exv10w3






EXHIBIT 10.3




SECOND AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT




     This Second Amendment to Amended and Restated Credit Agreement (this “Second
Amendment”) is made as of this 23rd day of July, 2009 by and among




THE GREAT ATLANTIC & PACIFIC TEA COMPANY, INC., a Maryland
corporation;




the other BORROWERS set forth on Annex A and Annex B
hereto,




the LENDERS party hereto, and




BANK OF AMERICA, N.A., a national banking association, as
Administrative Agent and Collateral Agent;


in consideration of the mutual covenants herein contained and benefits to be derived herefrom.




WITNESSETH




     A. Reference is made to the Amended and Restated Credit Agreement (as amended and in effect,
the “Credit Agreement”) dated as of December 27, 2007 by and among the Company, the other
Borrowers, the Lenders, Bank of America, N.A., as Administrative Agent and Collateral Agent,
JPMorgan Chase Bank, N.A. and Wells Fargo Retail Finance LLC, as Co-Syndication Agents, The CIT
Group/Business Credit, Inc., as Documentation Agent and Banc of America Securities LLC and JPMorgan
Chase Bank, N.A., as Co-Lead Arrangers.



     B. The parties to the Credit Agreement desire to modify and amend certain provisions of the
Credit Agreement, as provided herein.



     Accordingly, the parties hereto agree as follows:



     1. Definitions. Capitalized terms used herein and not otherwise defined herein shall
have the meanings assigned to such terms in the Credit Agreement.



     2. Amendment to Article I of the Credit Agreement. As of the Amendment Effective
Date, the provisions of Article I of the Credit Agreement are hereby amended as follows:




	 	a.	 	The definition of “Aggregate Tranche A-1 Commitments” is hereby amended by
deleting the last sentence thereof in its entirety and substituting the following in
its stead:
	 
	 	 	 	As of the Amendment Effective Date, the Aggregate Tranche A-1 Commitments are
$20,000,000.




 









 












	 	b.	 	The definition of “Applicable Margin” is hereby deleted in its entirety and the
following substituted in its stead:
	 
	 	 	 	“Applicable Margin” means, for any Interest Payment Date with respect to a
particular Type of Loan, the applicable rate per annum set forth in the applicable
pricing grid below:





	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	ABR	 	Applicable	 	 
	 	 	Applicable	 	LIBOR	 	 
	Facility	 	Margin	 	Margin	 	Unused Fee
	Tranche A
	 	 	2.25	%	 	 	3.25	%	 	 	0.25	%
	Term Loan
	 	 	2.25	%	 	 	3.25	%	 	 	N/A	 
	Tranche A-1
	 	 	3.50	%	 	 	4.50	%	 	 	0.50	%
	Term A-2
	 	 	5.00	%	 	 	6.00	%	 	 	N/A	 







	 	c.	 	The definition of “Average Daily Excess Availability” is hereby deleted in its
entirety.
	 
	 	d.	 	The definition of “Principal Properties” is hereby deleted in its entirety and
the following substituted in its stead:
	 
	 	 	 	“Principal Properties” means, the Real Estate described on Schedule
1.01(C),
	 
	 	e.	 	The definition of “Qualified Preferred Stock” is hereby deleted in its entirety
and the following substituted in its stead:
	 
	 	 	 	“Qualified Preferred Stock” means, with respect to any Person, any preferred
capital stock or preferred equity interest that by its terms (or by the terms of any
security into which it is convertible or for which it is exchangeable or
exercisable) or upon the happening of any event does not (a) except as set forth in
the proviso hereto, mature or becomes mandatorily redeemable prior to the Maturity
Date, pursuant to a sinking fund obligation or otherwise; (b) become convertible or
exchangeable at the option of the holder thereof for Indebtedness or preferred stock
that is not Qualified Preferred Stock, prior to the Maturity Date; or (c) except as
set forth in the proviso hereto, become redeemable at the option of the holder
thereof, in whole or in part, prior to the Maturity Date, provided that such
preferred capital stock or preferred equity interest. may by its terms (or by the
terms of any security into which it is convertible or for which it is exchangeable
or exercisable) become mandatorily redeemable or redeemable at the option of the
holder thereof upon the occurrence of a Change in Control only if (i) the
Administrative Agent or the Required Lenders have declared an Event of Default on
account thereof, (ii) all Obligations have been irrevocably paid in full in cash,
(iii) all Letters of Credit have been cancelled and the L/C Exposure has been cash
collateralized in accordance with the provisions of Section 7.02(c), and (iv) all
Commitments have been terminated. The Agent and the Lenders acknowledge




