Exhibit 10.52

 

CONSENT AND WAIVER

 

This Consent and Waiver dated as of May 1, 2004 (this “Consent”) is among the
Persons that have executed this Consent (the “Parties”). Capitalized terms used,
but not defined, in this Consent are used as defined in the Lease Agreement,
dated as of November 30, 2001 (the “Lease”), between Wells Fargo Bank Northwest,
National Association, as Owner Trustee under S&F Trust 1998-1, as lessor, and
Smart & Final Inc., as lessee, as modified by (i) Waiver and Amendment Agreement
No. 1, dated as of June 4, 2002, (ii) Waiver and Amendment Agreement No. 2,
dated as of February 14, 2003, (iii) Amendment Agreement No. 3, dated as of June
1, 2003, (iv) Waiver and Amendment Agreement, No. 4, dated as of July 11, 2003,
(v) Consent, Waiver, Collateral Release and Amendment Agreement No. 5A, dated as
of September 3, 2003, (vi) First Supplement to Consent, Waiver, Collateral
Release and Amendment Agreement No. 5A, dated as of September 5, 2003, (vii)
Consent, Waiver and Amendment Agreement No. 5B, dated as of September 26, 2003,
(viii) Sixth Amendment and Waiver to Lease Agreement, dated as of September 12,
2003, (ix) Amendment Agreement No. 7, dated as of October 21, 2003 and (x)
Consent and Waiver, dated as of March 8, 2004 (items (v) through (x) being
collectively, the “Extension Consents”).

 

RECITALS

 

A. Pursuant to the Extension Consents, the Majority Secured Parties, among other
things,

 

(i) Extended until May 7, 2004 (the “Extended Replacement Date”) the 60-day
limit for replacing the Florida Properties (as defined in the Extension
Consents) under Section 11.2(a) of the Lease;

 

(ii) Waived the $5,000,000 limit on the value of Properties to be replaced set
forth in Section 11.2(a) of the Lease;

 

(iii) Waived the requirement of Section 11.2(a) of the Lease for an Officer’s
Certificate setting forth the important business considerations requiring the
sale of the Florida Properties and the reasons why the Replacement Properties
were not purchased at the same time;

 

(iv) In connection with the disposition of the Florida Properties, waived the
requirements of Section 28.3(d) of the Lease limiting aggregate proceeds from
dispositions of assets (the “Proceeds Limitation”) and requiring dispositions to
be solely for cash; and

 

(v) Waived the requirement in Section 11.2(d) of the Lease that the Lessee
deposit the greater of the net cash proceeds from the transfer of the Florida
Properties or Termination Value attributable thereto plus the Prepayment Fee and
permitted the Lessee to deposit with the Owner Trustee only the $14,300,000 in
net cash proceeds received by the Lessee.

 

B. The Lessee desires to replace the Florida Properties with the Owned Real
Property identified on Schedule 1 to this Consent (the “Replacement Owned
Properties”) and, in connection with that replacement, has requested the
Majority Secured Parties to consent to:

 

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(i) The transfer of the Replacement Owned Properties to the Owner Trustee for a
payment from the proceeds of the Florida Properties held by the Owner Trustee
equal to the value set forth in the Appraisals for the Replacement Owned
Properties in a transaction that, otherwise, would violate the Proceeds
Limitation of Section 28.3(d) of the Lease;

 

(ii) Release of the Liens previously granted to the Agent under the Security
Documents on the Replacement Owned Properties;

 

(iii) In respect of each Replacement Owned Property, the delivery to, and
acceptance by, the Agent of an environmental site assessment from Giles
Engineering rather than from ATC Associates, Inc., the Environmental Consultant
required to deliver such assessments pursuant to Section 5.3(h) of the
Participation upon substitution of Properties in accordance with Section 11.2 of
the Lease;

 

(iv) Notwithstanding that separate certificates were delivered to each Lender
and Holder on the Closing Date, the delivery to, and acceptance by, the Agent of
a single certificate of insurance in accordance with Section 5.3(q) of the
Participation Agreement upon substitution of Properties in accordance with
Section 11.2 of the Lease; and

 

(v) To the extent that the proceeds of the Florida Properties, together with
interest and earnings thereon, are greater than the purchase price of the
Replacement Owned Properties, the Owner Trustee holding and investing such
excess in accordance with Section 11.2(d) of the Lease.

