Exhibit B-4(f)(1)
FIRST AMENDED AND RESTATED
CREDIT AGREEMENT
(Term Loan)
by and between
COBANK, ACB,
as Lender,
and
GOLD ▇▇▇▇, INC., as Borrower
dated as of January 29, 2003
FIRST AMENDED AND RESTATED
CREDIT AGREEMENT
(Term Loan)
Loan No. ______
THIS CREDIT AGREEMENT ("Credit Agreement") is entered into
as of the 29th day of January 2003, by and between COBANK, ACB,
as lender ("CoBank"), and GOLD ▇▇▇▇, INC., a cooperative
marketing association formed under the laws of the State of
Georgia, whose address is ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇.▇.,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ ("Borrower").
Recital
A. Borrower and CoBank entered into that certain Master
Loan Agreement entered into of August 1, 1996, that certain
Multiple Advance Term Loan Supplement entered into as of
September 1, 1997, and one or more amendments to such documents
(collectively, as so amended, the "Original Credit Agreement")
pursuant to which CoBank made a $50,000,000.00 term loan
available to Borrower ("Original Term Loan") more particularly
described therein on the terms and conditions set forth (the
Uncommitted Revolving Credit Supplement dated December 23, 1997
by and between Borrower and CoBank no longer being in effect).
Borrower (jointly with Young Pecan Shelling Company, Inc. -
collectively "Obligors") also entered into that certain document
entitled "Debt Repurchase Agreement" dated as of April 30, 2001
("DR Agreement"), whereby the Obligors agreed, under the
conditions set forth therein, to purchase from CoBank, up to a
maximum principal amount of $60,000,000.00, certain promissory
notes and other loan documents representing a loan made by
CoBank, in its capacity as agent for a lender group, and as the
sole member of the lender group to Young Pecan Company. Borrower
has requested that CoBank make certain changes in the credit
facilities provided and in certain covenants and other provisions
as contained in the Original Credit Agreement, including the
extension of an additional term loan in the amount of
$10,000,000.00, which CoBank is willing to do. In order to
reflect such changes the parties are entering into this First
Amended and Restated Credit Agreement which is intended to amend
and restate the Original Credit Agreement and which, after its
execution by all parties and the satisfaction of all conditions
to its effectiveness, shall be deemed to have replaced the
Original Credit Agreement and any reference in any Loan Document
to the "Credit Agreement" shall thereafter be deemed to be a
reference to this First Amended and Restated Credit Agreement.
ARTICLE 1. DEFINED TERMS
As used in this Credit Agreement, the following terms shall
have the meanings set forth below (and such meaning shall be
equally applicable to both the singular and plural form of the
terms defined, as the context may require):
1.1 Additional Costs: shall have the meaning set forth in
Section 13.11.
1.2 Advance: means a Term A Advance and/or a Term B
Advance, as the context requires.
1.3 Advance Date: a day (which shall be a Business Day) on
which an Advance is made.
1.4 Affiliate: shall mean, with respect to any Person, a
Person directly or indirectly controlling or controlled by, or
under direct or indirect common control with, such Person. A
Person shall be deemed to be "controlled by" any other Person if
such other Person possesses, directly or indirectly, the power
(a) to vote 10% or more of the securities having ordinary voting
power for the election of directors of such Person or (b) to
direct or cause the direction of the management and policies of
such corporation, whether through the ownership of voting
securities, by contract or otherwise. Additionally, for purposes
of this Agreement, Young Pecan Company shall be considered an
Affiliate of Borrower and its Subsidiaries notwithstanding
anything else to the contrary contained herein.
1.5 Applicable Interest Rate: means (a) for Tranche A,
7.60%; and (b) for Tranche B, 7.32%.
1.6 Applicable Lending Office: means the lending office of
CoBank designated as such on its signature page hereof.
1.7 Applicable Margin: means 295 basis points for the
period to and including March 31, 2003, after which it shall
mean, on a per annum basis, the percentage designated below under
the applicable column heading and corresponding to the Senior
Debt Coverage Ratio:
SENIOR DEBT COVERAGE RATIO APPLICABLE MARGIN
Greater than or 295 basis points
equal to 4.0
4.0 but 3.5 245 basis points
3.5 but 3.0 195 basis points
3.0 but 2.5 145 basis points
Less than or 95 basis points
equal to 2.50
Commencing April 1, 2003, the Applicable Margin for Term Loan A
shall be determined quarterly (and the rate determined at that
time shall apply until the next quarterly determination) based
upon the Senior Debt Coverage Ratio, calculated pursuant to the
financial statements delivered to CoBank pursuant to Subsection
9.2.2 hereof, with such Applicable Margin to be effective with
respect to calculations based upon such financial statements as
of the first day of the second Fiscal Quarter immediately
following the Fiscal Quarter for which such financial statements
are delivered ("Effective Interest Period"). By way of
illustration, the Applicable Margin for the Quarter beginning
April 1, 2003 will be based on the Senior Debt Coverage Ratio
calculated from the quarterly financial statements for the period
from October 1, 2002 through December 31, 2002 as delivered to
CoBank on or before the date required by Subsection 9.2.2 hereof.
Notwithstanding the foregoing, in the event that the financial
statements required to be delivered pursuant to Subsection 9.2.2,
and the related compliance certificate required to be delivered
in connection therewith, are not delivered when due, then (a) if
the calculation of the Applicable Margin based on such financial
statements and certificate, when delivered, results in an
increase from the Applicable Margin previously in effect, then
the increase shall be applied retroactively to the beginning of
the relevant Effective Interest Period; and (b) if the
calculation of the Applicable Margin based on such financial
statements and certificate, when delivered, results in an
decrease from the Applicable Margin previously in effect, then
the decrease shall be applied only from the date upon which the
financial statements and certificate are actually delivered and
CoBank has had an opportunity to confirm the calculations.
1.8 Authorized Officer: shall have the meaning set forth
in Subsection 8.1.5.
1.9 Bank Debt: all amounts owing under the Notes, fees,
Borrower's obligations to purchase CoBank Equity Interests,
Funding Losses and all interest, expenses, charges and other
amounts payable by Borrower pursuant to the Loan Documents.
1.10 Base Rate: a rate of interest per annum equal to the
"prime rate" as published from time to time in the Eastern
Edition of The Wall Street Journal as the average prime lending
rate for seventy-five percent (75%) of the United States' thirty
(30) largest commercial banks, or if The Wall Street Journal
shall cease publication or cease publishing the "prime rate" on a
regular basis, such other regularly published average prime rate
applicable to such commercial banks as is acceptable to CoBank in
its sole discretion, with such rate, in any case, modified by
adding the Base Rate Margin.
1.11 Base Rate Loan: shall have the meaning set forth in
Subsection 3.2.1.
1.12 Base Rate Margin: means 225 basis points.
1.13 Borrowing Notice: shall have the meaning set forth in
Section 2.3.
1.14 Business Day: any day (a) other than a Saturday or
Sunday and other than a day which is a Federal legal holiday or a
legal holiday for banks in the States of Colorado or New York,
and (b) if such day relates to a borrowing of, a payment or
prepayment of principal of or interest on, a continuation of or
conversion into, or a LIBO Rate Period for, a LIBO Rate Loan, or
a notice by Borrower with respect to any such borrowing, payment,
prepayment, continuation, conversion, or LIBO Rate Period, on
which dealings in U.S. Dollar deposits are carried out in the
London interbank market.
1.15 Capital Assets: means fixed assets, both tangible and
intangible; provided that Capital Asset shall not include any
item customarily charged directly to expense or depreciated over
a useful life of twelve (12) months or less in accordance with
GAAP, and shall not include any goodwill created on the balance
sheet of Borrower from the purchase of the common stock of Golden
Poultry Company, Inc.
1.16 Capital Expenditures: means amounts paid or
indebtedness incurred by Borrower or any of its Subsidiaries in
connection with the purchase or lease by Borrower or any of its
Subsidiaries of Capital Assets that would be required to be
capitalized and shown on the balance sheet of such Person in
accordance with GAAP.
1.17 Capital Lease: means any lease of property (whether
real, personal or mixed) by a Person, the discounted present
value of the rental obligations of such Person as lessee under
such lease, in accordance with GAAP, is required to be
capitalized on the balance sheet of such Person.
1.18 Change in Law: shall have the meaning set forth in
Subsection 3.3.2.
1.19 Closing Date: that date, which must occur on or before
February 14, 2003, on which CoBank and Borrower have executed all
Loan Documents to which they are parties and on which all of the
conditions set forth in Section 8.1 of this Credit Agreement have
been met.
1.20 CoBank Equity Interests: shall have the meaning set
forth in Article 5 hereof.
1.21 Code: means the Internal Revenue Code of 1986, as
amended from time to time.
1.22 Collateral: shall have the meaning set forth in
Section 6.1.
1.23 Collateral Agent: shall mean the Person designated
from time to time under the Intercreditor Agreement to act as the
collateral agent thereunder.
1.24 Commitment Fee: shall have the meaning set forth in
Subsection 3.5.1.
1.25 Compliance Certificate: a certificate of the chief
financial officer of Borrower acceptable to CoBank and in the
form attached hereto as Exhibit 1.25.
1.26 Consolidated Capital Assets: shall mean all Capital
Assets of Borrower and its Subsidiaries, consolidated in
accordance with GAAP.
1.27 Consolidated Current Assets: shall mean the current
assets of the Borrower and its Subsidiaries, determined on a
consolidated basis in accordance with GAAP.
1.28 Consolidated Current Liabilities: shall mean the
current liabilities of the Borrower and its Subsidiaries,
determined on a consolidated basis in accordance with GAAP.
1.29 Consolidated Interest Expense: shall mean, for any
period, total interest expense for such period of the Borrower
and its Subsidiaries (including without limitation, interest
expense attributable to Capital Leases in accordance with GAAP,
all commissions, discounts and other fees and charges owed with
respect to bankers acceptance financing, and total interest
expense (whether shown as interest expense or as loss and
expenses on sale of receivables) under a receivables purchase
facility) determined on a consolidated basis in accordance with
GAAP.
1.30 Consolidated Net Earnings: shall mean consolidated
gross revenues of the Borrower and its Subsidiaries before
extraordinary items (but after giving effect to the credit
resulting from any tax loss carry forwards) less all operating
and non-operating expenses of the Borrower and its Subsidiaries
including all charges of a proper character (including current
and deferred taxes on income and current additions to reserves),
but not including in gross revenues any gains (net of expenses
and taxes applicable thereto) in excess of losses resulting from
the sale, conversion or other disposition of capital assets
(i.e., assets other than current assets), any gains resulting
from the write-up of assets, or any earnings of any Person
acquired by the Borrower or any Subsidiary through purchase,
merger or consolidation or otherwise for any year prior to the
year of acquisition, or any deferred credit representing the
excess of equity in any Subsidiary at the date of acquisition
over the cost of investment in such Subsidiary; all determined in
accordance with GAAP.
1.31 Consolidated Senior Debt: shall mean the sum of (a)
Consolidated Total Debt, less (b) any amounts outstanding under
any Subordinated Debt of the Borrower (to the extent included in
Consolidated Total Debt), less (c) [any obligations with respect
to letters of credit issued for the account of the Borrower or
any of its Subsidiaries in the ordinary course of business to the
extent such letters of credit are not drawn upon or, if and to
the extent drawn upon, to the extent such drawing is reimbursed
no later than the tenth Business Day following receipt by the
Borrower or such Subsidiary of a demand for reimbursement
thereunder], and less (d) any other Consolidated Total Debt
subordinated to the repayment of the Borrower's obligations to
the Lenders in form and substance satisfactory to CoBank.