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	 	 	 	that, as of the Amendment Effective Date, the convertible preferred stock issued in
connection with the Convertible Preferred Stock Transaction constitutes Qualified
Preferred Stock.
	 
	 	f.	 	The definition of “Tranche A-1 Inventory Advance Rate” is hereby deleted in its
entirety and the following substituted in its stead:
	 
	 	 	 	“Tranche A-1 Inventory Advance Rate means 92.5%.
	 
	 	g.	 	The definition of “Tranche A-1 Prescription Advance Rate” is hereby deleted in
its entirety and the following substituted in its stead:
	 
	 	 	 	“Tranche A-1 Prescription Advance Rate” means 87.5%.
	 
	 	h.	 	The definition of “Tranche A-1 Real Estate Advance Rate” is hereby deleted in
its entirety and the following substituted in its stead:
	 
	 	 	 	“Tranche A-1 Real Estate Advance Rate” means 55%.
	 
	 	i.	 	The definition of “Triggering Event” is hereby amended by deleting the number
“$75,000,000” wherever the same shall appear and substituting the number “$90,000,000”
in its stead.
	 
	 	j.	 	The following new definitions are hereby added in appropriate alphabetical
order:
	 
	 	 	 	“Amendment Effective Date” has the meaning set forth in the Second
Amendment.
	 
	 	 	 	“Capital Expenditures” means, with respect to any Person for any period, all
expenditures made (whether made in the form of cash or other property) or costs
incurred for the acquisition or improvement of fixed or capital assets of such
Person (excluding normal replacements and maintenance which are properly charged to
current operations), in each case that are (or should be) set forth as capital
expenditures in a consolidated statement of cash flows of such Person for such
period, in each case prepared in accordance with GAAP.
	 
	 	 	 	“Capital Lease Obligations” means, with respect to any Person for any
period, the obligations of such Person to pay rent or other amounts under any lease
of (or other arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and accounted
for as liabilities on a balance sheet of such Person under GAAP and the amount of
which obligations shall be the capitalized amount thereof determined in accordance
with GAAP.
	 
	 	 	 	“Consolidated EBITDA” means, at any date of determination, an amount equal
to Consolidated Net Income of the Company and its Subsidiaries on a consolidated
basis for the most recently completed Measurement Period, plus (a) the following to
the extent deducted in calculating such Consolidated Net Income: (i) Consolidated
Interest Charges, (ii) the provision for federal, state, local and foreign income
Taxes, (iii) depreciation and amortization expense and (iv) other




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	 	 	 	non-recurring expenses reducing such Consolidated Net Income which do not represent
a cash item in such period or, other than annual accretion on the Convertible Notes,
any future period (in each case of or by Company and its Subsidiaries for such
Measurement Period), minus (b) the following to the extent increasing such
Consolidated Net Income: (i) federal, state, local and foreign income tax credits
and (ii) all non-cash items increasing Consolidated Net Income other than non-cash
items which will represent a cash item in a future period (in each case of or by the
Borrowers and their Subsidiaries for such Measurement Period), all as determined on
a consolidated basis in accordance with GAAP.
	 