 

All of the consents described in this Recital B are referred to in this Consent
as the “Replacement Consents.”

 

C. Also in connection with the replacement of the Florida Properties with the
Replacement Owned Properties, the Lessee desires the Majority Secured Parties to
waive:

 

(i) The requirements under Section 11.2(b) of the Lease that, in connection with
substitution of the Replacement Owned Properties as Properties under the Lease,
would require the Lessee to satisfy conditions contained in Section 5.3 of the
Participation Agreement to the extent that such conditions would not be
satisfied upon satisfaction of the conditions set forth in Section 4(b) below,
including, without limitation: (a) conditions relating to Properties other than
the Replacement Owned Properties; (b) conditions relating to delivery of a
Closing Notice and invoices for the Transaction Expenses incurred through the
Closing Date; and (c) the condition that the counsel to the Lessor deliver an
opinion of counsel;

 

(ii) The Proceeds Limitation of Section 28.3(d) of the Lease that, as waived by
the Extension Consents, provides that the Credit Parties may only dispose of
assets (in addition to the Florida Properties) if the aggregate purchase price
paid to all Credit Parties for all assets sold by the Credit Parties does not
exceed $7.5 million during the same Fiscal Year and $15 million during the Term;
and

 

(iii) To the extent that the proceeds of the Florida Properties, together with
interest and earnings thereon, are greater than the purchase price of the
Replacement Owned Properties, any provision of any of the Operative Agreements
which may be

 

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deemed to require the Owner Trustee to apply all or any portion of such excess
to the Lessee’s obligations under the Operative Agreements (including the
obligation to pay Prepayment Fees) rather than to hold (and invest to the extent
contemplated in the Lease) such amounts as security for the Lessee’s obligations
under the Lease.

 

All of the waivers described in this Recital C are referred to in this consent
as the “Replacement Waivers.”

 

NOW, THEREFORE, for good and valuable consideration received, the Parties agree
as follows:

 

1. Consents. The Lenders and the Holder hereby grant the Replacement Consents
requested by the Lessee.

 

2. Waiver. The A-2 Lenders, the B Lenders and the Holder hereby grant the
Replacement Waivers and hereby agree that, in determining compliance with the
Proceeds Limitation of Section 28.3(d) of the Lease, the proceeds realized by
the Lessee from the transfer of the Replacement Owned Properties to the Owner
Trustee shall not be taken into account.

 

3. Lessee’s Agreements and Acknowledgements. The Lessee acknowledges and agrees
to all matters approved or waived by the Lenders and the Holder, as applicable,
in Sections 1 and 2 of this Consent.

 

4. Conditions Precedent. This Consent shall not be effective until the date (the
“Consent Closing Date”) that each of the following conditions precedent shall
have been satisfied.

 

(a) Certain Documents. The Agent shall have received all of the following, in
form and substance satisfactory to the Agent:

 

(i) Consent. This Consent, duly executed by the Lessee and each Guarantor and
any other instrument, document or certificate required by the Agent to be
executed or delivered by the Lessee or any other Person in connection with this
Consent, duly executed by them (collectively, the “Consent Documents”);

 

(ii) Consent of Majority Secured Parties. This Consent duly executed by the
Majority Secured Parties; and

 

(iii) Additional Information. Such additional documents, instruments and
information as the Agent may reasonably request to effect the transactions
contemplated hereby.

 

(b) General Conditions Contained in Lease and Section 5.3 of Participation
Agreement.

 

(i) Correctness of Representations, etc. The Lessee shall have delivered to the
Agent an Officer’s Certificate (A) with respect to those matters described in
Sections 5.3(a), 5.3(f), 5.3(i), 5.3(k), and 5.3(z), of the Participation
Agreement (with references to “Operative Documents” being interpreted to include
the “Consent Documents,” and the “Closing Date” being interpreted as the
“Consent Closing Date”), (B) that each and every representation and warranty of
each Credit Party contained in this Consent, the Security Documents required by
this Consent and all other Consent

 

