Seneca Foods Corp. filed SEC Form 8-K: Entry into a Material Definitive Agreement, Termination of a Material Definitive Agreement, Creation of a Direct Financial Obligation, Financial Statements and Exhibits

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Washington, D.C. 20549

 

 

Current Report

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Date of Report (date of earliest event reported): December 23, 2024

 

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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

 

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Item 1.01         Entry into a Material Definitive Agreement

 

On December 23, 2024 (the “Closing Date”), Seneca Foods Corporation (the “Parent”) and its subsidiaries, Seneca Snack Company and Green Valley Foods, LLC (together with Parent, the “Borrowers”), Marion Foods, Inc., Portland Food Products Company and Gray & Company (the “Guarantors” and together with the Borrowers, the “Company”) entered into a Loan and Security Agreement (the “Loan Agreement”) by and among the Borrowers, the Guarantors, Wells Fargo Bank, National Association (when acting for itself, “Wells Fargo”), as agent thereunder (when acting in such capacity, the “Agent”), and various financial institutions (including Wells Fargo) which are parties thereto as lenders (collectively, the “Lenders”), pursuant to which, among other things, the Lenders established for the benefit of the Borrowers, a senior revolving credit facility of up to $450 million that is seasonally adjusted to a maximum of $400 million (the “2024 Credit Facility”).

 

The Loan Agreement replaced the Fourth Amended and Restated Loan and Security Agreement, dated as of March 24, 2021 (as the same has been amended from time to time prior to the Closing Date, the “Prior Loan Agreement”) by and among the Company, the lenders party thereto, Bank of America, N.A. as agent, issuing bank, and syndication agent, and BofA Securities, Inc. as lead arranger.

 

Borrowings under the Loan Agreement may be used to satisfy existing indebtedness, to pay fees and transaction expenses associated with the closing of the 2024 Credit Facility, to pay obligations in accordance with the Loan Agreement, to make permitted acquisitions and for working capital and other lawful corporate purposes of the Company, including, but not limited to, the making of capital expenditures and distributions, all in accordance with the terms of the Loan Agreement.

 

Availability under the 2024 Credit Facility is based on eligible accounts receivable and inventory, less (i) reserves established in accordance with the terms of the Loan Agreement and (ii) any outstanding loans and letters of credit issued under the 2024 Credit Facility. The Company is required to pay a commitment fee based on the daily unused portion of the 2024 Credit Facility.

 

The Loan Agreement contains customary affirmative and negative covenants, including covenants that restrict the Company’s ability to incur additional indebtedness, incur liens, pay dividends on the Company’s capital stock, make other restricted payments, including investments, transfer all or substantially all of the Company’s assets, enter into consolidations or mergers, and enter into transactions with affiliates. The Loan Agreement also requires the Company to meet a financial covenant related to a minimum fixed charge coverage ratio if (a) an event of default under the Loan Agreement has occurred or (b) availability under the Credit Facility is less than the greater of (i) 10% of the commitments then in effect and (ii) $30,000,000.

 

Obligations under the Loan Agreement may be declared due and payable upon the occurrence of certain events of default, as defined in the Loan Agreement, including failure to pay any obligations when due and payable, failure to comply with any covenant or representation of any loan document, any change of control, cross-defaults and certain other events as set forth in the Loan Agreement, with grace periods in some cases.

 

The 2024 Credit Facility matures on December 24, 2029, and borrowings are secured by substantially all of the Company’s non-realty assets and is fully and unconditionally guaranteed by the Guarantors.

 

The foregoing description of the Loan Agreement is not complete and is qualified in its entirety by the terms and provisions of the Loan Agreement, a copy of which is filed herewith as Exhibit 10.1 and is incorporated herein by reference.

 

Item 1.02         Termination of a Material Definitive Agreement

 

In connection with the matters described under Item 1.01, which description is incorporated herein by reference, as of the Closing Date, the Prior Loan Agreement was terminated. The Borrowers did not incur any early prepayment or early termination penalties in connection with the closing of the transactions contemplated by the Loan Agreement.

 

 

The above description of the Prior Loan Agreement is qualified in its entirety by the terms of the following:

 

 

 

 

 

each of which is incorporated herein by reference.

 

Item 2.03         Creation of a Direct Financial Obligation

 

The information set forth in Item 1.01 is incorporated herein by reference.

 

Item 9.01         Financial Statements and Exhibits.

 

(d)         Exhibits

 

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this amended report to be signed on its behalf by the undersigned hereunto duly authorized.