Common – 100,000
Common – 1
Canada
Common – Unlimited
Common – 100
Albert’s Organics, Inc.
California
Blue Marble Brands,
LLC
Delaware
DS & DJ Realty, LLC
Florida
Fromages De France, Inc.
Gourmet Guru, Inc.
Natural Retail Group,
Inc.
California
New York
Delaware
Voting – 99,500
Non-Voting – 500
Voting – 579.36
Non-Voting – 0
N/A
N/A
N/A
N/A
Common – 200
Common – 200
Common – 10,000
Common – 1,000
Nor-Cal Produce, Inc.
California
Common-1,000
Common – 1,000
SCTC, LLC
Florida
Select Nutrition, LLC
Delaware
N/A
N/A
N/A
N/A
Tony’s Fine Foods
SUPERVALU INC.
Tutto Pronte
UNFI Transport, LLC
United Natural Trading,
LLC
California
Delaware
California
Delaware
Delaware
Common – 200,000
Common – 122,500
Common – 1,000
Common – 100
Common – 1,000
Common – 100
N/A
N/A
N/A
N/A
2 As of August 23, 2018.
* Information on file with the Borrowers.
United Natural Foods, Inc.
United Natural Foods, Inc.
United Natural Foods, Inc.
United Natural Foods, Inc.
(sole member)
United Natural Foods, Inc.
(sole member)
United Natural Foods, Inc.
United Natural Foods, Inc.
United Natural Foods, Inc.
United Natural Foods, Inc.
(sole member)
United Natural Foods, Inc.
(sole member)
United Natural Foods
West, Inc.
United Natural Foods, Inc.
Tony’s Fine Foods, Inc.
United Natural Foods, Inc.
(sole member)
United Natural Foods, Inc.
(sole member)
Common – 100
Common – 100
Tony’s Fine Foods, Inc.
N/A
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.4- 1
Name
Jurisdiction
Direct and Indirect Subsidiaries of SUPERVALU INC. 3
Number / Class
of Authorized Shares
Number / Class of Issued
Shares
Record Owner
Percent Ownership of
Issued Shares
Advantage Logistics -
Southeast, Inc.
Advantage Logistics
Southwest, Inc.
Advantage Logistics
USA East L.L.C.
Advantage Logistics
USA West L.L.C.
American Commerce
Centers, Inc.
Arden Hills 2003 L.L.C.
Associated Grocers
Acquisition Company
Associated Grocers of
Florida, Inc.
Billings Distribution
Company, LLC
Billings Equipment
Company, Inc.
Billings Operations
Company, LLC
Bismarck Distribution
Company, LLC
Bismarck Equipment
Company, Inc.
Bismarck Operations
Company, LLC
Blaine North 1996
L.L.C.
Blue Nile Advertising, Inc.
Burnsville 1998 L.L.C.
Butson Enterprises of
Vermont, Inc.
Butson’s Enterprises of
Massachusetts, Inc.
Alabama
Arizona
Delaware
Delaware
Florida
Delaware
Florida
Florida
Delaware
Delaware
Delaware
Delaware
Delaware
Delaware
Delaware
Florida
Delaware
Vermont
1,000 shares of common stock,
$0.01 par value
100 shares of common stock,
$0.01 par value
1,000 shares of common stock,
no par value
1,000 shares of common stock,
no par value
N/A
N/A
100 units
(uncertificated)
100 units
(uncertificated)
100,000 shares of common
stock, $0.01 par value
*
[***]
[***]
[***]
[***]
[***]
N/A
506 units
SUPERVALU INC.
100,000 shares of common
stock, $0.01 par value
10,000 shares of common
stock, $0.01 par value
*
*
N/A
1,000 units
5,000 shares of common stock,
$0.001 par value
1,000 shares of common stock,
$0.001 par value
N/A
N/A
1,000 units
1,000 units
5,000 shares of common stock,
$0.001 par value
1,000 shares of common stock,
$0.001 par value
N/A
N/A
100,000 shares of common
stock, $0.01 par value per
share
1,000 units
137.3619 units
SUPERVALU INC.
*
[***]
N/A
363.35 units
SUPERVALU INC.
500 shares of common stock,
no par value
300 shares of common stock,
no par value
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
Massachusetts
1,000 shares of common stock,
no par value
*
Butson’s Enterprises, Inc.
New Hampshire
7,500 shares of Class A voting
stock, $1.00 par value; 7,500
shares of Class B non-voting
stock, $1.00 par value
2,386 shares of Class A voting
stock, $1.00 par value; 2,500
shares of Class B non-voting
stock, $1.00 par value
Cambridge 2006 L.L.C.
[***]
Delaware
[***]
N/A
[***]
1,000 units
[***]
SUPERVALU INC.
[***]
100%
100%
100%
100%
100%
90%
100%
100%
100%
100%
100%
100%
100%
100%
70%
100%
77.5%
100%
100%
100%
100%
[***]
3
Information for direct and indirect Subsidiaries of Supervalu is current as of August 28, 2018 and is subject to change prior to the Closing Date pursuant to the
previously disclosed potential Supervalu interim reorganization.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.4- 2
Name
Jurisdiction
Number / Class
of Authorized Shares
Number / Class of Issued
Shares
Record Owner
Percent Ownership of
Issued Shares
Champaign Distribution
Company, LLC
Champaign Equipment
Company, Inc.
Champaign Operations
Company, LLC
Champlin 2005 L.L.C.
Coon Rapids 2002
L.L.C.
Delaware
Delaware
Delaware
Delaware
Delaware
Crown Grocers, Inc.
California
Cub Foods, Inc.
Cub Stores, LLC
Eagan 2008 L.L.C.
Eagan 2014 L.L.C.
[***]
Eastern Region Management
Corporation
Fargo Distribution
Company, LLC
Fargo Equipment
Company, Inc.
Fargo Operations
Company, LLC
FF Acquisition, L.L.C.
Foodarama LLC
Delaware
Delaware
Delaware
Delaware
[***]
Virginia
Delaware
Delaware
Delaware
Virginia
Delaware
Forest Lake 2000 L.L.C.
Delaware
Fridley 1998 L.L.C.
Delaware
Grocers Capital
Company
Hastings 2002 L.L.C.
Hazelwood Distribution
Company, Inc.
Hazelwood Distribution
Holdings, Inc.
Hazelwood Equipment
Company, Inc.
Hazelwood Wholesale
Company, LLC
California
Delaware
Delaware
Delaware
Delaware
Delaware
N/A
1,000 units
5,000 shares of common stock,
$0.001 par value
1,000 shares of common stock,
$0.001 par value
N/A
N/A
N/A
1,000 units
1,814.708 units
(uncertificated)
182.2658 units
(uncertificated)
100,000 shares (par value not
specified)
*
5,000 shares of common stock,
$0.01 par value
1,000 shares of common stock,
$0.01 par value
N/A
N/A
N/A
[***]
5,000 shares of stock,
$1.00 par value
1,000 units
166.719 units
(uncertificated)
536.9547 units
(uncertificated)
[***]
*
N/A
1,000 units
5,000 shares of common stock,
$0.001 par value
1,000 shares of common stock,
$0.001 par value
N/A
N/A
N/A
N/A
N/A
500,000 Class A shares, no par
value; 2,000,000
Class B shares, no par value;
24 Class C
shares, no par value
N/A
1,000 units
10 units
315 units
147.906 units
(uncertificated)
412.73 units
(uncertificated)
*
421.5499 units
(uncertificated)
[***]
[***]
[***]
SUPERVALU INC.
SUPERVALU INC.
[***]
[***]
[***]
SUPERVALU INC.
SUPERVALU INC.
[***]
[***]
[***]
[***]
[***]
[***]
[***]
SUPERVALU INC.
SUPERVALU INC.
[***]
SUPERVALU INC.
5,000 shares of common stock,
$0.01 par value
1,000 shares of common stock,
$0.01 par value
5,000 shares of common stock,
$0.01 par value
1,000 shares of common stock,
$0.01 par value
5,000 shares of common stock,
$0.001 par value
1,000 shares of common stock,
$0.001 par value
N/A
1,000 units
[***]
[***]
[***]
[***]
100%
100%
100%
100%
64%
100%
100%
100%
51%
51%
[***]
100%
100%
100%
100%
100%
100%
65%
82%
100%
51%
100%
100%
100%
100%
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.4- 3
Name
Jurisdiction
Number / Class
of Authorized Shares
Number / Class of Issued
Shares
Record Owner
Percent Ownership of
Issued Shares
Hopkins Distribution
Company, LLC
Hopkins Equipment
Company, Inc.
Hopkins Operations
Company, LLC
Hornbacher’s, Inc.
International Distributors
Grand Bahama Limited
Inver Grove Heights
2001 L.L.C.
Keatherly, Inc.
Keltsch Bros., Inc.
Lakeville 2014 L.L.C.
Maplewood East 1996
L.L.C.
Delaware
Delaware
Delaware
Delaware
N/A
1,000 units
5,000 shares of common stock,
$0.001 par value
1,000 shares of common stock,
$0.001 par value
N/A
1,000 units
5,000 shares of common stock,
$0.001 par value
120 shares of common stock,
$0.001 par value
Bahamas
5,000 shares, $1.00 each
4,999 shares, $1.00 each
[***]
[***]
[***]
[***]
[***]
Delaware
New
Hampshire
Indiana
Delaware
Delaware
N/A
375.03 units
SUPERVALU INC.
300 shares of common stock,
no par value; 300 shares of
Class common stock, no par
value
*
N/A
N/A
*
1,000 shares of common stock,
$1.00 par value
[***]
[***]
273.8863 units
(uncertificated)
SUPERVALU INC.
667 units
SUPERVALU INC.
Market Company, Ltd.
Bermuda
12,000 shares, $1.00 par value 12,000 shares, $1.00 par value
Market Improvement
Company
Florida
Monticello 1998 L.L.C.
Delaware
[***]
[***]
NC&T Supermarkets,
Inc.
Nevada Bond
Investment Corp. I
[***]
[***]
Ohio
Nevada
Northfield 2002 L.L.C.
Delaware
Oglesby Distribution
Company, LLC
Oglesby Equipment
Company, Inc.
Oglesby Operations
Company, LLC
Delaware
Delaware
Delaware
Plymouth 1998 L.L.C.
Delaware
Savage 2002 L.L.C.
SFW Holding Corp.
Delaware
Delaware
3,000 shares of Class A
common stock, $100 par
value; 7,000 shares of Class B
common stock,
$100 par value
N/A
[***]
[***]
*
449.2737 units
(uncertificated)
[***]
[***]
750 shares of common stock,
no par value
100 shares of common stock,
no par value
1,000 shares of common stock,
$0.01 par value
N/A
N/A
*
362.4074 units
(uncertificated)
1,000 units
5,000 shares of common stock,
$0.001 par value
1,000 shares of common stock,
$0.001 par value
N/A
N/A
N/A
1,000 units
279.90 units
(uncertificated)
113.2856 units
(uncertificated)
[***]
[***]
SUPERVALU INC.
[***]
[***]
[***]
[***]
SUPERVALU INC.
[***]
[***]
[***]
SUPERVALU INC.
SUPERVALU INC.
1,000 shares of common stock,
$0.01 par value
500 shares of common stock,
$0.01 par value
[***]
100%
100%
100%
100%
99.98%
100%
100%
100%
51%
100%
100%
100%
90%
[***]
[***]
100%
100%
51%
100%
100%
100%
62.5%
51%
100%
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.4- 4
Name
Jurisdiction
Number / Class
of Authorized Shares
Number / Class of Issued
Shares
Record Owner
Percent Ownership of
Issued Shares
Shop ‘N Save East
Prop, LLC
Shop ‘N Save East, LLC
Shop ‘N Save Prop, LLC
Shop ‘N Save St. Louis, Inc.
Shop ‘N Save
Warehouse Foods, Inc.
Shoppers Food
Warehouse Corp.
Delaware
Delaware
Delaware
Missouri
Missouri
Ohio
Shorewood 2001 L.L.C.
Delaware
Silver Lake 1996 L.L.C.
[***]
Stevens Point Distribution
Company, LLC
Stevens Point Equipment
Company, Inc.
Stevens Point Operations
Company, LLC
Sunflower Markets, LLC
Super Rite Foods Equipment
Company, Inc.
Super Rite Foods Operations
Company, LLC
Super Rite Foods, Inc.
SUPERVALU Enterprise
Services, Inc.
SUPERVALU Enterprises,
Inc.
SUPERVALU Gold, LLC
SUPERVALU Holdco, Inc.
SUPERVALU Holdings
Equipment Company, Inc.
Delaware
[***]
Delaware
Delaware
Delaware
Delaware
Delaware
Delaware
Delaware
Delaware
Delaware
Delaware
Delaware
Delaware
N/A
N/A
N/A
1,000 units
10,199,000 units
1,000 units
1,000 shares of common stock,
no par value
1,000 shares of common stock,
no par value
3,000 shares of common stock,
$10.00 par value
100 shares of common stock,
$10.00 par value
25,000 shares of Class A non-
voting common stock, $5.00
par value;
25,000 shares of Class
B voting common stock,
$5.00 par value
N/A
N/A
[***]
N/A
10,000 shares of Class
B voting common stock,
$5.00 par value
415 units
(uncertificated)
66.827748 units
(uncertificated)
[***]
1,000 units
5,000 shares of common stock,
$0.001 par value
1,000 shares of common stock,
$0.001 par value
N/A
N/A
1,000 units
100 units
(uncertificated)
5,000 shares of common stock,
$0.001 par value
1,000 shares of common stock,
$0.001 par value
N/A
1,000 units
3,000 shares of common stock,
no par value
1,000 shares of common stock,
$0.01 par value
5,000 shares of common stock,
$0.001 par value
1,000 shares of common stock,
$0.001 par value
[***]
[***]
[***]
[***]
[***]
[***]
SUPERVALU INC.
SUPERVALU INC.
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
57,142,857 shares of common
stock, $0.01 par value;
1,000,000
shares of preferred stock
1,000 shares of common stock,
$0.01 par value
SUPERVALU INC.
N/A
100 units
(uncertificated)
SUPERVALU INC.
5,000 shares of common stock,
$0.001 par value
1,000 shares of common stock,
$0.001 par value
5,000 shares of common stock
$0.001 par value
1,000 shares of common stock,
$0.001 par value
[***]
[***]
100%
100%
100%
100%
100%
100%
83%
51%
[***]
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.4- 5
Name
Jurisdiction
Number / Class
of Authorized Shares
Number / Class of Issued
Shares
Record Owner
Percent Ownership of
Issued Shares
SUPERVALU Holdings
Operations Company, Inc.
SUPERVALU Holdings
PA Equipment Company,
Inc.
SUPERVALU Holdings
PA Operations Company,
LLC
SUPERVALU Holdings,
Inc.
SUPERVALU Holdings
- PA LLC
SUPERVALU India, Inc.
SUPERVALU Licensing,
LLC
SUPERVALU Merger
Sub, Inc.
SUPERVALU Penn
Equipment Company, Inc.
SUPERVALU Penn
Operations Company, LLC
SUPERVALU Penn, LLC
SUPERVALU Pharmacies,
Inc.
SUPERVALU Receivables
Funding Corporation
SUPERVALU Services
USA, Inc.
SUPERVALU
Transportation, Inc.
SUPERVALU TTSJ, LLC
SUPERVALU WA, L.L.C.
SUPERVALU Wholesale
Equipment Company, Inc.
SUPERVALU Wholesale
Holdings, Inc.
SUPERVALU Wholesale
Operations, Inc.
SUPERVALU Wholesale,
Inc.
Minnesota
Delaware
Delaware
Delaware
Delaware
Pennsylvania
Minnesota
Delaware
Minnesota
Minnesota
Delaware
Delaware
Delaware
Delaware
Delaware
Delaware
Delaware
Delaware
5,000 shares of common stock
$0.001 par value
1,000 shares of common stock,
$0.001 par value
5,000 shares of common stock
$0.001 par value
1,000 shares of common stock,
$0.001 par value
Delaware
N/A
1,000 units
Missouri
100,000 shares of common
stock, $0.01 par value
1,001.5 shares of common
stock, $0.01 par value
Pennsylvania
N/A
10 units
1,000 shares of common stock,
no par value
1,000 shares of common stock,
no par value
N/A
1,000 units
[***]
[***]
[***]
[***]
[***]
[***]
[***]
5,000 shares of common stock,
$0.001 par value
1,000 shares of common stock,
$0.001 par value
SUPERVALU Enterprises,
Inc.
5,000 shares of common stock
$0.001 par value
1,000 shares of common stock,
$0.001 par value
N/A
N/A
10,000 shares of common
stock, $0.01 par value
1,000 shares of common stock
$10.00 par value
1,000 units
1,000 units
*
*
1,000 shares of common stock,
no par value
1,000 shares of common stock,
no par value
25,000 shares of common
stock, $0.01 par value
1,000 shares of common stock,
$0.01 par value
N/A
N/A
100 units
100 units
5,000 shares of common stock,
$0.001 par value
1,000 shares of common stock,
$0.001 par value
5,000 shares of common stock,
$0.001 par value
1,000 shares of common stock,
$0.001 par value
5,000 shares of common stock,
$0.001 par value
1,000 shares of common stock,
$0.001 par value
5,000 shares of common stock,
$0.001 par value
1,000 shares of common stock,
$0.001 par value
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.4- 6
Name
Jurisdiction
Number / Class
of Authorized Shares
Number / Class of Issued
Shares
Record Owner
Percent Ownership of
Issued Shares
SV Markets, Inc.
SVU Legacy, LLC
TC Michigan LLC
TTSJ Aviation, Inc.
Ohio
Delaware
Michigan
Delaware
Ultra Foods, Inc.
New Jersey
1,000 shares of common stock,
no par value
N/A
N/A
*
1,000 units
*
1,000 shares of common stock,
$0.001 par value
100 shares of common stock,
$0.001 par value
1,000 shares of common stock,
$1.00 par value
1,000 shares of common stock,
$1.00 par value
[***]
[***]
[***]
[***]
[***]
Unified Grocers, Inc.
California
Unified International, Inc.
W. Newell & Co.
Distribution Company, LLC
W. Newell & Co.
Equipment Company, Inc.
Delaware
Delaware
Delaware
500,000 Class A shares, no par
value; 2,000,000
Class B shares, no par value;
24 Class C
shares, no par value
3,000 shares of common stock,
$1.00 par value
*
*
SUPERVALU INC.
Unified Grocers, Inc.
N/A
1,000 units
5,000 shares of common stock,
$0.001 par value
1,000 shares of common stock,
$0.001 par value
W. Newell & Co., LLC
Delaware
Wetterau Insurance Co. Ltd.
WSI Satellite, Inc.
Bermuda
Missouri
N/A
*
30,000 shares of common
stock, $1.00 par value
100 units
(uncertificated)
*
*
[***]
[***]
[***]
[***]
[***]
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
2.
All agreements binding on holders of Equity Interests of Borrowers and Subsidiaries with respect to such Equity Interests
are as follows:
Cub Foods Limited Liability Company Agreements
Supervalu holds limited liability company membership interests in certain Delaware limited liability companies (the
“ Cub LLCs ”) that operate Cub® banner corporate retail stores. The membership interests of the Cub LLCs are
subject to certain rights of first refusal and other purchase and sale provisions pursuant to the following limited
liability company operating agreements:
•
•
•
•
Limited Liability Company Agreement of Blaine North 1996 L.L.C., dated as of July 29, 1996, by and
among Company, [***] and [***]
Limited Liability Company Agreement of Bloomington 1998 LLC, dated as of October 23, 1998, by and
between Company and [***]
Limited Liability Company Agreement of Burnsville 1998 LLC, dated as of October 23, 1998, by and
among Company, [***] , [***] , [***] , and [***]
Limited Liability Company Agreement of Coon Rapids 2002 LLC, dated as of May 22, 2002, by and
between Company and [***]
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.4- 7
• Amended and Restated Limited Liability Company Agreement of Eagan 2008 LLC, dated as of July 14,
2014, by and between Company and [***]
• Amended and Restated Limited Liability Company Agreement of Eagan 2014 LLC, dated as of July 14,
•
•
•
2014, by and between Company and [***]
Limited Liability Company Agreement of Forest Lake 2001 LLC, dated as of June 2001, by and between
Company and [***]
Limited Liability Company Agreement of Fridley 1998 LLC, dated as of October 23, 1998, by and between
Company and [***]
Limited Liability Company Agreement of Hastings 2002 LLC, dated as of May 16, 2002, by and between
Company and [***]
• Amended and Restated Limited Liability Company Agreement of Lakeville 2014 LLC, dated as of July 14,
•
•
•
2014, by and between Company and [***]
Limited Liability Company Agreement of Monticello 1998 LLC, dated as of December 4, 1998, by and
among Company, [***] and [***]
Limited Liability Company Agreement of Northfield 2002 LLC, dated as of March 7, 2002, by and between
Company and [***]
Limited Liability Company Agreement of Plymouth 1998 LLC, dated as of October 23, 1998, by and
between Company, [***] , [***] , [***] , [***] and [***]
• Amended and Restated Limited Liability Company Agreement of Savage 2002 LLC, dated as of July 14,
2014, by and between Company and [***]
• Amended and Restated Limited Liability Company Agreement of Shakopee 1997 LLC, dated as of July 14,
•
•
2014, by and between Company and R [***]
Limited Liability Company Agreement of Shorewood 2001 LLC, dated as of January 17, 2003, by and
between Company and [***]
Limited Liability Company Agreement of Silver Lake 1996 LLC, dated as of April 12, 1996, by and
between Company and [***]
[***]
[***]
[***]
3.
In the five years preceding the Closing Date, no Borrower or Subsidiary has acquired all or substantially all of the assets of any other
Person nor been the surviving entity in a merger, amalgamation or combination, except:
Albert’s Organics, Inc.
•
In March 2016, Albert’s Organics, Inc., acquired certain assets of Global Organic/Specialty Source, Inc., GO
Transportation, LLC and Gulfcoast Cold Storage, LLC.
• In February 2017, Achondo Transportation, Inc. (“ ATI ”) was merged into
Albert’s Organics, Inc.
Butson’s Enterprises, Inc.
•
In August 2015, Peoples Market, Incorporated, a New Hampshire corporation, was dissolved following the
liquidation of any of its remaining assets into [***] .
Foodarama LLC
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.4- 8
•
•
In February 2015, FF Construction LLC, a Virginia limited liability company, dissolved after the liquidation of any
of its remaining assets into [***] .
In February 2015, the following entities were dissolved after their assets were dissolved after the liquidation of any
remaining assets of such entities into [***] : (a) Foodarama, Inc., a Maryland corporation; (b) Food-A-Rama-G.U.,
Inc., a Maryland corporation; and (c) Foodarama Group, Inc., a Maryland corporation.
Shoppers Food Warehouse Corp.
•
In February 2015, SFW Licensing Corp., a Delaware corporation, dissolved after the liquidation of any of its remaining
assets into [***] .
SUPERVALU INC.
•
•
•
•
•
•
•
•
•
•
•
In February 2015, Richfood Holdings, Inc., a Delaware corporation (“ RHI ”), merged with and into Supervalu with
Supervalu as the surviving entity. Prior to such merger, Market Funding, Inc., a Delaware corporation, was dissolved
after the liquidation of any of its remaining assets into [***] .