1.32 Consolidated Tangible Net Worth: means the net worth
of Borrower and its Subsidiaries (as determined in accordance
with GAAP) less the Intangible Assets of Borrower and its
Subsidiaries, but including the goodwill (as reflected on the
Borrower's financial statements delivered pursuant to Section 9.1
hereof from time to time but not to exceed $23,900,000.00)
created in connection with the acquisition by Borrower of the
outstanding equity of Golden Poultry Company, Inc. in September,
1997 plus up to $20,000,000.00 in connection with any write-down
in the book value of the SSC Securities for the period ending
March 2002 and thereafter.
1.33 Consolidated Total Debt: means (a) Total Debt of
Borrower and its Subsidiaries, plus (b) the Total Debt of any
other Person (other than Young Pecan Company) which (i) has been
guaranteed by Borrower or any Subsidiary or (ii) is supported by
a letter of credit issued for the account of Borrower or any
Subsidiary, all consolidated in accordance with GAAP.
1.34 Contribution Agreement: means that certain Second
Amended and Restated Contribution Agreement substantially in the
form of Exhibit J to the Rabobank Agreement, either as originally
executed or as it may be from time to time supplemented, amended,
restated, renewed, extended or otherwise modified.
1.35 Default Interest Rate: a rate of interest equal to 400
basis points in excess of the rate or rates of interest otherwise
being charged on the Term Loan.
1.36 EBITDA: shall mean for the Borrower and the
Subsidiaries, for any period, an amount equal to (a) the sum for
each period of (i) Consolidated Net Earnings plus (ii) to the
extent subtracted in determining such Consolidated Net Earnings,
(x) provisions for taxes based on income and Consolidated
Interest Expense, and (y) depreciation and amortization of assets
for such period, minus (b) any items of gain or plus any items of
loss, which were included in determining such Consolidated Net
Earnings and were (i) not realized in the ordinary course of
business or (ii) the result of any sale of assets.
1.37 Effective Interest Period. shall have the meaning set
forth in Section 1.7.
1.38 Environmental Laws: means any Law relating to the
public health, safety, industrial hygiene, pollution or the
environment, including Laws relating to noise or to emissions,
discharges, releases or threatened releases of Hazardous
Materials into the workplace, the community or the environmental
conditions, or otherwise relating to the generation, manufacture,
processing, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials, and including,
without limitation, the Comprehensive environmental Response
Compensation and Liability Act of 1980 as amended, 42 U.S.C. 9601-
9657 ("CERCLA") and the Resource Conservation and Recovery Act of
1976, 42 U.S.C. 6901-6987 ("RCRA").
1.39 Environmental Regulations: as defined in the
definition of Hazardous Substances.
1.40 ERISA: means the Employee Retirement Income Security
Act of 1974, as amended, and the regulations thereunder.
1.41 ERISA Affiliate: means any trade or business (whether
incorporated or unincorporated) which is a member of a group
described in Section 4 14(c) of the Code, of which Borrower is
also a member.
1.42 Event of Default: shall have the meaning set forth in
Section 12.1.
1.43 Fiscal Quarter: means each thirteen week period
beginning on the Sunday after the last Thursday in September,
December, March and June during each Fiscal Year of Borrower,
except that the fourth Fiscal Quarter in any Fiscal Year shall
run until the end of such Fiscal Year.
1.44 Fiscal Year: means a period commencing on the Sunday
after the last Thursday in June of any year and ending on the
Saturday after the last Thursday in June of the next year.
1.45 Foothill Interest: shall have the meaning set forth in
Section 2.6.
1.46 Funding Losses: shall have the meaning set forth in
Section 4.5.
1.47 Funding Loss Notice: shall have the meaning set forth
in Section 4.5.
1.48 GAAP: generally accepted accounting principles in the
United States of America, applied consistently, as in effect from
time to time.
1.49 GC Properties: shall mean GC Properties, a general
partnership formed under the laws of the State of Georgia, with
Borrower and Cotton States Insurance Companies acting as the
general partners.
1.50 Guaranty: shall mean any contractual obligation,
contingent or otherwise, of a Person with respect to any
Indebtedness or other obligation or liability of another Person,
including without limitation, any such Indebtedness, obligation
or liability directly or indirectly guaranteed, endorsed, co-made
or discounted or sold with recourse by that Person, or in respect
of which that Person is otherwise directly or indirectly liable,
including contractual obligations (contingent or otherwise)
arising through any agreement to purchase, repurchase, or
otherwise acquire such Indebtedness, obligation or liability or
any security therefor, or any agreement to provide funds for the
payment or discharge thereof (whether in the form of loans,
advances, stock purchases, capital contributions or otherwise),
or to maintain solvency, assets, level of income, or other
financial condition, or to make any payment other than for value
received. The amount of any Guaranty shall be deemed to be an
amount equal to the stated or determinable amount of the primary
obligation in respect of which guaranty is made or, if not so
stated or determinable, the maximum reasonably anticipated
liability in respect thereof (assuming such Person is required to
perform thereunder) as determined by such Person in good faith.
1.51 Hazardous Substances: dangerous, toxic or hazardous
pollutants, contaminants, chemicals, wastes, materials or
substances, as defined in or governed by the provisions of any
Environmental Laws or any other federal, state or local law,
statute, code, ordinance, regulation, requirement or rule
relating thereto ("Environmental Regulations"), and also
including urea formaldehyde, polychlorinated biphenyls, asbestos,
asbestos-containing materials, nuclear fuel or waste, and
petroleum products, or any other waste, material, substances,
pollutant or contaminant which would subject an owner of property
to any damages, penalties or liabilities under any applicable
Environmental Regulations.
1.52 Hedging Contracts: shall mean any forward contracts
(whether executed through a broker or directly with the buyer or
seller), futures contracts, option contracts, foreign exchange
contracts, currency swap agreements, interest rate exchange
agreements, interest rate cap agreements, interest rate collar
agreements, and other similar agreements and arrangements entered
into by any Person designed to protect against fluctuations in
either foreign exchange rates, interest rates, or commodity
prices.
1.53 Indebtedness: of any Person shall mean, without
duplication (a) all obligations of such Person which in
accordance with GAAP would be shown on the balance sheet of such
Person as a liability (including, without limitation, obligations
for borrowed money and for the deferred purchase price of
property or services, obligations evidenced by bonds, debentures,
notes or other similar instruments, and such Person's pro-rata
share of any obligations of a general partnership in which such
Person is the general partner); (b) all rental obligations under
leases required to be capitalized under GAAP; (c) all Guaranties
of such Person (including contingent reimbursement obligations
under undrawn letters of credit); (d) Indebtedness of others
secured by any Lien upon property owned by such Person, whether
or not assumed; and (e) obligations or other liabilities under
Hedging Contracts, or similar agreements or combinations thereof
which are disclosed as liabilities on the balance sheet of such
Person in accordance with GAAP; provided, however, that unless
and until Young Pecan is deemed a Subsidiary of Borrower pursuant
to this Agreement, clause (a) of this definition of
"Indebtedness" shall not include Borrower's pro rata share, as a
general partner of Young Pecan, of the indebtedness of Young
Pecan.
1.54 Indemnified Parties: shall have the meaning set forth
in Section 11.1.
1.55 Intangible Assets: of a Person, shall mean the non-
current, non-physical assets of such Person that entitle such
Person to certain legal rights or competitive advantages, and
shall include copyrights, trademarks, tradenames and other
intellectual property, franchises, goodwill (to the extent
positive), organizational costs, licenses and permits.
1.56 Intellectual Property: shall have the meaning set
forth in Section 7.18.
1.57 Intercreditor Agreement: means that document entitled
"Second Amended and Restated Intercreditor Agreement" dated as of
September 27, 2002, by and among Borrower, Rabobank, as
Collateral Agent (in such capacity "Collateral Agent"), the
various banks, lending institutions, and institutional investors
that are Lenders under the Rabobank Agreement, CoBank, ACB, as
Lender, The Prudential Insurance Company of America, as
Noteholder, Rabo Capital Services, Inc., as Capital market Party,
and SunTrust Bank and ▇▇▇▇▇▇ Trust and Savings Bank, as Letter of
Credit Issuers, as such document may be amended or replaced from
time to time.
1.58 LIBO Rate Loan: shall have the meaning set forth in
Subsection 3.2.2.
1.59 LIBO Rate Margin: means 350 basis points.
1.60 LIBO Rate Period: shall have the meaning set forth in
Subsection 3.2.2.
1.61 LIBO Rate Request: shall have the meaning set forth in
Subsection 3.2.2.
1.62 Licensing Laws: shall have the meaning set forth in
Section 7.4.
1.63 Lien: shall mean any mortgage, pledge, security
interest, encumbrance, lien or charge of any kind (including any
written agreement to give any of the foregoing, any conditional
sale or other title retention agreement, any lease in the nature
thereof, and the filing of or agreement to give any financing
statement under the Uniform Commercial Code of any jurisdiction).
1.64 Loan Documents: this Credit Agreement, the Notes, the
Security Documents, and other documents required to grant to
CoBank a perfected security interest in the Collateral.
1.65 Loan Party: shall mean Borrower and each wholly-owned
Subsidiary of Borrower whose Stock is pledged to the Collateral
Agent pursuant to the Security Agreement (or a supplement
thereto) and that has executed and delivered to the Collateral
Agent a Subsidiary Guaranty (or a supplement thereto) and a
security agreement (or a supplement thereto), together with
applicable financing statements required under the Uniform
Commercial Code, and such opinions of counsel and other documents
as may be reasonably required by the Collateral Agent. As of the
Closing Date, each Subsidiary that is a Loan Party is listed on
Schedule L-1 attached to the Rabobank Agreement.
1.66 Material Adverse Effect: means: (a) a material adverse
effect on the financial condition, results of operation, business
or property of Borrower; (b) a material adverse effect on the
ability of Borrower to perform its obligations under this Credit
Agreement and the other Loan Documents; or (c) a material adverse
effect upon the ability of CoBank to enforce its rights and
remedies under the Loan Documents.
1.67 Material Agreements: shall have the meaning set forth
in Section 7.16.
1.68 Money Borrowed: means, as applied to the Indebtedness
of a Person,
(a) Indebtedness for money borrowed including all revolving
and term Indebtedness and all other lines of credit; or
(b) Indebtedness (other than trade debt of such Person
incurred in the ordinary course of business), whether or not in
any such case the same was for money borrowed:
(i) represented by notes payable, and drafts accepted,
that represent extensions of credit;
(ii) constituting obligations evidenced by bonds,
debentures, notes or similar instruments; or
(iii) constituting purchase money indebtedness,
conditional sales contracts, title retention debt
instruments or other similar instruments upon which
interest charges are customarily paid or that are issued
or assumed as full or partial payment for property; or
(c) all reimbursement obligations under any letters of
credit or acceptances; or
(d) Indebtedness that is such by virtue of clause (c) of
the definition of Indebtedness, but only to the extent that the
obligations guaranteed are obligations that would constitute
Indebtedness for Money Borrowed.
1.69 Multiemployer Plan: shall mean any Plan which is a
"multiemployer plan" (as such term is defined in Section 4001 of
ERISA)
1.70 Net Proceeds of Stock: shall mean any proceeds
received by Borrower or a consolidated Subsidiary in respect of
the issuance of Stock, after deducting therefrom all reasonable
and customary costs and expenses incurred by Borrower or such
consolidated Subsidiary directly in connection with the issuance
of such Stock, including without limitation any underwriter's
discounts and commissions.