	 	 	 	“Consolidated Fixed Charge Coverage Ratio” means, at any date of
determination, for any Measurement Period, the ratio of (a) (i) Consolidated EBITDA
for such period minus (ii) Capital Expenditures made during such period, minus (iii)
the aggregate amount of federal, state, local and foreign income taxes paid in cash
during such period to (b) the sum of (i) Debt Service Charges plus (ii) the
aggregate amount of all Restricted Payments made in cash under Sections 6.08(a)(i)
and 6.08(a)(ii), in each case, of or by Company and its Subsidiaries for the most
recently completed Measurement Period, all as determined on a consolidated basis in
accordance with GAAP; provided the items described in clauses (a)(ii),
(a)(iii) and (b) above made by a Person prior to the date it becomes a Subsidiary of
the Company or any of the Company’s Subsidiaries or is merged into or consolidated
with the Company or any of its Subsidiaries or that Person’s assets are acquired by
the Company or any of its Subsidiaries shall be excluded in the calculation of
Consolidated Fixed Charge Coverage Ratio.
	 
	 	 	 	“Consolidated Interest Charges” means, for any Measurement Period, the sum
of (a) all interest, premium payments, debt discount, fees, charges and related
expenses in connection with borrowed money (including capitalized interest) or in
connection with the deferred purchase price of assets, in each case to the extent
treated as interest in accordance with GAAP, including, without limitation, all
commissions, discounts and other fees and charges owed with respect to letters of
credit and bankers’ acceptance financing and net costs under Swap Contracts, but
excluding any non-cash or deferred interest financing costs, and (b) the portion of
rent expense with respect to such period under Capital Lease Obligations that is
treated as interest in accordance with GAAP, in each case of or by Company and its
Subsidiaries for the most recently completed Measurement Period, all as determined
on a consolidated basis in accordance with GAAP.
	 
	 	 	 	“Consolidated Net Income” means, as of any date of determination, the net
income of Company and its Subsidiaries for the most recently completed Measurement
Period, all as determined on a consolidated basis in accordance with GAAP, provided,
however, that there shall be excluded (a) extraordinary gains and extraordinary
losses for such Measurement Period, (b) the income (or loss) of any non-wholly owned
Subsidiary of the Company during such Measurement Period in which any other Person
has a joint interest, except to the extent of the amount of cash dividends or other
distributions actually paid in cash to the Company or any of its wholly owned
Subsidiaries during such period, (c) the income (or loss) of any Person during such
Measurement Period and accrued prior




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	 	 	 	to the date it becomes a wholly owned Subsidiary of the Company or any of the
Company’s wholly owned Subsidiaries or is merged into or consolidated with the
Company or any of its wholly owned Subsidiaries or that Person’s assets are acquired
by the Company or any of its wholly owned Subsidiaries, and (d) the income of any
direct or indirect Subsidiary of the Company (other than a Loan Party) to the extent
that the declaration or payment of dividends or similar distributions by that
Subsidiary of that income is not at the time permitted by operation of the terms of
its organization documents or any agreement, instrument, judgment, decree, order,
statute, rule or governmental regulation applicable to that Subsidiary, except that
Company’s equity in any net loss of any such Subsidiary for such Measurement Period
shall be included in determining Consolidated Net Income.
	 
	 	 	 	“Convertible Preferred Term Sheet” means the terms set forth on Exhibit S
hereto.
	 
	 	 	 	“Convertible Preferred Stock Transaction” means the issuance by the Company
of 175,000 shares of its convertible preferred stock on the terms set forth in the
Convertible Preferred Term Sheet and the Articles Supplementary of 8% Cumulative
Convertible Preferred Stock, Series [A-T, A-Y, B-T and B-Y] of the Company.
	 
	 	 	 	“Debt Service Charges” means for any Measurement Period, the sum of (a)
Consolidated Interest Charges paid or required to be paid for such Measurement
Period, plus (b) principal payments made or required to be made on account of
Indebtedness of the Company and its Subsidiaries (excluding the Obligations and any
refinancings and refundings of Indebtedness permitted under this Agreement, but
including, without limitation, Capital Lease Obligations) for such Measurement
Period, in each case determined on a Consolidated basis in accordance with GAAP.
	 
	 	 	 	“Measurement Period” means, at any date of determination, the most recently
completed twelve (12) fiscal months of Company.
	 