In February 2015, the following entities Supervalu dissolved after the liquidation of any remaining assets of such entities
into [***] : (a) SUPERVALU Finance, Inc., a Minnesota corporation; (b) SUPERVALU Receivables, Inc., a Delaware
corporation; and (c) Valu Ventures, Inc., a Minnesota corporation.
In June 2015, Supermarket Operators of America, Inc., a Delaware corporation, merged with and into Supervalu with
Supervalu as the surviving entity.
In June 2016, Planmark Architecture of Oregon, P.C., an Oregon professional corporation, was dissolved following the
liquidation of any of its remaining assets into [***] .
In June 2016, Valu Ventures 2, Inc., an Indiana corporation (“ VV2 ”), was dissolved following the liquidation of any its
remaining assets into [***] , in August 2015, SUPERVALU Terre Haute Limited Partnership, an Indiana limited
partnership, was dissolved following the liquidation of any of its remaining assets into [***] .
In February 2017, Advantage Logistics USA, Inc., a Delaware corporation, merged with and into Supervalu with
Supervalu surviving.
In June 2017, Supervalu acquired Unified Grocers, Inc., a California corporation (“ UG ”), upon the merger of West
Acquisition Corporation, a California corporation and then wholly-owned subsidiary of Supervalu, with and into UG
with UG as the surviving entity.
In August 2017, the following entities were dissolved after liquidation of any remaining assets of such entities into [***] :
(a) Planmark, Inc. and (b) Risk
Planners, Inc.
In December 2017, Supervalu acquired Associated Grocers of Florida, Inc., a Florida corporation (“ AGF ”), upon the
merger of Gator Merger Sub Inc., a Florida corporation and then wholly-owned subsidiary of Supervalu, with and into
AGF with AGF as the surviving entity.
In March 2018, SUPERVALU Management Corp., a Delaware corporation, dissolved following the liquidation of its
assets into [***] .
SUPERVALU Holdings, Inc.
In February 2015, SV Ventures, an Indiana general partnership, dissolved following the liquidation of fifty percent
(50%) of any of its assets to each of
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.4- 9
•
•
•
•
•
[***] and [***] (the “ SV Ventures Liquidation ”).
In August 2015, R&M Kensoha LLC, a Delaware limited liability company, was dissolved following the liquidation of
any of its remaining assets into [***] .
In October 2015, SVH Holding, Inc., a Delaware corporation, merged with and into SV Holdings with SV Holdings
surviving.
In October 2015, SVH Realty, Inc., a Delaware corporation, merged with and into SV Holdings with SV Holdings
surviving.
In June 2016, the following entities were dissolved after liquidation of any remaining assets of such entities into [***] :
Advantage Logistics-PA LLC, a Pennsylvania limited liability company; (b) Livonia Holding Company, Inc., a
Michigan corporation; and (c) WC&V Supermarkets, Inc., a Vermont corporation.
In December 2016, Wetterau Finance Co., a Missouri corporation, was merged with and into SV Holdings with SV
Holdings as the surviving entity.
SUPERVALU Pharmacies, Inc.
•
In March 2018, the following entities were dissolved after liquidation of any remaining assets of such entities into [***] :
(a) Hornbacher’s Pharmacies, Inc., a Delaware corporation; and (b) Shop ‘N Save Pharmacies, Inc., a Delaware
corporation.
SUPERVALU TTSJ, LLC
•
In June 2018, SUPERVALU TTSJ, Inc., a Delaware corporation, converted into a Delaware limited liability company
pursuant to the laws of the State of Delaware.
Super Rite Foods, Inc.
•
•
•
•
•
In February 2015, Richfood, Inc., a Virginia corporation (“ RFI ”), merged with and into Super Rite Foods, Inc., a
Delaware corporation (“ SRF ”), with SRF as the surviving entity (the “ RFI Merger ”).
In February 2015, prior to the RFI Merger, the following entities were dissolved after the liquidation of any remaining
assets of such entities into [***] : (a) Rich-Temps, Inc., a Virginia corporation; (b) Market Insurance Agency, Inc., a
Virginia corporation; and (c) Market Improvement Corporation, a Virginia corporation.
In February 2015, following the RFI Merger, Market Brands, Inc., a Delaware corporation, dissolved following the
liquidation of any of its remaining assets into [***] .
In February 2015, following the RFI Merger, Richfood Procurement, L.L.C., a Virginia limited liability company,
merged with and into SRF with SRF as the surviving entity.
In June 2015, the following entities were dissolved after the liquidation of any remaining assets of such entities into [***] :
(a) Discount Books, Inc., a Delaware corporation; (b) G.W.M. Holdings, Inc., a Virginia corporation;
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.4- 10
United Natural Foods, Inc.
•
•
•
•
•
•
•
In September 2013, UNFI acquired all of the equity interest of Trudeau Foods, LLC (“ Trudeau Foods ”) from Trudeau
Holdings, LLC, a portfolio company of Arbor Investments II, LP. In June 2015, Trudeau Foods was dissolved into
UNFI.
In March 2016, UNFI acquired all the outstanding stock of Nor-Cal Produce, Inc. and an affiliated entity Achondo
Transportation, Inc. (“ ATI ”) along with substantially all the assets of Achondo Properties Limited Partnership, an
affiliated entity.
In August 2016, UNFI acquired all of the equity interest of Haddon House Food Products, Inc., (“ Haddon House ”)
along with its subsidiaries SCTC, LLC and DS & DJ Realty, LLC. In December 2016, Haddon House was dissolved into
UNFI.
In August 2016, Springfield Development, LLC was liquidated into UNFI.
In January 2017, Organic Food, LLC liquidated into UNFI Inc.
United Natural Foods West, Inc.
In May 2014, UNFW acquired all of the stock of Tony’s Fine Foods and their wholly owned subsidiaries Tutto Pronte
and Fromages De France (both dormant), a leading distributor of perishable food products.
In July 2015, United Natural Transportation Inc. was merged into UNFW.
UNFI Transport, LLC
•
In February 2016, UNFI Transport, LLC was formed as a transportation company for UNFI.
SCHEDULE 9.1.11
ROYALTIES; PATENTS, TRADEMARKS AND COPYRIGHTS
1. In the ordinary course of business, Supervalu and its Subsidiaries license, and pay licensee and maintenance fees for, the use of and
access to, various third-party software which is used in and necessary to the conduct of its business.
2. Registered Trademarks and Trademark Applications:
Owner
Trademark
SUPERVALU Licensing, LLC
1 2 3 4 FOR THE COMMUNITY
SUPERVALU Licensing, LLC
A FRESH TAKE ON VALUE
Status
App. Date
Registered
Sep-12-2008
Registered
Jan-6-2016
App. No.
77568464
86867130
Reg. Date
May-26-2009
Apr-4-2017
Reg. No
3626212
5177545
SUPERVALU Licensing, LLC
A SMART CHOICE FOR SAVINGS. DOLLAR
SMART
Registered
Apr-30-2003
78243633
Sep-20-2005
2996944
Country
USA
USA
USA
SUPERVALU Licensing, LLC
A TRADITION OF FRESH THINKING
Registered
Aug-23-2005
TMA738,288
Apr-17-2009
TMA738,288
Canada
Unified Grocers, Inc.
A WORLD OF DIFFERENCE
Registered
Jan-14-2014
SUPERVALU Licensing, LLC
ARCTIC SHORES SEAFOOD COMPANY
Registered
Dec-12-2011
SUPERVALU Licensing, LLC
ARCTIC SHORES SEAFOOD COMPANY
SUPERVALU Licensing, LLC
AWESOME
Registered
Registered
Jun-26-2006
Jan-2-2001
86165521
85492518
78916558
76191790
Mar-29-2016
Aug-7-2012
Feb-19-2008
Jun-4-2002
4927982
4185858
3386833
2576742
USA
USA
USA
USA
Unified Grocers, Inc.
Unified Grocers, Inc.
B.I.G. BETTER
INDEPENDENT GROCERS
B.I.G. BETTER
INDEPENDENT GROCERS
Registered
Jun-10-1983
16737
Jun-10-1983
16737
California
Registered
Oct-14-2016
121616
Oct-14-2016
121616
California
SUPERVALU Licensing, LLC
BABY BASICS
SUPERVALU Licensing, LLC
BASICS FOR KIDS
Registered
Apr-3-1995
Registered
Sep-28-2006
74655402
77009937
Mar-17-1998
Aug-28-2007
2144905
3284349
USA
USA
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.4- 11
Owner
Trademark
Status
App. Date
SUPERVALU Licensing, LLC
BASICS FOR KIDS
SUPERVALU Licensing, LLC
BASICS FOR KIDS
SUPERVALU Licensing, LLC
BEEF SPOKEN HERE
SUPERVALU Licensing, LLC
BUILDING ACTIVE RECOGNIZABLE
SERVICE
SUPERVALU Licensing, LLC
CARLITA
SUPERVALU Licensing, LLC
CHATTANOOGA CHICKEN
SUPERVALU Licensing, LLC
CHILL-A WHOLE NEW WAY!
SUPERVALU Licensing, LLC
CLEAR EXCELLENCE
SUPERVALU Licensing, LLC
COLOSSAL DONUTS
Unified Grocers, Inc.
COTTAGE HEARTH
SUPERVALU Licensing, LLC
COUNTRY STORE
SUPERVALU Licensing, LLC
COUNTY MARKET
SUPERVALU Licensing, LLC
COUNTY MARKET
SUPERVALU Licensing, LLC
COUNTY MARKET
SUPERVALU Licensing, LLC
COUNTY MARKET
SUPERVALU Licensing, LLC
COUNTY MARKET
SUPERVALU Licensing, LLC
COUNTY MARKET
Registered
Registered
Registered
Sep-28-2006
Nov-28-2007
Jan-16-2009
App. No.
77009933
77339460
77651039
Reg. Date
Aug-4-2009
Dec-16-2008
Sep-29-2009
Reg. No
3662314
3546072
3690577
Registered
Feb-9-1994
74488345
Apr-18-1995
1890123
Registered
Registered
Registered
Registered
Registered
Registered
Registered
Registered
Registered
Registered
Registered
Registered
Registered
Nov-4-2003
Jul-17-2003
Jul-14-2003
Apr-25-1997
Mar-28-2005
Nov-1-1993
Aug-14-2002
Jul-27-1981
Jul-27-1981
Jun-5-1981
Mar-19-1981
Jan-24-2006
Aug-20-2003
78322603
78275369
78273659
75281481
76634444
74452858
76440834
73320866
73320865
73313421
73301808
78797759
76541214
Mar-24-2009
Feb-8-2005
Nov-9-2004
Mar-10-1998
Mar-21-2006
Sep-20-1994
Apr-20-2004
Apr-17-1984
Apr-3-1984
Jun-19-1984
Aug-10-1982
Oct-17-2006
Aug-3-2004
3596476
2925006
2901673
2142810
3069978
1854786
2833752
1274441
1272976
1282825
1204794
3158766
2869022
Country
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 1
Owner
Trademark
SUPERVALU Licensing, LLC
COUNTY MARKET
SUPERVALU Licensing, LLC
COUNTY MARKET EXPRESS
SUPERVALU Licensing, LLC
COUNTY MARKET PHARMACY
SUPERVALU Licensing, LLC
COUNTYMARKET WE VALUE FRESH · WE
VALUE FAMILY WE V
Status
Registered
Registered
Registered
App. Date
Nov-5-2013
May-27-2004
Sep-10-2007
App. No.
86110206
78426383
77275565
Reg. Date
Jul-1-2014
Aug-9-2005
Apr-29-2008
Reg. No
4559698
2983260
3418110
Registered
Dec-14-2005
78773448
Apr-3-2007
3224488
SUPERVALU Holdings, Inc.
CRESTWOOD BAKERY
SUPERVALU Holdings, Inc.
CRESTWOOD BAKERY
SUPERVALU Holdings, Inc.
CRESTWOOD BAKERY
SUPERVALU INC.
SUPERVALU INC.
SUPERVALU INC.
SUPERVALU INC.
SUPERVALU INC.
SUPERVALU INC.
SUPERVALU INC.
SUPERVALU INC.
SUPERVALU INC.
SUPERVALU INC.
CUB
CUB
CUB
CUB
CUB DISCOUNT LIQUOR
CUB FOODS
CUB KINDNESS
CUB PHARMACY
CUB. FOR YOU LIFE
CUB’S BIG YUMMY
MUFFIN
Registered
Registered
Registered
Registered
Registered
Registered
Registered
Registered
Registered
Jul-18-2001
May-14-2002
Sep-9-2004
Sep-14-1981
Jul-30-2003
Sep-14-1981
Mar-15-1977
Jun-7-2002
Mar-15-1977
Pending
Apr-7-2017
76286974
76412256
78480726
73327957
78280644
73327958
73119200
76418275
73119207
87403476
Mar-12-2002
Mar-4-2003
Nov-15-2005
Jul-12-1983
Sep-14-2004
Jul-12-1983
Nov-22-1977
Sep-9-2003
Jan-17-1978
2547355
2693083
3015456
1245543
2884303
1245515
1078153
2762718
1082984
Registered
Registered
Nov-25-2002
78188657
Mar-9-2004
2821196
Apr-6-2018
1009778100034
Apr-6-2018
100977810003 4 Minnesota
Registered
Sep-24-2003
78304847
Nov-23-2004
2905017
USA
Country
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 2
Owner
Trademark
SUPERVALU Licensing, LLC
CULINARY CIRCLE
SUPERVALU Licensing, LLC
CULINARY CIRCLE
SUPERVALU Licensing, LLC
CULINARY CIRCLE
SUPERVALU Licensing, LLC
CULINARY CIRCLE
SUPERVALU Licensing, LLC
CULINARY CIRCLE
Status
Registered
Registered
Pending
Pending
Pending
App. Date
Apr-9-2008
Nov-30-2016
App. No.
77443676
87252617
Reg. Date
Dec-8-2009
Oct-3-2017
Reg. No
3723156
5303359
Apr-13-2018
2018/0027295
Jan-18-2018
2643/2018
Jan-9-2018
87748519
SUPERVALU Licensing, LLC
CULINARY CIRCLE
Pending
Jan-17-2018
2018-2242
SUPERVALU Licensing, LLC
CULINARY CIRCLE
Pending
Feb-7-2018
263968-01
SUPERVALU Licensing, LLC
CULINARY CIRCLE FOOD LOVER’S
FOOD
Registered
May-30-2008
77487463
Apr-28-2009
3613669
SUPERVALU Licensing, LLC
EQUALINE
Registered
Mar-5-2004
78379410
Nov-28-2006
3177770
SUPERVALU Licensing, LLC
ESSENTIAL 9.5
Pending
May-15-2018
87922087
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
ESSENTIAL EVERYDAY
Registered
Registered
Sep-6-2011
Oct-29-2010
Pending
Jan-4-2018
Registered
Registered
Registered
Nov-18-2014
Jan-16-2012
Jan-16-2012
85416015
85165277
148/2018
86457152
10426015
10426017
Apr-23-2013
Jan-1-2013
4325174
4268741
May-26-2015
Jun-21-2013
May-14-2013
4743723
10426015
10426017
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
Pending
Feb-17-2017
2017-0001478
Country
USA
USA
Colombia
Honduras
USA
Dominican
Republic
Panama
USA
USA
USA
USA
USA
Honduras
USA
China
China
Costa Rica
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 3
Owner
Trademark
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
Status
Pending
Pending
Pending
Pending
Pending
Pending
Pending
Pending
Registered
Registered
Registered
Registered
Registered
Registered
Registered
Registered
Registered
App. Date
App. No.
Reg. Date
Reg. No
Country
Feb-1-2017
2017000868
Feb-1-2017
2017000869
Feb-1-2017
2017008070
Feb-1-2017
2017000871
Feb-1-2017
2017000872
Feb-1-2017
2017000873
Feb-1-2017
2017000874
Feb-2-2017
2017000912
Jan-16-2012
Oct-29-2010
Jan-16-2012
Jan-16-2012
Jan-16-2012
Jan-16-2012
Jan-16-2012
Jan-16-2012
Jan-16-2012
10426011
85977016
10426016
10426182
10426183
10426185
10426186
10426187
10426188
Jun-7-2013
Aug-28-2012
Mar-21-2013
Mar-28-2013
Mar-21-2013
Mar-21-2013
Mar-21-2013
Mar-21-2013
Mar-21-2013
10426011
4200134
10426016
10426182
10426183
10426185
10426186
10426187
10426188
Guatemala
Guatemala
Guatemala
Guatemala
Guatemala
Guatemala
Guatemala
Guatemala
China
USA
China
China
China
China
China
China
China
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 4
Owner
Trademark
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
Status
Registered
Registered
Registered
Registered
Registered
Registered
Registered
Registered
Registered
Registered
Registered
Registered
Registered
Registered
Pending
Pending
Pending
App. Date
Jan-16-2012
Jan-20-2012
Jan-16-2012
Jan-16-2012
Jan-16-2012
Jan-16-2012
Jan-16-2012
Jan-16-2012
Jan-16-2012
Jan-16-2012
Jan-20-2012
Jan-16-2012
Feb-2-2017
Feb-6-2017
App. No.
10426191
10445522
10426012
10426014
10426184
10426190
10426008
10426009
10426010
10426013
10445523
10426189
1348340
1348340
Reg. Date
Mar-21-2013
Mar-28-2013
Mar-21-2013
Mar-21-2013
Apr-21-2013
Apr-21-2013
Apr-28-2013
Apr-28-2013
Apr-28-2013
Apr-28-2013
Mar-28-2013
Mar-21-2013
Feb-6-2017
Feb-6-2017
Reg. No
10426191
10445522
10426012
10426014
10426184
10426190
10426008
10426009
10426010
10426013
10445523
10426189
1348340
134830
Jan-31-2017
87319498
Apr-27-2017
304123205
Feb-17-2017
256430-01
Country
China
China
China
China
China
China
China
China
China
China
China
China
WIPO
Australia
USA
Hong Kong
Panama
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 5
Owner
Trademark
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
Status
Pending
Pending
Pending
Pending
Pending
Pending
Pending
Pending
Pending
Pending
Pending
Pending
Pending
Pending
Pending
Pending
Pending
App. Date
App. No.
Reg. Date
Reg. No
Country
Feb-17-2017
256428-01
256425-01
Feb-17-2017
256424-01
Feb-17-2017
256423-01
Feb-17-2017
256422-01
Feb-17-2017
256421-01
Feb-17-2017
256420-01
Feb-23-2017
DID2017008632
Feb-23-2017
DID2017008633
Feb-23-2017
DID2017008634
Feb-23-2017
DID2017008635
Feb-23-2017
DID2017008636
Feb-23-2017
DID2017008644
Feb-23-2017
DID2017008645
Feb-23-2017
DID2017008646
Feb-10-2017
2017052182
Feb-10-2017
2017052162
Panama
Panama
Panama
Panama
Panama
Panama
Panama
Indonesia
Indonesia
Indonesia
Indonesia
Indonesia
Indonesia
Indonesia
Indonesia
Malaysia
Malaysia
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 6
Owner
Trademark
Status
App. Date
App. No.
Reg. Date
Reg. No
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
Pending
Feb-10-2017
2017052160
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
Pending
Feb-10-2017
2017052157
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
Pending
Feb-10-2017
2017052152
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
Pending
Feb-10-2017
2017052147
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
Pending
Feb-10-2017
2017052142
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
Pending
Feb-10-2017
2017052140
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
Pending
Dec-28-2017
2017-48391
Country
Malaysia
Malaysia
Malaysia
Malaysia
Malaysia
Malaysia
Dominican
Republic
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
Registered
Feb-3-2017
1240848
Feb-3-2017
1240848
Chile
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
Pending
Feb-6-2017
1348340
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
Pending
Pending
Feb-6-2017
1348340
Feb-2-2017
2017-000912
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
Registered
Feb-6-2017
Republic of
Korea (South)
Singapore
Guatemala
Feb-6-2017
1348340
Colombia
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
SUPERVALU Licensing, LLC
ESSENTIAL EVERYDAY
Pending
Pending
Feb-6-2017
1348340
1348340
Feb-6-2017
1348340
SUPERVALU Holdings, Inc.
F
Registered
Apr-13-1966
72243313
Oct-1-1968
0858088
Unified Grocers, Inc.
FAMILY GROCER
SUPERVALU Licensing, LLC
FARM FRESH
Registered
Registered
Jul-16-1990
19942
Jul-16-1990
19942
Washington
Jan-26-2010
77920049
Aug-31-2010
3840836
USA
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 7
New Zealand
Philippines
United States of
America
Owner
Trademark
SUPERVALU Licensing, LLC
FARM FRESH
SUPERVALU Licensing, LLC
FARM FRESH
SUPERVALU Licensing, LLC
FARM FRESH FOOD & PHARMACY
SUPERVALU Licensing, LLC
FARM STAND
SUPERVALU Licensing, LLC
FARMSTAND
SUPERVALU Holdings, Inc.
FESTIVAL FOODS
SUPERVALU Holdings, Inc.
FESTIVAL FOODS
SUPERVALU Holdings, Inc.
FESTY BURGER
SUPERVALU Licensing, LLC
FLAVORITE
SUPERVALU Licensing, LLC
FOOD RITE
SUPERVALU Holdings, Inc.
FOODLAND
SUPERVALU Holdings, Inc.
FOODLAND
SUPERVALU Holdings, Inc.
FOODLAND
SUPERVALU Holdings, Inc.
FOODLAND EXPRESSSS PAPA’S PEPPERONI
ROLL
SUPERVALU Holdings, Inc.
FOODLAND EXPRESSSSSS
SUPERVALU Holdings, Inc.
FOODLAND FRESH
SUPERVALU Holdings, Inc.
FOODLANE
Status
Registered
Registered
Registered
App. Date
Dec-7-1981
Dec-3-1984
Mar-8-2006
Registered
Apr-11-1966
Registered
Jun-10-1997
Registered
Apr-11-2002
Registered
Apr-11-2002
App. No.
73340382
73511769
78831950
72243140
75305979
76393963
76393962
Reg. Date
Jun-20-1989
Oct-31-1989
Jan-2-2007
May-7-1968
Oct-23-2001
Feb-18-2003
Feb-18-2003
Reg. No
1544928
1563627
3193865
0848743
2499262
2688438
2688437
Country
USA
USA
USA
USA
USA
USA
USA
Registered
Mar-5-2008
20085801559
Mar-5-2008
20085801559
Wisconsin
Registered
Aug-15-2002
Registered
Apr-9-1998
Registered
Oct-11-1991
Registered
Mar-6-1963
Registered
Oct-19-1966
78154616
75464879
74211325
72164032
72256732
Mar-21-2006
Dec-7-1999
Aug-11-1992
Feb-16-1965
Apr-30-1968
3070033
2297583
1707516
0785369
0848268
Registered
Jun-24-2003
78266354
Jul-27-2004
2866771
Registered
Registered
Jan-22-2003
Nov-4-2008
Registered
Sep-12-1977
78205748
77606585
73140907
Oct-5-2004
Jun-16-2009
Nov-7-1978
2891171
3638580
1105820
USA
USA
USA
USA
USA
USA
USA
USA
USA
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 8
Owner
Trademark
SUPERVALU Licensing, LLC
FRESH EVENTS BY FARM FRESH
SUPERVALU Licensing, LLC
FRESH PRODUCE. FRESH PRICES.
Status
App. Date
Registered
Mar-19-2008
Registered
Sep-21-2011
App. No.
77426307
85427816
Reg. Date
Dec-30-2008
May-1-2012
Reg. No
3553229
4135526
SUPERVALU Licensing, LLC
FRESHNESS YOU DESERVE. SAVINGS YOU
EXPECT.