1.71 Notes: the Term Loan A Note and the Term Loan B Note.
1.72 Organization Documents: in the case of a corporation,
its articles or certificate of incorporation and bylaws; in the
case of a partnership, its partnership agreement and certificate
of limited partnership, if applicable; in the case of a limited
liability company, its articles of organization and its operating
agreement.
1.73 PBGC: means the Pension Benefit Guaranty Corporation.
1.74 Permitted Encumbrance: shall have the meaning set
forth in Section 7.12.
1.75 Person: any individual, corporation, limited liability
company, association, partnership, trust, organization,
government, governmental agency, or other entity.
1.76 Plan: means an "employee pension benefit plan" (as
defined in Section 3 of ERISA), which is or has been established
or maintained, or to which contributions are or have been made,
by Borrower, any Subsidiary, or any ERISA Affiliate.
1.77 Potential Default: any event, other than an event
described in Section 12.1(a) hereof, which with the giving of
notice or lapse of time, or both, would become an Event of
Default.
1.78 Prudential Agreement: means that document entitled
"Second Consolidated, Amended and Restated Note Agreement" dated
as of September 27, 2002 by and among Borrower, The Prudential
Insurance Company of America, and Gateway Recovery Trust, as such
document may be amended or replaced from time to time.
1.79 Rabobank: means Cooperatieve Centrale Raiffeisen-
Boerenleenbank B.A., "Rabobank Nederland", New York Branch.
1.80 Rabobank Agreement: means that document entitled
"Third Amended and Restated Credit Agreement" dated as of
September 27, 2002 by and among Borrower, Rabobank, as Agent, and
the various banks, lending institutions, and institutional
investors that are Lenders thereunder, as such document may be
amended or replaced from time to time.
1.81 Regulatory Change: shall have the meaning set forth in
Section 13.11.
1.82 Reportable Event: means an event described in Section
4043(b) of ERISA with respect to which the thirty (30)-day notice
requirement has not been waived by the PBGC.
1.83 Reported Net Income: shall mean, for any period, the
"Net Income" as reflected on the financial statements delivered
pursuant to Subsections 9.2.1 and 9.2.2 hereof.
1.84 Required License: shall have the meaning set forth in
Section 7.9.
1.85 Restricted Payments: shall have the meaning set forth
in Section 10.1.
1.86 Revolving Loan: shall mean, collectively, the
revolving credit loans made to the Borrower by the Lenders
pursuant to Section 2.1(a) of the Rabobank Agreement.
1.87 Security Documents: the security agreements,
mortgages, deeds of trust, financing statements, pledge
agreements, leasehold assignment and consents, assignments and/or
other security documents executed by Borrower in favor of the
Collateral Agent, for the benefit of the parties to the
Intercreditor Agreement, to secure Borrower's performance of its
obligations described in the Intercreditor Agreement, including
all obligations under the Notes and other Loan Documents with a
lien on the assets of Borrower described therein.
1.88 Senior Debt Coverage Ratio: a ratio of (a)
Consolidated Senior Debt as of the end of any Fiscal Quarter, to
(b) the sum of EBITDA for the Fiscal Quarter then ending and the
preceding seven Fiscal Quarters (divided by two).
1.89 SSC Securities: means the $40,000,000 Series B
Cumulative Redeemable Preferred Stock and the $60,000,000 Series
B Capital Securities issued by Southern States Cooperative or
Southern States Capital Trust, respectively, and purchased by
Borrower pursuant to the Securities Purchase Agreement between
Borrower and Southern States Cooperative dated as of October 5,
1999.
1.90 Stock: shall mean, as applied to any Person, any
stock, share capital, partnership interests or other equity of
such Person, regardless of class or designation, and all
warrants, options, purchase rights, conversion or exchange
rights, voting rights, calls or claims of any character with
respect thereto.
1.91 Subordinated Capital Certificates of Interest: shall
mean those debt instruments issued by Borrower to the public
under trust indentures with SunTrust Bank, Atlanta, Georgia, as
"Trustee," registered with the United States Securities and
Exchange Commission and having maturities of greater than one
year.
1.92 Subordinated Debt: shall mean all Indebtedness for
Money Borrowed wherein the principal and premium, if any, and
interest is subordinated and junior in right of payment to the
prior payment in full of all other Indebtedness of Borrower for
Money Borrowed except other Subordinated Debt, and shall include,
without limitation, the Subordinated Capital Certificates of
Interest, and Subordinated Loan Certificates, issued by Borrower,
as described on, and an example of whose subordination provisions
are annexed to the Rabobank Agreement, as Schedule S-1.
1.93 Subordinated Loan Certificates: shall mean those debt
instruments issued by Borrower to the public under trust
indentures with SunTrust Bank, Atlanta, Georgia, as "Trustee,"
registered with the United Stated Securities and Exchange
Commission and having maturities of one year or less.
1.94 Subsidiary: shall, with respect to Borrower, mean any
corporation, partnership, joint venture, limited liability
company, trust or estate or other entity in which (or of which)
the Borrower, directly or indirectly, owns or controls more than
50% of (a) any shares of Stock or other form of ownership
interest of such Person having general voting power under
ordinary circumstances to vote in the election of the board of
directors, managers or trustees of such Person (irrespective of
whether or not at the time Stock of any other class or classes
shall have or might have voting power by reason of the happening
of any contingency), or (b) the interest in the capital or
profits of such Person, provided, however, notwithstanding the
foregoing, GC Properties shall not be deemed to be a "Subsidiary"
of Borrower, and provided, further, notwithstanding the
foregoing, Young Pecan shall not be deemed to be a "Subsidiary"
of Borrower until the earlier of (x) October 31, 2002, and (y)
the date of any repurchase demand on, or repurchase by, Borrower
of the CoBank Note pursuant to that certain Debt Repurchase
Agreement between CoBank, ACB, Borrower, and Young Pecan Shelling
Company, Inc. dated as of April 30, 2001.
1.95 Subsidiary Guarantee: shall mean that certain Second
Amended and Restated Subsidiary Guaranty dated as of even date
herewith, executed by certain Subsidiaries of Borrower in favor
of the Collateral Agent, substantially in the form of Exhibit I
attached to the Rabobank Agreement, as originally executed or as
from time to time supplemented, amended, restated, renewed,
extended or otherwise modified.
1.96 Substantial Part: shall mean the consolidated assets
of Borrower and all Subsidiaries which, as a whole, (a)
constitute more than 10% of Consolidated Assets or (b)
contributed more than 15% of Consolidated Net Earnings for any
one or more of the three prior fiscal years of Borrower.
1.97 Temporary Revolving Credit Facility: means the
revolving facility in an amount of up to $33,125,000.00 to be
extended to Borrower pursuant to that certain Credit Agreement,
dated as of February ___, 2003, by and among Borrower, various
banks and other lending institutions and institutional investors
as are, or may from time to time become, parties thereto and
Rabobank, as agent thereunder (as amended, restated, supplemented
or otherwise modified from time to time), which facility shall be
in addition to the credit facilities available to Borrower under
the Rabobank Agreement.
1.98 Term A Advance: shall have the meaning set forth in
Section 2.1.
1.99 Term B Advance: shall have the meaning set forth in
Section 2.2.
1.100 Term A Commitment: shall be $35,720,000.00,
consisting of the Tranche A Commitment of $17,860,000.00 and the
Tranche B Commitment of $17,860,000.00.
1.101 Term B Commitment: shall be $10,000,000.00.
1.102 Term A Maturity Date: means December 1, 2012.
1.103 Term B Maturity Date: means December 31, 2007.
1.104 Term Loan: means Term Loan A and/or Term Loan B,
as the context requires.
1.105 Term Loan A: means a loan made pursuant to
Article 2 (and particularly Section 2.1) hereof.
1.106 Term Loan A Note: shall have the meaning set
forth in Section 2.4 hereof.
1.107 Term Loan B: means a loan made pursuant to
Article 2 (and particularly Section 2.2) hereof.
1.108 Term Loan B Note: shall have the meaning set
forth in Section 2.4 hereof.
1.109 Voluntary Prepayments: shall have the meaning set
forth in Section 4.4.
1.110 Wholly Owned Subsidiary: mean any Subsidiary all
of the shares of Stock or other ownership interests of which
(except directors' qualifying shares) are at the time directly or
indirectly owned by Borrower.
ARTICLE 2. TERM FACILITY
2.1 Term Loan A. On the terms and conditions set forth in
this Credit Agreement, and so long as no Event of Default or
Potential Default has occurred and is continuing, CoBank agrees,
to make a single advance under Term Loan A ("Term A Advance"), as
an extension of the existing financing outstanding under, the
Original Credit Agreement, in an amount not in excess of the Term
A Commitment.
2.2 Term Loan B. On the terms and conditions set forth in
this Credit Agreement, and so long as no Event of Default or
Potential Default has occurred and is continuing, CoBank agrees,
to make a single advance under Term Loan B ("Term B Advance"), in
an amount, not in excess of the Term B Commitment, equal to the
amount necessary to fund Borrower's $10,000,000.00 interest in,
or purchase of an interest in, on the Closing Date, a loan from
Foothill Capital Corporation and various lenders to Young Pecan
Shelling Company, Inc. pursuant to that certain Loan and Security
Agreement dated as of January __, 2003.
2.3 Borrowing Notice. Borrower shall give CoBank written
notice on the Closing Date in writing in substantially the form
of Exhibit 2.3 hereto ("Borrowing Notice") which must specify the
amount of Term A Advance and the amount of Term B Advance
Borrower requests. CoBank shall, not later than 3:00 P.M.
(Central time) on the Closing Date, make the Term B Advance
available to Borrower, in immediately available funds, and will
transmit such funds by wire transfer as directed by Borrower in
writing.
2.4 Term Facility Promissory Notes. Borrower's obligations
to CoBank under (a) Term Loan A, including Borrower's payment
obligations with respect to all Term A Advances made by CoBank
shall be evidenced by, and repaid with interest in accordance
with, a promissory note of Borrower in substantially the form of
Exhibit 2.4A hereto duly completed, in the stated maximum
principal amount equal to the Term A Commitment, payable to
CoBank for the account of its Applicable Lending Office, and
maturing as to principal on the Term A Maturity Date ("Term Loan
A Note"); and (b) Term Loan B, including Borrower's payment
obligations with respect to all Term B Advances made by CoBank
shall be evidenced by, and repaid with interest in accordance
with, a promissory note of Borrower in substantially the form of
Exhibit 2.4B hereto duly completed, in the stated maximum
principal amount equal to the Term B Commitment, payable to
CoBank for the account of its Applicable Lending Office, and
maturing as to principal on the Term B Maturity Date ("Term Loan
B Note").
2.5 CoBank's Records. CoBank shall record on its books and
records the amount of the Advances, all payments of principal and
interest, and the principal balance from time to time
outstanding. CoBank's record thereof shall be prima facie
evidence as to all such amounts and shall be binding on Borrower
absent manifest error. Notwithstanding the foregoing, Borrower
will never be required to pay to CoBank as principal more than
the principal amount of the Advances made by CoBank.