	 	 	 	“Permitted Refinancings” means any refinancings, refundings, renewals,
extensions or replacements of Indebtedness permitted hereunder; provided
that (i) the principal amount of such indebtedness is not increased at the time of
such refinancing, refunding, renewal, extension or replacement (except by an amount
equal to any reasonable premiums, fees and expenses incurred, in connection with
such refinancing, refunding, renewal, extension or replacement), and (ii) the result
of such refinancing, refunding, renewal, extension or replacement shall not be an
earlier maturity date or decreased weighted average life of such indebtedness, and
(iii) the terms relating to collateral (if any) and subordination (if any), and
other material terms taken as a whole, of any such refinancing, refunding, renewal,
extension or replacement indebtedness, and of any agreement entered into and of any
instrument issued in connection therewith, are no less favorable in any material
respect to the Loan Parties or the Secured Parties than the terms of the agreements
or instruments governing the Indebtedness being refinanced, refunded, renewed,
extended or replaced.






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	 	 	 	“Second Amendment” means the Second Amendment to Amended and Restated Credit
Agreement dated as of July 23, 2009 between, among others, the Company, the
Administrative Agent and the Required Lenders.
	 
	 	 	 	“Second Lien Notes” means senior secured notes issued by the Company (and
any notes registered with the SEC in exchange therefor) (i) which are in an
aggregate principal amount not to exceed $400,000,000, (ii) which are secured by the
Collateral (or a portion thereof), (iii) which have a maturity of no earlier than
180 days after the Maturity Date, (iv) which do not require principal amortization
until all Obligations have been paid in full, (v) which are subject to an
intercreditor agreement satisfactory in form and substance to the Required Lenders,
(vi) the proceeds of which are utilized to repay the Tranche A-Loans and the Tranche
A-1 Loans (without a permanent reduction in the Commitments), to repay other
Indebtedness of the Company or any Subsidiary (as long as such repayment is in
accordance with, and permitted by, the Credit Agreement), to pay related fees and
expenses and for working capital and other general corporate purposes, (vii) which
may be guaranteed by the Subsidiaries of the Company which have executed a Guaranty
of the Obligations; and (viii) which are on terms consistent with the preliminary
Offering Memorandum dated July 23, 2009, other than changes which are not adverse
to the Secured Parties in any material respect.





     3. Amendments to Article V of the Credit Agreement. As of the Amendment Effective
Date, the provisions of Section 5.09(b) of the Credit Agreement are hereby deleted in their
entirety and the following substituted in their stead:




(b) The Company will, and will cause each of the Subsidiaries to, permit any
representatives designated by the Administrative Agent (including any consultants,
accountants, lawyers and appraisers retained by the Administrative Agent) in
consultation with the Borrowers to conduct commercial finance examinations and
appraisals of the assets included in the computation of the Tranche A Borrowing Base
and the Tranche A-1 Borrowing Base, including supporting systems, processes and
controls, all at the expense of the Borrowers (i) subject to the provisions of
clauses (ii) and (iii) below, up to two (2) times during any twelve month period,
(ii) up to three (3) times during any twelve month period in which Excess
Availability is at any time less than $100,000,000, and (iii) at any time at the
request of the Administrative Agent after the occurrence and the continuation of an
Event of Default; provided, that, notwithstanding the provisions of
clause (ii) above, no more than two (2) appraisals of Eligible Real Estate, Eligible
Leaseholds, and Scripts may be conducted during any twelve month period unless an
Event of Default has occurred and is continuing. In addition to the foregoing the
Administrative Agent will have the right to conduct such commercial finance
examinations and appraisals at the expense of the Administrative Agent, but no more
frequently than twice in any calendar year. The expenses reimbursable by the
Borrowers pursuant to his Section shall include the reasonable fees and expenses of
any representatives retained by the Administrative Agent.