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Documents and in the other Operative Documents to which it is a party is true
and correct as of the Consent Closing Date and with respect to those other
matters contained in Section 5.3(x) of the Participation Agreement, (C)
representing and warranting that as required by Section 28.3(d) of the Lease,
the purchase price paid to the Lessee for the Replacement Owned Properties will
be not less than the fair market value of such assets at the time of the sale,
will be paid in cash, and will be applied in accordance with Section
2.05(b)(iii) of the Lessee Credit Agreement and (D) representing and warranting
that, as required by Section 11.2(a) of the Lease, on the date that the
Replacement Owned Properties are substituted for the Florida Properties in
accordance with this Consent, each Replacement Owned Property will have a value
of at least $1,000,000 and the Replacement Owned Properties together will have a
value, residual value, remaining useful life and utility at least as great as,
and will be in as good condition as, the Florida Properties when they were sold;

 

(ii) Title to Replacement Owned Properties. Title to each Replacement Owned
Property shall conform to the representations and warranties contained in
Section 6.2(l) of the Participation Agreement and Section 11.2(v) of the Lease;

 

(iii) Title Insurance. The Lessee shall have delivered to the Agent (A) an
owner’s title insurance policy for each Replacement Owned Property in favor of
the Lessor in an amount equal to the value set forth in the Appraisal for such
Replacement Owned Property, and (B) a lender’s title insurance policy for each
Replacement Owned Property in favor of the Agent which, together with the
lender’s policies on all of the other Properties (including each of the other
Replacement Owned Properties), shall provide coverage in an amount not less than
the total amount of the Advance then outstanding. Each of the foregoing policies
shall be issued by a title insurance company acceptable to the Agent, shall be
subject only to such title exceptions as are acceptable to the Agent and shall
include such endorsements as the Agent may deem necessary;

 

(iv) Environmental Site Assessment. The Lessee shall have delivered to the Agent
an environmental site assessment respecting each Replacement Owned Property
prepared by Giles Engineering, and in form and substance acceptable to the
Agent;

 

(v) No Material Adverse Effect on Lessor, etc. The Agent shall be satisfied that
the holding of each Replacement Owned Property and the execution of the Mortgage
Instruments and other Security Documents with respect thereto will not
materially and adversely affect the rights of the Lessor, the Agent, the Holders
or the Lenders under or with respect to the Operative Agreements;

 

(vi) Lessee Credit Agreement. The Lessee shall have delivered to the Agent an
amendment to the Lessee Credit Agreement containing terms conforming the
requirements of the Lessee Credit Agreement and the substitution of the
Replacement Owned Properties pursuant to this Consent;

 

(vii) Mortgage Instruments. The Lessee shall have caused to be delivered to the
Agent (A) the Mortgage Instruments (each in such form as is acceptable to the
Agent) for the Replacement Owned Properties, including, without limitation, a
Leasehold Deed of Trust and Assignment of Rents and Subleases, Security
Agreement

 

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and Fixture Filing (Synthetic) from the Lessee and an Assignment of Beneficial
Interest in Leasehold Deed of Trust (Synthetic) and (B) amendments to Lessor
Financing Statements and Lender Financing Statements reflecting the identities
of the Properties after giving effect to the transactions contemplated by this
Consent and, in connection with the foregoing, Uniform Commercial Code lien
searches satisfactory to the Agent in the State of California;

 

(viii) Lease Supplement. The Lessee shall have delivered to the Agent a Lease
Supplement with respect to each Replacement Owned Property and a memorandum (or
short form lease) regarding each Lease Supplement (such memorandum or short form
lease to be in the form attached to the Lease as Exhibit B or in such other form
as is acceptable to the Agent, with modifications as necessary to conform to
applicable state law, and in form suitable for recording);

 

(ix) Appraisals. The Lessee shall have caused an Appraisal regarding each of the
Replacement Owned Properties to be provided to the Agent from the Appraiser,
which Appraisal must be satisfactory in all respect to the Agent;

 

(x) Surveys. A survey of each Replacement Owned Property in form and substance
satisfactory to the Agent;

 

(xi) Insurance. The Lessee shall have provided the Agent with evidence of the
(A) insurance required to be maintained under the Lease and a broker’s letter,
with respect to each Replacement Owned Property and in form and substance
acceptable to the Agent and (B) a flood hazard certificate with respect to each
Replacement Owned Property prepared by an independent recognized professional
acceptable to the Agent;

 

(xii) Taxes, etc. All taxes, fees and other charges in connection with the
execution, delivery, recording, filing and registration of the Security
Documents required by this Consent;

 

(xiii) Effectiveness of Operative Agreements. Each of the Operative Agreements
to be entered into on the Consent Closing Date shall have been duly authorized,
executed and delivered by the parties thereto, and shall be in full force and
effect, and the Agent shall have received a fully executed copy of each such
Operative Agreement;