2.6 Use of Proceeds. The proceeds (a) of Term Loan A will
be used by Borrower to effect an extension of all amounts owing
under the CoBank Credit Agreement and related documents as of the
Closing Date; and (b) of Term Loan B will be used by Borrower to
fund Borrower's $10,000,000.00 interest in, or purchase of an
interest in, on the Closing Date, a loan from Foothill Capital
Corporation and various lenders to Young Pecan Shelling Company,
Inc. pursuant to that certain Loan and Security Agreement dated
as of January __, 2003 ("Foothill Interest"), and Borrower agrees
not to request or use such proceeds for any other purpose.
Borrower will not, directly or indirectly, use any part of such
proceeds for the purpose of purchasing or carrying any margin
stock within the meaning of Regulation U of the Board of
Governors or to extend credit to any Person for the purpose of
purchasing or carrying any such margin stock.
article 3. INTEREST AND FEES
3.1 Interest - Term Loan A. Interest on Term Loan A (as
set forth for Tranche A and for Tranche B) and the Term Loan A
Note shall be calculated at the Applicable Interest Rate plus the
Applicable Margin and shall be calculated on the actual number of
days the principal owing is outstanding with the daily rate
calculated on the basis of a year consisting of 360 days. In
calculating interest, the Advance Date shall be included and the
date each payment is received shall be excluded.
3.2 Interest - Term Loan B. Interest on Term Loan B shall
be calculated as follows:
3.2.1 Base Rate Option. Unless Borrower requests
and receives a LIBO Rate Loan pursuant to Subsection 3.2.2
hereof, the outstanding principal balance under the Term
Loan B Note shall bear interest at the Base Rate plus the
Base Rate Margin (each a "Base Rate Loan").
3.2.2 LIBO Rate Option. From time to time, and so
long as no Event of Default has occurred and is continuing,
at the request of Borrower, including a request contained in
a Borrowing Notice, all or any part of the outstanding
principal balance under the Term Loan B Note may bear
interest at the LIBO Rate plus the LIBO Rate Margin (each a
"LIBO Rate Loan"); provided that Borrower may have no more
than three (3) LIBO Rate Loans outstanding at any time. To
effect this option, the Borrowing Notice must specify (a)
the principal amount that is to bear interest at the LIBO
Rate, which must be a minimum of $1,000,000.00 and in
incremental multiples of $500,000.00, and (b) the period
selected by Borrower during which the LIBO Rate is to be
applied ("LIBO Rate Period"), which must be a period of six
months, but must expire no later than the Applicable
Maturity Date. In addition, from time to time, and so long
as no Event of Default has occurred and is continuing,
Borrower may convert any Base Rate Loan to a LIBO Rate Loan,
or continue a LIBO Rate Loan, by making a written request
therefore ("LIBO Request") to CoBank by facsimile at least
three (3) Banking Days prior to the date of such conversion,
specifying (x) the principal amount that is to bear interest
at the LIBO Rate, which must be a minimum of $1,000,000.00
and in incremental multiples of $500,000.00; and (y) the
LIBO Rate Period selected by Borrower during which the LIBO
Rate is to be applied. CoBank shall incur no liability in
acting upon a request which it believed in good faith had
been made by a properly authorized representative of
Borrower. Following the expiration of the LIBO Rate Period
for any LIBO Rate Loan, interest shall automatically accrue
at the Base Rate, unless Borrower requests and receives
another LIBO Rate Loan as provided in this Subsection.
3.3 Additional Provisions for LIBO Rate Loans.
3.3.1 Limitation on LIBO Rate Loans. Anything
herein to the contrary notwithstanding, if, on or prior to
the determination of the LIBO Rate for any LIBO Rate Period:
(a) CoBank determines (which determination shall be
conclusive) that quotations of interest rates in accordance
with the definition of LIBO Rate are not being provided in
the relevant amounts or for the relevant maturities for
purposes of determining rates of interest for LIBO Rate
Loans as provided in this Credit Agreement; or
(b) CoBank determines (which determination shall be
conclusive) that the relevant rates of interest referred to
in the definition of LIBO Rate upon the basis of which the
rate of interest for LIBO Rate Loans for such LIBO Rate
Period is to be determined do not adequately cover the cost
to CoBank of making or maintaining such LIBO Rate Loans for
such LIBO Rate Period;
then CoBank shall give Borrower prompt notice thereof, and so
long as such condition remains in effect, CoBank shall be under
no obligation to make LIBO Rate Loans, convert Base Rate Loans
into LIBO Rate Loans, or continue LIBO Rate Loans, and Borrower
shall, on the last days of the then current applicable LIBO Rate
Periods for the outstanding LIBO Rate Loans, either prepay such
LIBO Rate Loans or such LIBO Rate Loans shall automatically be
converted into a Base Rate Loan in accordance with Section 3.1
hereof.
3.3.2 LIBO Rate Loan Unlawful. If any law, treaty,
rule, regulation or determination of a court or governmental
authority or any change therein or in the interpretation or
application thereof subsequent to the Closing Date (each, a
"Change in Law") shall make it unlawful for CoBank to (a)
make an Advance as a LIBO Rate Loan or (b) maintain all or
any portion of the LIBO Rate Loans, CoBank shall promptly,
by telephone (in which case it must be promptly followed by
a writing) or facsimile, notify Borrower thereof, and of the
reasons therefor. In the former event, any obligation of
CoBank to make any future LIBO Rate Loan shall immediately
be canceled (and, in lieu thereof shall be made as a Base
Rate Loan), and in the latter event, any such unlawful LIBO
Rate Loans or portions thereof then outstanding shall be
converted, at the option of CoBank, to a Base Rate Loan;
provided, however, that if any such Change in Law shall
permit the LIBO Rate to remain in effect until the
expiration of the LIBO Rate Period applicable to any such
unlawful LIBO Rate Loan, then such LIBO Rate Loan shall
continue in effect until the expiration of such LIBO Rate
Period. Upon the occurrence of any of the foregoing events
on account of any Change in Law, Borrower shall pay to
CoBank immediately upon demand such amounts as may be
necessary to compensate CoBank for any fees, charges, or
other costs incurred or payable by CoBank as a result
thereof and which are attributable to any LIBO Rate Loan
made available to Borrower hereunder, and any reasonable
allocation made by CoBank among its operations shall be
conclusive and binding upon Borrower absent manifest error.
3.4 Default Interest Rate. All past due payments on the
Term Notes or of any other Bank Debt (whether as a result of
nonpayment by Borrower when due, at maturity, or upon
acceleration) shall bear interest at the Default Interest Rate
from and after the due date for the payment, or on the date of
maturity or acceleration, as the case may be.
3.5 Fees. Borrower shall pay the following fees:
3.5.1 Commitment Fee. A non-refundable fee in the
amount of $207,150.00 ("Commitment Fee") payable on the
Closing Date. The Commitment Fee shall be payable to
CoBank.
ARTICLE 4. PAYMENTS; FUNDING LOSSES
4.1 Principal Payments. Principal shall be payable (a)
under Term Loan A in nineteen (19) installments of $1,785,000.00
on September 30, 2003 and on each subsequent December 1 and June
1 to and including June 1, 2012, and a final payment of
$1,805,000.00 due on December 1, 2012; and (b) under Term Loan B
in the amount of $400,000.00 on December 31, 2003 and thereafter
in the amount of $600,000.00 on the last day of each March, June,
September, and December, with a final payment equal to the unpaid
balance on December 31, 2007.
4.2 Interest Payments. Interest shall be payable monthly
in arrears on the tenth Banking Day of each month; and all
accrued and unpaid interest shall be payable on the respective
Maturity Dates.
4.3 Manner of Payment. All payments, including
prepayments, that Borrower is required or permitted to make under
the terms of this Credit Agreement shall be made to CoBank (a) in
immediately available federal funds, to be received no later than
2:00 P.M. Central time of the Banking Day on which such payment
is due by wire transfer through Federal Reserve Bank, Kansas
City, Routing Number: ▇▇▇▇▇▇▇▇▇, COBANK ENGWD (or to such other
account as CoBank may designate by notice); and (b) without
setoff or counterclaim and free and clear of and without
deduction for any taxes, levies, impost, duties, charges, fees,
deductions, withholding, compulsory loans, restrictions or
conditions of any nature now or hereafter imposed or levied by
any jurisdiction or any political subdivision thereof or taxing
or other authority therein unless Borrower is required by law to
make such deduction or withholding.
4.4 Voluntary Prepayments. Borrower shall have the right
to prepay ("Voluntary Prepayments") all or any part of the
outstanding principal balance under the Term Loan at any time in
integral multiples of $100,000.00 (or the entire outstanding
balance, if less); provided that (a) Borrower must provide three
(3) Banking Days notice to CoBank prior to making such
prepayment; and (b) Borrower must, at the time of making such
prepayment, pay all Funding Losses applicable to such prepayment.
Any Voluntary Prepayments shall not excuse any subsequently
scheduled installment payment and shall, instead, be applied to
installment payments last coming due. Principal amounts prepaid
may not be reborrowed.
4.5 Funding Losses. In the event of any prepayment of any
LIBO Rate Loans or the Term Loan A, whether voluntary or
mandatory, and including on account of acceleration, Borrower
must, at the time of making such prepayment, pay all Funding
Losses applicable to such prepayment. "Funding Losses" shall be
determined by CoBank as the amount which would result in CoBank
being made whole (on a present value basis) for the actual or
imputed funding losses (including, without limitation, any loss,
cost or expense incurred by reason of obtaining, liquidating or
employing deposits or other funds acquired by CoBank to fund or
maintain such LIBO Rate Loan or Term Loan A, as applicable)
incurred by CoBank as a result of such prepayment (regardless of
whether CoBank actually funded with such deposits). In the event
of any such prepayment, CoBank shall, promptly notify Borrower
orally or in writing of the amount of such Funding Losses. A
determination by CoBank as to the amounts payable pursuant to
this Section shall be conclusive absent manifest error.
4.6 Application of Principal Payments.
4.6.1 Scheduled Payments; Voluntary Prepayments.
Principal payments, including Voluntary Prepayments, shall
be applied to principal amounts owing on the Term Loan A
Note (and allocated equally between the Tranche A Commitment
and the Tranche B Commitment) and/or under the Term Loan B
Note, as designated by Borrower.
4.6.2 Potential or Actual Default. Upon the
occurrence and during the continuance of an Event of Default
or Potential Default, all principal payments and prepayments
shall be applied, as CoBank in its sole discretion shall
determine, to fees, interest or principal indebtedness under
the Term Loan A Note and/or the Term Loan B Note, or to any
other Bank Debt.
article 5. COBANK EQUITY
Borrower agrees to purchase such equity interests in CoBank
("CoBank Equity Interests") as CoBank may from time to time
require in accordance with its bylaws and capital plan as
applicable to cooperative borrowers generally. In connection
with the foregoing, Borrower hereby acknowledges receipt, prior
to the execution of this Credit Agreement, of CoBank's bylaws, a
written description of the terms and conditions under which the
CoBank Equity Interests are issued, CoBank's Loan-Based Capital
Plan, CoBank's most recent annual report, and if more recent than
CoBank's latest annual report, its latest quarterly report.
article 6. SECURITY
6.1 Borrower's Assets. As security for the payment and
performance of all obligations of Borrower to CoBank, including
but not limited to all obligations of Borrower under Article 5
hereof, and principal and interest under the Notes, purchases of
CoBank Equity Interests, fees, Funding Losses, reimbursements,
and all other Bank Debt or obligations under any of the Loan
Documents, Borrower has, pursuant to the provisions of the
"Security Agreement" and the "Additional Security Agreements" (as
the latter two terms are defined in the Intercreditor Agreement,
and as they may be amended, restated, or otherwise modified from
time to time), granted to the Collateral Agent a first lien and
security interest, subject only to permitted encumbrances, in the
"Collateral" as described in the Intercreditor Agreement
("Collateral"). It is expressly agreed by Borrower and CoBank
that this Credit Agreement and each of the Loan Documents are
amendments or modifications of and/or replacements to the
documents described in Recital E of the Intercreditor Agreement
and shall be deemed to be the "CoBank Agreements" as that term is
used in the Intercreditor Agreement and the Notes issued
hereunder shall be deemed to be the "CoBank Notes" as that term
is used in the Intercreditor Agreement. Borrower shall execute
and deliver to the Collateral Agent, or to CoBank in the event of
the termination of the Intercreditor Agreement such security
agreements, financing statements, mortgages, or other documents
as Collateral Agent (or CoBank) shall request to establish,
confirm, perfect or provide notice of the security interest
granted to CoBank in the Collateral.