Registered
Oct-17-2013
86093700
May-27-2014
4537543
SUPERVALU Licensing, LLC
FROSTED FRUITY
Registered
Feb-11-1991
SUPERVALU Licensing, LLC
FUEL EXPRESS AT FARM FRESH
SUPERVALU Licensing, LLC
GOLDEN AGAVE
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
GOLDEN CREME
GOLDEN CREME
GOLDEN CREME
GOLDEN CREME
SUPERVALU Licensing, LLC
GOLDEN CRÈME AND COW WITH SUN
DESIGN
SUPERVALU Licensing, LLC
GOOD THINGS IN-STORE
SUPERVALU Licensing, LLC
GOTTA LOVE A SALE
SUPERVALU Licensing, LLC
GOTTA LOVE GREAT DEALS
SUPERVALU Licensing, LLC
GOTTA LOVE LOW PRICES
Unified Grocers, Inc.
GRAND REWARDS
SUPERVALU Licensing, LLC
GREAT VALU
Registered
Registered
Registered
Registered
Registered
Registered
Dec-9-2014
Jul-24-1995
Jul-31-1998
Nov-1-1993
Dec-8-1992
Dec-8-1992
74137972
86474919
74705394
75529734
74452859
156320
156319
Pending
4/3/2018
87860829
Registered
Nov-20-2009
Registered
Registered
May-1-2012
May-1-2012
Registered
Mar-26-2012
Registered
Apr-22-1998
Registered
Sep-9-1997
77877407
85613356
85613374
85580040
75472280
75354182
Sep-24-1991
Feb-2-2016
Oct-29-1996
Aug-3-1999
Jun-10-1997
Jul-30-1996
Oct-9-1996
Oct-5-2010
Dec-25-2012
Dec-25-2012
Dec-4-2012
Jul-11-2000
Dec-28-1999
1870706
4894352
2011671
2267318
2068201
527406
533627
3858219
4265850
4265851
4255398
2367184
2303297
Country
USA
USA
USA
USA
USA
USA
USA
USA
Mexico
Mexico
USA
USA
USA
USA
USA
USA
USA
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 9
Owner
Trademark
Status
App. Date
App. No.
Reg. Date
Reg. No
Country
SUPERVALU Licensing, LLC
GROCERIES AT THE SPEED OF LIFE
Pending
Oct-11-2016
87199441
SUPERVALU Licensing, LLC
HEALTHY PURSUITS
Registered
Aug-11-2008
77543959
Jun-2-2009
3633012
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
HEALTHY SHELVES
HEALTHY SHELVES
HEALTHY SHELVES
HEALTHY SOLUTIONS
SUPERVALU Licensing, LLC
HERITAGE & CROWN Design
SUPERVALU Licensing, LLC
HOMELIFE
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Hornbacher’s, Inc.
Hornbacher’s, Inc.
HOMETOWN FRESH
HOMETOWN FRIENDLY
HOMETOWN HEROES
HORNBACHER’S
HORNBACHER’S
PHARMACY
Hornbacher’s, Inc.
HORNBACHER’S FOODS
SUPERVALU Licensing, LLC
IDEAL PORTIONS
SUPERVALU Licensing, LLC
INDEPENDENT MINDED
Unified Grocers, Inc.
IOS
Registered
Nov-19-2012
Registered
Jan-15-2013
Registered
Nov-19-2012
Registered
May-18-2010
Registered
Mar-23-2012
Registered
Feb-16-2009
Registered
Sep-14-2009
Registered
Sep-14-2009
Registered
Sep-14-2009
Registered
Aug-16-2005
42502
68377
55691
85041933
85578920
77669620
77826239
77826234
77826230
78693658
Nov-19-2012
Jan-15-2013
Nov-19-2012
Nov-6-2012
Aug-15-2017
Mar-22-2011
Nov-23-2010
Nov-23-2010
Nov-16-2010
Sep-19-2006
42502
68377
55691
4238125
5263145
3934926
3881229
3881228
3877908
3144939
Registered
Mar-31-2015
86581997
Jan-19-2016
4888241
Registered
Registered
Registered
Registered
Jan-29-2003
Jun-5-2012
Nov-3-2008
Jun-27-2005
78208216
85643082
77606199
76641770
Jul-13-2004
Jun-4-2013
Jul-14-2009
Jan-1-2008
2862615
4348018
3655855
3361179
USA
USA
Oregon
California
Washington
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 10
Owner
Trademark
SUPERVALU Licensing, LLC
JAVA DELIGHT
SUPERVALU Licensing, LLC
JENICA PEAK
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
KITCHEN CHEF
KITCHEN CHEF SIGNATURE
KITCHEN CHEF SIGNATURE
LA CORONA
LIMONAZO
SUPERVALU Licensing, LLC
MAPLEWOOD FARMS
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
MARKET CENTRE
MARKET CENTRE and DESIGN
MARKET PLACE
MEGA FOODS
MEMBERLINK
MERCADO SAVINGS! and SHOPPING CART
DESIGN
SUPERVALU Licensing, LLC
METOLIUS RIVER ALES
SUPERVALU Licensing, LLC
METRO
SUPERVALU Licensing, LLC
MIGHTY
Status
App. Date
Registered
Aug-23-2007
Registered
Jul-20-2001
Registered
Oct-24-2016
Registered
Registered
Jun-3-2008
Jun-17-2016
App. No.
77262711
76288057
87213947
77490207
87076052
Pending
Aug-13-2014
86366046
Registered
Oct-24-2016
Registered
Registered
Aug-9-2010
Jan-19-2016
Registered
Nov-30-2005
Registered
Jun-5-1997
Registered
May-21-2003
87213909
85102840
86880073
78980835
26170
31576
Reg. Date
Apr-29-2008
Dec-23-2003
Jun-13-2017
Dec-8-2009
Dec-6-2016
May-30-2017
Mar-22-2011
Aug-30-2016
Mar-3-2009
Jun-5-1997
May-21-2003
Reg. No
3418054
2798490
5222068
3723215
5095588
5213830
3934569
5031172
3584869
26170
31576
Registered
Sep-10-2002
78162701
Mar-30-2004
2827758
Registered
Sep-11-2015
86754887
Oct-25-2016
5067075
Registered
Oct-26-2011
Registered
Nov-25-2002
Registered
Aug-1-1994
85457095
78188644
74555854
Jun-18-2013
Dec-9-2003
Jul-23-1996
4354756
2791341
1989088
Country
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
Washington
Washington
USA
USA
USA
USA
USA
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 11
Owner
Trademark
SUPERVALU Holdings, Inc.
MOM’S MEAT LOAF
Status
App. Date
Registered
Jan-14-2008
Unified Grocers, Inc.
Unified Grocers, Inc.
MORE WAYS TO MAKE IT YOUR MARKET
Registered
Aug-18-2005
MORE WAYS TO MAKE IT YOUR MARKET
SUPERVALU Licensing, LLC
MORE WAYS TO SAVE
SUPERVALU Licensing, LLC
MOUNTAIN STREAM
SUPERVALU Licensing, LLC
Unified Grocers, Inc.
NEIGHBORHOOD CONVENIENCE.
NEIGHBORHOOD SAVINGS.
NEIGHBORHOOD MARKET FAST FRESH
FRIENDLY and DESIGN
SUPERVALU Licensing, LLC
NEWMARKET
SUPERVALU Licensing, LLC
NUTRITION IQ
Unified Grocers, Inc.
Unified Grocers, Inc.
PAWSITIVELY PETS
PAY NET
SUPERVALU Holdings, Inc.
PAY PAK 24
SUPERVALU Licensing, LLC
PEER
SUPERVALU Licensing, LLC
PERSONAL CONFIDENCE
SUPERVALU Licensing, LLC
PIER 14
SUPERVALU Licensing, LLC
PLENTY FOR TWENTY
SUPERVALU Licensing, LLC
PLENTY FRESH FOR
PLENTY LESS
Registered
Registered
Registered
Aug-7-2006
Oct-2-2008
May-2-2008
App. No.
77370616
78695483
76664209
77584354
77464632
Reg. Date
Aug-26-2008
Dec-26-2006
May-29-2007
Apr-14-2009
Mar-17-2009
Reg. No
3491972
3190184
3245964
3606038
3592829
Registered
Feb-6-2014
86186021
Nov-11-2014
4638528
Registered
Oct-2-1996
75175703
Nov-24-1998
2206081
Registered
Feb-12-1992
Registered
Apr-24-2008
Registered
Registered
Registered
Jun-15-2012
Jul-9-1993
Jan-15-1993
Registered
Aug-23-2002
Registered
Jan-4-2006
Registered
May-12-1998
Registered
Jul-19-2011
74245670
77456869
85653675
74411533
74348988
78157214
78785054
75483824
85374863
Sep-29-1992
Mar-10-2009
Jul-16-2013
Jan-30-1996
Oct-22-1996
Feb-24-2004
Sep-11-2007
Mar-2-1999
Jun-12-2012
1721009
3588781
4369908
1952518
2010359
2817071
3292045
2229000
4156872
Registered
Mar-29-2011
85279401
Nov-22-2011
4061607
Country
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 12
Owner
Unified Grocers, Inc.
Unified Grocers, Inc.
PRIZE
PRIZE WILD BIRD FOOD and BIRD DESIGN
SUPERVALU Licensing, LLC
PUMP PERKS
SUPERVALU Licensing, LLC
PUMP PERKY P.P.
Registered
Registered
Feb-6-1986
Jul-22-1974
Registered
Sep-17-2004
Registered
Sep-17-2004
80048
73027452
78485177
78485175
Feb-6-1986
Sep-2-1975
Dec-13-2005
Dec-13-2005
Reg. No
80048
1019555
3027901
3027900
Trademark
Status
App. Date
App. No.
Reg. Date
SUPERVALU Licensing, LLC
QUICK & EASY LOGO
Pending
Nov-30-2017
87703494
SUPERVALU INC.
SUPERVALU INC.
RAINBOW
RAINBOW FOODS
Registered
Feb-19-1987
Registered
Jan-9-1984
73645507
73460102
Sep-29-1987
Nov-6-1984
1459729
1304312
Associated Grocers of Florida, Inc RAINIER VALLEY FARMS
Registered
Feb-10-2000
T00/04446J
Mar-21-2000
T00/04446J
Associated Grocers of Florida, Inc RAINIER VALLEY FARMS
Registered
Mar-31-2000
T00/044471
Mar-31-2000
T00/044471
Associated Grocers of Florida, Inc RAINIER VALLEY FARMS
Associated Grocers of Florida, Inc RAINIER VALLEY FARMS
Associated Grocers of Florida, Inc RAINIER VALLEY FARMS
Associated Grocers of Florida, Inc RAINIER VALLEY FARMS
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
RAINIER VALLEY FARMS
RAINIER VALLEY FARMS
READY PAY and DESIGN
READY PAY and DESIGN
Registered
Jun-13-2000
Registered
Feb-10-2000
Registered
Mar-27-2000
Registered
Mar-27-2000
Registered
Mar-28-2000
Registered
Mar-28-2000
Registered
Aug-10-1993
Registered
Jul-12-1991
422765
422766
00003473
00003472
89016541
89016542
74423947
74184323
Jun-13-2000
KOR157823
Feb-10-2000
KOR137415
Apr-11-2003
Feb-7-2003
Jul-16-2001
Jul-16-2002
May-16-1995
Oct-31-1995
00003473
00003472
951871
1008440
1894302
1931839
Country
California
USA
USA
USA
USA
USA
USA
Singapore
Singapore
Thailand
Thailand
Malaysia
Malaysia
Taiwan
Taiwan
USA
USA
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 13
Owner
Trademark
Status
App. Date
App. No.
Reg. Date
Reg. No
Country
SUPERVALU Licensing, LLC
REAL FOOD IN REAL TIME
Pending
Jan-10-2018
87750059
SUPERVALU Licensing, LLC
REAL GOODNESS REAL VALUE
Registered
Dec-18-2015
86854145
Apr-4-2017
5177494
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
RED APPLE MARKET
RED APPLE MARKET
RED APPLE MARKET
SUPERVALU Licensing, LLC
RED OWL
SUPERVALU Licensing, LLC
RED OWL logo
SUPERVALU Licensing, LLC
RED OWL logo
SUPERVALU Licensing, LLC
REFILLADVANTAGE
SUPERVALU Licensing, LLC
REWARDING CAREER, FULFILLING LIFE
Super Rite Foods, Inc.
SUPERVALU INC.
RICHFOOD
RON VICARO
SUPERVALU Licensing, LLC
RX DESIGN
SUPERVALU Licensing, LLC
S SUPER VALU
SUPERVALU Licensing, LLC
SEASONAL ESSENTIALS
SUPERVALU Licensing, LLC
SEASONAL ESSENTIALS
Unified Grocers, Inc.
SELECT MARKETS
Registered
Registered
Registered
May-7-1998
Jun-12-1998
Jun-16-1998
Registered
Dec-26-1961
Registered
Dec-26-1961
Registered
Nov-22-2016
Registered
Registered
Oct-7-2005
Jun-2-2005
Registered
Mar-18-1980
Registered
Registered
Jul-14-1995
Jun-17-2002
Registered
Dec-23-1964
Registered
Registered
Registered
May-6-2015
May-1-2012
Jun-21-1989
32469
27073
3024
72134679
72134678
87245618
78728958
78641904
73254498
74700901
76422677
72208783
86621026
85612892
73808228
May-7-1998
Jun-12-1998
Jun-16-1998
Nov-6-1962
Nov-6-1962
Feb-27-2018
Aug-28-2007
Jul-18-2006
Nov-23-1982
Oct-8-1996
Jul-1-2003
Oct-19-1965
Nov-10-2015
Jun-4-2013
Oct-9-1990
32469
27073
3024
0740378
0740377
5414785
3286994
3116772
1217143
2005834
2731716
0797910
4851381
4347941
1616987
USA
USA
Oregon
Washington
Alaska
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 14
Owner
Trademark
SUPERVALU Holdings, Inc.
SUPERVALU Holdings, Inc.
SUPERVALU Holdings, Inc.
Unified Grocers, Inc.
SENTRY
SENTRY
SENTRY
SENTRY
SUPERVALU Holdings, Inc.
SENTRY EXPRESS
SUPERVALU Holdings, Inc.
SENTRY FOODS
Status
App. Date
Registered
Nov-16-1989
Registered
Apr-16-2004
App. No.
74002863
78402870
Reg. Date
Aug-23-1994
Jun-9-2009
Registered
Aug-10-2011
18776
Aug-10-2011
Registered
Aug-15-1985
73553577
Aug-23-1994
Registered
Jul-23-2008
5900154
Jul-23-2008
Registered
Aug-10-2011
18777
Aug-10-2011
Reg. No
1850830
3635362
18776
1850829
5900154
18777
Country
USA
USA
Wisconsin
USA
Wisconsin
Wisconsin
Unified Grocers, Inc.
SERIOUS ABOUT SERVICE
Registered
Dec-9-1992
74338863
Aug-17-1993
1788660
Unified Grocers, Inc.
SERVICES FOR
GROCERS...BY GROCERS
Registered
Dec-12-2008
77569298
Jan-20-2009
3566235
Shoppers Food Warehouse Corp.
SFW
Registered
Dec-13-1983
73456907
Mar-4-1986
1385507
Shop ‘N Save
Warehouse
Foods, Inc.
SHOP ‘N SAVE
Registered
Dec-7-1978
73196070
Mar-19-1985
1326364
SUPERVALU Holdings, Inc.
SHOP ‘N SAVE
Registered
Jun-8-1981
73313529
Mar-19-1985
1326367
SHOP ‘N SAVE EXPRESS
Registered
Nov-19-2003
78329849
Jul-26-2005
2979563
SHOP ‘N SAVE FUEL EXPRESS
Registered
Nov-27-2006
77051046
Apr-29-2008
3419192
USA
SHOP ‘N SAVE PERKS
Registered
Mar-15-2006
78837978
Oct-2-2007
3304444
SHOP ‘N SAVE PHARMACY
Registered
Jul-10-2003
78272658
Jul-6-2004
2860289
Shoppers Food Warehouse Corp.
SHOPPERS
Registered
Jun-10-1988
73733419
Jun-13-1989
1543972
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 15
Shop ‘N Save
Warehouse
Foods, Inc.
Shop ‘N Save
Warehouse
Foods, Inc.
Shop ‘N Save Warehouse Foods,
Inc.
Shop ‘N Save Warehouse Foods,
Inc.
USA
USA
USA
USA
USA
USA
USA
USA
USA
Owner
Trademark
Shoppers Food Warehouse Corp.
SHOPPERS FOOD & PHARMACY
Shoppers Food Warehouse Corp.
SHOPPERS FOOD WAREHOUSE
Shoppers Food Warehouse Corp.
SHOPPERS PHARMACY
SUPERVALU Licensing, LLC
SHOPPERS VALUE
SUPERVALU Licensing, LLC
SHOPPERS VALUE
SUPERVALU Licensing, LLC
SHOPPERS VALUE FOODS
Status
App. Date
Registered
Jun-28-2005
Registered
Dec-13-1983
Registered
Oct-4-2006
Registered
Oct-21-1988
Registered
Oct-20-2003
Registered
Nov-20-2013
App. No.
78659594
73456904
77013280
73758869
78315608
86124199
SUPERVALU Licensing, LLC
SHOPPING AT THE SPEED OF LIFE
Pending
Jan-19-2017
87306650
SUPERVALU Licensing, LLC
SIX
SUPERVALU Licensing, LLC
SMART TIPS FOR LIVING WELL
SUPERVALU Licensing, LLC
SMOKEHOUSE RECIPE
SPECIAL VALUE
SPECIAL VALUE
SPECIAL VALUE and DESIGN (ON
RECTANGLE)
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Registered
Feb-13-1995
74633402
Jan-28-1997
2033325
SPECIAL VALUE and SEAL DESIGN
Registered
Apr-29-1974
SPRING FRESH
SPRINGFIELD
SPRINGFIELD
Registered
Feb-3-2014
Registered
Mar-24-1976
Registered
Oct-17-1994
73020071
86183057
73081207
74586578
Aug-10-1976
Dec-8-2015
Jun-7-1977
Apr-16-1996
1046187
4867627
1067042
1967920
Registered
May-6-2002
Registered
Apr-11-2012
Registered
May-10-2006
Registered
Registered
Apr-9-2004
Jul-14-2011
76405893
85594333
78880779
78399682
85371988
Reg. Date
Aug-15-2006
Nov-13-1984
Oct-23-2007
Dec-5-1989
Mar-22-2005
Sep-16-2014
Jan-28-2003
Nov-6-2012
Oct-30-2007
Jul-26-2005
Feb-7-2012
Reg. No
3129223
1305515
3315520
1569081
2934826
4607280
2680991
4237643
3327756
2975990
4096358
Country
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
USA
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 16
Owner
Trademark
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
SPRINGFIELD
SPRINGFIELD
SPRINGFIELD
SPRINGFIELD
SPRINGFIELD
SPRINGFIELD
SPRINGFIELD
SPRINGFIELD
SPRINGFIELD
SPRINGFIELD
SPRINGFIELD
SPRINGFIELD
SPRINGFIELD
SPRINGFIELD
SPRINGFIELD
SPRINGFIELD
SPRINGFIELD
Status
App. Date
Registered
Sep-12-2008
Registered
Apr-14-1993
Registered
Apr-14-1993
Registered
Registered
Dec-8-1992
Dec-8-1992
Registered
Apr-14-1993
Registered
Dec-8-1992
Registered
Apr-14-1993
Registered
Registered
Registered
Registered
Registered
Registered
Registered
Registered
Registered
Aug-4-1995
Aug-4-1995
Oct-4-1995
Aug-4-1995
Aug-4-1995
Aug-4-1995
Aug-4-1995
Aug-4-1995
Aug-4-1995
App. No.
77569286
165379
165375
156318
156316
165377
156315
165376
101846
101847
101845
101844
101843
101842
101841
101838
101848
Reg. Date
Feb-16-2010
May-13-1994
Aug-30-1993
Sep-29-1994
Jul-30-1996
Sep-13-1993
Jul-13-1994
Aug-30-1993
Nov-10-1998
Dec-8-1998
Nov-9-1999
Dec-8-1998
Dec-8-1998
Nov-4-1998
Dec-8-1998
Dec-28-1998
Dec-8-1998
Reg. No
3750483
460273
440794
471485
527405
441884
466326
440795
66416
66770
104087
66768
66777
66210
66776
66883
66754
Country
USA
Mexico
Mexico
Mexico
Mexico
Mexico
Mexico
Mexico
Philippines
Philippines
Philippines
Philippines
Philippines
Philippines
Philippines
Philippines
Philippines
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 17
Owner
Trademark
Status
App. Date
App. No.
Reg. Date
Unified Grocers, Inc.
SPRINGFIELD
Registered
Feb-26-1997
970015901
Jun-21-1998
Reg. No
1185395
Country
China
Unified Grocers, Inc.
SPRINGFIELD
Registered
Jun-3-1997
97-25210
Dec-4-1998
432137
Unified Grocers, Inc.
SPRINGFIELD
Registered
Sep-23-1998
98-24760
Dec-15-1999
460814
Unified Grocers, Inc.
SPRINGFIELD
Pending
Jan-4-2018
87743566
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
SPRINGFIELD
SPRINGFIELD
SPRINGFIELD
Pending
Pending
Apr-13-2018
2018/0027301
Feb-7-2018
263969-01
Pending
Jan-10-2018
1047/2018
SPRINGFIELD and DESIGN (3 PETALS)
Registered
Dec-21-1987
62-141650
Sep-21-1990
SPRINGFIELD in Chinese (CHUN TIAN)
SPRINGFIELD in Chinese (CHUN TIAN)
Registered
Registered
Mar-7-1997
970018881
Sep-7-1998
Mar-7-1997
970018882
Mar-21-1999
2268280
1204349
1257416
Unified Grocers, Inc.
SPRINGFIELD in Korean
Registered
Jun-10-1997
97-26501
Dec-4-1998
40-432139
Republic of
Korea (South)
Republic of
Korea (South)
United States of
America
Colombia
Panama
Honduras
Japan
China
China
Republic of
Korea (South)
SUPERVALU Licensing, LLC
STOCKMAN & DAKOTA
SUPERVALU Licensing, LLC
STONE RIDGE CREAMERY
SUPERVALU Licensing, LLC
SUPER CHILL
SUPERVALU Licensing, LLC
SUPER CHILL
SUPERVALU Licensing, LLC
SUPER CHILL
SUPERVALU Licensing, LLC
SUPERVALU
Registered
Sep-29-2008
Registered
Registered
Registered
Jan-18-2005
Jul-25-2006
Jul-19-2006
Registered
Oct-25-2001
Registered
Aug-29-2002
77581162
78549003
78937287
78933106
76329694
78159160
Sep-1-2009
Apr-18-2006
Aug-7-2007
Jun-8-2010
Sep-11-2007
Feb-10-2004
3677711
3083883
3275086
3801267
3291257
2812894
USA
USA
USA
USA
USA
USA
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 18
Owner
Trademark
SUPERVALU Licensing, LLC
SUPERVALU
SUPERVALU Licensing, LLC
SUPERVALU
SUPERVALU Licensing, LLC
SUPERVALU
SUPERVALU Licensing, LLC
SUPERVALU
SUPERVALU Licensing, LLC
SUPERVALU
SUPERVALU Licensing, LLC
SUPERVALU
SUPERVALU Licensing, LLC
SUPERVALU
SUPERVALU Licensing, LLC
SUPERVALU
SUPERVALU Licensing, LLC
SUPERVALU
SUPERVALU Holdings, Inc.