 

(xiv) No Material Adverse Effect. Since the date of the most recent audited
financial statements (as delivered pursuant to the requirements of the Lessee
Credit Agreement) of the Lessee, there shall not have occurred any event,
condition or state of facts which shall have or could reasonably be expected to
have a Material Adverse Effect;

 

(xv) Certificate of Lessor and Trust Company. The Agent shall have received an
Officer’s Certificate of the Lessor and a certificate from the Trust Company
conforming to the requirements of Sections 5.3(aa) and 5.3(bb)(i), respectively,
of the Participation Agreement (with references to “Operative Documents” being
interpreted to include the “Consent Documents” and the “Closing Date” being
interpreted as the “Consent Closing Date”);

 

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(xvi) No Material Adverse Change in Credit Parties. There shall not have
occurred any material adverse change in the consolidated assets, liabilities,
operations, business or condition (financial or otherwise) of the Credit Parties
(on a consolidated basis) from that set forth in the most recent audited
consolidated financial statements of the Credit Parties, which have been
provided to the Agent.

 

(xvii) Other. There shall have been executed, recorded or filed with the
appropriate authorities such additional or other termination or subordination
documents as the Agent shall require to establish the priority of the Liens
intended to be granted on the Replacement Owned Properties.

 

(c) Corporate Proceedings Satisfactory. The Lessee shall have delivered to the
Agent a certificate of the secretary or an assistant secretary of the Lessee,
dated the Consent Closing Date, in such form as is acceptable to the Agent
attaching and certifying to those matters identified in Section 5.3(y) of the
Participation Agreement (with references therein to “Operative Agreements”
including the “Consent Documents.”) All corporate proceedings taken in
connection with the transactions contemplated by this Consent and all other
agreements, documents and instruments executed or delivered pursuant to it, and
all legal matters incident thereto, shall be satisfactory to the Agent.

 

(d) No Lease Default or Lease Event of Default. No Lease Default or Lease Event
of Default shall have occurred and be continuing after giving effect to this
Consent.

 

(e) Fees. Each of the Lenders which has executed this Consent at or before 5:00
p.m. (Pacific time) on Friday, April 30, 2004 shall have received a fee equal to
0.025% of its Commitment, and the Lessee shall have paid such other fees,
expenses and charges as it may otherwise have agreed to pay prior to the
effectiveness of this Consent.

 

5. Representations and Warranties. Each Credit Party represents and warrants to
the Agent and the Secured Parties that, as of the date of and after giving
effect to this Consent, (a) the execution, delivery and performance of this
Consent and all other Consent Documents executed or delivered in connection
herewith have been authorized by all requisite corporate action on the part of
each Credit Party and will not violate any Credit Party’s certificate of
incorporation or bylaws, (b) all representations and warranties set forth in the
Lease and in any other Operative Agreement are true and correct as if made again
on and as of such date (except those, if any, that by their terms specifically
relate only to an earlier date, in which case such representations and
warranties are true and correct as of the earlier date), (c) no Lease Default or
Lease Event of Default has occurred and is continuing, and (d) the Lease and all
other Operative Agreement are and remain legal, valid, binding and enforceable
obligations in accordance with their terms.

 

6. Survival of Representations and Warranties. All representations and
warranties made by any Credit Party in this Consent or any other Operative
Agreement shall survive the execution and delivery of this Consent and the other
Operative Agreements, and no investigation by the Agent or the Secured Parties,
or any closing, shall affect the representations and warranties or the right of
the Agent and the Secured Parties to rely thereon.

 

7. Costs and Expenses. The Lessee shall pay on demand all reasonable costs and
expenses of the Agent (including the reasonable fees, costs and expenses of
counsel to the Agent) incurred in connection with the preparation, execution and
delivery of this Consent.

 

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8. Governing Law. THIS CONSENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF CALIFORNIA, WITHOUT REGARD TO CONFLICT-OF-LAWS
PRINCIPLES.

 

9. Execution. This Consent may be executed in any number of counterparts and by
different Parties on separate counterparts, each of which when so executed shall
be deemed to be an original and all of which taken together shall constitute one
and the same instrument. A Party’s delivery of an executed counterpart of this
Consent by telecopier shall be effective as delivery of a manually executed
counterpart of this Consent.