ARTICLE 7. REPRESENTATIONS AND WARRANTIES
To induce CoBank to make the Term Loan, and recognizing that
CoBank is relying thereon, Borrower represents and warrants as
follows:
7.1 Organization, Good Standing, Etc. Borrower: (a) is
duly organized, validly existing, and in good standing under the
laws of its state of incorporation; (b) qualifies as a
cooperative association under the laws of its state of
incorporation; (c) is duly qualified to do business and is in
good standing in each jurisdiction in which the transaction of
its business makes such qualification necessary; and (d) has all
requisite corporate and legal power (i) to own and operate its
assets and to carry on its business, and (ii) to enter into and
perform the Loan Documents to which it is a party.
7.2 Corporate Authority, Due Authorization; Consents.
Borrower has full power and authority to conduct its business as
contemplated to be operated from and after the Closing Date; to
execute, deliver and perform under this Credit Agreement, the
Notes, all other Loan Documents and all other documents and
agreements as contemplated by this Credit Agreement; all of which
have been duly authorized. All consents or approvals of any
Person that are necessary for, or are required as a condition of
the execution, delivery and performance of the Loan Documents,
have been obtained.
7.3 Litigation. Except as described on Exhibit 7.3 hereto,
there are, no pending legal or governmental actions, proceedings
or investigations to which Borrower is a party or to which any
property of Borrower is subject which might result in any
Material Adverse Effect and, to Borrower's knowledge, no such
actions or proceedings are threatened or contemplated by any
federal, state, county, or city (or similar unit) governmental
agency or any other Person.
7.4 No Violations. The execution, delivery and performance
of the Loan Documents will not: (a) violate any provision of
Borrower's articles of incorporation or bylaws, or any law, rule,
regulation, judgment, order or ruling of any court or
governmental agency; (b) violate, conflict with, result in a
breach of, constitute a default under, or with the giving of
notice or the expiration of time or both, constitute a default
under, any existing real estate mortgage, indenture, lease,
security agreement, contract, note, instrument or any other
agreements or documents binding on Borrower or affecting its
property; or (c) violate, conflict with, result in a breach of,
constitute a default under, or result in the loss of, or
restriction of rights under, any Required License or any order,
law, rule, or regulation under or pursuant to which any Required
License was issued or is maintained ("Licensing Laws").
7.5 Binding Agreement. Each of the Loan Documents to which
Borrower is a party is, or when executed and delivered, will be,
the legal, valid and binding obligation of Borrower, enforceable
in accordance with its terms, subject only to limitations on
enforceability imposed by applicable bankruptcy, insolvency,
reorganization, moratorium, or similar laws affecting creditors'
rights generally and by general principles of equity.
7.6 Compliance with Laws. Borrower is in compliance with
all federal, state, and local laws, rules, regulations,
ordinances, codes and orders, including without limitation all
Environmental Laws and all Licensing Laws, with respect to which
noncompliance would result in a Material Adverse Effect.
7.7 Principal Place of Business; Place of Incorporation.
Borrower's place of business, or chief executive office if it has
more than one place of business, and the place where the records
required by Section 9.1 hereof are kept, is located at the
place(s) shown on Exhibit 7.7 hereto. Borrower was incorporated
under the laws of the State of Georgia.
7.8 Payment of Taxes. Borrower has filed all required
federal, state and local tax returns and has paid all taxes as
shown on such returns as they have become due. Borrower has paid
when due all other taxes, assessments or impositions levied or
assessed against Borrower or its business or properties.
7.9 Licenses and Approvals. Borrower has ownership of, or
has been issued, all franchises, certificates, approvals,
permits, authorities, agreements, and licenses which are used or
necessary to permit it to own its properties and to conduct the
business as presently being conducted (each a "Required
License"). Each Required License is in full force and effect,
and there is no outstanding notice of cancellation or termination
or, to Borrower's knowledge, any threatened cancellation or
termination in connection therewith, nor has an event occurred
with respect to any Required License which, with the giving of
notice or passage of time or both, could result in the revocation
or termination thereof or otherwise in any impairment of
Borrower's rights with respect thereto, which impairment could
reasonably be expected to have a Material Adverse Effect. No
consent, permission, authorization, order, or license of any
governmental authority, is necessary in connection with the
execution, delivery, performance, or enforcement of and under the
Loan Documents to which Borrower is a party, except such as have
been obtained and are in full force and effect.
7.10 Employee Benefit Plans. No accumulated funding
deficiency (as defined in section 302 of ERISA and section 412 of
the Code), whether or not waived, exists with respect to any Plan
(other than a Multiemployer Plan). No liability to the PBGC has
been or is expected by Borrower to be incurred with respect to
any Plan (other than a Multiemployer Plan) by Borrower or any of
its Subsidiaries which is or would be materially adverse to
Borrower and its Subsidiaries taken as a whole. Neither Borrower
nor any of its subsidiaries has incurred or presently expects to
incur any withdrawal liability under Title IV of ERISA with
respect to any Multiemployer Plan which is or would be materially
adverse to Borrower and its Subsidiaries taken as a whole.
Borrower has delivered to CoBank a list of all employee benefit
plans established or maintained by Borrower and each Subsidiary,
or as to which Borrower or any Subsidiary is a party in interest
or a disqualified person. The execution and delivery of this
Credit Agreement and the Advances hereunder will not involve any
prohibited transaction within the meaning of ERISA or in
connection with which a tax could be imposed pursuant to section
4975 of the Code or a violation of section 406 or section 407 of
ERISA.
7.11 Equity Investments. Borrower does not now own any
stock or other voting or equity interest, directly or indirectly,
in any Person other than: (a) the CoBank Equity Interests; (b)
Subsidiaries of Borrower; and (c) as set forth on Exhibit 10.3.
7.12 Real Property; Title to Real and Personal Property.
Borrower: (a) has all real property interests, including without
limitation, fee interests, leasehold interests, easements,
licenses and rights of way which are necessary for the conduct of
Borrower's business; (b) holds good and marketable title to all
of Borrower's real property (other than rights of way, easements
and similar interests in real property which in the aggregate are
not material and liens permitted by Section 10.2 hereof); (c)
owns all of its personal property, and holds all of its leases,
free and clear of any lien, pledge, restriction, or encumbrance,
except as permitted by Section 10.2 hereof ("Permitted
Encumbrances"). All of Borrower's leases which constitute
Material Agreements are in full force and effect and afford
Borrower peaceful and undisturbed possession of the subject
matter thereof.
7.13 Personal Property. Borrower has all tangible personal
property necessary for the conduct of Borrower's business as it
is being conducted; all such property is in good operating
condition and repair, reasonable wear and tear excepted, and
suitable in all material respects for the uses for which it is
being utilized; and all such property (other than titled motor
vehicles) is described in one or more of the Security Documents.
7.14 Environmental Compliance. Without limiting the
provisions of Section 7.6 above, all property owned or leased by
Borrower and all operations conducted by it are in compliance in
all material respects with all Laws relating to environmental
protection, with respect to which the failure to comply would
have a Material Adverse Effect.
7.15 Fiscal Year. Each fiscal year of Borrower begins on
the Sunday after the last Thursday in June of any year and ends
on the Saturday after the last Thursday in June of the next year.
7.16 Material Agreements. All agreements of Borrower, the
termination or breach of which, based upon Borrower's knowledge
as of the date of making any representation with respect thereto,
would have a Material Adverse Effect ("Material Agreements") have
been attached to filings, including 10K and 10Q Reports, made by
Borrower in the ordinary course with the Securities and Exchange
Commission. Neither Borrower nor, to Borrower's knowledge, any
other party to any Material Agreement, is in default thereunder,
and no facts exist which with the giving of notice or the passage
of time, or both, would constitute such a default.
7.17 Regulations G, U and X. No portion of any Advance will
be used for the purpose of purchasing, carrying, or making loans
to finance the purchase of, any "margin security" or "margin
stock" as such terms are used in Regulations G, U or X of the
Board of Governors of the Federal Reserve System, 12 C.F.R. Parts
207, 221, and 224.
7.18 Intellectual Property. Borrower owns or licenses all
patents, trademarks, trade names, service marks and copyrights,
that it utilizes in its business as presently being conducted and
as anticipated to be conducted, except where the failure to do so
could not reasonably be expected to result in a Material Adverse
Effect on Borrower (collectively, "Intellectual Property") and
all such Intellectual Property that is owned by Borrower is
registered with, or an application has been made for such
registration, all applicable federal or state governmental
authorities. Borrower is not a licensee under any written
license for any patent, trademark, tradename, service ▇▇▇▇ or
copyright other than shrinkwrap licenses for "off-the-shelf"
software used by Borrower in the conduct of its business. The
Intellectual Property registrations are in full force and effect,
and Borrower has taken or caused to be taken all action,
necessary to maintain the Intellectual Property registrations in
full force and effect and has not taken or failed to take or
cause to be taken any action which, with the giving of notice, or
the expiration of time, or both, could result in any such
Intellectual Property registrations being revoked, invalidated,
modified, or limited.
7.19 Labor Matters; Labor Agreements. Except as set forth
in Exhibit 7.19 hereof: (a) As of the Closing Date, there are no
collective bargaining agreements or other labor agreements
covering any employees of Borrower or any Subsidiary, the
termination, cessation, or breach of which could reasonably be
expected to result in a Material Adverse Effect, and a true and
correct copy of each such agreement will be furnished to CoBank
upon its written request from time to time. (b) There is no
organizing activity involving Borrower or any Subsidiary or
pending or, to Borrower's knowledge, threatened by any labor
union or group of employees. (c) There are, to Borrower's
knowledge, no representation proceedings pending or threatened
with the National Labor Relations Board, and no labor
organization or group of employees of Borrower or any Subsidiary,
has made a pending demand for recognition. (d) There are no
complaints or charges against Borrower or any Subsidiary, pending
or, to Borrower's knowledge threatened to be filed with any
federal, state, local or foreign court, governmental agency or
arbitrator based on, arising out of, in connection with, or
otherwise relating to the employment or termination of employment
by Borrower or any Subsidiary, of any individual. (e) There are
no strikes or other labor disputes against Borrower or any
Subsidiary, that are pending or, to Borrower's knowledge,
threatened. (f) Hours worked by and payment made to employees of
Borrower or any Subsidiary, have not been in violation of the
Fair Labor Standards Act (29 U.S.C. 201 et seq.) or any other
applicable law dealing with such matters. The representations
made in subparagraphs (b) through (f) of this Section are made
with respect to those occurrences described which could,
considered in the aggregate, reasonably be expected to have a
Material Adverse Effect.