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     4. Amendments to Article VI of the Credit Agreement. As of the Amendment Effective
Date, the provisions of Article VI of the Credit Agreement are hereby amended as follows:




	 	a.	 	The provisions of Section 6.01 of the Credit Agreement are hereby amended by
deleting clause (xiv) in its entirety and substituting following in its stead:






(xiv) Indebtedness of the Borrowers on account of the Convertible Notes, in an
aggregate principal amount not to exceed $420,000,000, plus any additional amounts
recorded in accordance with GAAP related to the convertible bond hedge and warrant
transaction issued concurrently with the Convertible Notes, outstanding at any time
(or such greater amount as the Administrative Agent, in its discretion, may agree)
and any Permitted Refinancings thereof;




	 	b.	 	The provisions of Section 6.01(a) of the Credit Agreement are hereby further
amended by deleting the word “and” at the end of clause (xiii), deleting the period at
the end of clause (xiv) and substituting “; and” in its stead, and adding the following
new clause:






(xv) Indebtedness of the Loan Parties on account of the Second Lien Notes and any
Permitted Refinancings thereof.




	 	c.	 	The provisions of Section 6.02 of the Credit Agreement are hereby amended by
deleting the word “and” at the end of clause (i), deleting the period at the end of
clause (j) and substituting “; and” in its stead, and adding the following new clause:






(k) Liens to secure the Second Lien Notes and any Permitted Refinancings thereof;




	 	d.	 	The provisions of Section 6.08(a) of the Credit Agreement are hereby deleted in
their entirety and the following substituted in their stead:






(a) The Company will not, nor will it permit any Subsidiary to, declare or make, or
agree to pay or make, directly or indirectly, any Restricted Payment, or incur any
obligation (contingent or otherwise) to do so, except (i) the Company may declare
and pay cash dividends to the holders of the convertible preferred stock issued in
connection with the Convertible Preferred Stock Transaction, provided that
immediately before and after giving effect to any such Restricted Payment (1) the
Loan Parties, on a consolidated basis, are Solvent, (2) Excess Availability on the
date of any such dividend and average monthly Excess Availability projected on a pro
forma basis for the following twelve months shall be in an amount greater than
twenty percent (20%) of Tranche A-1 Borrowing Base (or, if the Tranche A-1
Commitments have been terminated, the then Tranche A Borrowing Base), and (3) no
Default or Event of Default has occurred and is continuing, (ii) the Company may
make other Restricted Payments, provided that immediately before and after giving
effect to any such Restricted Payment (1) the Loan Parties, on a consolidated basis,
are Solvent, (2) Excess Availability on the date of any such Restricted Payment and
average monthly Excess Availability projected on a pro forma basis for the following
twelve months shall be in an amount greater



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than twenty percent (20%) of Tranche A-1 Borrowing Base (or, if the Tranche A-1
Commitments have been terminated, the then Tranche A Borrowing Base), (3) the
Consolidated Fixed Charge Coverage Ratio is equal to at least 1.1:1.0, and (4) no
Default or Event of Default has occurred and is continuing, (iii) the Company may
declare and pay dividends with respect to its capital stock payable solely in
additional shares of its common stock or, with respect to the convertible preferred
stock issued in connection with the Convertible Preferred Stock Transaction,
additional shares of such preferred stock or additional shares of its common stock,
and (iv) Subsidiaries may declare and pay dividends ratably with respect to their
capital stock.




	 	e.	 	The provisions of Section 6.08(b) of the Credit Agreement are hereby deleted in
their entirety and the following substituted in their stead:






(b) The Company will not, nor will it permit any Subsidiary to, make or agree to pay
or make, directly or indirectly, any payment or other distribution (whether in cash,
securities or other property) in respect of principal of, or any payment or other
distribution (whether in cash, securities or other property), including any sinking
fund or similar deposit, on account of the purchase, redemption, retirement,
acquisition, cancellation or termination of any Indebtedness of the Company or any
Subsidiary provided that:




(i) except as provided in clause (iv), below, the Loan Parties may make
regularly scheduled or mandatory repayments or redemptions of Indebtedness
permitted under Section 6.01 (including, without limitation, payments of
principal and interest as and when due);




(ii) the Company or any Subsidiary may make payments and distributions in
respect of, and purchase, redeem, retire, acquire, cancel or terminate any
Indebtedness of the Company or any Subsidiary (including the Convertible
Notes) by the issuance of common stock or Qualified Preferred Stock of the
Company or its Subsidiaries;