SUPERVALU EXPRESS
SUPERVALU Licensing, LLC
SUPERVALU PHARMACIES
SUPERVALU Licensing, LLC
SUPERVALU UNIVERSITY
Status
App. Date
Registered
Sep-13-1962
Registered
Feb-27-1956
Registered
Feb-27-1956
Registered
Feb-17-1956
Registered
Aug-3-1954
App. No.
72153129
72003476
72003475
72002930
71671067
Reg. Date
Nov-12-1963
Jun-11-1957
Jun-11-1957
Jun-11-1957
Jul-24-1956
Reg. No
0760163
0646916
0646906
0646905
0631486
Pending
Nov-28-2016
1825530
Pending
Nov-29-2016
1826035
Pending
Feb-23-2017
Registered
Feb-23-2017
Registered
Mar-18-2003
Registered
Jun-17-2002
Registered
Feb-27-2007
40-2017-
0024041
78226732
76423049
77117503
Country
USA
USA
USA
USA
USA
Mexico
Mexico
China
Nov-15-2017
401304306
Republic of
Korea (South)
Aug-17-2004
Nov-25-2003
Dec-11-2007
2874492
2785665
3351130
2788805
2935019
4755017
3292358
USA
USA
USA
USA
USA
USA
USA
USA
SUPERVALU Licensing, LLC
SUPERVALU WE DELIVER
Pending
Dec-22-2016
87277823
SUPERVALU Licensing, LLC
SV HARBOR
SUPERVALU Licensing, LLC
SVHARBOR
SUPERVALU Licensing, LLC
SVINSIGHTS
SUPERVALU Licensing, LLC
SVOUTFITTER
Registered
Sep-11-2002
Registered
Registered
Mar-9-2004
Oct-8-2014
Registered
Aug-16-2006
78162777
78380692
86417797
78953559
Dec-2-2003
Mar-22-2005
Jun-16-2015
Sep-11-2007
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 19
Owner
Trademark
Status
App. Date
App. No.
Reg. Date
Reg. No
Country
SUPERVALU Licensing, LLC
SWEET PETALS DESIGN
Pending
Jan-16-2018
87756383
SUPERVALU Licensing, LLC
TASTE-GREAT
SUPERVALU Licensing, LLC
THE AMAZING EGG
Registered
Registered
Jul-12-1991
Jul-31-1997
74184358
75333559
Jun-9-1992
Feb-2-1999
1693797
2222050
SUPERVALU Holdings, Inc.
THE MORE YOU SHOP THE MORE YOU
SAVE
Registered
Jun-10-1991
74174541
Nov-10-1992
1731826
SUPERVALU Licensing, LLC
THE W. NEWELL ADVANTAGE
Registered
Nov-1-2005
SUPERVALU Licensing, LLC
THE WINE CELLAR AT FARM FRESH
Registered
Sep-25-2007
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
THRIFTWAY
THRIFTWAY
THRIFTWAY
SUPERVALU Licensing, LLC
THRIVE LIVE & EAT WELL
SUPERVALU Licensing, LLC
TIMBERWOOD
SUPERVALU Holdings, Inc.
TOT SPOT
Unified Grocers, Inc.
U UNIFIED GROCERS (stylized)
SUPERVALU Licensing, LLC
UNCUP
UNIFIED GROCERS
Unified Grocers, Inc.
Unified Grocers, Inc.
Unified Grocers, Inc.
Registered
Mar-25-1985
S19946
Mar-25-1985
Registered
Mar-29-1999
Registered
Jul-20-2001
Registered
Jun-22-2011
Registered
Feb-11-2000
Registered
Dec-20-1999
Registered
Jun-8-2007
Registered
Apr-27-2012
Registered
May-22-2007
78744750
77288513
75669221
76288152
Oct-24-2006
Aug-12-2008
Aug-1-2006
Aug-1-2006
85353001
75916691
75876464
77201603
85610946
77187560
77569289
Mar-27-2012
Dec-11-2001
Jul-17-2001
Jul-15-2008
May-28-2013
Oct-1-2008
Oct-20-2009
3162281
3486067
3122251
3122269
S19946
4119709
2518550
2469156
3469066
4343958
3521609
3697791
UNIFIED GROCERS INSURANCE SERVICES
Registered
Sep-12-2008
UNIFIED UNIFIED WESTERN GROCERS,
INC. and DESIGN
Registered
Sep-28-1999
75811243
Dec-10-2002
2659980
USA
USA
USA
USA
USA
USA
USA
USA
Oregon
USA
USA
USA
USA
USA
USA
USA
USA
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 20
Owner
Trademark
Status
App. Date
Unified Grocers, Inc.
VALUE STOP and DESIGN (STOP SIGN)
Registered
Oct-25-2016
SUPERVALU Holdings, Inc.
VILLAGE MARKET
SUPERVALU Licensing, LLC
VILLAGE MARKET
Registered
Nov-20-1995
Registered
May-22-1997
App. No.
121601
75021944
75978808
Reg. Date
Oct-25-2016
Apr-21-1998
Feb-15-2000
Reg. No
121601
2152805
2319903
SUPERVALU Licensing, LLC
W. NEWELL & CO. FRESH THINKING SINCE
1937
Registered
Feb-24-2005
78574398
Jul-18-2006
3118368
SUPERVALU Licensing, LLC
WATCH OUT BUTTER!
SUPERVALU Licensing, LLC
WE DELIVER
SUPERVALU Licensing, LLC
WHISPER SOFT IMAGES
Registered
May-24-2012
Pending
Dec-21-2016
Registered
Sep-25-1997
85633858
87276550
75362596
May-21-2013
Dec-26-2017
Jul-17-2001
SUPERVALU Licensing, LLC
WILD HARVEST
Pending
Jan-4-2018
147/2018
SUPERVALU Licensing, LLC
WILD HARVEST
SUPERVALU Licensing, LLC
WILD HARVEST
SUPERVALU Licensing, LLC
WILD HARVEST
SUPERVALU Licensing, LLC
WILD HARVEST
SUPERVALU Licensing, LLC
WILD HARVEST
SUPERVALU Licensing, LLC
WILD HARVEST
SUPERVALU Licensing, LLC
WILD HARVEST
SUPERVALU Licensing, LLC
WILD HARVEST
SUPERVALU Licensing, LLC
WILD HARVEST
Registered
Registered
May-9-2005
Jul-18-1995
Registered
Apr-15-2008
Registered
Apr-15-2008
Registered
Feb-9-2017
78625480
74702903
77449117
77449116
87329786
Sep-5-2006
Apr-22-1997
Jul-6-2010
Jul-20-2010
Dec-12-2017
Pending
Pending
Pending
Pending
Feb-1-2017
2017000875
Feb-1-2017
2017000876
Feb-1-2017
2017000877
Feb-1-2017
2017000878
4339953
5366236
2469959
3138351
2056158
3815034
3822419
5353790
Country
California
USA
USA
USA
USA
USA
USA
Honduras
USA
USA
USA
USA
USA
Guatemala
Guatemala
Guatemala
Guatemala
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 21
Owner
Trademark
SUPERVALU Licensing, LLC
WILD HARVEST
SUPERVALU Licensing, LLC
WILD HARVEST
SUPERVALU Licensing, LLC
WILD HARVEST
SUPERVALU Licensing, LLC
WILD HARVEST
SUPERVALU Licensing, LLC
WILD HARVEST
Status
Pending
Pending
Pending
Pending
Pending
Feb-1-2017
2017000879
Feb-1-2017
2017000880
Feb-1-2017
2017000881
Feb-1-2017
2017000882
Jul-8-2015
86686697
App. Date
App. No.
Reg. Date
Reg. No
Country
SUPERVALU Licensing, LLC
WILD HARVEST
Registered
Feb-15-2017
1343167
Feb-15-2017
1,343,167
SUPERVALU Licensing, LLC
WILD HARVEST
Pending
Feb-17-2017
256445-01
SUPERVALU Licensing, LLC
WILD HARVEST
Pending
Feb-17-2017
256444-01
SUPERVALU Licensing, LLC
WILD HARVEST
Pending
Feb-17-2017
256437-01
SUPERVALU Licensing, LLC
WILD HARVEST
Pending
Feb-17-2017
256432-01
SUPERVALU Licensing, LLC
WILD HARVEST
Pending
Feb-17-2017
256436-01
SUPERVALU Licensing, LLC
WILD HARVEST
Pending
Feb-17-2017
256434-01
SUPERVALU Licensing, LLC
WILD HARVEST
Pending
Feb-17-2017
256431-01
SUPERVALU Licensing, LLC
WILD HARVEST
Pending
Feb-17-2017
256429-01
SUPERVALU Licensing, LLC
WILD HARVEST
Pending
Feb-10-2017
2017052219
SUPERVALU Licensing, LLC
WILD HARVEST
Pending
Feb-10-2017
2017052213
SUPERVALU Licensing, LLC
WILD HARVEST
Pending
Feb-10-2017
2017052208
Guatemala
Guatemala
Guatemala
Guatemala
USA
WIPO
Panama
Panama
Panama
Panama
Panama
Panama
Panama
Panama
Malaysia
Malaysia
Malaysia
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 22
Owner
Trademark
Status
App. Date
App. No.
Reg. Date
Reg. No
SUPERVALU Licensing, LLC
WILD HARVEST
Pending
Feb-10-2017
2017052207
SUPERVALU Licensing, LLC
WILD HARVEST
Pending
Feb-10-2017
2017052201
SUPERVALU Licensing, LLC
WILD HARVEST
Pending
Feb-10-2017
2017052197
SUPERVALU Licensing, LLC
WILD HARVEST
Pending
Feb-10-2017
2017052195
SUPERVALU Licensing, LLC
WILD HARVEST
Pending
Feb-10-2017
2017052186
SUPERVALU Licensing, LLC
WILD HARVEST
Pending
Dec-28-2017
2017-48389
SUPERVALU Licensing, LLC
WILD HARVEST
Pending
Feb-15-2017
1343167
SUPERVALU Licensing, LLC
WILD HARVEST
Pending
Feb-15-2017
1343167
SUPERVALU Licensing, LLC
WILD HARVEST
Pending
Oct-17-2017
87648889
SUPERVALU Licensing, LLC
WILD HARVEST
Pending
Feb-15-2017
1343167
SUPERVALU Licensing, LLC
WILD HARVEST
SUPERVALU Licensing, LLC
WILD HARVEST
SUPERVALU Licensing, LLC
WILD HARVEST
SUPERVALU Licensing, LLC
WILD HARVEST
SUPERVALU Licensing, LLC
WILD HARVEST
Pending
Feb-15-2017
Registered
Feb-15-2017
1343167
1343167
Feb-15-2017
Registered
Feb-17-2017
20170001479
Jun-15-2017
1343167
N262795
Pending
Feb-3-2017
Registered
Feb-15-2017
1240814
1343167
Feb-15-2017
1343167
3. Registered Patents and Patent Applications:
Country
Malaysia
Malaysia
Malaysia
Malaysia
Malaysia
Dominican
Republic
Singapore
Republic of
Korea (South)
USA
Philippines
New Zealand
Colombia
Costa Rica
Chile
China
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 23
Owner
Title
Application Number
Application Date
Patent Number
Registration Date
SUPERVALU INC
TRUCK AND TRAILER DOOR SAFETY DEVICE
12852955
8/9/2010
8474096
7/2/2013
4. Registered Copyrights and Copyright Applications:
Owner
Title
Registration
Number
Registration
Year
Type of Work
Description
Suisse AG,
Credit
Cayman Islands
Branch/ Supervalu Inc/ New Albertson’s
Inc/ Shop ‘N Save Warehouse Foods, Inc Arx application -- Alpha 7 & 15 other titles V3627D713
2013
Recorded
Document
Release of security interests in United States
copyrights
Cub Foods
Cub Foods
Cub Foods
Cub Foods
Cub Foods
Cub Foods
Cub Foods
Cub Foods
Want to save a lot? : CUBF-2290W.
Cart
PA0000173682
PA0000141699
1983
1978
Motion Picture
(With No one can save you more & Minnesota
price message).
Deposit includes descriptions (3 p.)
Motion Picture Commercial
Truckload/BP : CF-01T-82.
PA0000149316
1982
Motion Picture
Price of a bag : CUBF-1110W.
PA0000151238
1982
Motion Picture
Advertisement for Cub Foods.
Deposit includes script (1 p.)
(With Depends).
Deposit includes script (1 p.)
Butcher campaign, revision : CUBF-2050
PA0000173104
Cub Foods--Customer awareness.
Cub Foods--Meat cutting : pt. 1.
PA0000173105
PA0000173124
1982
1981
1978
Motion Picture
(With Cow 52, where are you? revision).
Commercial
Kit
Kit
C.O. correspondence.
C.O. correspondence.
Fast growing G. O. : CUBF 1030.
PA0000173125
1978
Motion Picture
Cub Foods
Produce : CF-05-78.
PA0000173125
1982
Motion Picture
Cub Foods
Minnesota price message : CUBF-2330.
PA0000173683
1983
Motion Picture
Cub Foods
No one can save you more : CUBF-2300.
PA0000173684
1983
Motion Picture
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 24
(With Position G. O. & Cub Foods’ Cottage Grove
G. O.).
Deposit includes script (1 p.)
(With Generic).
Commercial.
Deposit includes description (1 p.) with title: Cub
Foods/Produce.
(With No one can save you more & Want to save a
lot?).
Commercial.
Deposit includes descriptions (3 p.)
(With Want to save a lot? & Minnesota price
message).
Deposit includes descriptions (3 p.).
Title on 1 description: No one else can save you
more
Cub Foods
Cub Foods
Cub Foods
Cub Foods
Cub Foods
Cub Foods
Cub Foods
Cub Foods
Cub Foods
Cub Foods
Cub Foods
Owner
Title
Registration
Number
Registration
Year
Type of Work
Description
Position G. O. : CUBF 1040.
PA0000184707
1982
Motion Picture
(With Fast growing G. O. & Cub Foods’ Cottage
Grove G. O.).
Deposit includes script (1 p.) bearing title: Last to
leave bag.
Cub Foods’ Cottage Grove G. O. : CUBF
1050
Cub Foods--Maintenance training.
Cub Foods “Stocker.”
PA0000184708
PAu000492158
PAu000492159
1981
1982
1982
Motion Picture Videocassette
Kit
C.O. correspondence.
Motion Picture C.O. correspondence.
Generic : CF-105.
Cub Foods--Produce training.
Cub Foods--Employee orientation.
Cub Foods--Frozen food & dairy
PAu000492160
PAu000492161
PAu000492162
PAu000492163
1982
1982
1982
1982
Motion Picture
Kit
Kit
Kit
Depends : CUBF-2030.
PAu000492164
1982
Motion Picture
(With Produce).
Commercial.
Deposit includes description (1 p.) with title: Cub
Foods--Generic.
C.O. correspondence.
C.O. correspondence.
C.O. correspondence.
(With Price of a bag).
Deposit includes script (1 p.)
Dahlstron Display Inc/ Supervalu Inc
Jennifer
Warehouse Foods Inc
Andrade/
Shop ‘N Save
Meet Alice : CUBF-2040.
Cub Foods--Meat cutting : pt. 2.
PAu000492165
TX0002393186
1982
1986
ALWAYS FRESH! ALWAYS CHICAGO!
(JEWEL-OSCO)
V3571D947
2008
The More You Shop, The More You Save
V3628D838
2013
New Albertson’s Inc/ Supervalu Inc
Diving dinosaur & 11 other titles
V3627D433
2013
New Albertson’s Inc/ Supervalu Inc
Diving dinosaur & 11 other titles
V3627D788
2013
Rocky Mountain Technology Group Inc/
Supervalu Inc
Shop ‘N Save Warehouse Foods Inc/
Wells Fargo Bank
ARx application--Alpha 7 & 2 other titles
V3558D973
2007
Jingle: the more you shop, the more you save V3622D450
2012
Motion Picture
Commercial.
Deposit includes description (2 p.)
Motion Picture C.O. correspondence.
Recorded
Document
Recorded
Document
Recorded
Document
Recorded
Document
Recorded
Document
Recorded
Document
Copyright Assignment
Assignment
Copyright Assignment
Copyright Assignment
Assignment of intellectual property rights
of security interest
Grant
copyrights
in United States
Shop ‘N Save/ Lever Brothers/ Meredith
Corp
Better Homes and Gardens Trends ninety-
seven : smart ideas for the way you…
TX0004767889
1997
Text
compilation, additional text & photos.
Supervalu Inc/ New Albertson’s Inc
ALWAYS FRESH! ALWAYS CHICAGO!
(JEWEL-OSCO)
V3631D168
2013
Supervalu Inc/ New Albertson’s Inc/
Shop ‘N Save Warehouse Foods Inc/
Credit Suisse AG, Cayman Islands Brand Arx application - alpha 7 & 15 other titles.
V3620D907
2012
Recorded
Document
Recorded
Document
Copyright Assignment
of security interest
Grant
copyrights
in United States
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 25
Owner
Title
Registration
Number
Registration
Year
Supervalu Inc/ Shop ‘n Save Warehouse
Foods Inc/ Goldman Sachs Bank USA
ARx application--Alpha 7 & 15 other titles V3627D893
2013
Supervalu Inc/ Wells Fargo Bank
Arx application - Alpha 7 & 2 other titles
V3622D449
2012
Type of Work
Description
Recorded
Document
Recorded
Document
of security interest
Grant
copyrights
of security interest
Grant
copyrights
in United States
in United States
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.11- 26
TRADEMARK CASE PRINT
ClientCode
Docket
Number
Status
Case Type
Appl. No. Appl. Date Reg. No. Reg. Date Exp. Date
Renewal Date
U010-UNF T02164-US
Registered
Intent
To
Use
Application
78723899 9/30/2005
3277444
8/7/2007
8/7/2027
8/7/2027
Country
United
States
Trademark
GRATEFUL
HARVEST
(WORD
MARK)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02164-US1
Registered
Intent
To
Use
Application
78723904 9/30/2005
3357403 12/18/2007
12/18/2027
12/18/2027
Country
United
States
Trademark
GRATEFUL
HARVEST
(WORD
MARK)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02164-US3
Registered
Intent
To
Use
Application
78175910 10/18/2002
2855136 6/15/2004
6/15/2024
6/15/2024
Country
United
States
Trademark
GRATEFUL
HARVEST
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02165-US
Registered
Intent
To
Use
Application
78723922 9/30/2005
3406848
4/1/2008
4/1/2028
4/1/2028
Country
United
States
Trademark
MISCELLANEOUS
DESIGN
(GRATEFUL
HARVEST
LOGO)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02165-US1
Registered
Intent
To
Use
Application
78723918 9/30/2005
3283744 8/21/2007
8/21/2027
8/21/2027
Country
United
States
Trademark
MISCELLANEOUS
DESIGN
(GRATEFUL
HARVEST
LOGO)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02168-IB
Registered
Regular
847419
1/6/2005
847419
1/6/2005
1/6/2025
1/6/2025
Country
International
Trademark
UNITED
NATURAL
FOODS
(WORD
MARK)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
1
TRADEMARK CASE PRINT
ClientCode Docket Number Status
Case Type
Appl. No. Appl. Date Reg. No. Reg. Date Exp. Date
Renewal Date
U010-UNF
T02168-IB-
EUTM
Registered
Regular
847419
1/6/2005
847419
1/6/2005
1/6/2025
1/6/2025
Country
European
Union
Trademark
Trademark
UNITED
NATURAL
FOODS
(WORD
MARK)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02168-IB-JP
Registered
Regular
A0000435
1/6/2005
847419
1/6/2005
1/6/2025
1/6/2025
Country
Japan
Trademark
UNITED
NATURAL
FOODS
(WORD
MARK)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02168-TW
Registered
Regular
94029813 6/22/2005
1231397 10/1/2006
10/1/2026
9/30/2026
Country
Taiwan
Trademark
UNITED
NATURAL
FOODS
(WORD
MARK)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02168-US
Registered
Regular
78530623 12/10/2004
3049980 1/24/2006
1/24/2026
1/24/2026
Country
United
States
Trademark
UNITED
NATURAL
FOODS
(WORD
MARK)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02170-EUTM Registered
Regular
4666046 10/4/2005
4666046 9/13/2006
10/4/2025
10/4/2025
Country
European
Union
Trademark
Trademark
WOODSTOCK
FARMS
(WORD
MARK)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02170-EUTM1 Registered
Regular
4994083 3/17/2006
4994083 4/11/2007
3/17/2026
3/17/2026
Country
European
Union
Trademark
Trademark
WOODSTOCK
FARMS
(WORD
MARK)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
2
TRADEMARK CASE PRINT
ClientCode Docket Number Status
Case Type
Appl. No. Appl. Date Reg. No. Reg. Date Exp. Date
Renewal Date
U010-UNF T02170-TW
Registered
Regular
94033609 7/13/2005
1207882
5/1/2006
5/1/2026
4/30/2026
Country
Taiwan
Trademark
WOODSTOCK
FARMS
(WORD
MARK)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02170-TW1
Registered
Regular
94033608 7/13/2005
1208006
5/1/2006
5/1/2026
4/30/2026
Country
Taiwan
Trademark
WOODSTOCK
FARMS
(WORD
MARK)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02170-TW2
Registered
Regular
94033607 7/13/2005
1196782 2/16/2006
2/16/2026
2/15/2026
Country
Taiwan
Trademark
WOODSTOCK
FARMS
(WORD
MARK)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02171-EUTM Registered
Regular
4999157 3/17/2006
4999157 8/23/2007
3/17/2026
3/17/2026
Country
European
Union
Trademark
Trademark
WOODSTOCK
FARMS
&
DESIGN
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02171-TW
Registered
Regular
95013659 3/21/2006
1253807
3/1/2007
3/1/2027
2/28/2027
Country
Taiwan
Trademark
WOODSTOCK
FARMS
&
DESIGN
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02174-US
Registered
Regular
76187631 12/28/2000
2671140
1/7/2003
1/7/2023
1/7/2023
Country
United
States
Trademark
EARTH
ORIGINS
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
3
TRADEMARK CASE PRINT
ClientCode Docket Number Status
Case Type
U010-UNF T02175-US
Registered
Regular
Appl. No. Appl. Date Reg. No. Reg. Date Exp. Date
Renewal Date
74120751 12/5/1990
1731357 11/10/1992
11/10/2022
11/10/2022
Country
United
States
Trademark
EXPRESS
SNACKS
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02178-US
Registered
Regular
78592493 3/22/2005
3065993
3/7/2006
3/7/2026
3/7/2026
Country
United
States
Trademark
HEALTHY
CLIPPINGS
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02179-US
Registered
Regular
75517573 7/13/1998
2263145 7/20/1999
7/20/2019
7/20/2019
Country
United
States
Trademark
MOUNTAIN
PEOPLES
WAREHOUSE
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02189-US
Registered
Regular
75453273 3/19/1998
2221771
2/2/1999
2/2/2019
2/2/2019
Country
United
States
Trademark
WOODFIELD
FARMS
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02190-US
Registered
Supplemental
/
B
Register
75516249
7/9/1998
2378242 8/15/2000
8/15/2020
8/15/2020
Country
United
States
Trademark
RESOURCE
ORGANIC
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02191-US
Registered
Regular
75516240
7/9/1998
2353204 5/30/2000
5/30/2020
5/30/2020
Country
United
States
Trademark
SOURCE
ORGANIC
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
4
TRADEMARK CASE PRINT
ClientCode
Docket
Number
Status
Case Type
Appl. No. Appl. Date Reg. No. Reg. Date Exp. Date
Renewal Date
U010-UNF T02193-US
Registered
Regular
75153421 8/20/1996
2248478
6/1/1999
6/1/2019
6/1/2019
Country
United
States
Trademark
SUNSPLASH
MARKET
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02266-CA
Registered
Regular
1539398 8/11/2011
830725 8/27/2012
8/27/2027
8/27/2027
Country
Canada
Trademark
RISING
MOON
ORGANICS
&
Design
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02653-US
Registered
Regular
77579954 9/26/2008
3615593
5/5/2009
5/5/2019
5/5/2019
Country
United
States
Trademark
UNFI
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02654-US
Registered
Regular
77579975 9/26/2008
3634425
6/9/2009
6/9/2019
6/9/2019
Country
United
States
Trademark
UNFI
DRIVEN
BY
NATURE
and
Design
(logo)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02655-US
Registered
Regular
77579987 9/26/2008
3615594
5/5/2009
5/5/2019
5/5/2019
Country
United
States
Trademark
DRIVEN
BY
NATURE
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02661-US
Registered
Regular
76183563 12/21/2000
2636805 10/15/2002
10/15/2022
10/15/2022
Country
United
States
Trademark
SELECT
NUTRITION
DISTRIBUTORS
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
5
TRADEMARK CASE PRINT
ClientCode
Docket
Number
Status
Case Type
Appl. No. Appl. Date Reg. No. Reg. Date Exp. Date
Renewal Date
U010-UNF T02709-CA
Registered
Regular
1313435 8/11/2006
786273
1/4/2011
1/4/2026
1/4/2026
Country
Canada
Trademark
FANTASTIC
WORLD
FOODS
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02737-JP
Registered
Regular
12630694 12/14/1994
4330701 10/29/1999
10/29/2019
10/29/2019
Country
Japan
Trademark
FANTASTIC
FOODS
&
DESIGN
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02737-JP1
Registered
Regular
12630794 12/14/1994
4282810 6/11/1999
6/11/2019
6/11/2019
Country
Japan
Trademark
FANTASTIC
FOODS
&
DESIGN
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02899-US
Registered
Regular
77853859 10/21/2009
3820881 7/20/2010
7/20/2020
7/20/2020
Country
United
States
Trademark
CLEARVUE
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02966-US
Registered
Regular
77957492 3/12/2010
3863865 10/19/2010
10/19/2020
10/19/2020
Country
United
States
Trademark
HEARTLAND
MEADOW
WHERE
GOODNESS
Attorney
David
R.
