This excerpt taken from the RDK 8-K filed Jun 8, 2006.
Date of Report (Date of earliest event reported): June 7, 2006
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:
On June 7, 2006, Ruddick Corporation (the Registrant) entered into a new Credit Agreement (the Credit Agreement), dated as of June 7, 2006, by and among Registrant, as Borrower, Wachovia Bank, National Association (Wachovia), Branch Banking and Trust Company (BB&T), Regions Bank (Regions), RBC Centura (RBC), Bank of America, N.A. (BofA), Harris N.A. (Harris) and JPMorgan Chase Bank, N.A. (JPMorgan and, together with Wachovia, BB&T, Regions, RBC, BofA, and Harris, the Lenders), and Wachovia, as administrative agent for the Lenders. Under the terms of the Credit Agreement, the Lenders will make available a five-year revolving credit facility in the aggregate amount of up to $350 million (the Revolving Credit Facility). The Credit Agreement contains two 1-year maturity extension options that require lender approval.
Borrowings under the Revolving Credit Facility will bear interest, at Registrants option, at (a) a base rate, as determined by reference to rates on federal funds transactions with members of the Federal Reserve System or the prime rate in effect on the interest determination date, (b) LIBOR Market Index Rate or (c) LIBOR Rate, each plus an applicable margin depending upon Registrants consolidated leverage ratio and as determined by the administrative agent in accordance with the terms of the Credit Agreement. The Credit Agreement requires Registrant to maintain a consolidated fixed charge ratio of at least 1.5 to 1 and a consolidated leverage ratio of no more than 4.0 to 1. The Credit Agreement contains representations and warranties and events of default that are customary for this type of transaction.
The description in this Item 1.01 is qualified in its entirety by reference to the Credit Agreement filed as Exhibit 10.1 to this Current Report on Form 8-K.
On June 7, 2006, simultaneously with entering into the Credit Agreement, Registrant terminated its existing $200 million revolving credit facility, dated October 28, 2005 (the Existing Credit Agreement), among Registrant, the lenders named therein and Wachovia as administrative agent. The Existing Credit Agreement was scheduled to expire on October 28, 2010 and was terminated because it has been replaced by the new Revolving Credit Facility described under Item 1.01 above. Registrant incurred no early termination penalties in connection with the termination of the Existing Credit Agreement.
See disclosure under Item 1.01 of this Current Report on Form 8-K.
The Registrants Employee Stock Ownership Plan (ESOP) was amended effective June 1, 2006 to enhance existing diversification rules allowing participants to fully diversify their account balances, to the extent comprised of the Registrants common stock, into other investment alternatives. As previously disclosed by the Registrant, effective September 30, 2005, changes were made to several of the Registrants retirement and benefit plans, including the ESOP, and as a result of these changes participation in the ESOP was frozen, Company contributions to the ESOP ceased and ESOP account balances became fully vested. At October 2, 2005, approximately 16% of the Companys common shares outstanding were owned by employee participants in the ESOP.
The following exhibit is filed herewith: