Exhibit 10.2



 


 


 


TERMINATION AND RELEASE AGREEMENT


THIS TERMINATION AND RELEASE AGREEMENT, dated as of March 31, 2005
(this "Agreement"), is executed by and among Wild Oats Markets, Inc., a
Delaware corporation (the "Borrower"), each of the financial institutions
which are a party to the Credit Agreement referred to below (each a "Lender",
and collectively, the "Lenders") and Wells Fargo Bank, National
Association, a national banking association ("Wells Fargo Bank"), as
administrative agent for the Lenders (in such capacity, the "Administrative Agent"),
as L/C Issuer (in such capacity, the "L/C Issuer") and as Swing Line
Lender (in such capacity, the "Swing Line Lender") under that
certain Second Amended and Restated Credit Agreement, dated as of February 26, 2003, as
amended by that certain First Amendment to Second Amended and Restated Credit Agreement
dated as of May 21, 2004, as further amended by that certain Second Amendment to Second
Amended and Restated Credit Agreement dated as of August 3, 2004, and as further amended
by that certain Third Amendment to Second Amended and Restated Credit Agreement dated as
of November 4, 2004 (as amended to the date hereof, the "Credit Agreement")
among the Borrower, the Lenders and the Administrative Agent. Capitalized terms used
herein and not otherwise defined shall have the meanings given to such terms in the Credit
Agreement.


 


RECITALS


WHEREAS, the Borrower, the Lenders and the Administrative Agent are
parties to the Credit Agreement pursuant to which the Lenders have agreed to make
Revolving Loans to the Borrower in an aggregate principal amount of up to $95,000,0000, of
which $0 is outstanding as of the date hereof, and the Swing Line Lender has agreed to
make Swing Line Loans to the Borrower in an aggregate principal amount equal to the lesser
of $20,000,000 and the Total Commitment, of which $0 is outstanding as of the date hereof
(collectively, the "Loans"). In addition, pursuant to the Credit
Agreement, the L/C Issuer agreed to issue Letters of Credit for the account of the
Borrower in an amount equal to the to the lesser of $10,000,000 and the Total Commitment,
of which Letters of Credit in an aggregate amount of $8,758,035.12 are issued and
outstanding as of the date hereof (collectively, the "Outstanding Letters of
Credit"). To evidence the Obligations of the Borrower to repay the Loans, the
Borrower executed and delivered to each of the Lenders and the Swing Line Lender, as
applicable, Revolving Loan Notes and a Swing Line Note, each dated February 26, 2003
(except for the Revolving Loan Note made payable to Bank of America, N.A., which Revolving
Loan Note is dated December 12, 2003) and made payable to each Lender or the Swing Line
Lender, as applicable, in an aggregate amount of each such Lender’s Commitment or the
Swing Line Sublimit, as applicable (collectively, the "Notes"); and


WHEREAS, to secure repayment by the Borrower of the Obligations, the
Borrower and certain of its Subsidiaries executed in favor of the Administrative Agent and
the Lenders that certain Amended and Restated Security Agreement dated as of February 26,
2003 (the "Security Agreement") pursuant to which the Borrower and
certain of its Subsidiaries granted to the Administrative Agent, on behalf of and for the
benefit of the Administrative Agent and the Lenders, a security interest in all right,
title and interest of the Borrower in and to the Collateral (as defined in the Security
Agreement); and


WHEREAS, to further secure repayment by the Borrower of the
Obligations, the Borrower and certain of its Subsidiaries executed in favor of the
Administrative Agent and the Lenders that certain Amended and Restated Pledge Agreement
dated as of February 26, 2003 (the "Pledge Agreement") pursuant to which
the Borrower and certain of its Subsidiaries pledged to the Administrative Agent, on
behalf of and for the benefit of the Administrative Agent and the Lenders, a security
interest in all right, title and interest of the Borrower or its Subsidiaries in and to
the Pledged Collateral (as defined in the Pledge Agreement); and


WHEREAS, to further secure repayment by the Borrower of the
Obligations, the Borrower and certain of its Subsidiaries executed in favor of the
Administrative Agent and the Lenders certain Leasehold Mortgages dated various dates
(collectively, the "Leasehold Mortgages") pursuant to which the Borrower
and certain of its Subsidiaries granted to the Administrative Agent and the Lenders a
security interest in all right, title and interest of the Borrower and certain of its
Subsidiaries in and to the Leasehold Collateral; and


WHEREAS, to further secure repayment by the Borrower of the
Obligations, certain of its Subsidiaries executed in favor of the Administrative Agent and
the Lenders an Amended and Restated Subsidiary Guaranty dated as of February 26, 2003 (the
"Guaranty") pursuant to which such Subsidiaries guaranteed the payment
and performance by the Borrower of the Obligations; and


WHEREAS, the Borrower wishes to repay to the Administrative Agent and
the Lenders $234,682.09 as consideration in full for all principal, interest, fees and
other amounts owing under the Credit Agreement and the other Credit Documents (other than
(a) the Continuing Indemnity Obligations (as hereinafter defined) and (b) the Letter of
Credit Obligations with respect to the Outstanding Letters of Credit which will be
transferred to a separate standby letter of credit facility (the "WFB L/C Facility")
to be entered into between the Borrower and Wells Fargo Bank) and in consideration of the
release by the Administrative Agent and the Lenders of their security interests in the
Collateral, the Pledged Collateral, the Leasehold Collateral and their rights under the
Guaranty; and


WHEREAS, the Administrative Agent and the Lenders are willing to accept
$234,682.09 from the Borrower as consideration in full for all principal, interest, fees
and other amounts owing under the Credit Agreement and the other Credit Documents (other
than (a) the Continuing Indemnity Obligations and (b) the Letter of Credit Obligations
with respect to the Outstanding Letters of Credit which will be transferred to the WFB L/C
Facility), and in consideration of the release by the Administrative Agent and the Lenders
of their security interests in the Collateral, the Pledged Collateral, the Leasehold
Collateral and their rights under the Guaranty upon the terms and subject to the
conditions set forth herein.


NOW, THEREFORE, in consideration of the above Recitals, the Borrower,
the Lenders and the Administrative Agent hereby agree as follows:


1. Payment and Termination of Credit Agreement and other Credit
Documents. The Administrative Agent on behalf of the Lenders hereby acknowledges
receipt of $234,682.09 as consideration in full of all principal, interest and fees owing,
and fees estimated to be owed, under the Credit Agreement and the other Credit Documents
and the termination of the Credit Agreement, the other Credit Documents (for purposes of
this Agreement, such term includes, without limitation, the Security Agreement, the Pledge
Agreement, the Leasehold Mortgages and the Guaranty) and all related documents,
instruments and agreements as follows:


 



	
      
        A. 

      

    

    	Outstanding Principal as of March 31, 2005	$0

	
      
        B. 

      

    

    	Outstanding Interest as of March 31, 2005	$0
	
      
        C. 

      

    

    	Unpaid Commitment Fees as of March 31, 2005	$156,649.53
	
      
        D. 

      

    

    	Unpaid Letter of Credit Fees as of March 31, 2005	$28,032.56
	
      
        E. 

      

    

    	Unpaid Legal Fees as of March 31, 2005 and an estimate of
    Legal Fees through April 30, 2005	$50,000.00





 


provided, however, that nothing contained herein shall have
any effect on the Borrower’s obligation to reimburse the Lenders and the
Administrative Agent with respect to indemnification and related obligations and for fees
and expenses set forth in the Credit Agreement and the other Credit Documents (the "Continuing
Indemnity Obligations") which by their terms survive the termination of the
agreement in which they are contained (it being understood, however, that any such
Continuing Indemnity Obligations shall not be secured by any security interests or liens
created pursuant to the Credit Agreement or any of the other Credit Documents at any time
after the conditions precedent set forth in Section 6 of this Agreement have been
satisfied).


2. Termination of Security Agreement, Pledge Agreement and Leasehold
Mortgages; Release of Liens.



  
    (a) The Security Agreement, the Pledge Agreement, each Leasehold
    Mortgage and all documents, instruments and agreements related thereto are hereby
    terminated and the Borrower and its Subsidiaries, respectively, are each hereby released
    therefrom, and the Administrative Agent and the Lenders hereby release, assign, transfer
    and deliver to the Borrower and its Subsidiaries, respectively, without recourse and
    without representation or warranty, all of their right, title and interest in the
    Collateral, the Pledged Collateral and the Leasehold Collateral.

    (b) From time to time, upon request by the Borrower, its Subsidiaries
    or Bank of America, N.A. (the "New Lender"), respectively, the
    Administrative Agent and the Lenders shall, without further consideration other than
    reimbursement for any costs and expenses, execute, deliver and acknowledge all such
    further documents, agreements, certificates and instruments and do such further acts as
    the Borrower, its Subsidiaries or the New Lender may reasonably require to more
    effectively evidence or effectuate the transactions contemplated by this Agreement,
    including, but not limited to, this release and termination of the Security Agreement, the
    Pledge Agreement, the Leasehold Mortgages and this release and discharge of all security
    interests and all other rights and interests that the Administrative Agent or the Lenders
    have or may have had in the Collateral, the Pledged Collateral and the Leasehold
    Collateral. Without limiting the generality of the foregoing, (i) the Administrative Agent
    and the Lenders hereby authorize the Borrower or and/or the New Lender to file any Uniform
    Commercial Code ("UCC") Financing Statement Amendments necessary to
    evidence the termination of any UCC Financing Statements naming the Administrative Agent
    as Secured Party and the Borrower or any of its Subsidiaries as Debtor and (ii) the
    Lenders hereby authorize and instruct the Administrative Agent to execute and deliver to
    the Borrower or its Subsidiaries all such further documents, agreements, certificates and
    instruments and do such further acts as the Borrower or its Subsidiaries may reasonably
    require to more effectively evidence or effectuate the transactions contemplated by this
    Agreement, including, but not limited to, this release and termination of the Security
    Agreement, the Pledge Agreement, the Leasehold Mortgages and this release and discharge of
    all security interests and all other rights and interests that the Administrative Agent or
    the Lenders have or may have had in the Collateral, the Pledged Collateral and the
    Leasehold Collateral.

  




3. Termination of Guaranty. The Guaranty, and all documents,
instruments and agreements related thereto are hereby terminated and each Guarantor is
hereby released therefrom. From time to time, upon request by the Guarantors, the
Administrative Agent and the Lenders shall, without further consideration other than
reimbursement for any costs and expenses, execute, deliver and acknowledge all such
further documents, agreements, certificates and instruments and do such further acts as
the Guarantors and or the New Lender may reasonably require to more effectively evidence
or effectuate the transactions contemplated by this Agreement, including, but not limited
to, the release and termination of the Guaranty.


4. Further Assurances. The Borrower shall fully cooperate with
the Administrative Agent and the Lenders and perform all additional acts reasonably
requested by the Administrative Agent or any Lender to effect the purposes of this
Agreement.


5. Miscellaneous. This Agreement may not be amended, modified or
waived except in writing signed by the party against whom enforcement of such amendment,
modification or waiver is sought. THIS AGREEMENT SHALL BE CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF COLORADO. This Agreement may be executed in
one or more counterparts, each of which shall be deemed an original, but all of which,
when taken together, shall constitute one and the same instrument.


6. Effectiveness. This Agreement and the releases and lien
terminations effected hereby shall become effective upon the satisfaction of each of the
following conditions: (a) the Borrower, the Administrative Agent and the Lenders
shall have executed and delivered a counterpart hereof (including by way of facsimile
transmission); (b) the Administrative Agent and the Lenders shall have received the
payment of the amounts referred to in Section 1 hereof and (c) all conditions to
the effectiveness of the WFB L/C Facility shall, in Wells Fargo Bank’s sole and
absolute discretion, have been satisfied.


IN WITNESS WHEREOF, the undersigned have entered into this Agreement as
of the day and year first above written.


	BORROWER:	WILD OATS MARKETS, INC.,a Delaware corporation

    By: /s/ Freya R. Brier

    Name: Freya R. Brier

    Title: Senior Vice President

	ADMINISTRATIVE AGENT:	WELLS FARGO BANK, NATIONAL ASSOCIATIONBy: /s/ Marc
    Rosenberg

    Name: Marc Rosenberg

    Title: Vice President

	LENDERS:	WELLS FARGO BANK, NATIONAL ASSOCIATIONBy: /s/ Marc
    Rosenberg

    Name: Marc Rosenberg

    Title: Vice President

		U.S. BANK NATIONAL ASSOCIATIONBy: /s/ Jacob Payne

    Name: Jacob Payne

    Title: Assistant Vice President

		BANK OF AMERICA, N.A.By: David R. Barney

    Name: David R. Barney

    Title: Senior Vice President

		VECTRA BANK COLORADO N.A.By: Steven Griffith

    Name: Steven Griffith

    Title: Senior Vice President