(iii) the Company or any Subsidiary may make other voluntary payments and
distributions in respect of, and purchase, redeem, retire, acquire, cancel
or terminate any Indebtedness of the Company or any Subsidiary (including
the Convertible Notes), provided that immediately before and after
giving effect to any such distribution or payment (A) the Loan Parties, on a
consolidated basis, are Solvent, (B) Excess Availability on the date of such
distribution or payment and projected on a pro forma basis for the following
twelve months shall be in an amount greater than twenty percent (20%) of the
Tranche A-1 Borrowing Base (or, if the Tranche A-1 Commitments have been
terminated, the then Tranche A Borrowing Base), and (C) no Default or Event
of Default has occurred and is continuing or would arise therefrom;




(iv) in addition to the provisions of clause (ii), above, the Company may
make mandatory prepayments of principal due under the Convertible Notes as
long as immediately before and after giving effect to any such



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distribution or payment (A) the Loan Parties, on a consolidated basis, are
Solvent, (B) Excess Availability on the date of such payment and projected
on a pro forma basis for the following twelve months shall be in an amount
greater than twenty percent (20%) of the Tranche A-1 Borrowing Base (or, if
the Tranche A-1 Commitments have been terminated, the then Tranche A
Borrowing Base), and (C) no Default or Event of Default has occurred and is
continuing or would arise therefrom; and




(iv) refinancings and refundings of such Indebtedness subject to and in
accordance with the terms of this Agreement.




	 	f.	 	The provisions of Section 6.09 of the Credit Agreement are hereby deleted in
their entirety and the following substituted in their stead:






The Company will not, nor will it permit any Subsidiary to, sell, lease or otherwise
transfer any property or assets to, or purchase, lease or otherwise acquire any
property or assets from, or otherwise engage in any other transactions with, any of
its Affiliates, except (a) transactions at prices and on terms and conditions not
less favorable to the Company or such Subsidiary than could be obtained on an
arm’s-length basis from unrelated third parties (it being agreed that such condition
may be satisfied by the Company’s obtaining a “fairness” opinion from a Person
reasonably acceptable to the Administrative Agent), (b) transactions between or
among the Loan Parties not involving any other Affiliate, (c) the Convertible
Preferred Stock Transaction, and (d) payments to Affiliates of Placement Fees,
Transaction Advisory Fees and expense reimbursements on the consummation of the
Convertible Preferred Stock Transaction in the amounts set forth in the Convertible
Preferred Term Sheet.




	 	g.	 	The provisions of Section 6.10 of the Credit Agreement are hereby amended by
adding the words “or in the agreements relating to the Second Lien Notes,” after the
words “Schedule 6.10” in the first line thereof.
	 
	 	h.	 	The provisions of Section 6.11 of the Credit Agreement are hereby deleted in
their entirety and the following substituted in their stead:






The Company will not, nor will it permit any Subsidiary to, amend, modify or
waive any of (a) the provisions of its certificate of incorporation, by-laws or
other organizational documents (including, without limitation, the documents
relating to the Convertible Preferred Stock Transaction) in a manner materially
adverse to the Lenders (b) its rights and obligations under other Material Contracts
in a manner materially adverse to the Lenders, (c) the terms of
the Company’s
93/8%
Senior Quarterly Interest Bonds due 2039 (“QUIBs”) and any refinancings or
replacements of any of the foregoing in a manner materially adverse to the Lenders,
or (d) the terms of the Convertible Notes, the Second Lien Notes, and any
refinancings or replacements of any of the foregoing in a manner materially adverse
to the Lenders, including, without limitation, in the case of clauses (c) and (d)
and amendment, modification or waiver which, (i) shortens the scheduled maturity
date of the QUIBs, the Convertible Notes or the Second Lien Notes other



9









 







than as the result of an acceleration after the occurrence of an event of default
thereunder; or (ii) changes the prepayment, redemption or defeasance provisions
thereof which could reasonably be expected to accelerate or shorten the time for any
payments thereunder or otherwise in a manner adverse to any Loan Party.