7.20 Disclosure. The representations and warranties
contained in this Article 7 and in the other Loan Documents or in
any financial statements or projections provided to CoBank do not
contain any untrue statement of a material fact or omit to state
a material fact necessary to make such representations or
warranties not misleading.
ARTICLE 8. CONDITIONS TO ADVANCES
8.1 Conditions to Closing. The obligation of CoBank to
make any Advance hereunder is subject to satisfaction, in the
sole discretion of CoBank, of each of the following conditions
precedent prior to the Advances (except as specifically provided
otherwise):
8.1.1 Loan Documents. CoBank shall have received
duly executed originals of the Loan Documents.
8.1.2 Amendment to, or Consent under, Intercreditor
Agreement; Security Agreement. CoBank shall, no later than
twenty-one (21) days after the making of an Advance
hereunder, have received in form satisfactory to CoBank in
its discretion, (a) an amendment to the Intercreditor
Agreement, or consent or other document satisfactory to
CoBank, providing that the term "CoBank Agreements" as used
in the Intercreditor Agreement clearly includes this Credit
Agreement, and the Loan Documents executed pursuant to this
Credit Agreement, and that the term "CoBank Notes" as used
in the Intercreditor Agreement clearly shall be deemed to
mean the Notes executed pursuant to this Credit Agreement
from time to time, and as all such documents may be amended
or replaced from time to time; and (b) an amendment to the
Security Agreement in favor of the Collateral Agent, or
other document satisfactory to CoBank, making it clear that
the obligations secured thereby include this Credit
Agreement, and the Loan Documents executed pursuant to this
Credit Agreement.
8.1.3 Approvals. CoBank shall have received
evidence satisfactory to it that all consents and approvals
of governmental authorities and third parties which are with
respect to Borrower, necessary for, or required as a
condition of the validity and enforceability of the Loan
Documents to which they are a party, have been obtained and
are in full force and effect.
8.1.4 Organizational Documents. CoBank shall, no
later than fourteen (14) days after the making of an Advance
hereunder, have received: (a) good standing certificates,
dated no more than thirty (30) days prior to the Closing
Date, for Borrower for its state of incorporation and for
each state where its operations require qualification or
authorization to transact business; (b) a copy of the
articles of incorporation of Borrower certified by the
Secretary of State of its state of organization; and (c) a
copy of the bylaws of Borrower, certified as true and
complete by the Secretary or Assistant Secretary of
Borrower.
8.1.5 Evidence of Corporate Action. CoBank shall
have received in form and substance satisfactory to CoBank
documents evidencing all corporate action taken by Borrower
to authorize (including the specific names and titles of the
persons authorized to so act (each an "Authorized Officer"))
the execution, delivery and performance of the Loan
Documents to which it is a party, certified to be true and
correct by the Secretary or Assistant Secretary of Borrower.
8.1.6 Legal Opinion for Borrower. CoBank shall, no
later than fourteen (14) days after the making of an Advance
hereunder, have received an opinion of counsel for Borrower
(who shall be acceptable to CoBank), in form and content
acceptable to CoBank and addressed to CoBank covering such
matters as CoBank shall specify.
8.1.7 Evidence of Insurance. Borrower shall have
provided CoBank with insurance certificates and such other
evidence, in form and substance satisfactory to CoBank, of
all insurance required to be maintained by it under the Loan
Documents; provided however, so long as the Intercreditor
Agreement is in effect, Borrower shall be in compliance with
this Section if it is in compliance with any comparable
requirement under the Intercreditor Agreement.
8.1.8 Material Agreements. CoBank shall have
received copies of those Material Agreements as CoBank may
request in its sole discretion.
8.1.9 Appointment of Agent for Service. CoBank
shall, no later than fourteen (14) days after the making of
an Advance hereunder, have received evidence satisfactory to
CoBank that Borrower has appointed The Corporation Company
to serve as its agent for service of process at their
Denver, Colorado office (presently at ▇▇▇▇ ▇▇▇▇▇▇▇▇), and
that The Corporation Company has accepted such appointment
by Borrower.
8.1.10 No Material Change. No change shall have
occurred in the condition or operations of Borrower since
November 30, 2002 which could result in a Material Adverse
Effect, except as previously disclosed in writing to CoBank
in the form of a PowerPoint presentation that was posted via
the digital workspace provider known as IntraLinks, Inc. on
January 15, 2003.
8.1.11 Fees and Expenses. Borrower shall have paid
CoBank, by wire transfer of immediately available federal
funds all fees set forth in Section 3.5 hereof and any other
fees owing to CoBank which are due on the Closing Date, and
all expenses owing pursuant to Section 13.1 hereof.
8.1.12 CoBank Equity Interest Purchase Obligation.
Borrower shall have purchased such CoBank Equity Interests
as CoBank may require pursuant to Article 5 hereof.
8.1.13 Waivers of Events of Default Under Rabobank
Agreement. Borrower shall have provided to CoBank (a) a
written waiver, executed by the lenders under the Rabobank
Agreement, waiving Borrower's breach of any covenants
contained in the Rabobank Agreement for the period ending
December 31, 2002, or, (b) a written amendment to the
Rabobank Agreement revising the covenants contained in the
Rabobank Agreement for the period ending December 31, 2002
so that Borrower is not in breach thereof.
8.1.14 Prudential Consent. Borrower shall have
provided to CoBank a writing, executed by an authorized
representative of Prudential Insurance Company of America,
in its capacity as "Noteholder" (as such term is defined in
the Intercreditor Agreement) under the Prudential Agreement,
acknowledging that the term "CoBank Agreements" as used in
the Intercreditor Agreement includes this Credit Agreement,
and the Loan Documents executed pursuant to this Credit
Agreement, and that the term "CoBank Notes" as used in the
Intercreditor Agreement includes the Notes executed pursuant
to this Credit Agreement from time to time, and as all such
documents may be amended or replaced from time to time;
provided that this requirement shall not be applicable if
(a) CoBank has received a copy of a proposed amendment to
the Prudential Agreement in form satisfactory to CoBank in
its discretion which authorizes Borrower to incur the
obligations arising out of this Credit Agreement; and (b) no
later than twenty-one (21) days after the making of an
Advance hereunder, CoBank has received an executed copy of
such amendment.
8.1.15 Further Assurances. Borrower shall have
provided and/or executed and delivered to CoBank such
further documents, in form and substance satisfactory to
CoBank, that Borrower is to execute and/or deliver pursuant
to the terms of the Loan Documents or as CoBank may
reasonably request.
8.2 Conditions to Advance. CoBank's obligation to fund any
Advance is subject to the satisfaction, in the sole discretion of
CoBank, of each of the following conditions precedent, as well as
those set forth in Section 8.1 hereof, and a request by Borrower
for an Advance shall constitute a representation by Borrower,
upon which CoBank may rely, that the conditions set forth in
Subsections 8.2.2 and 8.2.3 hereof have been satisfied:
8.2.1 Borrowing Notice. Borrower shall have
provided to CoBank a Borrowing Notice that satisfies the
requirements of Section 2.3 hereof.
8.2.2 Default. As of the Advance Date no Event of
Default or Potential Default (after giving effect to the
waiver required in Subsection 8.1.13 hereof) shall have
occurred and be continuing, and the disbursing of the amount
of the Advance requested in the Borrowing Notice shall not
result in an Event of Default or Potential Default.
8.2.3 Representations and Warranties. The
representations and warranties of Borrower contained in each
of the Loan Documents to which it is a party, shall be true
and correct in all material respects on and as of the date
on which the Advance is to be made as though made on such
date. Borrower shall have paid CoBank, by wire transfer of
immediately available U.S. funds all fees set forth in
Section 3.5 hereof which are then due and payable, including
all expenses owing pursuant to Section 13.1 hereof.
8.2.4 Closing Date. The Borrowing Notice does not
specify an Advance Date which is later than the Closing
Date.
8.2.5 No Material Change. No change shall have
occurred in the condition or operations of Borrower since
the date of the monthly financial statements most recently
provided by Borrower to CoBank, which, when considered in
the aggregate, could reasonably be expected to result in a
Material Adverse Effect, except as previously disclosed in
writing to CoBank in the form of a PowerPoint presentation
that was posted via the digital workspace provider known as
IntraLinks, Inc. on January 15, 2003.
ARTICLE 9. AFFIRMATIVE COVENANTS
From and after the date of this Credit Agreement and until
the Bank Debt is indefeasibly paid in full and CoBank has no
obligation to make any Advance hereunder, Borrower agrees that it
will observe and comply with, the following covenants for the
benefit of CoBank:
9.1 Books and Records. Borrower shall at all times keep
proper books of record and account, in which correct and complete
entries shall be made of all its dealings, in accordance with
GAAP.
9.2 Reports and Notices. Borrower shall provide to CoBank
the following reports, information and notices:
9.2.1 Annual Financial Statements. As soon as
available, but in no event later than ninety (90) days after
the end of any Fiscal Year of Borrower occurring during the
term hereof annual financial statements of Borrower and its
consolidated Subsidiaries prepared in accordance with GAAP
consistently applied which shall: (a) be audited by
independent certified public accountants selected by
Borrower which are reasonably acceptable to CoBank; (b) be
accompanied by a report of such accountants containing an
opinion reasonably acceptable to CoBank; (c) be accompanied
by a Compliance Certificate; (d) be prepared in reasonable
detail and in comparative form; and (e) include a balance
sheet, an income statement, a statement of cash flows, a
statement of retained earnings, and all notes and schedules
relating thereto, and such other information as CoBank may
reasonably request from time to time. In addition to any
other information requested by CoBank pursuant to the
preceding sentence, together with each delivery of financial
statements required by this Subsection, Borrower will
deliver to CoBank a certificate of such accountants
(substantially in the form of the September 6, 2002 letter
from KPMG, LLP delivered to Borrower's Board of Directors
and covering the aforementioned subjects) stating that, in
making the audit necessary to the certification of such
financial statements, they have obtained no knowledge of any
Event of Default or Potential Default, or, if any Event of
Default or Potential Default exists, specifying the nature
and period of existence thereof. Such accountants, however,
shall not be liable to CoBank or any other Person by reason
of their failure to obtain knowledge of any Event of Default
or Potential Default that would not be disclosed in the
course of an audit conducted in accordance with generally
accepted auditing standards.
9.2.2 Quarterly Financial Statements. As soon as
available but in no event more than forty-five (45) days
after the end of each Fiscal Quarter the following financial
statements or other information concerning the operations of
Borrower and its consolidated Subsidiaries for such period
and for the Fiscal Year to date, prepared in accordance with
GAAP consistently applied, a consolidated and consolidating
income statement, and such other quarterly statements as
CoBank may reasonably request, all prepared in reasonable
detail and certified by the Chief Financial Officer or
Treasurer of borrower (subject to normal year-end
adjustments). Such quarterly financial statements required
pursuant to this Subsection shall be accompanied by a
Compliance Certificate.
9.2.3 Monthly Financial Statements. As soon as
available but in no event more than forty-five (45) days
after the end of each month, unaudited consolidated and
consolidating and business segment statements of sales and
margins of Borrower and its consolidated Subsidiaries for
such month and for the period from the beginning of the
current fiscal year to the end of such month and an
unaudited consolidated and consolidating balance sheet of
Borrower and its consolidated Subsidiaries as at the end of
such month, setting forth, with respect to such consolidated
statements of sales and margins and such consolidated
balance sheet, in comparative form, figures for the
corresponding period in the preceding Fiscal Year.