 

10. Limited Effect. This Consent relates only to the specific matters it covers,
shall not be considered to be a waiver of any other rights any Secured Party may
have under the Operative Agreements, and shall not be considered to create a
course of dealing or to otherwise obligate any Secured Party to grant similar
waivers or execute any amendments under the same or similar circumstances in the
future.

 

11. Ratification by Guarantors. Each Guarantor consents to this Consent, and
each Guarantor acknowledges that its guaranty remains in full force and effect
without any modification.

 

12. Certain Waivers. Each Credit Party agrees that none of the Financing Parties
shall be liable under a claim of, and waives any claim against any Financing
Party based upon lender liability (including, but not limited to, liability for
breach of the implied covenant of good faith and fair dealing, fraud,
negligence, conversion, misrepresentation, duress, control and interference,
infliction of emotional distress, defamation and breach of fiduciary duty) as a
result hereof, the discussions conducted pursuant hereto, or any course of
action taken by any Financing Party in response thereto or arising therefrom.
This Section 14 shall survive the execution and delivery of this Consent and the
expiration or termination of the Lease

 

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LESSOR:

 

Wells Fargo Bank Northwest, National Association,

As Owner Trustee under S&F Trust 1998-1

 

By:

 

/s/ Val T. Orton

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Name:

 

Val T. Orton

Title:

 

Vice President

 

LESSEE:

 

Smart & Final Inc.

 

By:

 

/s/ Richard N. Phegley

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Name:

 

Richard N. Phegley

Title:

 

Senior Vice President &

   

Chief Financial Officer

 

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A-2 LENDER, B LENDER AND HOLDER:

 

Casino USA, Inc.

 

By:

 

/s/ Andre Delolmo

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Name:

 

Andre Delolmo

Title:

 

President

 

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A-2 LENDER:

 

General Electric Capital Corporation,

as successor in interest to GMAC Business Credit, LLC

 

By:

 

/s/ Ronald E. Lis

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Name:

 

Ronald E. Lis

Title:

 

Senior Risk Manager

 

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A-2 LENDER:

 

Natexis Banques Populaires

 

By:

 

/s/ Anne Ulrich

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By:

 

/s/ P. J. van Tulder

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Name:

 

Anne Ulrich

     

Name:

 

P. J. van Tulder

Title:

 

Vice President

     

Title:

 

Group Head

 

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A-2 LENDER:

 

BNP Paribas Leasing Corporation

 

By:

 

/s/ Sean T. Conlon

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By:

 

/s/ Mitchell M. Ozawa

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Name:

 

Sean T. Conlon

     

Name:

 

Mitchell M. Ozawa

Title:

 

Managing Director

     

Title:

 

Managing Director

 

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A-2 LENDER AND AGENT:

 

Cooperative Centrale Raiffeisen-Boerenleenbank B.A.

“Rabobank Nederland,” New York Branch

 

By:

 

/s/ Bradford F. Scott

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By:

 

/s/ Rebecca O. Morrow

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Name:

 

Bradford F. Scott

     

Name:

 

Rebecca O. Morrow

Title:

 

Executive Director

     

Title:

 

Executive Director

 

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B LENDER:

 

Transamerica Equipment Financial Services Corporation

 

By:

 

/s/ Ronald E. Lis

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Name:

 

Ronald E. Lis

Title:

 

Senior Risk Manager

 

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GUARANTORS:

 

American Foodservices Distributors

Smart & Final Stores Corporation

Smart & Final Oregon, Inc.

Port Stockton Food Distributors, Inc.

Amerifoods Trading Company

Casino Frozen Foods, Inc.

FoodService Specialists.Com, Inc.

Okum Produce International, Inc.

HL Holding Corporation

 

By:

 

/s/ Richard N. Phegley

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Name:

 

Richard N. Phegley

Title:

 

Senior Vice President &

   

Chief Financial Officer

 

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SCHEDULE 1 TO CONSENT

 

(REPLACEMENT OWNED PROPERTIES)

 

Store Number

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Address

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314

 

266 East Huntington Drive

Monrovia, CA 91016

369

 

20410 Susana Road

Carson, CA 90810

457

 

1575 Centinela Avenue

Inglewood, CA 90302

459

 

2720 Beverly Blvd.

Los Angeles, CA 90057

475

 

14490 Newhope St.

Moreno Valley, CA 92553

479

 

6201 Alameda St.

Huntington Park, CA 90001

 

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