Josephs
GROWS
and
Design
(logo)
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02968-US
Registered
Regular
77961285 3/17/2010
3864137 10/19/2010
10/19/2020
10/19/2020
Country
United
States
Trademark
HEARTLAND
MEADOW
(word
mark)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
6
TRADEMARK CASE PRINT
ClientCode Docket Number Status
Case Type
Appl. No. Appl. Date Reg. No. Reg. Date Exp. Date
Renewal Date
U010-UNF T02977-US
Registered
Intent
To
Use
Application
85012434 4/13/2010
3926983
3/1/2011
3/1/2021
3/1/2021
Country
United
States
Trademark
EARTH
ORIGINS
MARKET
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02977-US1
Registered
Regular
85914499 4/25/2013
4504334
4/1/2014
4/1/2024
4/1/2024
Country
United
States
Trademark
EARTH
ORIGINS
MARKET
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T02998-CA
Registered
Regular
1508778 12/20/2010
817852 2/17/2012
2/17/2027
2/17/2027
Country
Canada
Trademark
GRATEFUL
HARVEST
ORGANIC
100%
PURE
Attorney
David
R.
Josephs
NEW
ZEALAND
and
Design
(color
logo)
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T03074-US
Registered
Regular
85203188 12/21/2010
3978302 6/14/2011
6/14/2021
6/14/2021
Country
United
States
Trademark
EARTH
ORIGINS
MARKET
and
Design
(color
logo)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T03074-US1
Registered
Regular
85913132 4/24/2013
4504329
4/1/2014
4/1/2024
4/1/2024
Country
United
States
Trademark
EARTH
ORIGINS
MARKET
and
Design
(color
logo)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T03088-CA1
Registered
Regular
1537237 7/26/2011
842281
2/5/2013
2/5/2028
2/5/2028
Country
Canada
Trademark
WOODSTOCK
EAT
BECAUSE
IT'S
GOOD!
(LOGO)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
7
TRADEMARK CASE PRINT
ClientCode Docket Number Status
Case Type
Appl. No. Appl. Date Reg. No. Reg. Date Exp. Date
Renewal Date
U010-UNF T03089-CA1
Registered
Regular
1537236 7/26/2011
842624
2/7/2013
2/7/2028
2/7/2028
Country
Canada
Trademark
WOODSTOCK
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T03090-CA1
Registered
Regular
1537235 7/26/2011
841894 1/31/2013
1/31/2028
1/31/2028
Country
Canada
Trademark
EAT
BECAUSE
ITS
GOOD!
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T03143-CA
Registered
Regular
1538713
8/8/2011
847222 3/28/2013
3/28/2028
3/28/2028
Country
Canada
Trademark
HARVEST
BAY
and
Design
(logo
with
swoosh)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T03196-US
Registered
Regular
85332059 5/27/2011
4083374 1/10/2012
1/10/2022
1/10/2022
Country
United
States
Trademark
IUNFI
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T03222-CA
Registered
Intent
To
Use
Application
1565561 2/23/2012
896046
2/9/2015
2/9/2030
2/9/2030
Country
Canada
Trademark
IUNFI
and
Design
(logo)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T03222-US
Registered
Regular
85405957 8/24/2011
4084106 1/10/2012
1/10/2022
1/10/2022
Country
United
States
Trademark
IUNFI
and
Design
(logo)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
8
TRADEMARK CASE PRINT
ClientCode
Docket
Number
Status
Case Type
Appl. No. Appl. Date Reg. No. Reg. Date Exp. Date
Renewal Date
U010-UNF T03362-US
Registered
Intent
To
Use
Application
85620942
5/9/2012
4332890
5/7/2013
5/7/2023
5/7/2023
Country
United
States
Trademark
EARTH
ORIGINS
OUTLET
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T03391-US
Registered
Regular
85649668 6/12/2012
4438359 11/26/2013
11/26/2023
11/26/2023
Country
United
States
Trademark
ALBERT'S
ORGANICS
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T03392-US
Registered
Regular
85649708 6/12/2012
4438360 11/26/2013
11/26/2023
11/26/2023
Country
United
States
Trademark
ALBERT'S
ORGANICS
and
Design
(B-W
logo)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T03395-CA
Registered
Regular
1584216 7/12/2012
860679 9/19/2013
9/19/2028
9/19/2028
Country
Canada
Trademark
UNFI
DRIVEN
BY
NATURE
and
Design
Attorney
David
R.
Josephs
(Canadian
color
logo
with
red
leaf)
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T03397-US
Registered
Intent
To
Use
Application
85660184 6/25/2012
4448608 12/10/2013
12/10/2023
12/10/2023
Country
United
States
Trademark
MARKET
WATCH
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T03457-US
Registered
Regular
85754951 10/16/2012
4357431 6/25/2013
6/25/2023
6/25/2023
Country
United
States
Trademark
SELECT
NUTRITION
DISTRIBUTORS
&
DESIGN
(LOGO)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
9
TRADEMARK CASE PRINT
ClientCode
Docket
Number
Status
Case Type
Appl. No. Appl. Date Reg. No. Reg. Date Exp. Date
Renewal Date
U010-UNF T03465-CA
Registered
Regular
1620736
4/2/2013
934423 4/12/2016
4/12/2031
4/12/2031
Country
Canada
Trademark
SELECT
NUTRITION
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T03465-US
Registered
Regular
85759659 10/22/2012
4357655 6/25/2013
6/25/2023
6/25/2023
Country
United
States
Trademark
SELECT
NUTRITION
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T03546-US
Registered
Regular
85861409 2/27/2013
4450382 12/17/2013
12/17/2023
12/17/2023
Country
United
States
Trademark
HONEST
GREEN
(BLOCK
LETTERS)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T03547-US
Registered
Regular
85861437 2/27/2013
4450383 12/17/2013
12/17/2023
12/17/2023
Country
United
States
Trademark
HONEST
GREEN
&
DESIGN
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T03769-US
Registered
Regular
86121462 11/18/2013
4567433 7/15/2014
7/15/2024
7/15/2024
Country
United
States
Trademark
SELECT
NUTRITION
DISTRIBUTORS
&
design
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T03790-CA
Registered
Regular
1665705 2/27/2014
1665705
3/6/2017
3/6/2032
3/6/2032
Country
Canada
Trademark
SELECT
NUTRITION
(LOGO)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
10
TRADEMARK CASE PRINT
ClientCode Docket Number Status
Case Type
Appl. No. Appl. Date Reg. No. Reg. Date Exp. Date
Renewal Date
U010-UNF T03790-US
Registered
Regular
86140463 12/11/2013
4568143 7/15/2014
7/15/2024
7/15/2024
Country
United
States
Trademark
SELECT
NUTRITION
(LOGO)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T03805-US
Registered
Regular
86161202
1/9/2014
4584089 8/12/2014
8/12/2024
8/12/2024
Country
United
States
Trademark
HEALTHY
EXPLORATIONS
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T03806-US
Registered
Regular
86161218
1/9/2014
4584091 8/12/2014
8/12/2024
8/12/2024
Country
United
States
Trademark
HEALTHY
EXPLORATIONS
(LOGO)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T03807-CA
Registered
Intent
To
Use
Application
1663267 2/10/2014
963678 2/22/2017
2/22/2032
2/22/2032
Country
Canada
Trademark
CONNECTING
FARMS,
FOOD,
AND
FAMILIES
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T03829-CA
Registered
Intent
To
Use
Application
1663268 2/10/2014
963676 2/22/2017
2/22/2032
2/22/2032
Country
Canada
Trademark
UNISSANT
LA
FERME,
LES
ALIMENTS
ET
LES
FAMILLES
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T03855-US
Registered
Intent
To
Use
Application
86225526 3/19/2014
4740476 5/19/2015
5/19/2025
5/19/2025
Country
United
States
Trademark
CONNECTING
FARMS
TO
FAMILIES
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
11
TRADEMARK CASE PRINT
ClientCode
Docket
Number
Status
Case Type
Appl. No. Appl. Date Reg. No.
Reg. Date Exp. Date
Renewal Date
U010-UNF T03863-US
Registered
Intent
To
Use
Application
86232524 3/26/2014
4928045 3/29/2016
3/29/2026
3/29/2026
Country
United
States
Trademark
INDEPENDENT
ADVANTAGE
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T03947-US
Registered
Regular
78282038
8/1/2003
2912935 12/21/2004
12/21/2024
12/21/2024
Country
United
States
Trademark
FRITZIE
FRESH
(Stylized/Design)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T03948-US
Registered
Regular
74291185
7/6/1992
1757091
3/9/1993
3/9/2023
3/9/2023
Country
United
States
Trademark
FRITZIE
FRESH
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T04238-US
Registered
Regular
86830194 11/24/2015
4997883 7/12/2016
7/12/2026
7/12/2026
Country
United
States
Trademark
SUPPLY
CHAIN
BY
CLEARVUE
U010-UNF T04315-CA
Registered
Regular
1787771 6/20/2016 TMA991013 2/20/2018
2/20/2033
2/20/2033
Country
Canada
Trademark
UNFI
UNITED
NATURAL
FOODS
&
Design
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T04316-US
Registered
Regular
87080668 6/22/2016
5133119 1/31/2017
1/31/2027
1/31/2027
Country
United
States
Trademark
UNFI
UNITED
NATURAL
FOODS
&
design
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
12
TRADEMARK CASE PRINT
ClientCode Docket Number Status
Case Type
Appl. No. Appl. Date Reg. No. Reg. Date Exp. Date
Renewal Date
U010-UNF T04317-US
Registered
Regular
87080692 6/22/2016
5154740
3/7/2017
3/7/2027
3/7/2027
Country
United
States
Trademark
SELECT
NUTRITION
&
design
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T04319-US
Registered
Regular
87080739 6/22/2016
5133123 1/31/2017
1/31/2027
1/31/2027
Country
United
States
Trademark
ALBERT'S
ORGANICS
&
design
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T04330-US
Registered
Regular
87130441
8/8/2016
5137665
2/7/2017
2/7/2027
2/7/2027
Country
United
States
Trademark
HONEST
GREEN
ESOLUTIONS
BY
UNFI
and
Attorney
David
R.
Josephs
Design
(logo)
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T04523-US
Registered
Regular
87606963 9/13/2017
5479585 5/29/2018
5/29/2028
5/29/2028
Country
United
States
Trademark
ALBERT'S
FRESH
PRODUCE
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T04524-US
Registered
Regular
87607012 9/13/2017
5479586 5/29/2018
5/29/2028
5/29/2028
Country
United
States
Trademark
ALBERT'S
FRESH
PRODUCE
and
Design
(b/w
logo)
U010-UNF T04530-US
Filed
Intent
To
Use
Application
87667628 11/1/2017
Country
United
States
Trademark
UNFI
FRESH
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
13
TRADEMARK CASE PRINT
ClientCode Docket Number Status
Case Type
Appl. No. Appl. Date Reg. No. Reg. Date Exp. Date
Renewal Date
U010-UNF T04531-US
Filed
Intent
To
Use
Application
87667644 11/1/2017
Country
United
States
Trademark
UNFI
FRESH
and
Design
(b-w
logo)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T04559-CA
Filed
Regular
1186883 11/20/2017
Country
Canada
Trademark
PRO
ORGANICS
PRODUCE
&
FRESH
FOOD
Attorney
David
R.
Josephs
and
Design
Client\Division
United
Natural
Foods,
Inc.
U010-UNF T04594-US
Registered
Regular
76029019 4/17/2000
2766041 9/23/2003
9/23/2023
9/23/2023
Country
United
States
Trademark
KOYO
and
Design
(tree
logo)
Attorney
David
R.
Josephs
Client\Division
United
Natural
Foods,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
14
TRADEMARK CASE PRINT
ClientCode Docket Number Status
Case Type
Appl. No. Appl. Date Reg. No.
Reg. Date Exp. Date
Renewal Date
U010-CA
T04512-CA
Registered
Regular
1,795,478
8/11/2016 TMA992325
3/13/2018
3/13/2033
3/13/2033
Country
Canada
Trademark
SAVOR
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-CA
T04513-CA
Registered
Regular
1,066,193
7/11/2000 TMA593305 10/28/2003
10/28/2018
10/28/2018
Country
Canada
Trademark
ORGANIC
LIVING
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-CA
T04514-CA
Registered
Regular
1,103,199
5/17/2001 TMA626522 11/24/2004
11/24/2019
11/24/2019
Country
Canada
Trademark
ORGANIC
SENSATIONS
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-CA
T04515-CA
Registered
Regular
1,105,409
6/6/2001 TMA628142 12/10/2004
12/10/2019
12/10/2019
Country
Canada
Trademark
NATURAL
SENSATIONS
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-CA
T04516-CA
Registered
Regular
1,000,041 12/18/1998 TMA555693 12/19/2001
12/19/2031
12/19/2031
Country
Canada
Trademark
PRO
ORGANICS
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-CA
T04517-CA
Registered
Regular
1,000,039 12/18/1998 TMA555691 12/19/2001
12/19/2031
12/19/2031
Country
Canada
Trademark
CANADA'S
ORGANIC
FRESH
FOOD
LEADER
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
1
TRADEMARK CASE PRINT
ClientCode Docket Number Status
Case Type
Appl. No. Appl. Date Reg. No.
Reg. Date Exp. Date
Renewal Date
U010-BMB
T02170-US1
Registered
Regular
78609470 4/15/2005
3619430 5/12/2009
5/12/2019
5/12/2019
Country
United
States
Trademark
WOODSTOCK
FARMS
(WORD
MARK)
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T02170-US2
Registered
Regular
78609472 4/15/2005
3619431 5/12/2009
5/12/2019
5/12/2019
Country
United
States
Trademark
WOODSTOCK
FARMS
(WORD
MARK)
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T02170-US3
Registered
Regular
78609475 4/15/2005
3619432 5/12/2009
5/12/2019
5/12/2019
Country
United
States
Trademark
WOODSTOCK
FARMS
(WORD
MARK)
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T02171-US1
Registered
Regular
78723958 9/30/2005
3619439 5/12/2009
5/12/2019
5/12/2019
Country
United
States
Trademark
WOODSTOCK
FARMS
&
DESIGN
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T02171-US5
Registered
Regular
85831392 1/24/2013
4364898
7/9/2013
7/9/2023
7/9/2023
Country
United
States
Trademark
WOODSTOCK
FARMS
and
Design
(logo)
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T02176-US
Registered
Regular
75292335 5/15/1997
2327088
3/7/2000
3/7/2020
3/7/2020
Country
United
States
Trademark
GOURMET
ARTISAN
HANDCRAFTED
FOODS
AND
DESIGN
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
1
TRADEMARK CASE PRINT
ClientCode Docket Number Status
Case Type
Appl. No. Appl. Date Reg. No.
Reg. Date Exp. Date
Renewal Date
U010-BMB
T02177-US2
Registered
Regular
85165859 11/1/2010
3977545 6/14/2011
6/14/2021
6/14/2021
Country
United
States
Trademark
HARVEST
BAY
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T02181-US
Registered
Regular
78238990 4/17/2003
2895383 10/19/2004
10/19/2024
10/19/2024
Country
United
States
Trademark
NATURAL
SEA
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T02187-US
Registered
Regular
75222924
1/9/1997
2211644 12/15/1998
12/15/2018
12/15/2018
Country
United
States
Trademark
ORGANIC
BABY
CERTIFIED
ORGANIC
BABY
FOOD
AND
DESIGN
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T02195-US
Registered
Regular
646393 2/25/1987
1487657 5/10/1988
5/10/2028
5/10/2028
Country
United
States
Trademark
WOODSTOCK
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T02266-US
Registered
Regular
78302417 9/18/2003
2884380 9/14/2004
9/14/2024
9/14/2024
Country
United
States
Trademark
RISING
MOON
ORGANICS
&
Design
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T02283-US
Registered
Regular
74258939 3/25/1992
1831483 4/19/1994
4/19/2024
4/19/2024
Country
United
States
Trademark
COOL
FRUITS
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
2
TRADEMARK CASE PRINT
ClientCode Docket Number Status
Case Type
Appl. No. Appl. Date Reg. No.
Reg. Date Exp. Date
Renewal Date
U010-BMB
T02284-US
Registered
Regular
76106166 8/10/2000
2611611 8/27/2002
8/27/2022
8/27/2022
Country
United
States
Trademark
AH!
LASKA
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T02294-US
Registered
Regular
78038833 12/11/2000
2858711 6/29/2004
6/29/2024
6/29/2024
Country
United
States
Trademark
MEDITERRANEAN
ORGANIC
&
DESIGN
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T02295-US
Registered
Regular
73691997 10/26/1987
1493354 6/21/1988
6/21/2028
6/21/2028
Country
United
States
Trademark
LORIVA
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T02498-US
Registered
Regular
74506206 3/23/1994
1893236
5/9/1995
5/9/2025
5/9/2025
Country
United
States
Trademark
TUMARO'S
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T02503-US
Registered
Regular
75852865 11/17/1999
2465219
7/3/2001
7/3/2021
7/3/2021
Country
United
States
Trademark
TUMARO'S
GOURMET
TORTILLAS
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T02506-US
Registered
Regular
75683942 4/16/1999
2764541 9/16/2003
9/16/2023
9/16/2023
Country
United
States
Trademark
TUMARO'S
THE
ORIGINAL
GOURMET
WRAPS
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
3
TRADEMARK CASE PRINT
ClientCode Docket Number Status
Case Type
Appl. No. Appl. Date Reg. No.
Reg. Date Exp. Date
Renewal Date
U010-BMB
T02507-US
Registered
Regular
76302605 8/20/2001
2762465
9/9/2003
9/9/2023
9/9/2023
Country
United
States
Trademark
TUMARO'S
AMERICA'S
FAVORITE
GOURMET
TORTILLA
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T02677-US
Registered
Regular
77628776 12/8/2008
3647068 6/30/2009
6/30/2019
6/30/2019
Country
United
States
Trademark
BLUE
MARBLE
BRANDS
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T02698-US
Registered
Regular
74075573
7/5/1990
1656369 9/10/1991
9/10/2021
9/10/2021
Country
United
States
Trademark
FANTASTIC
FOODS
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T02701-US
Registered
Regular
74587161 10/18/1994
1928000 10/17/1995
10/17/2025
10/17/2025
Country
United
States
Trademark
NATURE'S
BURGER
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T02702-US
Registered
Regular
74485626
2/2/1994
2396643 10/24/2000
10/24/2020
10/24/2020
Country
United
States
Trademark
CHA-CHA
CHILI
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T02709-US
Registered
Regular
78814540 2/14/2006
3518298 10/14/2008
10/14/2028
10/14/2028
Country
United
States
Trademark
FANTASTIC
WORLD
FOODS
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
4
TRADEMARK CASE PRINT
ClientCode Docket Number Status
Case Type
Appl. No. Appl. Date Reg. No.
Reg. Date Exp. Date
Renewal Date
U010-BMB
T02746-US
Registered
Regular
78892521 5/25/2006
3218006 3/13/2007
3/13/2027
3/13/2027
Country
United
States
Trademark
MT
VIKOS
(Stylized)
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T02747-US
Registered
Regular
78318318 10/24/2003
2877744 8/24/2004
8/24/2024
8/24/2024
Country
United
States
Trademark
FETIRI
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T02769-CA
Filed
Regular
1816262 12/29/2016
Country
Canada
Trademark
FIELD
DAY
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T02769-US
Registered
Intent
To
Use
Application
77691780 3/16/2009
3782510 4/27/2010
4/27/2020
4/27/2020
Country
United
States
Trademark
FIELD
DAY
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T02769-US1
Registered
Intent
To
Use
Application
86495147
1/5/2015
4952407
5/3/2016
5/3/2026
5/3/2026
Country
United
States
Trademark
FIELD
DAY
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T03088-US
Registered
Intent
To
Use
Application
85226939 1/26/2011
4143766 5/15/2012
5/15/2022
5/15/2022
Country
United
States
Trademark
WOODSTOCK
EAT
BECAUSE
IT'S
GOOD!
(LOGO)
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
5
TRADEMARK CASE PRINT
ClientCode Docket Number Status
Case Type
Appl. No. Appl. Date Reg. No.
Reg. Date Exp. Date
Renewal Date
U010-BMB
T03088-US1
Registered
Intent
To
Use
Application
85230668 1/31/2011
4100138 2/14/2012
2/14/2022
2/14/2022
Country
United
States
Trademark
WOODSTOCK
EAT
BECAUSE
IT'S
GOOD!
(LOGO)
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T03089-US
Registered
Intent
To
Use
Application
85227329 1/27/2011
4143767 5/15/2012
5/15/2022
5/15/2022
Country
United
States
Trademark
WOODSTOCK
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T03089-US1
Registered
Intent
To
Use
Application
85230671 1/31/2011
4100139 2/14/2012
2/14/2022
2/14/2022
Country
United
States
Trademark
WOODSTOCK
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T03090-US
Registered
Intent
To
Use
Application
85227333 1/27/2011
4139993
5/8/2012
5/8/2022
5/8/2022
Country
United
States
Trademark
EAT
BECAUSE
IT'S
GOOD!