     5. Acknowledgement and Waiver.




	 	a.	 	The Borrowers and Lenders hereby acknowledge that the Aggregate Tranche A-1
Commitments will be reduced on the Amendment Effective Date to $20,000,000 and the
Lenders waive any provisions of Section 2.09(c) of the Credit Agreement which was
otherwise prohibit or restrict such commitment reduction.
	 
	 	b.	 	The Agents and the Lenders each acknowledge and agree that the Articles
Supplementary of 8% Cumulative Convertible Preferred Stock, Series [A-T, A-Y, B-T and
B-Y] of the Company and any other amendments to the Company’s organizational documents
in connection with the Convertible Preferred Stock Transaction (which amendments are
described on Exhibit S attached hereto) will not violate Section 6.11 of the
Credit Agreement.





     6. Conditions Precedent to Effectiveness. The amendments to the Credit Agreement
provided in Sections 2, 3 and 4 of this Second Amendment shall become effective as of the date (the
“Amendment Effective Date”) when each of the following conditions precedent have been
fulfilled to the satisfaction of the Administrative Agent:




	 	a.	 	This Second Amendment shall have been duly executed and delivered by the
Borrowers and the Required Lenders and shall be in full force and effect.
	 
	 	b.	 	All action on the part of the Borrowers necessary for the valid execution,
delivery and performance by the Borrowers of this Second Amendment shall have been duly
and effectively taken and evidence thereof satisfactory to the Administrative Agent
shall have been provided to the Administrative Agent.
	 
	 	c.	 	The Borrowers shall have paid to the Administrative Agent, (i) for the pro rata
account of the Lenders consenting to the Second Amendment (including Bank of America,
N.A.), an amendment fee in an amount equal to 0.20% of each such Lender’s Tranche A
Commitment, Tranche A-1 Commitment (after giving effect to the reduction of the Tranche
A-1 Commitments on the Amendment Effective Date), and outstanding Term Loans and Term
A-2 Loans. Such fee shall be earned upon and payable in full in cash upon the
Amendment Effective Date, and (ii) such expense reimbursements and other charges to the
Administrative Agent as are then due and payable.
	 
	 	d.	 	The issuance of the Second Lien Notes shall have occurred and the Loan Parties
shall have received the proceeds therefrom, and, if the Convertible Preferred Stock
Transaction has been consummated, the Loan Parties shall have received the proceeds
therefrom.
	 
	 	e.	 	After giving effect to the Second Amendment, the issuance of the Second Lien
Notes and the application of the proceeds therefrom (and, if applicable, from the





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	 	 	 	Convertible Preferred Stock Transaction), no Default or Event of Default shall then
exist.
	 
	 	f.	 	The Borrowers shall have provided such additional instruments and documents to
the Administrative Agent as the Agents and Agents’ counsel may have reasonably
requested.





     7. Miscellaneous.




	 	a.	 	Except as otherwise expressly provided herein, all provisions of the Credit
Agreement and the other Loan Documents remain in full force and effect.
	 
	 	b.	 	This Second Amendment may be executed in several counterparts and by each party
on a separate counterpart, each of which when so executed and delivered shall be an
original, and all of which together shall constitute one instrument.
	 
	 	c.	 	This Second Amendment expresses the entire understanding of the parties with
respect to the transactions contemplated hereby. No prior negotiations or discussions
shall limit, modify, or otherwise affect the provisions hereof.
	 
	 	d.	 	Any determination that any provision of this Second Amendment or any
application hereof is invalid, illegal or unenforceable in any respect and in any
instance shall not effect the validity, legality, or enforceability of such provision
in any other instance, or the validity, legality or enforceability of any other
provisions of this Second Amendment.
	 
	 	e.	 	The Borrowers shall pay on demand all costs and expenses of the Agents,
including, without limitation, reasonable attorneys’ fees in connection with the
preparation, negotiation, execution and delivery of this Second Amendment.
	 
	 	f.	 	The Borrowers warrant and represent that the Borrowers have consulted with
independent legal counsel of the Borrowers’ selection in connection with this Second
Amendment and are not relying on any representations or warranties of the Agents, the
Lenders or their counsel in entering into this Second Amendment.