9.2.4 Borrowing Base Certificate/Hedging Position
Report. On the twenty-first Business Day of each month,
Borrower shall deliver to CoBank a photo copy of all
borrowing base certificates and hedge position reports
submitted to the agent and/or lenders pursuant to the
RaboBank Agreement.
9.2.5 Notice of Default. As soon as the existence
of any Event of Default or Potential Default becomes known
to any officer of Borrower, Borrower shall promptly give
CoBank written notice of such Event of Default or Potential
Default, the nature and status thereof, and the action being
taken or proposed to be taken with respect thereto.
9.2.6 Notice of Certain Changes. Borrower shall:
(a) notify CoBank at least ten (10) Business Days prior to
the occurrence of any change in the name or business form of
Borrower or any Subsidiary; and (b) take, or cause any
Subsidiary to take, all actions necessary or reasonably
requested by CoBank in order to maintain the perfected
status of the lien and security interest in the Collateral.
So long as the Intercreditor Agreement is in effect,
Borrower shall be in compliance with this Subsection if it
is in compliance with any comparable requirement under the
Intercreditor Agreement.
9.2.7 Notice of Litigation. Borrower shall
promptly notify CoBank in writing of all litigation in which
Borrower or Subsidiary is a party, and which either: (a)
involves an amount of $1,000,000 or more, singly or in the
aggregate at any time involves an amount of $2,000,000 or
more; or (b) could reasonably be expected to result in a
Material Adverse Effect with respect to Borrower.
9.2.8 Notice of Material Adverse Effect. Promptly
after Borrower obtains knowledge thereof, notice of any
matter which has resulted or would result in a Material
Adverse Effect.
9.2.9 Notice of Environmental Litigation. Without
limiting the provisions of Subsection 9.2.5 hereof, promptly
after Borrower's receipt thereof, notice of the receipt of
all pleadings, orders, complaints, indictments, or other
communication alleging a condition that may require Borrower
to undertake or to contribute to a cleanup or other response
under Environmental Regulations, or which seeks penalties,
damages, injunctive relief, or criminal sanctions related to
alleged violations of such laws, or which claims personal
injury or property damage to any person as a result of
environmental factors or conditions or which, if adversely
determined, could have a Material Adverse Effect.
9.2.10 Regulatory and Other Notices. Promptly after
Borrower's receipt thereof, copies of any notices or other
communications received from any governmental authority with
respect to any matter or proceeding the effect of which
could reasonably be expected to have a Material Adverse
Effect.
9.2.11 Adverse Action Regarding Required Licenses.
In the event Borrower learns that any petition, action,
investigation, notice of violation or apparent liability,
notice of forfeiture, order to show cause, complaint or
proceeding is pending, or, to the best of Borrower's
knowledge, threatened, to seek to revoke, cancel, suspend,
modify, or limit any of the Required Licenses, Borrower
shall provide CoBank with prompt written notice thereof and
shall take, or cause to be taken, all reasonable measures to
contest such action in good faith.
9.2.12 SEC Filings; Reports to Third Parties.
Promptly after transmission thereof, copies of all such
financial statements, proxy statements, notices and reports
as Borrower sends to its patrons or registered debt
certificate holders and copies of all registration
statements (without exhibits) and all reports which it files
with the Securities and Exchange Commission (or any
governmental body or agency succeeding to the functions of
the Securities and Exchange Commission), including, without
limitation, a copy of all 10K and 10Q reports filed with the
Securities and Exchange Commission.
9.2.13 Tax Related Notices. Promptly (a) after
notice thereof being delivered to Borrower or any
Subsidiary, notice of the commencement of any audit of any
federal, state or other income tax return of Borrower or any
Subsidiary, and (b) upon receipt thereof, a copy of each
other report submitted to Borrower or any Subsidiary by
independent accountants in connection with any annual,
interim or special audit made by them of the books of
Borrower or any Subsidiary.
9.2.14 Additional Information. With reasonable
promptness such additional financial information or other
documentation as CoBank may reasonably request. So long as
the Intercreditor Agreement is in effect, Borrower shall be
in compliance with this Subsection if it is in compliance
with any comparable requirement under the Intercreditor
Agreement.
9.3 Maintenance of Existence and Qualification. Borrower
shall maintain its corporate existence in good standing under the
laws of the state of Georgia. Borrower will qualify and remain
qualified as a foreign corporation in each jurisdiction in which
such qualification is necessary or desirable in view of its
business, operations and properties. Borrower will qualify and
remain qualified as a foreign corporation in each jurisdiction in
which such qualification is necessary or desirable in view of its
business, operations and properties.
9.4 Compliance with Legal Requirements and Agreements.
Borrower shall: (a) comply with all laws, rules, regulations and
orders applicable to Borrower or its business; and (b) comply
with all agreements, indentures, mortgages, and other instruments
to which it is a party or by which it or any of its property is
bound; provided, however, that the failure of Borrower to comply
with this sentence in any instance not directly involving CoBank
shall not constitute an Event of Default unless such failure
would have a Material Adverse Effect.
9.5 Compliance with Environmental Laws. Without limiting
the provisions of Section 9.4 of this Credit Agreement, Borrower
shall comply in all material respects with, and take all
reasonable steps necessary to cause all persons occupying or
present on any properties owned or leased by Borrower to comply
with, all Environmental Regulations, the failure to comply with
which would have a Material Adverse Effect.
9.6 Taxes. Borrower shall cause to be paid when due all
taxes, assessments, and other governmental charges upon it, its
income, its sales, its properties, and federal and state taxes
withheld from its employees' earnings, unless such taxes,
assessments, or other governmental charges shall be contested in
good faith by appropriate actions or legal proceedings and
Borrower shall establish adequate reserves therefor in accordance
with GAAP.
9.7 Insurance. Borrower shall keep the Collateral insured
at all times by an insurance carrier or carriers reasonably
acceptable to CoBank which have an AI rating by the current BEST
Key Rating Guide, against all risks covered by a special form
policy (and including flood (for property located in a flood
plain zone), earthquake and windstorm coverage) in the amount of
the full replacement cost (other than with respect to motor
vehicles) of the Collateral as well as liability, worker's
compensation, business interruption, boiler and machinery and
such other insurance as CoBank may reasonably require, in amounts
and with deductibles or maximum payouts customarily carried by
entities in similar lines of business. Borrower shall also
maintain fidelity coverage (including employee dishonesty) on
such officers and employees and in such amounts as CoBank shall
specify, or in the absence of any such specification, as
customarily carried by corporations engaged in comparable
businesses and comparably situated. Such insurance policies
shall contain such reasonable endorsements as CoBank shall from
time to time require and all liability policies shall name CoBank
as an additional insured as its interests may appear. All such
casualty insurance policies shall be endorsed with a loss payable
clause, as appropriate, in favor of CoBank. Certificates of all
insurance referred to in this Section satisfactory to CoBank
shall be delivered to and held by CoBank, and the policy or
policies evidencing all such insurance shall be provided to
CoBank upon CoBank's request therefor. All such insurance
policies shall contain a provision requiring at least ten (10)
days' notice to CoBank prior to any cancellation for non-payment
of premiums and at least forty-five (45) days' notice to CoBank
of cancellation for any other reason or of modification or non-
renewal. No later than forty (40) days prior to expiration,
Borrower shall give CoBank (a) satisfactory written evidence of
renewal of all such policies with premiums paid, or (b) a written
report as to the steps being taken by Borrower to renew or
replace all such policies, provided that notwithstanding the
receipt of such written report, CoBank may at any time thereafter
give Borrower written notice to provide CoBank with such evidence
as described in clause (a), in which case Borrower must do so
within ten (10) days of such notice. Borrower agrees to pay all
premiums on such insurance as they become due, and will not
permit any condition to exist on or with respect to the
Collateral which would wholly or partially invalidate any
insurance thereon. Effective upon the occurrence of an Event of
Default, all of Borrower's right, title and interest in and to
all such policies and any unearned premiums paid thereon are
hereby assigned to CoBank who shall have the right, but not the
obligation, to assign the same to any purchaser of the Collateral
at any foreclosure sale. Borrower shall give immediate written
notice to the insurance carrier and CoBank of any loss. Borrower
hereby authorizes and empowers CoBank upon the occurrence and
during the continuation of an Event of Default, at CoBank's
option and in CoBank's sole discretion, to act as attorney-in-
fact for Borrower to make proof of loss, to adjust and compromise
any claim under insurance policies, to collect and receive
insurance proceeds, and to deduct therefrom CoBank's expenses
incurred in the collection of such proceeds. So long as the
Intercreditor Agreement is in effect, Borrower shall be in
compliance with this Section if it is in compliance with any
comparable requirement under the Rabobank Agreement or security
documents executed in connection therewith.
9.8 Title to Assets and Maintenance. Borrower shall defend
and maintain title to all its properties and assets, including
the Collateral. Borrower shall keep its assets, both real and
personal, including the Collateral, in good order and condition
consistent with industry practice and shall make all necessary
repairs, replacements and improvements so that its business may
be properly and advantageously conducted.
9.9 Payment of Liabilities. Borrower shall pay all
liabilities (including, without limitation: (a) any indebtedness
for borrowed money or for the deferred purchase price of property
or services; (b) any obligations under leases which have or
should have been characterized as capitalized leases, as
determined in accordance with GAAP; and (c) any contingent
liabilities, such as guaranties, for the obligations of others
relating to indebtedness for borrowed money or for the deferred
purchase price of property or services or relating to obligations
under leases which have or should have been characterized as
capitalized leases, as determined in accordance with GAAP) as
they become due beyond any period of grace under the instrument
creating such liabilities, unless (with the exception of the Bank
Debt) they are contested in good faith by appropriate actions or
legal proceedings, Borrower establishes adequate reserves
therefor in accordance with GAAP, and such contesting will not
result in a Material Adverse Effect.
9.10 Further Assurances. Borrower shall, as may be required
from time to time by CoBank, provide such documents as may be
necessary or desirable in the judgment of CoBank to verify the
existence and perfection of the security interest in the
Collateral granted to CoBank. So long as the Intercreditor
Agreement is in effect, Borrower shall be in compliance with this
Section if it is in compliance with any comparable requirement
under the Intercreditor Agreement.
9.11 Inspection. Borrower shall permit CoBank or its
agents, during normal business hours or at such other times as
the parties may agree, to inspect the Collateral and to examine
Borrower's properties, books, and records, and to discuss
Borrower's affairs, finances, operations, and accounts with its
respective officers, directors, employees, and independent
certified public accountants.
9.12 Required Licenses; Permits; Etc. Borrower shall duly
and lawfully obtain and maintain in full force and effect all
Required Licenses as appropriate for the business being conducted
and properties owned by Borrower at any given time.
9.13 ERISA. Promptly (and in any event within 30 days)
after Borrower or any of its Subsidiaries knows or has reason to
know that a Reportable Event with respect to any Plan has
occurred, that any Plan is or may be terminated, reorganized,
partitioned or declared insolvent under Title IV of ERISA, or
that Borrower or any of its Subsidiaries will or may incur any
material liability to or on account of a Plan under Section 4062,
4063, 4064, 4201 or 4204 of ERISA, Borrower will deliver to
CoBank a certificate of the chief financial officer of Borrower
setting forth information as to such occurrence and what action,
if any, Borrower is required or proposes to take with respect
thereto, together with any notices concerning such occurrences
which are required to be filed with or by Borrower, the PBGC or
the plan administrator of any such Plan, as the case may be.