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T03090-US1
Registered
Intent
To
Use
Application
85230675 1/31/2011
4119519 3/27/2012
3/27/2022
3/27/2022
Country
United
States
Trademark
EAT
BECAUSE
IT'S
GOOD!
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T03143-US
Registered
Intent
To
Use
Application
85279490 3/29/2011
4191544 8/14/2012
8/14/2022
8/14/2022
Country
United
States
Trademark
HARVEST
BAY
and
Design
(logo
with
swoosh)
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
6
TRADEMARK CASE PRINT
ClientCode Docket Number Status
Case Type
Appl. No. Appl. Date Reg. No.
Reg. Date Exp. Date
Renewal Date
U010-BMB
T03390-US
Registered
Intent
To
Use
Application
85648416 6/11/2012
4426300 10/29/2013
10/29/2023
10/29/2023
Country
United
States
Trademark
NATURAL
SEA
PURE
WILD
SEAFOOD
and
Attorney
Design
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T03446-US
Registered
Intent
To
Use
Application
85736659 9/24/2012
4597798
9/2/2014
9/2/2024
9/2/2024
Country
United
States
Trademark
TUMARO'S
and
Design
(logo)
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T03447-US
Registered
Intent
To
Use
Application
85736607 9/24/2012
4597797
9/2/2014
9/2/2024
9/2/2024
Country
United
States
Trademark
TODAYS
THE
DAY.
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T03516-US
Registered
Intent
To
Use
Application
85821096 1/11/2013
4433922 11/12/2013
11/12/2023
11/12/2023
Country
United
States
Trademark
LET'S
SKIP
THE
SANDWICH.
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T03719-US
Registered
Intent
To
Use
Application
86046220 8/23/2013
5059843 10/11/2016
10/11/2026
10/11/2026
Country
United
States
Trademark
THANK
YOUR
FARMER!
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T03720-US
Registered
Intent
To
Use
Application
86046236 8/23/2013
4941757 4/19/2016
4/19/2026
4/19/2026
Country
United
States
Trademark
GIVE
THANKS
TO
YOUR
FARMER!
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
7
TRADEMARK CASE PRINT
ClientCode Docket Number Status
Case Type
Appl. No. Appl. Date Reg. No.
Reg. Date Exp. Date
Renewal Date
U010-BMB
T03816-US
Registered
Regular
86174231 1/24/2014
4596640
9/2/2014
9/2/2024
9/2/2024
Country
United
States
Trademark
BLUE
MARBLE
BRANDS
(LOGO)
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T03864-US
Registered
Regular
86236978 3/31/2014
4617649 10/7/2014
10/7/2024
10/7/2024
Country
United
States
Trademark
RISING
MOON
ORGANICS
(LOGO)
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T03866-US
Registered
Regular
86241035
4/3/2014
4588960 8/19/2014
8/19/2024
8/19/2024
Country
United
States
Trademark
A
WORLD
OF
GOOD
FOOD.
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T03892-US
Registered
Intent
To
Use
Application
86405810 9/25/2014
5142211 2/14/2017
2/14/2027
2/14/2027
Country
United
States
Trademark
WOODSTOCK
MINIME'S
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T03937-US
Registered
Intent
To
Use
Application
86330658
7/8/2014
5365276 12/26/2017
12/26/2027
12/26/2027
Country
United
States
Trademark
TASTY.TRUSTY.SNACKS!
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T04020-US
Registered
Regular
86405735 9/25/2014
4759169 6/23/2015
6/23/2025
6/23/2025
Country
United
States
Trademark
RISING
MOON
ORGANICS
(WORDMARK)
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
8
TRADEMARK CASE PRINT
ClientCode Docket Number Status
Case Type
Appl. No. Appl. Date Reg. No.
Reg. Date Exp. Date
Renewal Date
U010-BMB
T04081-CA
Filed
Intent
To
Use
Application
1816260 12/29/2016
Country
Canada
Trademark
FIELD
DAY
and
Design
(logo)
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T04081-US
Registered
Intent
To
Use
Application
86495156
1/5/2015
4952408
5/3/2016
5/3/2026
5/3/2026
Country
United
States
Trademark
FIELD
DAY
and
Design
(logo)
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T04084-US
Registered
Intent
To
Use
Application
86516878 1/28/2015
5233035 6/27/2017
6/27/2027
6/27/2027
Country
United
States
Trademark
WILDLY
SIMPLE
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T04265-US
Registered
Intent
To
Use
Application
86904506 2/11/2016
5266866 8/15/2017
8/15/2027
8/15/2027
Country
United
States
Trademark
EASY
GOURMET
TONIGHT!
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T04308-US
Registered
Regular
87038020 5/16/2016
5201568
5/9/2017
5/9/2027
5/9/2027
Country
United
States
Trademark
RISING
MOON
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T04309-US
Registered
Regular
87038058 5/16/2016
5201569
5/9/2017
5/9/2027
5/9/2027
Country
United
States
Trademark
RISING
MOON
&
Design
(logo)
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
9
TRADEMARK CASE PRINT
ClientCode Docket Number Status
Case Type
Appl. No. Appl. Date Reg. No.
Reg. Date Exp. Date
Renewal Date
U010-BMB
T04310-US
Registered
Regular
87038422 5/16/2016
5221254 6/13/2017
6/13/2027
6/13/2027
Country
United
States
Trademark
TEAM
NON-GMO
U010-BMB
T04311-US
Registered
Regular
87038466 5/16/2016
5221255 6/13/2017
6/13/2027
6/13/2027
Country
United
States
Trademark
TEAM
NON-GMO
LEARN
SHARE
GROW
and
Attorney
Design
(logo)
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T04334-US
Registered
Regular
87139761 8/16/2016
5109966 12/27/2016
12/27/2026
12/27/2026
Country
United
States
Trademark
MT
VIKOS
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T04335-US
Registered
Intent
To
Use
Application
87139903 8/16/2016
5257734
8/1/2017
8/1/2027
8/1/2027
Country
United
States
Trademark
MT
VIKOS
&
DESIGN
(NEW
2016
LOGO)
U010-BMB
T04369-US
Registered
Regular
76629617 1/28/2005
3200092 1/23/2007
1/23/2027
1/23/2027
Country
United
States
Trademark
ASIAN
GOURMET
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T04370-US
Registered
Regular
76236101
4/6/2001
2784682 11/18/2003
11/18/2023
11/18/2023
Country
United
States
Trademark
BELLA
FAMIGLIA
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
10
TRADEMARK CASE PRINT
ClientCode Docket Number Status
Case Type
Appl. No. Appl. Date Reg. No.
Reg. Date Exp. Date
Renewal Date
U010-BMB
T04371-US
Registered
Regular
76503792
4/3/2003
2829576
4/6/2004
4/6/2024
4/6/2024
Country
United
States
Trademark
TROPICAL
PEPPER
CO.
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T04372-US
Registered
Regular
72096413
4/4/1960
713619
4/4/1961
4/4/2021
4/4/2021
Country
United
States
Trademark
HADDON
HOUSE
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T04373-US
Registered
Regular
73009552 12/26/1973
1013016 6/10/1975
6/10/2025
6/10/2025
Country
United
States
Trademark
MUSETTE
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T04374-US
Registered
Regular
77652138 1/19/2009
3672297 8/25/2009
8/25/2019
8/25/2019
Country
United
States
Trademark
MEDFORD
FARMS
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T04375-US
Registered
Regular
73251781 2/27/1980
1186982 1/19/1982
1/19/2022
1/19/2022
Country
United
States
Trademark
MEDFORD
FARMS
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T04384-US
Registered
Intent
To
Use
Application
87265265 12/12/2016
5325618 10/31/2017
10/31/2027
10/31/2027
Country
United
States
Trademark
HOOKED
ON
ORGANIC
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
11
ClientCode Docket Number Status
Case Type
Appl. No. Appl. Date Reg. No.
Reg. Date Exp. Date
Renewal Date
TRADEMARK CASE PRINT
U010-BMB
T04605-US
Docket
Intent
To
Use
Application
Country
United
States
Trademark
KOYO
(word
mark)
U010-BMB
T04606-US
Docket
Intent
To
Use
Application
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
Country
United
States
Trademark
KOYO
AN
UMAMI
ADVENTURE
(word
mark)
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-BMB
T04607-US
Docket
Intent
To
Use
Application
Country
United
States
Trademark
KOYO
and
Design
(leaf
logo)
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
12
TRADEMARK CASE PRINT
ClientCode Docket Number Status
Case Type
Appl. No. Appl. Date Reg. No. Reg. Date Exp. Date
Renewal Date
U010-GG
T04348-US
Registered
Regular
78218347 2/24/2003
3607524 4/14/2009
4/14/2019
4/14/2019
Country
United
States
Trademark
GOURMET
GURU
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
1
TRADEMARK CASE PRINT
ClientCode
Docket Number Status
Case Type
Appl. No. Appl. Date Reg. No.
Reg. Date Exp. Date
Renewal Date
U010-AO
T03722-US
Registered
Intent
To
Use
Application
86049862 8/28/2013
4642256 11/18/2014
11/18/2024
11/18/2024
Country
United
States
Trademark
ORGANIC
PRODUCE
PRODIGY
U010-AO
T03723-US
Registered
Intent
To
Use
Application
86051139 8/29/2013
4642265 11/18/2014
11/18/2024
11/18/2024
Country
United
States
Trademark
ORGANIC
PRODUCE
PRODIGY
&
DESIGN
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
1
TRADEMARK CASE PRINT
ClientCode
Docket Number Status
Case Type
Appl. No. Appl. Date Reg. No.
Reg. Date Exp. Date
Renewal Date
U010-TFF
T04021-US
Registered
Regular
76657796
4/3/2006
3245893 5/29/2007
5/29/2027
5/29/2027
Country
United
States
Trademark
CALIFORNIA
COLD
LOGISTICS
(Stylized/Design)
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-TFF
T04023-US1
Registered
Regular
76065296
6/5/2000
2603587
8/6/2002
8/6/2022
8/6/2022
Country
United
States
Trademark
NONNA'S
KITCHEN
(Stylized/Design)
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-TFF
T04024-US
Registered
Regular
76390942
4/3/2002
2766326 9/23/2003
9/23/2023
9/23/2023
Country
United
States
Trademark
GOLD
RUSH
CREAMERY
NATURAL
CHEESE
Attorney
(Stylized/Design)
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-TFF
T04025-US
Registered
Regular
586340
3/6/1986
1462111 10/20/1987
10/20/2027
10/20/2027
Country
United
States
Trademark
NONNA'S
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
U010-TFF
T04026-US
Registered
Regular
76715251 10/24/2013
4553705 6/24/2014
6/24/2024
6/24/2024
Country
United
States
Trademark
DIANA
SUPREME
(Stylized/Design)
U010-TFF
T04118-US
Registered
Intent
To
Use
Application
86557527
3/9/2015
4840579 10/27/2015
10/27/2025
10/27/2025
Country
United
States
Trademark
BOO
CHIPS
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
1
TRADEMARK CASE PRINT
ClientCode
Docket Number Status
Case Type
Appl. No. Appl. Date Reg. No.
Reg. Date Exp. Date
Renewal Date
U010-TFF
T04560-US
Filed
Regular
87943551 5/31/2018
Country
United
States
Trademark
NONNA'S
KITCHEN
and
Design
(with
banner)
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
2
TRADEMARK CASE PRINT
ClientCode
Docket Number Status
Case Type
Appl. No. Appl. Date Reg. No.
Reg. Date Exp. Date
Renewal Date
U010-UNT
T04558-US
Filed
Intent
To
Use
Application
87687890 11/16/2017
Country
United
States
Trademark
GROOVE
Attorney
Client\Division
David
R.
Josephs
United
Natural
Foods,
Inc./UNFI
Canada,
Inc.
SCHEDULE 9.1.14
ENVIRONMENTAL MATTERS
None.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
Page
1
1.
Proceedings and investigations pending or threatened against Borrowers or Subsidiaries:
SCHEDULE 9.1.16
LITIGATION
•
In December 2008, a class action complaint was filed in the United States District Court for the Western District of
Wisconsin against Supervalu alleging that a 2003 transaction between Supervalu and C&S Wholesale
Grocers, Inc. (“ C&S ”) was a conspiracy to restrain trade and allocate markets. In the 2003 transaction,
Supervalu purchased certain assets of the Fleming Corporation as part of Fleming Corporation’s
bankruptcy proceedings and sold certain assets of Supervalu to C&S that were located in New England.
Three other retailers filed similar complaints in other jurisdictions and the cases were consolidated and
are proceeding in the United States District Court in Minnesota. The complaints allege that the conspiracy
was concealed and continued through the use of non-compete and non-solicitation agreements and the
closing down of the distribution facilities that Supervalu and C&S purchased from each other. Plaintiffs
are divided into Midwest plaintiffs and New England plaintiff and are seeking monetary damages,
injunctive relief and attorneys’ fees. On June 19, 2015, the District Court Magistrate Judge entered an
order that decided a number of matters including granting Midwest plaintiffs' request to seek class
certification for certain Midwest Distribution Centers and denying New England plaintiff’s request to add
an additional New England plaintiff and denying plaintiffs’ request to seek class certification for a group
of New England retailers. In September 2015, the New England plaintiff appealed to the 8th Circuit the
denial of the request to add an additional New England plaintiff and to seek class certification for a group
of New England retailers and the hearing before the 8th Circuit occurred on May 17, 2016. On September
7, 2016, the District Court granted Midwest plaintiffs’ motion to certify five Midwest distribution center
classes, only one of which sued Supervalu (the non-arbitration Champaign distribution center class). On
March 1, 2017, the 8th Circuit denied the New England plaintiff’s appeals seeking to join an additional
New England plaintiff and the appeal seeking the ability to move for class certification of a smaller New
England class. At a mediation on May 25, 2017, Supervalu reached a settlement with the non-arbitration
Champaign distribution center class, which is the one Midwest class suing Supervalu. Supervalu and the
Midwest plaintiffs entered into a settlement agreement and the Court granted final approval of the
settlement on November 17, 2017. The material terms of the settlement include: (1) denial of wrongdoing
and liability by Supervalu; (2) release of all Midwest plaintiffs’ claims against Supervalu related to the
allegations and transactions at issue in the litigation that were raised or could have been raised by the non-
arbitration Champaign distribution center class; and (3) payment by Supervalu of $8.75 million. There is
no contribution between C&S and Supervalu, and C&S did not settle the claims alleged against them. The
New England Village Markets plaintiff is not a party to the settlement and is pursuing its individual
claims and potential class actions claims against Supervalu, which at this time are determined as remote.
On February 15, 2018, Supervalu filed a summary judgment and Daubert motion and the New England
plaintiff filed a motion for class certification. The hearing on the motions occurred
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.16- 1
on May 16, 2018, and on July 27, 2018, the Court ruled in Supervalu’s favor granting both the Daubert and summary
judgment motions. On August 15, 2018, the plaintiff appealed to the 8 th Circuit.
•
In August and November 2014, four class action complaints were filed against Supervalu relating to the criminal
intrusions into its computer network announced by Supervalu in fiscal 2015 (the “ Criminal Intrusion ”).
The cases were centralized in the Federal District Court for the District of Minnesota under the caption In
Re: SUPERVALU INC. Customer Data Security Breach Litigation. On June 26, 2015, the plaintiffs filed
a Consolidated Class Action Complaint. Supervalu filed a Motion to Dismiss the Consolidated Class
Action Complaint and the hearing took place on November 3, 2015. On January 7, 2016, the District
Court granted the Motion to Dismiss and dismissed the case without prejudice, holding that the plaintiffs
did not have standing to sue as they had not met their burden of showing any compensable damages. On
February 4, 2016, the plaintiffs filed a motion to vacate the District Court’s dismissal of the complaint or
in the alternative to conduct discovery and file an amended complaint, and Supervalu filed its response in
opposition on March 4, 2016. On April 20, 2016, the District Court denied plaintiffs’ motion to vacate the
District Court’s dismissal or in the alternative to amend the complaint. On May 18, 2016, plaintiffs
appealed to the 8th Circuit and on May 31, 2016, Supervalu filed a cross-appeal to preserve its additional
arguments for dismissal of the plaintiffs’ complaint. On August 30, 2017, the 8th Circuit affirmed the
dismissal for 14 out of the 15 plaintiffs finding they had no standing. The 8th Circuit did not consider
Supervalu’s cross-appeal and remanded the case back for consideration of Supervalu’s additional
arguments for dismissal against the one remaining plaintiff. On October 30, 2017, Supervalu filed its
motion to dismiss the remaining plaintiff and on November 7, 2017, the plaintiff filed a motion to amend
its complaint. The Court held a hearing on the motions on December 14, 2017, and on March 7, 2018, the
District Court denied plaintiff’s motion to amend and granted Supervalu’s motion to dismiss. On March
14, 2018, plaintiff appealed to the 8th Circuit.
• On June 30, 2015, Supervalu received a letter from the Office for Civil Rights of the U.S. Department of Health and
Human Services (“ OCR ”) seeking documents and information regarding Supervalu’s HIPAA breach
notification and reporting from 2009 to the present. The letter indicates that the OCR Midwest Region is
doing a compliance review of Supervalu’s alleged failure to report small breaches of protected health
information related to its pharmacy operations (e.g., any incident involving less than 500 individuals). On
September 4, 2015, Supervalu submitted its response to OCR’s letter. [***]. The potential penalties related
to the issues being investigated are up to $50 thousand per violation (which can be counted per day) with
a $1.5 per calendar year maximum for multiple violations of a single provision (with the potential for
finding violations of multiple provisions each with a separate $1.5 per calendar year maximum); however,
as noted above, any actual penalties will be determined only after consideration by OCR of various
factors, including the nature of any violation, remedial actions taken by Supervalu and other factors
determined relevant by OCR.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.16- 2
• On September 21, 2016, Supervalu’s retail banner Farm Fresh received an administrative subpoena issued by the
Drug Enforcement Administration (“ DEA ”) on September 9, 2016. In addition to requesting information
on Farm Fresh’s pharmacy policies and procedures generally, the subpoena also requested the production
of documents that are required to be kept and maintained by Farm Fresh pursuant to the Controlled
Substances Act and its implementing regulations. On November 23, 2016, Farm Fresh responded to the
subpoena and is cooperating fully with DEA’s additional requests for information. On February 8, 2018,
Farm Fresh received a letter from the US Attorney’s Office asserting violations of the Controlled
Substances Act and the potential for penalties. Farm Fresh provided its response to the alleged violations
on April 30, 2018., and discussions with the DEA/USAO continue. While Supervalu cannot predict the
outcome of this matter at this time, Supervalu does not believe that a monetary loss is probable. However,
Supervalu believes that a monetary loss is reasonably possible, but cannot estimate the amount of any
such loss as Supervalu does not know the amount of monetary penalties, if any, the DEA may seek. [***].
• On November 30, 2015, an amended complaint was filed alleging that Supervalu and Albertson's pharmacies
overcharged government health programs (Medicare, Medicaid, Tricare) for prescriptions. This matter
started in 2012 when Supervalu received a subpoena from the Department of Justice seeking various
documents regarding the Company's price match program and pharmacy prescription pricing. We fully
cooperated with the government and provided the documents requested along with a white paper as to
why we didn't believe we had overcharged government health programs. We heard nothing further on this
matter until we learned in September 2015 that there had been a Qui Tam action filed by Schutte and
Yarberry in August 2011. The Government declined to pursue the matter on May 22, 2015, and the court
unsealed the case on May 27, 2015. The relators (Yarberry and Schutte) decided to pursue the matter
despite the government's declination. They filed an amended complaint asserting that Supervalu and
Albertson’s defrauded government health programs in several states when reporting and calculating Usual
& Customary (U&C) pricing for reimbursement from government health programs. The relators assert
that when Supervalu price matched certain competitors' generic prescription prices it should have adjusted
its U&C price to match that of the price matched pricing. On January 29, 2016, Supervalu filed a Motion
to Dismiss and on October 21, 2016 the Court denied the motion. On February 2, 2018, the plaintiffs
submitted expert reports asserting single damages of $169M, but recently corrected an error which
reduced its single damages to $139M. Based on our expert's analysis of the report, and assuming
plaintiffs' theory is correct which we vigorously dispute, Supervalu’s share would be single damages of
approximately $26M. Under the False Claims Act damages are trebled and penalties are imposed based
on the number of false claims. On May 21, 2018, we filed our motions for Summary Judgment and a
Daubert motion (to exclude experts) and plaintiffs filed motions for summary judgment. Plaintiffs also
filed Summary Judgment and Daubert motions. The parties are waiting for the Court to rule on the
motions. The trial date is currently scheduled for December 4, 2018.
• On August 24, 2018, two class action complaints ( Wallace v. Supervalu Inc., et.al; Gusinsky v. Supervalu, Inc. et.
al.) were filed in Delaware Federal District Court
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.16- 3
alleging violations of securities laws as a result of the proposed merger with United Natural Foods, Inc. The
complaints allege that the Supervalu’s proxy statement fails to disclose material information necessary for
shareholders to assess the fairness of the merger.
2.
Pending Commercial Tort Claim held by any Obligor:
Case Name
Defendant
Summary of Claim
American Express Antitrust Litigation
American Express
Antitrust case regarding Interchange Rates and anti-steering
rules
In re: Processed Egg Products Antitrust Litigation
Seventeen Egg Producers including United Egg
Producers and Sparboe Farms
Price fixing - eggs
Androgel Antitrust
Unimed Pharmaceuticals Inc.;
Solvay Pharmaceuticals, Inc.;
Actavis, Inc.; Par Pharmaceuticals, Inc.; Paddock
Laboratories, Inc.
Brand drug maker Solvay Pharmaceuticals (predecessor to
Abbvie) alleged to have filed sham patent litigation and
entered into reverse payment agreements with generic mfrs.
In re Broiler Chicken Antitrust Litigation
Many poultry producers including Tyson and
Perdue
Price fixing- broiler chickens
In re Lipitor Antitrust Litigation
In re: Effexor XR Antitrust Litigation
Pfizer, Inc.;
Pfizer Manufacturing Ireland;
Warner-Lambert Company;
Warner-Lambert Company LLC;
Ranbaxy, Inc.;
Ranbaxy Pharmaceuticals, Inc.;
Ranbaxy Laboratories Limited
Wyeth, Inc.; American Home Products;
Wyeth-Whitehall Pharmaceuticals;
Wyeth Pharmaceutical Company;
Teva Pharmaceuticals USA, Inc.;
Teva Pharmaceuticals Industries, Ltd.;
Antitrust case alleging conspiracy to delay market entry of a
generic version
Antitrust case alleging conspiracy to delay market entry of
generic version
In re: Processed Egg Products Antitrust Litigation
Seventeen Egg Producers including United Egg
Producers and Sparboe Farms
Price fixing - eggs
Supervalu v. Bumble Bee, et al.