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     IN WITNESS WHEREOF, the parties have duly executed this Second Amendment as of the day and
year first above written.



	 	 	 	 	 
	 	 	THE GREAT ATLANTIC & PACIFIC TEA COMPANY, INC.
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Brenda Galgano
	 

	 	 	 	 
	 

	 	Name:
	 	Brenda Galgano
	 

	 	Title:
	 	CFO
	 
	 	 	 	 
	 	 	APW SUPERMARKETS, INC.
	 	 	COMPASS FOODS, INC.
	 	 	FOOD BASICS, INC.
	 	 	HOPELAWN PROPERTY I, INC.
	 	 	MCLEAN AVENUE PLAZA CORP.
	 	 	SHOPWELL, INC. [A DELAWARE ENTITY]
	 	 	SUPER FRESH FOOD MARKETS, INC.
	 	 	SUPER FRESH/SAV -A- CENTER, INC.
	 	 	SUPER MARKET SERVICE CORP.
	 	 	SUPER PLUS FOOD WAREHOUSE, INC.
	 	 	TRADEWELL FOODS OF CONN., INC.
	 	 	WALDBAUM, INC.
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Christopher McGarry
	 

	 	 	 	 
	 

	 	Name:
	 	Christopher McGarry
	 

	 	Title:
	 	VP & Secretary
	 
	 	 	 	 
	 	 	LO-LO DISCOUNT STORES, INC.
	 
	 	 	 	 
	 

	 	By:
	 	/s/ William Moss
	 

	 	 	 	 
	 

	 	Name:
	 	William Moss
	 

	 	Title:
	 	VP & Treasurer
	 
	 	 	 	 
	 	 	PATHMARK STORES, INC.
	 	 	AAL REALTY CORP.
	 	 	BERGEN STREET PATHMARK, INC.
	 	 	BRIDGE STUART INC.
	 	 	EAST BRUNSWICK STUART LLC
	 	 	LANCASTER PIKE STUART, LLC
	 	 	MACDADE BOULEVARD STUART, LLC
	 	 	PLAINBRIDGE LLC
	 	 	UPPER DARBY STUART, LLC
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Christopher McGarry
	 

	 	 	 	 
	 

	 	Name:
	 	Christopher McGarry
	 

	 	Title:
	 	President






12









 






	 	 	 	 	 
	 	 	BANK OF AMERICA, N.A.,
	 	 	as Administrative Agent, as Collateral
	 	 	Agent, and as Lender
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Christine Hutchinson
	 

	 	 	 	 
	 

	 	Name:
	 	Christine Hutchinson
	 

	 	Title:
	 	Principal






13









 






	 	 	 	 	 
	 	 	WELLS FARGO RETAIL FINANCE LLC, as Lender
	 

	 	 
	 	 
	 

	 	By:
	 	/s/ Michelle L. Ayou
	 

	 	 	 	 
	 

	 	Name:
	 	Michelle L. Ayou
	 

	 	Title:
	 	Vice President






14









 







ANNEX A




APW SUPERMARKETS, INC.

COMPASS FOODS, INC.

FOOD BASICS, INC.

HOPELAWN PROPERTY I, INC.

MCLEAN AVENUE PLAZA CORP.

SHOPWELL, INC.

SUPER FRESH FOOD MARKETS, INC.

SUPER FRESH/SAV-A-CENTER, INC.

SUPER MARKET SERVICE CORP.

SUPER PLUS FOOD WAREHOUSE, INC.

TRADEWELL FOODS OF CONN., INC.

WALDBAUM, INC.




15









 





     ANNEX B



PATHMARK STORES, INC.

AAL REALTY CORP.

MACDADE BOULEVARD STUART, LLC

BERGEN STREET PATHMARK, INC.

BRIDGE STUART INC.

EAST BRUNSWICK STUART LLC

LANCASTER PIKE STUART, LLC

PLAINBRIDGE LLC

UPPER DARBY STUART, LLC





16