Starkist Company;
Bumble Bee Foods, LLC;
Tri-Union Seafoods, LLC d/b/a Chicken of the
Sea
Price fixing – shelf stable packaged seafood
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.16- 4
SCHEDULE 9.1.18
ERISA; CANADIAN PLANS
1. One or more Obligors maintained, established, contributed to or been obligated to contribute to the following Multiemployer Plans:
Teamsters Joint Council 32 – Employers H&W Fund
Indiana Teamsters Safety Training Educational Trust Fund
IUOE & Pipeline Employers Health & Welfare Fund
• United Wire, Metal and Machine Pension Fund (the Woodstock Farms location)
• New England Teamsters and Trucking Industry Pension Fund (the Leicester, MA location)
• Western Conference of Teamsters Pension Trust
• Bakery and Confectionery Union and Industry International Health Benefits Fund
• District 77 IAM&AW Welfare Association
•
•
• Machinists Health & Welfare Trust
• Minnesota Teamsters Health & Welfare Plan
•
• Minnesota Teamsters HRA Plan
• Montana Teamsters/Contractors-Employers Trust
• Montana Teamsters/Contractors-Employers Trust (Retirees)
• Montana Teamsters/Contractors-Employers Trust (HRA)
• Minneapolis Retail Meat Cutters & Food Handlers Health & Welfare Fund
• Automotive, Petroleum & Allied Industries Employees Health & Welfare Trust
• Central Pennsylvania Teamsters Health & Welfare Fund
• Central States Southeast & Southwest Areas Health & Welfare Fund
• Washington Teamsters Welfare Trust
• Washington Bakers Trust
• Northwest IAM Benefit Trust
• Northern Minnesota - Wisconsin Area Retail Food Health and Welfare Fund
• Oregon Teamster Employers Trust
Sound Health &Wellness Trust
•
Southern States Savings Plan
•
St. Louis Labor Healthcare Network
•
Teamsters & Employers Welfare Trust of Illinois
•
Teamsters 206 Employers Trust
•
Teamsters Local 610 Prescripticare Trust Fund
•
Teamsters and Food Employers Security Trust Fund
•
•
Twin Cities Bakery Workers Health & Welfare Fund
• UFCW Local 88 & Employers Health & Welfare Fund
• UFCW Local 1189 & St. Paul Food Employers Health and Welfare Plans (formerly Local 789)
• UFCW Union Local 655 Welfare Fund
• UFCW Unions & Employers Midwest Health Benefits Fund
• UFCW Unions & Participating Employers Health and Welfare Fund
• UFCW Unions & Participating Employers Legal Fund
Teamsters Medicare Trust for Retired Employees
•
• District 9 IAM&AW Welfare Trust
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.18- 1
Locals 302 & 612 IUOE Construction Industry Health and Security Fund
Employer-Teamsters Local Nos. 175 & 505 Pension Trust Fund
Employers and Local 534 Grocery Employees Pension Fund
Employers and Local 534 Meat Employees Pension Fund
Food Employers Labor Relations Association (FELRA) and UFCW Pension Fund
International Association of Machinists National Pension Fund
•
• Automotive Machinists Pension Trust
• Bakery and Confectionery Union and Industry International Pension Fund
• Central Pension Fund of the IUOE and Participating Employers
• Central States, SE & SW Areas Pension Fund
•
•
•
•
•
• Minneapolis Food Distributing Industry Pension Plan
• Minneapolis Retail Meat Cutters and Food Handlers Pension Fund
• Minnesota Bakers Union Pension Plan
• Minnesota Teamsters 401(k) Plan
• Northern Minnesota / Wisconsin Area Retail Clerks Pension Fund
•
• UFCW 1189 & St. Paul Food Employers Defined Contribution Plan
• UFCW Consolidated Pension Plan
• UFCW International Union-Industry Pension Fund
• UFCW Union Local 655 Food Employers Joint Pension Plan and Trust
• UFCW Unions and Employers Midwest Pension Fund
• UFCW Unions and Employers Pension Fund
• UFCW Unions and Participating Employers Pension Fund
•
Sound Retirement Trust
Stationary Engineers Training Local 286 Journeymen Upgrading, Apprenticeship Training, and Training Trust
2.
[***]
3. Supervalu has withdrawn from certain Multiemployer Plans which could result in Supervalu incurring withdrawal liability under
Title IV of ERISA in the future. Supervalu’s estimate of such potential liability is set forth in Supervalu’s Annual Report on Form 10-
K, as filed with the SEC on April 24, 2018.
4. The SUPERVALU Retirement Plan and Unified Grocers, Inc. Cash Balance Pension Plan have Unfunded Pension Liabilities.
5. On April 24, 2018, Supervalu announced that it is pursuing the sale of the corporately owned and operated retail operations of its
Shop ‘n Save retail banner based in the Saint Louis, Missouri region (including the operations of the distribution center dedicated to
supplying such retail operations) and that those operations are now reported in Supervalu’s financial statements as assets held for sale
within discontinued operations. The sale or closure of certain of these operations could result in triggering withdrawal liability under
ERISA.
6.
[***]
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.18- 2
SCHEDULE 9.1.20
LABOR CONTRACTS
1. Agreement between UNFI and Teamsters Local Union No. 117, effective March 1, 2017 – February 28, 2021.
2. Agreement between UNFI and Chaufers, Teamsters & Helpers Local Union No 238, effective July 2, 2017 – July 1, 2021.
3. Agreement between United Natural Foods Inc. and Teamsters Local 493, effective August 1, 2014 – July 31, 2019.
4. Agreement between United Natural Trading Co. dba Woodstock Farms Manufacturing Co and Local 810 International Brotherhood
of Teamsters, effective July 1, 2017 – March 20, 2019.
5. Agreement between Nor-Cal Produce, Inc. and Chauffeurs Teamsters and Helpers Local Union No. 150, effective June 1, 2014 –
May 31, 2020.
6. Agreement between United Natural Foods Inc. and IBT Local 63 (chartered by the International Brotherhood of Teamsters,
Chauffeurs, Warehousemen and Helpers of America), effective March 12, 2016 – March 20, 2019.
7. Agreement between Teamsters Local Union No. 493 and United Natural Foods Inc., effective August 1, 2014 – July 31, 2019.
8. Agreement between Teamsters Local No. 445 and United Natural Foods Inc., effective August 1, 2017 – July 31, 2020.
9. Agreement between Teamsters Local 419 and United Natural Foods Canada, Inc., effective March 1, 2017 – March 5, 2022.
10. Agreement between SuperValu, Inc., Hazelwood (St. Louis) Distribution Company, Inc. and International Association of
Machinists and Aerospace Workers, District No. 9, effective May 8, 2016 – November 9, 2019.
11. Agreement between Advantage Logistics Rocky Mountain and International Union of Operating Engineers, Local Union No. 1,
effective June 20, 2016 –June 15, 2019.
12. Agreement between the Lancaster Distribution Center of SuperValu, Inc. and United Steel, Paper and Forestry, Rubber,
Manufacturing, Energy, Allied Industrial and Service Workers International Union, AFL-CIO-CLC, Local Union 1035-11,
effective October 27, 2015 – January 26, 2019.
13. Agreement between SuperValu, Inc. Tacoma – Inventory Control and International Brotherhood of Teamsters, Local Union No.
117, effective July 15, 2018 – July 17, 2021.
14. Agreement between SuperValu, Inc. Tacoma - Warehouse and International Brotherhoods of Teamsters, Local Union No. 117,
effective July 15, 2018 – July 17, 2021.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.25- 1
15. Agreement between Cub Foods, Duluth and United Food and Commercial Workers Union, Local No. 1189, effective November 1,
2017 – October 31, 2020.
16. Agreement between United Food and Commercial Workers Union, Local No. 1189 and Cub Gold, effective April 3, 2016 – April
6, 2019.
17. Agreement between United Food and Commercial Workers Union, Local No. 1189 and Cub Foods, St. Paul, effective April 3, 2016
– April 6, 2019.
18. Agreement between SuperValu, Inc. Fargo Division (Drivers, Warehouse and Office) and International Brotherhood of Teamsters,
Local No. 120, effective June 1, 2017 through June 1, 2019.
19. Agreement between SuperValu, Inc. Minneapolis (Hopkins) – Drivers and Warehouse and International Brotherhood of Teamsters,
Local No. 120, effective June 1, 2018 – May 31, 2022.
20. Agreement between SuperValu Stores, Inc. (d/b/a Cub Foods), Grocery – Freeport Store and UFCW Local 1546, effective August
27, 2017 – June 27, 2020
21. Agreement between SuperValu Stores, Inc. (d/b/a Cub Foods), Meat – Freeport Store and UFCW Local 1546, effective August 27,
2017 – June 27, 2020.
22. Agreement between SuperValu, Inc. – Billings Distribution Center and Teamsters Local Union No. 190, and between SuperValu,
Inc. – Great Falls, Montana Drivers and Teamsters Local Union No. 2, effective April 22, 2018 – April 22, 2023.
23. Agreement between Bakery, Confectionery, Tobacco Workers and Grain Millers Union, Twin Cities Local 22, AFL-CIO and Cub
Foods, effective September 6, 2015 – September 8, 2018.
24. Agreement between Shoppers Food and Pharmacy and United Food and Commercial Workers Union, Local 27, effective July 9,
2017 – July 11, 2020.
25. Agreement between SuperValu Tacoma Grocery Division and International Association of Machinists and Aerospace Workers,
AFL-CIO, District Lodge No. 160, Automotive Machinists, Local No. 297, effective July 10, 2014 – July 14, 2018.
26. Collective Bargaining Agreement between SuperValu, Inc. New Stanton and International Brotherhood of Teamsters, Local Union
No. 30, effective June 5, 2016 – June 1, 2019 (Driver Agreement).
27. Collective Bargaining Agreement between SuperValu, Inc. New Stanton and International Brotherhood of Teamsters, Local Union
No. 30, effective June 5, 2016 – June 1, 2019 (Building and Equipment Maintenance Employees).
28. Collective Bargaining Agreement between SuperValu, Inc. New Stanton and International Brotherhood of Teamsters, Local Union
No. 30, effective June 5, 2016 – June 1, 2019 (Warehouse Agreement).
29. Agreement between SuperValu, Inc. and International Brotherhood of Teamsters, Union Local No. 313 (Tacoma Warehouse
Receiving & Billing Clerks), effective July 15, 2018 – July 17, 2021.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.25- 2
30. Agreement between SuperValu, Inc. and International Brotherhood of Teamsters, Local No. 313, (Tacoma - Drivers) effective July
15, 2018 – July 17, 2021.
31. Labor Agreement between SuperValu, Inc. and Bakery, Confectionery, Tobacco Workers and Grain Millers International Union
Local 358, (Mechanicsville - Warehouse) effective February 1, 2018 – January 23, 2021.
32. Agreement between Shoppers Food and Pharmacy and United Food & Commercial Workers Union, Local 400, effective July 9,
2017 – July 11, 2020.
33. Agreement between SuperValu, Inc., Fort Wayne Distribution Center and International Brotherhood of Teamsters, Local Union No.
414, effective June 15, 2017 – September 14, 2019.
34. Agreement between Unified Grocers, Inc. Stockton (Automotive Workers) and Teamsters Local 439, effective September 20, 2015
– September 19, 2020.
35. Agreement between Unified Grocers, Inc. Stockton (Wholesale Delivery Drivers) and Teamsters Local 439, effective September
20, 2015 – September 19, 2020.
36. Agreement between Unified Grocers, Inc. Stockton (Dry Warehouse) and Teamsters Local Union No. 439, effective September 20,
2015 – September 19, 2020.
37. Agreement between Unified Grocers, Inc. Stockton (Frozen Foods Warehouse) and Teamsters Local Union No. 439, effective
September 19, 2015 – September 19, 2020.
38. Agreement between Unified Grocers, Inc. Stockton (Truck Mechanics) and Teamsters Local 439, effective September 19, 2015 and
September 19, 2020.
39. Agreement between Advantage Logistics Inc. (Denver/Rocky Mountain - Warehouse) and International Brotherhood of Teamsters,
Local Union No. 455, effective September 25, 2016 – September 26, 2020.
40. Agreement between Advantage Logistics Colorado South (Warehouse) and International Brotherhood of Teamsters, Local Union
No. 455, effective April 24, 2016 – April 24, 2021.
41. Agreement between Unified Grocers, Inc. (Commerce and Santa Fe Springs, Automotive Workers) and International Brotherhood
of Teamsters, Local 495, effective September 20, 2015 – September 19, 2020.
42. Agreement between Shop ‘n Save Warehouse Foods, Inc. (Maintenance) and International Brotherhood of Teamsters, Teamsters
and Chauffeurs Local Union No. 525, effective July 17, 2016 – July 13, 2019.
43. Collective Bargaining Agreement between Shop ‘n Save Warehouse Foods, Inc. (Jerseyville – Meat/Deli) and U.F.C.W. Meat
Cutters’ Union Local 534, effective October 7, 2012 – December 13, 2014.
44. Collective Bargaining Agreement between Shop ‘n Save Warehouse Foods, Inc. (Metro Illinois - Clerks) and United Food and
Commercial Workers International Union, Local 534, effective October 17, 2010 – October 19, 2013.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.25- 3
45. Agreement between Shop ‘n Save Warehouse Foods, Inc., a member of the Greater St. Louis Food Employers’ Council (St. Louis -
Meat, Deli & Seafood) – and the United Food and Commercial Workers Union, Local No. 534, effective July 18, 2011 – December
14, 2014 (as extended by the Extension Agreement between the Greater St. Louis Food Employers’ Council (Shop ‘n Save St.
Louis) and UFCW Local 534.
46. Agreement between SuperValu Eastern Region, Mechanicsville, Virginia (Drivers) and International Brotherhood of Teamsters,
Local Union No. 592, effective May 7, 2017 – May 7, 2022.
47. Collective Bargaining Agreement between SuperValu, Inc., Hazelwood Distribution Company, Inc. (St. Louis – Drivers) and
International Brotherhood of Teamsters, Miscellaneous Drivers, Helpers, Health Care and Public Employees Union, Local 610,
effective March 27, 2016 – March 30, 2019.
48. Agreement between SuperValu Stores, Inc. (Anniston) and International Brotherhood of Teamsters, Local 612, effective March 24,
2017 – March 26, 2022.
49. Agreement between SuperValu, Inc., Hazelwood Distribution Company, Inc. (St. Louis - Service Garage) and Automotive,
Petroleum and Allied Industries Employees Union, Local No. 618, effective March 27, 2016 – March 30, 2019.
50. Agreement between Unified Grocers, Inc. (Stockton and Santa Fe Springs - Frozen Food) and Teamsters Local Union No. 630,
effective September 20, 2015 – September 19, 2020.
51. Agreement between SuperValu, Inc., Bismarck Distribution Center, Bismarck; North Dakota (Warehouse, Office & Drivers) and
International Brotherhood of Teamsters, Local 638, effective June 18, 2017 – September 14, 2019.
52. Agreement between Cub Foods (Minneapolis, Monticello – Clerks and Meat) and United Food and Commercial Workers Union,
District Local 653, effective March 4, 2018 – March 4, 2023.
53. Agreement between Shop ‘n Save Warehouse Foods Inc. (St. Louis – Clerks) and United Food and Commercial Workers Union,
Local 655, effective May 9, 2016 – May 11, 2019.
54. Agreement between SuperValu, Inc. (Green Bay – Drivers & Warehouse) and International Brotherhood of Teamsters - Drivers,
Warehouse & Dairy Employees, Local No. 662, effective June 1, 2016 – May 31, 2019.
55. Agreement between SuperValu, Inc. St. Louis Distribution Center (Warehouse) and International Brotherhood of Teamsters, Local
Union No. 688, effective July 1, 2017 – September 20, 2019.
56. Wholesale Grocery Agreement between SuperValu, Inc. (Tacoma – Ellensburg Drivers) and International Brotherhood of
Teamsters, Local Union No. 760, effective July 15, 2018 – July 17, 2021.
57. Collective Agreement between Unified Grocers, Inc. (Commerce Dispatching and Routing Clerks) and International Brotherhood
of Teamsters, Local Union 848, effective September 20, 2015 – September 19, 2020.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.25- 4
58. Agreement between Unified Grocers, Inc. (Commerce - Wholesale Delivery Drivers) and International Brotherhood of Teamsters,
Local Union 848, effective September 20, 2015 – September 19, 2020.
59. Agreement between Unified Grocers, Inc. (Commerce and Santa Fe Springs - Truck Mechanics) and International Brotherhood of
Teamsters, Local Union No. 848, effective September 20, 2015 – September 19, 2020.
60. Warehouse Agreement Between Unified Grocers, Inc. and Teamsters Local Union No. 630, effective September 20, 2015 –
September 19, 2020.
61. Agreement between SHOP ‘n SAVE Warehouse Foods, Inc. (St. Louis - Meat, Delicatessen and Seafood Departments) and United
Food and Commercial Workers Union Local No. 88, effective March 27, 2017 – March 28, 2020.
62. Collective Bargaining Agreement between Local 881 U.F.C.W and SHOP ‘n SAVE Warehouse Foods, Inc., (St. Louis - Clerks),
effective September 21, 2014 – September 23, 2017 (as extended by that certain Contract Extension Agreement Between UFCW
Local 881 and Shop ‘n Save Warehouse Foods, Inc. (Metro Illinois Agreement), effective September 24, 2017).
63. Agreement between International Brotherhood of Teamsters and Unified Grocers, Inc. (Portland – Warehouse Supplement),
effective April 24, 2016 – April 20, 2019.
64. Master Agreement between Unified Grocers, Inc. (Portland) and International Brotherhood of Teamsters, Local Unions No. 162,
206, 305, effective April 24, 2016 – April 20, 2019.
65. Agreement between International Brotherhood of Teamsters and Unified Grocers, Inc. (Portland – Drivers and Mechanics
Supplement), effective April 24, 2016 – April 20, 2019.
66. Agreement by and between SUPERVALU, Inc. (Green Bay – Mechanics) and Lodge 1855, International Association of Machinists
and Aerospace Workers, effective April 1, 2015 – March 31, 2020.
67. Wage and Working Agreement, by and between SuperValu, Inc. Minneapolis Distribution Center (Mechanics) and District Lodge
No. 77 of the International Association of Machinists and Aerospace Workers, AFL-CIO, effective November 1, 2017 – October
31, 2020.
68. Bargaining Agreement between SuperValu, Inc. Distribution Center Lancaster County, Pennsylvania (Warehouse) and International
Brotherhood of Teamsters, Local Union No. 771, effective January 14, 2017 – January 11, 2020.
69. Agreement by and between Supervalu, Inc. (Great Falls Cash & Carry) and Teamsters Local Union No. 2, effective April 22, 2018
– April 22, 2023.
70. Labor Arbitration between C. Lloyd/Teamsters Local 117 and SUPERVALU (Seattle warehouse) regarding termination of employee.
Arbitration decision was adverse, no final determination as to amount awarded.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-9.1.25- 5
SCHEDULE 10.1.11
POST-CLOSING DELIVERABLES
1. Within thirty (30) days after the Closing Date, the Borrowers shall, and shall cause the other Obligors to, deliver to the Applicable Agent
all insurance certificates as to coverage under the insurance policies required by Section 8.6.1 .
2. Within thirty (30) days after the Closing Date, the Borrowers shall, and shall cause all such insurance with respect to the Obligors and
property constituting ABL Priority Collateral to be endorsed to provide that (i) the Applicable Agent is an additional insured or loss
payee, as applicable, (ii) that no cancellation in coverage thereof shall be effective prior to at least thirty (30) days after written notice
thereof to the Applicable Agent and (iii) the interest of the Applicable Agent shall not be impaired or invalidated by any act or neglect of
any Obligor or the owner of the Property, nor by the occupation of the premises for purposes more hazardous than are permitted by the
policy.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
#91229296v4
S-10.1.11-1
SCHEDULE 10.2.1
EXISTING DEBT
1. Equipment Loan
Instrument
Amount Outstanding
Secured / Unsecured
Equipment Loan, between [***] , as borrower, [***] , as guarantor, and [***],
as lender.
36,008,411.85
Secured
2. Intercompany Debt Arrangements
Lender
[***]
[***]
Borrower
[***]
[***]
Amount Owed
[***]
[***]
[***]
3. Unsecured Surety Bonds (as of 8/27/18)
[***]
4. Standby Letters of Credit (as of 8/27/18)
[***]
5. Swap Termination Value
UNFI (as of April 2018)
Interest Rate Swaps Termination Value: $7,318,879.37
Supervalu (as of August 2018)
Interest Rate Swap Termination Value: $569,984
Fuel Hedge Swaps Termination Value: $(11,632)
·
·
·
6. Guaranties
[***]
7. Contingent Lease Liabilities
[***]
8. [***]
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-10.2.1- 1
9. [***]
10. California Workers’ Compensation Guaranties
·
•
•
July 27, 2006, Agreement of Assumption and Guarantee of Workers’ Compensation Liabilities executed by SVU for the benefit of
Albertson’s, Inc. in consideration for the Department of Industrial Relations permission for Albertson’s, Inc. to operate as certified
self-insured employers in the State of California. SVU agrees to assume and guarantee to pay all liabilities and obligations which
Albertson’s, Inc. may incur as a self-insurer of its California workers’ compensation liabilities on or after 7/27/2006 through
3/21/2013, when Supervalu completed the sale of New Albertson’s Inc. (“ NAI ”).
August 8, 2007, Agreement of Assumption and Guarantee of Workers’ Compensation Liabilities executed by SVU for the benefit of
American Drug Stores LLC in consideration for the Department of Industrial Relations permission for American Drug Store LLC to
operate as certified self-insured employers in the State of California. SVU agrees to assume and guarantee to pay all liabilities and
obligations which American Drug Store LLC may incur as a self-insurer of its California workers’ compensation liabilities arising
on or after 8/3/2007 through 3/21/2013, when Supervalu completed the sale of NAI. (the parent company of American Drug Stores
LLC).
September 8, 2010, Agreement of Assumption and Guarantee of Worker’s Compensation Liabilities executed by SVU for the
benefit of New Albertson’s, Inc. in consideration for the Department of Industrial Relations permission for NAI to operate as
certified self-insured employers in the State of California. SVU agrees to assume and guarantee to pay all liabilities and obligations
which NAI may incur as a self-insurer of its California workers’ compensation liabilities on or after 9/8/2010 through 3/21/2013,
when SVU completed the sale of NAI
11. ASC Notes Guarantee
Supervalu has guaranteed certain debt obligations of American Stores Company (“ ASC ”). In connection with the NAI sale on March 21,
2013, AB Acquisition assumed the ASC debt but the existing guarantee as provided by SVU was not released and SVU continues as
guarantor. Concurrently with the NAI sale, AB Acquisition entered into an agreement with Supervalu to indemnify SVU for any
consideration used to satisfy the guarantee by depositing $467,000,000 in cash into an escrow account, which provides Supervalu first priority
interest and the trustee of the ASC bondholders’ second priority interest in the collateral balance. On January 24, 2014, ASC successfully
tendered for $462,000,000 of the $467,000,000 notes outstanding under the ASC indenture. The escrow account balance has since been
reduced to below $4,000,000, reflecting the approximate amount of ASC notes still outstanding under the ASC indenture.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-10.2.1- 2
SCHEDULE 10.2.2
EXISTING LIENS
State
Debtor
Secured Party
Filing Information
Collateral
File No. 02092373445 Filed:
9/23/2002 Lapse Date: 9/23/2012
VA
FF Acquisition, L.L.C.
American Bank Note Company, as
Agent for the United States Postal
Service
Continuation
File No. 07070670920
Filed: 7/6/2007
The Consigned Goods are all USPS postage delivered to
Consignee for sale to the public from all establishments
maintained by Consignee, including, but not limited to, First
Class postage.
File No. 10031072883
Filed: 3/10/2010
Lapse Date: 3/10/2020
Continuation
File No. 15021356516
Filed: 2/13/2015
Amendment
File No. 15022462497
Filed: 2/24/2015
Amendment
File No. 16082338296
Filed: 8/23/2016
File No. 12082456298
Filed: 8/24/2012
Lapse Date: 8/24/2017
Full Assignment
File No. 12092157715
Filed: 9/21/2012
Full Assignment
File No. 13022055387
Filed: 2/20/2013
Inventory sold or delivered by Secured Party or its affiliates
to Debtor.
Specific leased equipment.
VA
FF Acquisition, L.L.C.
American Greetings Corporation
VA
FF Acquisition, L.L.C.
Community First Bank
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-10.2.2- 1
State
Debtor
Secured Party
Filing Information
Collateral
File No. OH00140730723
Filed: 3/10/2010
Lapse Date: 3/10/2020
Continuation
File No. 20150440107
Filed: 2/13/2015
Collateral Amendment
File No. 20150550248
Filed: 2/24/2015
Collateral Amendment
File No. 20162350182
Filed: 8/22/2016
File #127317423040
File Date: 6/15/2012
Lapse Date 6/15/2017
Termination:
File #1675622736
File Date: 12/20/2016
File #127317423161
File Date: 6/15/2012
Lapse Date: 6/15/2017
Termination
File #1675622737
File Date: 12/20/2016
File #127327421413
File Date 8/31/2012
Lapse Date 8/31/2017
Termination
File #1675604128
File Date: 12/9/2016
File #127343033218
File Date: 12/31/2012
Lapse Date: 12/31/2017
OH
Shoppers Food Warehouse Corp.
American Greetings Corporation
CA
Unified Grocers, Inc.
Juanita’s Foods
CA
Unified Grocers, Inc.
Juanita’s Foods
CA
Unified Grocers, Inc.
IMB Credit LLC
CA
Unified Grocers, Inc.
Banc of America Leasing & Capital,
LLC
Inventory sold or delivered by Secured Party or its affiliates
to Debtor.
All Inventory which Secured Party delivers to Debtor
pursuant to that certain Consignment Agreement dated
March 26, 2012.
All Inventory which Secured Party delivers to Debtor
pursuant to that certain Consignment Agreement dated
March 26, 2012.
Equipment and software.
Equipment described in Master Lease Agreement No.
22181-9000 dated March 23, 2011.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-10.2.2- 2
State
Debtor
Secured Party
Filing Information
Collateral
CA
Unified Grocers, Inc.
CA
Unified Grocers, Inc.
CA
Unified Grocers, Inc.
South Coast Air Quality
Management District
South Coast Air Quality
Management District
South Coast Air Quality
Management District
CA
Unified Grocers, Inc.
BMO Harris Equipment Finance
Company
CA
Unified Grocers, Inc.
BMO Harris Equipment Finance
Company
CA
Unified Grocers, Inc.
BMO Harris Equipment Finance
Company
CA
Unified Grocers, Inc.
BMO Harris Equipment Finance
Company
File #137345977662
File Date 1/24/2013
Lapse Date: 1/24/2018
File #137362861259
File Date: 5/29/2013
Lapse Date: 5/29/2018
File #137365959280
File Date: 6/19/2013
Lapse Date 6/19/2018
File #137392024374
File Date: 12/23/2013
Lapse Date: 12/23/2018
Amendment
File #1473966169
File Date: 1/24/2014
File #137392024495
File Date 12/23/2013
Lapse Date 12/23/2018
Amendment
File #1473966168
File Date 1/24/2014
File #137392027044
File Date: 12/23/2013
Lapse Date: 12/23/2018
Amendment
File #1473966176
File Date 1/24/2014
File #137392027428
File Date 12/23/2013
Lapse Date: 12/23/2018
Amendment
File #1473966177
File Date 1/24/2014
Equipment.
Equipment.
Equipment.
Equipment and insurance proceeds.
Equipment and insurance proceeds.
Equipment and insurance proceeds.
Equipment and insurance proceeds.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-10.2.2- 3
State
Debtor
Secured Party
Filing Information
Collateral
CA
Unified Grocers, Inc.
Sutherland Fibre Recycling
CA
Unified Grocers, Inc.
CA
Unified Grocers, Inc.
CA
Unified Grocers, Inc.
CA
Unified Grocers, Inc.
CA
Unified Grocers, Inc.
CA
Unified Grocers, Inc.
CA
Unified Grocers, Inc.
CA
Unified Grocers, Inc.
CA
Unified Grocers, Inc.
CA
Unified Grocers, Inc.
South Coast Air Quality
Management District
South Coast Air Quality
Management District
BMO Harris Equipment Finance
Company
BMO Harris Equipment Finance
Company
BMO Harris Equipment Finance
Company
BMO Harris Equipment Finance
Company
Banc of America Leasing & Capital,
LLC
BMO Harris Equipment Finance
Company
Banc of America Leasing & Capital,
LLC
Banc of America Leasing & Capital,
LLC
File #147401958918
File Date 3/6/2014
Lapse Date: 3/6/2019
File #147404084385
File Date 3/20/2014
Lapse Date 3/20/2019
File #147404606789
File Date 3/25/2014
Lapse Date 3/25/2019
File #147436256078
File Date 11/12/2014
Lapse Date 11/12/2019
File #147436257342
File Date: 11/12/2014
Lapse Date: 11/12/2019
File #147436257463
File Date: 11/12/2014
Lapse Date: 11/12/2019
File #147436258232
File Date: 11/12/2014
Lapse Date: 11/12/2019
File #157469744855
File Date: 6/15/2015
Lapse Date: 6/15/2020
File #157471497661
File Date: 6/24/2015
Lapse Date 6/24/2020
File #157472343753
File Date 6/30/2015
Lapse Date 6/30/2020
File #157484027654
File Date 9/9/2015
Lapse Date 9/9/2020
Equipment.
Equipment.
Equipment.
Equipment and insurance proceeds.
Equipment and insurance proceeds.
Equipment and insurance proceeds.
Equipment and insurance proceeds.
Equipment and insurance proceeds.
Equipment and insurance proceeds.
Equipment and insurance proceeds.
Equipment and insurance proceeds.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-10.2.2- 4
State
Debtor
Secured Party
Filing Information
Collateral
CA
Unified Grocers, Inc.
CA
Unified Grocers, Inc.
Banc of America Leasing & Capital,
LLC
Banc of America Leasing & Capital,
LLC
PNC Equipment Finance, LLC
CA
Unified Grocers, Inc.
Fleet Advantage, LLC
CA
Unified Grocers, Inc.
Canon Financial Services, Inc.
PNC Equipment Finance, LLC
CA
Unified Grocers, Inc.
Fleet Advantage, LLC
CA
Unified Grocers, Inc.
International Paper Company
File #157489993267
File Date: 10/14/2015
Lapse Date: 10/14/2020
File #157492462575
File Date 10/30/2015
Lapse Date 10/30/2020
File #157497358988
File Date 12/1/2015
Lapse Date 12/1/2020
File #167520860904
File Date 4/21/2016
Lapse Date 4/21/2021
File #167527937108
File Date 5/27/2016
Lapse Date 5/27/2021
File #167537597838
File Date 7/21/2016
Lapse Date 7/21/2021
File No. 20050068215M
Filed: 6/29/2005
Lapse Date: 6/29/2020
Continuation
File No. 20100060676K
Filed: 6/9/2010
Equipment and insurance proceeds.
Equipment and insurance proceeds.
All rights of Debtor to Schedule No. 1 of Master Equipment
Lease Agreement dated November 18, 2015.
All rights of Debtor to the Assigned Leases and Equipment.
All rights of Debtor to Schedule No. 2 of Master Equipment
Lease Agreement dated November 18, 2015.
Equipment.
MO
SUPERVALU Holdings, Inc.
American Bank Note Company, as
Agent for the United States Postal
Service
Continuation
File No. 1502195022025
Filed: 2/13/2015
The Consigned Goods are all USPS postage delivered to
Consignee for sale to the public from all establishments
maintained by Consignee, including, but not limited to, First
Class postage.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-10.2.2- 5
State
Debtor
Secured Party
Filing Information
Collateral
MO
SUPERVALU Holdings, Inc.
American Greetings Corporation
DE
SUPERVALU Inc.
Forsythe/McArthur Associates, Inc.
DE
SUPERVALU Inc.
General Electric Capital Corporation
DE
SUPERVALU Inc.
General Electric Capital Corporation
File No. 20100025328E
Filed: 3/10/2010
Lapse Date: 3/10/2020
Continuation
File No. 1502235038390
Filed: 2/23/2015
Amendment
File No. 1608247554554
Filed: 8/23/2016
File No. 20080714996
Filed: 2/28/2008
Lapse Date: 2/28/2018
Continuation
File No. 20123586692
Filed: 9/18/2012
File No. 20081059250
Filed: 3/20/2008
Lapse Date: 3/20/2018
Secured Party Amendment
File No. 20125082773
Filed: 12/28/2012
Continuation
File No. 20125082781
Filed: 12/28/2012
File No. 20081059292
Filed: 3/20/2008
Lapse Date: 3/20/2018
Secured Party Amendment
File No. 20125088010
Filed: 12/28/2012
Continuation
File No. 20125088028
Filed: 12/28/2012
Inventory sold or delivered by Secured Party or its affiliates
to Debtor.
Specific leased equipment.
Specific leased equipment.
Specific leased equipment.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-10.2.2- 6
State
Debtor
Secured Party
Filing Information
Collateral
DE
SUPERVALU Inc.
Crown Credit Company
DE
SUPERVALU Inc.
NCR Corporation
DE
SUPERVALU Inc.
American Greetings Corporation
DE
SUPERVALU Inc.
DE
SUPERVALU Inc.
Banc of America Leasing & Capital,
LLC
Banc of America Leasing & Capital,
LLC
DE
SUPERVALU Inc.
Nestle Dreyer’s Ice Cream Company
DE
SUPERVALU Inc.
Papyrus/Recycled Greetings, Inc.
File No. 20092161534
Filed: 7/6/2009
Lapse Date: 7/6/2019
Continuation
File No. 20142201762
Filed: 6/6/2014
File No. 20092513429
Filed: 8/5/2009
Lapse Date: 8/5/2019
Continuation
File No. 20143059110
Filed: 7/31/2014
File No. 20100806459
Filed: 3/10/2010
Lapse Date: 3/10/2020
Continuation
File No. 20150636505
Filed: 2/13/2015
Collateral Amendment
File No. 20150775261
Filed: 2/24/2015
Amendment
File No. 20165092620
Filed: 8/22/2016
File No. 20114575224
Filed: 11/30/2011
Lapse Date: 11/30/2016
File No. 20114575240
Filed: 11/30/2011
Lapse Date: 11/30/2016
File No. 20115000438
Filed: 12/20/2011
Lapse Date: 12/20/2016
File No. 20122461111
Filed: 6/26/2012
Lapse Date: 6/26/2017
Specific leased equipment.
All products, including without limitations, equipment,
components, software, deliverables and supplies, whether
now or hereafter acquired, which are acquired (directly or
indirectly) from NCR Corporation and/or the acquisition of
which is financed by NCR Corporation, and all proceeds.
Inventory sold or delivered by Secured Party or its affiliates
to Debtor.
Specific equipment.
Specific equipment.
Specific consigned products.
Inventory sold or delivered by Secured Party to Debtor on a
scan based trading and consignment basis.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-10.2.2- 7
State
Debtor
Secured Party
Filing Information
Collateral
DE
SUPERVALU Inc.
IBM Credit LLC
DE
SUPERVALU Inc.
IBM Credit LLC
DE
SUPERVALU Inc.
IBM Credit LLC
Banc of America Leasing & Capital,
LLC
Citi Finance LLC
DE
SUPERVALU Inc.
Bank of Cape Cod
DE
SUPERVALU Inc.
IBM Credit LLC
DE
SUPERVALU Inc.
IBM Credit LLC
DE
SUPERVALU Inc.
Banc of America Leasing & Capital,
LLC
DE
SUPERVALU Inc.
Bank of Cape Cod
File No. 20122634972
Filed: 7/9/2012
Lapse Date: 7/9/2017
File No. 20123107341
Filed: 8/10/2012
Lapse Date: 8/10/2017
File No. 20123761444
Filed: 9/28/2012
Lapse Date: 9/28/2017
File No. 20130977810
Filed: 3/14/2013
Lapse Date: 3/14/2018
Collateral Amendment
File No. 20131080192
Filed: 3/21/2013
Amendment
File No. 20131958504
Filed: 5/22/2013
Amendment
File No. 20131970707
Filed: 5/23/2013
File No. 20131479444
Filed: 4/17/2013
Lapse Date: 4/17/2018
File No. 20131769141
Filed: 5/8/2013
Lapse Date: 5/8/2018
File No. 20132337609
Filed: 6/18/2013
Lapse Date: 6/18/2018
Collateral Amendment
File No. 20132566801
Filed: 7/3/2013
File No. 20132990712
Filed: 8/1/2013
Lapse Date: 8/1/2018
Specific leased equipment.
Specific leased equipment.
Specific leased equipment.
Specific equipment.
Specific leased equipment.
Specific leased equipment.
Specific leased equipment.
Specific leased equipment.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-10.2.2- 8
State
Debtor
Secured Party
Filing Information
Collateral
DE
SUPERVALU Inc.
IBM Credit LLC
DE
SUPERVALU Inc.
IBM Credit LLC
DE
SUPERVALU Inc.
Data Sales Co., Inc.
DE
SUPERVALU Inc.
Data Sales Co., Inc.
DE
SUPERVALU Inc.
CenturyLink Communications, LLC
DE
SUPERVALU Inc.
Consignor : TNG GP
DE
SUPERVALU Inc.
IBM Credit LLC
DE
SUPERVALU Inc.
IBM Credit LLC
DE
SUPERVALU Inc.
IBM Credit LLC
DE
SUPERVALU Inc.
IBM Credit LLC
DE
SUPERVALU Inc.
IBM Credit LLC
File No. 20133839785
Filed: 10/1/2013
Lapse Date: 10/1/2018
File No. 20134603222
Filed: 11/21/2013
Lapse Date: 11/21/2018
File No. 20140082693
Filed: 1/8/2014
Lapse Date: 1/8/2019
File No. 20141709716
Filed: 5/1/2014
Lapse Date: 5/1/2019
File No. 20141885748
Filed: 5/13/2014
Lapse Date: 5/13/2019
File No. 20143887247
Filed: 9/19/2014
Lapse Date: 9/19/2019
File No. 20144748711
Filed: 11/24/2014
Lapse Date: 11/24/2019
File No. 20144775862
Filed: 11/25/2014
Lapse Date: 11/25/2019
File No. 20144791000
Filed: 11/26/2014
Lapse Date: 11/26/2019
File No. 20144832580
Filed: 12/2/2014
Lapse Date: 12/2/2019
File No. 20145032339
Filed: 12/11//2014
Lapse Date: 12/11/2019
Specific equipment.
Specific equipment.
Specific leased equipment.
Specific leased equipment.
Specific equipment.
Consigned goods.
Specific leased equipment.
Specific leased equipment.
Specific leased equipment.
Specific leased equipment.
Specific leased equipment.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-10.2.2- 9
State
Debtor
Secured Party
Filing Information
Collateral
DE
SUPERVALU Inc.
Banc of America Leasing & Capital,
LLC
File No. 20145134879
Filed: 12/17//2014
Lapse Date: 12/17/2019
Nestle DSD Company;
Dreyer’s Grand Ice Cream, Inc.;
DE
SUPERVALU Inc.
Nestle Dreyer’s Ice Cream Company
DE
SUPERVALU Inc.
Noreast Capital Corporation
MN
Super Valu
Forklifts of Minnesota, Inc.
File No. 20153127312
Filed: 7/20/2015
Lapse Date: 7/20/2020
File No. 20154950720
Filed: 10/27/2015
Lapse Date: 10/27/2020
File No. 891253900023
Filed: 6/7/2016
Lapse Date: 6/7/2021
Specific leased equipment.
(a) Ice cream, frozen novelties & other products sold under
the following brand names: Dreyer’s, Skinny Cow, Frosty
Paws, Edy’s, Nestle or Haegen/Dazs; and
(b) Frozen pizza & other frozen dinner items & products
sold under the following brand names: DiGiornio, California
Pizza Kitchen, Tombstone or Jack’s.
UCC statement filing is for notice purposes & is not
intended to convert lease into security agreement.
2 - CM2400 cash manager safes located at Shoppers Food
and Pharmacy, 5600 Thea Alameda, Baltimore, MD 21239.
Specific equipment.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-10.2.2- 10
SCHEDULE 10.2.5
EXISTING INVESTMENTS
1. Investments in non-wholly owned entities:
Entity Name
Blaine North 1996 L.L.C.
Bloomington 1998, L.L.C.
[***]
Burnsville 1998 L.L.C.
Coon Rapids 2002 L.L.C.
Eagan 2008 L.L.C.
[***]
Forest Lake 2000, L.L.C.
Fridley 1998 L.L.C.
[***]
[***]
Hastings 2002 L.L.C.
[***]
[***]
Lakeville 2014 L.L.C.
[***]
[***]
Monticello 1998 L.L.C.
[***]
[***]
[***]
Northfield 2002 L.L.C.
[***]
Plymouth 1998 L.L.C.
Savage 2002 L.L.C.
Shakopee 1997 L.L.C.
Shorewood 2001 L.L.C.
Silver Lake 1996 L.L.C.
[***]
[***]
[***]
Owner
SUPERVALU INC.
SUPERVALU INC.
[***]
SUPERVALU INC.
SUPERVALU INC.
SUPERVALU INC.
[***]
SUPERVALU INC.
SUPERVALU INC.
[***]
[***]
SUPERVALU INC.
[***]
[***]
SUPERVALU INC.
[***]
[***]
SUPERVALU INC.
[***]
[***]
[***]
SUPERVALU INC.
[***]
SUPERVALU INC.
SUPERVALU INC.
SUPERVALU INC.
SUPERVALU INC.
SUPERVALU INC.
[***]
[***]
[***]
Ownership %
70.00
40.00
[***]
77.50
64.00
51.00
[***]
65.00
92.00
[***]
[***]
58.00
[***]
[***]
51.00
[***]
[***]
90.00
[***]
[***]
[***]
51.00
[***]
62.50
51.00
25.00
62.00
51.00
[***]
[***]
[***]
2. UNFI is a party to warrant agreements with [***] , pursuant to which UNFI has the right to acquire up to 992 shares of [***] .
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-10.2.5- 1
SCHEDULE 10.2.16
EXISTING AFFILIATE TRANSACTIONS
None.
Portions of this Exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Secretary of the Commission pursuant to the Registrant’s
application requesting confidential treatment pursuant to Rule 406 of the Securities Act of 1933, as amended.
S-10.2.16- 1
SUBSIDIARIES OF THE REGISTRANT
Exhibit 21
JURISDICTION OF
INCORPORATION/FORMATION
New Jersey
Delaware
Florida
California
New York
Delaware
Delaware
California
Florida
Delaware
California
California
Canada
Delaware
California
Delaware
NAME
Albert's Organics, Inc.
Blue Marble Brands, LLC
DS & DJ Realty, LLC
Fromages de France, Inc
Gourmet Guru, Inc.
Jedi Merger Sub
Natural Retail Group, Inc. (d/b/a Earth Origins Market)
Nor-Cal Produce, Inc.
SCTC, LLC
Select Nutrition, LLC
Tony's Fine Foods
Tutto Pronte
UNFI Canada, Inc.
UNFI Transport, LLC
United Natural Foods West, Inc.
United Natural Trading, LLC
Consent of Independent Registered Public Accounting Firm
Exhibit 23.1
The Board of Directors
United Natural Foods, Inc.:
We consent to the incorporation by reference in the registration statements (No. 333-161800 and 333-51167) on Form S-3 of United Natural Foods, Inc. and (No.
333-208695, 333-161845, 333-161884, 333-222257, 333-106217, 333-123462, and 333-185637) on Form S-8 of United Natural Foods, Inc. of our report dated
September 24, 2018 , with respect to the consolidated balance sheets of United Natural Foods, Inc. and subsidiaries as of July 28, 2018 and July 29, 2017 , and the
related consolidated statements of income, comprehensive income, stockholders' equity, and cash flows for each of the years in the three-year period ended July 28,
2018 , and the related notes (collectively the “consolidated financial statements”), and the effectiveness of internal control over financial reporting as of July 28,
2018 , which report appears in the July 28, 2018 annual report on Form 10-K of United Natural Foods, Inc.
Providence, Rhode Island
September 24, 2018
Exhibit 31.1
CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Steven L. Spinner, certify that:
I have reviewed this annual report on Form 10-K of United Natural Foods, Inc.;
1.
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange
Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the
registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure
that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities,
particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision,
to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness
of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal
quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect,
the registrant's internal control over financial reporting; and
5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the
registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely
to adversely affect the registrant's ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over
financial reporting.
Dated: September 24, 2018
Note: A signed original of this written statement has been provided to the Company and will be retained by the Company and furnished to the Securities and
Exchange Commission or its staff upon request.
/s/ STEVEN L. SPINNER
Steven L. Spinner
Chief Executive Officer
Exhibit 31.2
CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Michael P. Zechmeister, certify that:
I have reviewed this annual report on Form 10-K of United Natural Foods, Inc.;
1.
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange
Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the
registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure
that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities,
particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision,
to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness
of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal
quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect,
the registrant's internal control over financial reporting; and
5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the
registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely
to adversely affect the registrant's ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over
financial reporting.
Dated: September 24, 2018
Note: A signed original of this written statement has been provided to the Company and will be retained by the Company and furnished to the Securities and
Exchange Commission or its staff upon request.
/s/ MICHAEL P. ZECHMEISTER
Michael P. Zechmeister
Chief Financial Officer
CERTIFICATION PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
The undersigned, in his capacity as the Chief Executive Officer of United Natural Foods, Inc., a Delaware corporation (the "Company"), hereby certifies that
the Annual Report of the Company on Form 10-K for the fiscal year ended July 28, 2018 fully complies with the requirements of Section 13(a) or 15(d) of the
Securities Exchange Act of 1934 and that the information contained in such Annual Report on Form 10-K fairly presents, in all material respects, the financial
condition and results of operations of the Company.
Exhibit 32.1
/s/ STEVEN L. SPINNER
Steven L. Spinner
Chief Executive Officer
September 24, 2018
Note: A signed original of this written statement has been provided to the Company and will be retained by the Company and furnished to the Securities and
Exchange Commission or its staff upon request.
CERTIFICATION PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
Exhibit 32.2
The undersigned, in his capacity as the Chief Financial Officer of United Natural Foods, Inc., a Delaware corporation (the "Company"), hereby certifies that
the Annual Report of the Company on Form 10-K for the fiscal year ended July 28, 2018 fully complies with the requirements of Section 13(a) or 15(d) of the
Securities Exchange Act of 1934 and that the information contained in such Annual Report on Form 10-K fairly presents, in all material respects, the financial
condition and results of operations of the Company.
/s/ MICHAEL P. ZECHMEISTER
Michael P. Zechmeister
Chief Financial Officer
September 24, 2018
Note: A signed original of this written statement has been provided to the Company and will be retained by the Company and furnished to the Securities and
Exchange Commission or its staff upon request.