Borrower shall furnish, at the request of CoBank, a copy of each
annual report (Form 5500 Series) of any Plan received or prepared
by Borrower or any of its Subsidiaries. Each annual report and
any notice required to be delivered hereunder shall be delivered
no later than ten (10) days after the later of the date such
report or notice is filed with the Internal Revenue Service or
the PBGC or the date such report or notice is received by the
Borrower or any of its Subsidiaries, as the case may be.
9.14 Financial Covenants. Borrower shall maintain the
following financial covenants:
9.14.1 Fixed Charge Coverage Ratio . At, and
measured as of the end of, each Fiscal Quarter a ratio of
(a) EBITDA for the previous consecutive four (4) Fiscal
Quarters (including such Fiscal Quarter), (b) divided by the
sum of (i) Consolidated Interest Expense and (ii) the
aggregate scheduled principal amount of Indebtedness for
Money Borrowed (other than the Revolving Loans) to be paid
within one year after the last day of such Fiscal Quarter,
equal to or greater than the ratio set forth opposite the
relevant Fiscal Quarter:
FISCAL QUARTER RATIO
1st Fiscal Quarter 2003 No requirement
through the 1st Fiscal
Quarter 2004
2nd Fiscal Quarter 2004 1.40 to 1.00
3rd Fiscal Quarter 2004 1.60 to 1.00
4th Fiscal Quarter 2004 1.75 to 1.00
and thereafter
9.14.2 Current Ratio. At, and measured as of the
end of, each Fiscal Quarter, a ratio of Consolidated Current
Assets, divided by Consolidated Current Liabilities, of
greater than or equal to 1.10 to 1.00.
9.14.3 Minimum Consolidated Tangible Net Worth. At
all times Consolidated Tangible Net Worth (less any gain or
loss as a result of accumulated other comprehensive income,
as defined by GAAP) equal to no less than (a) $135,000,000,
plus (b) the sum of (i) 50% of the Reported Net Income of
the Borrower and its consolidated Subsidiaries (to the
extent positive) for the Fiscal Quarter ending December 31,
2002, and each Fiscal Quarter thereafter on a cumulative
basis (taken as one accounting period), but excluding from
such calculations of Reported Net Income for purposes of
this clause (i) any fiscal quarter in which the Reported Net
Income of the Borrower and its consolidated Subsidiaries is
negative, and (ii) 100% of the cumulative Net Proceeds of
Stock received during any period after June 29, 2002.
9.14.4 Senior Debt Coverage Ratio. At, and measured
as of the end of, each Fiscal Quarter, a Senior Debt
Coverage Ratio equal to or less than the ratio set forth
opposite the relevant Fiscal Quarter:
FISCAL QUARTER RATIO
3rd Fiscal Quarter 2003 6.00 to 1.00
4th Fiscal Quarter 2003 7.25 to 1.00
and 1st Fiscal Quarter 2004
2nd Fiscal Quarter 2004 6.25 to 1.00
and 3rd Fiscal Quarter 2004
4th Fiscal Quarter 2004 5.00 to 1.00
1st Fiscal Quarter 2005 4.50 to 1.00
2nd Fiscal Quarter 2005 4.00 to 1.00
3rd Fiscal Quarter 2005 3.50 to 1.00
4th Fiscal Quarter 2005 3.25 to 1.00
and thereafter
9.14.4 Minimum Cumulative EBITDA. At, and measured
as of the end of, each Fiscal Quarter designated below, a
cumulative EBITDA of no less than the amount set forth
below:
FISCAL QUARTER CUMULATIVE AMOUNT
For the 3rd Fiscal negative $22,000,000.00
Quarter 2003
For the 3rd Fiscal negative $4,000,000.00
Quarter 2003 and 4th
Fiscal Quarter 2003, cumulative
For the 3rd Fiscal positive $40,000,000.00
Quarter 2003, 4th Fiscal
Quarter 2003, and 1st Fiscal
Quarter 2004, cumulative
ARTICLE 10. NEGATIVE COVENANTS
From and after the date of this Credit Agreement until the
Bank Debt is indefeasibly paid in full, and CoBank has no
obligation to make Advances, Borrower agrees that it will observe
and comply with the following covenants:
10.1 Limitation on Restricted Payments. Borrower will not
pay or declare any dividend or make any other distribution on or
on account of any class of its Stock or other equity or make cash
distributions of equity (including cash patronage refunds), or
make interest payments on equity, or redeem, purchase or
otherwise acquire, directly or indirectly, any shares of its
Stock or other equity, or redeem, purchase or otherwise acquire,
directly or indirectly, any Subordinated Debt, including, but not
limited to, its Subordinated Capital Certificates of Interest,
Subordinated Loan Certificates (except required redemptions as
provided in the indentures pursuant to which such Subordinated
Debt was issued), or permit any Subsidiary to do any of the above
(all of the foregoing being herein called "Restricted Payments")
except that Borrower may make (a) cash patronage refunds in
fiscal year 2002 and thereafter in an amount, for each fiscal
year, not to exceed 10% of the member earnings for such fiscal
year, and (b) present value cashing retirement and death payments
(net of any amount Borrower receives as insurance proceeds) in an
aggregate amount not to exceed $5,000,000 in any fiscal year;
provided that Borrower shall not make any Restricted Payments
upon the occurrence and during the continuance of a Default or
Event of Default. So long as there is no Default or Event of
Default occurring or continuing, there shall not be included in
the definition of Restricted Payments: (x) dividends paid, or
distributions made, in Stock of Borrower or (y) exchanges of
Stock of one or more classes of Borrower, except to the extent
that cash or other value is involved in such exchange. Moreover,
nothing in this Section shall prevent any Subsidiary from making
any Restricted Payments to the Borrower or to any other Loan
Party that directly owns Stock of such Subsidiary. The term
"equity" as used in this Section shall include the Borrower's
common stock, preferred stock, if any, other equity certificates,
and notified equity accounts of patrons.
10.2 Liens. Borrower shall not, and shall not permit any
Subsidiary to, create, assume or suffer to exist any Lien upon
any of its property or assets whether now owned or hereafter
acquired, except:
(a) Liens existing prior to the date of this
Agreement, as set forth on Exhibit 10.2 hereto;
(b) Liens for taxes not yet due, and Liens for taxes
or Liens imposed by ERISA which are being contested in good faith
by appropriate proceedings and with respect to which adequate
reserves are being maintained;
(c) Statutory Liens of landlords and Liens of
carriers, warehousemen, mechanics, materialmen and other Liens
imposed by law created in the ordinary course of business for
amounts not yet due or which are being contested in good faith by
appropriate proceedings and with respect to which adequate
reserves are being maintained;
(d) Liens incurred or deposits made in the ordinary
course of business in connection with workers' compensation,
unemployment insurance and other types of social security, or to
secure the performance of tenders, statutory obligations, surety
and appeal bonds, bids, leases, government contracts, performance
and return-of-money bonds and other similar obligations
(exclusive of obligations for the payment of borrowed money);
(e) Liens securing purchase money debt, provided that
(i) the Lien in each instance does not extend beyond the assets
acquired with the purchase money debt, and (ii) the aggregate of
such debt so secured does not exceed five percent (5%) of
Consolidated Net Worth;
(f) Liens consisting of encumbrances in the nature of
zoning restrictions, easements and rights or restrictions of
record on the use of real property, which do not materially
detract from the value of such property or impair the use thereof
in the business of such Person; and
(g) Liens securing the obligations due to the parties
to the Intercreditor Agreement
10.3 Restrictions on Loans, Advances, Investments, Asset
Acquisitions and Contingent Liabilities. Borrower shall not and
shall not permit any Subsidiary to (a) make or permit to remain
outstanding any loan or advance to, or extend credit other than
credit extended in the normal course of business to any Person
which is not an Affiliate of the Borrower, or (b) guarantee,
endorse or otherwise be or become contingently liable, directly
or indirectly, in connection with the obligations, Stock or
dividends of any Person, or (c) own, purchase or acquire any
Stock, obligations or securities of, or any other interest in, or
make any capital contribution to, any Person, or (d) acquire all,
or substantially all, of the assets of any Person, in a single or
a series of related transactions; except that the Borrower or any
Subsidiary may:
(i) (A) make or permit to remain outstanding
loans or advances to any other Loan Party, or (B) guarantee or
otherwise become liable for obligations of any other Loan Party
to the extent such obligation that is guaranteed is incurred in
the ordinary course of business of such Loan Party or is
Indebtedness otherwise permitted to be incurred by such Loan
Party hereunder (including guarantee obligations under the
Subsidiary Guaranty);
(ii) acquire and own Stock, obligations or
securities received in settlement of debts (created in the
ordinary course of business) owing to Borrower or any Subsidiary;
(iii) own, purchase or acquire prime
commercial paper and certificates of deposit in United States
commercial banks (whose long-term debt is rated "A" or better by
▇▇▇▇▇'▇ Investors Service or Standard and Poor's Corporation), in
each case due within one year from the date of purchase and
payable in the United States in Dollars;
(iv) own, purchase and acquire obligations of the
United States Government or any agency thereof, in each case due
within one year from the date of purchase;
(v) own, purchase and acquire obligations
guaranteed by the United States Government, in each case due
within one year from the date of purchase;
(vi) own, purchase and acquire repurchase
agreements of United States commercial banks (whose long-term
debt is rated "A" or better by ▇▇▇▇▇'▇ Investors Service or
Standard and Poor's Corporation) for terms of less than one year
in respect of the foregoing certificates and obligations;
(vii) own, purchase and acquire tax-exempt
securities maturing within one year from the date of purchase and
rated "A" or better by ▇▇▇▇▇'▇ Investors Service or Standard and
Poor's Corporation;
(viii) own, purchase and acquire adjustable
rate preferred stocks rated "A" or better by ▇▇▇▇▇'▇ Investors
Service or Standard and Poor's Corporation;
(ix) endorse negotiable instruments for collection
in the ordinary course of business;
(x) make or permit to remain outstanding travel
and other like advances to officers and employees in the ordinary
course of business;
(xi) (x) permit to remain outstanding investments
in the Subsidiaries of the Borrower in existence as of the
Closing Date, and (y) make or permit to remain outstanding
investments in any Subsidiary (whether in existence on the
Closing Date or created after the Closing Date in accordance with
Section 10.13 hereof) if such Subsidiary is a Loan Party;
(xii) make or permit to remain outstanding
loans from Agratrade Financing, Inc., a wholly-owned Subsidiary
of the Borrower, to members and non-members of the Borrower
(provided that all such loans are made to facilitate the business
of the Borrower) in an aggregate amount not to exceed
$20,000,000;
(xiii) make or permit to remain outstanding
investments described on Exhibit 10.3 attached hereto;
(xiv) make or permit to remain outstanding
investments in GC Properties in an aggregate amount not exceeding
$500,000 during the term of this Agreement;
(xv) (A) prior to the date of the release and
termination of the Debt Repurchase Agreement and the satisfaction
of all of Borrower's obligations thereunder ("Repurchase Release
Date"), guarantee or otherwise be or become contingently liable
for obligations of Young Pecan not to exceed an aggregate amount
of $60,000,000 pursuant to the Debt Repurchase Agreement, (B) on
or after the Repurchase Release Date, acquire the Foothill
Interest;
(xvi) have increases in existing investments
arising from non-cash notified equity or other equity methods of
accounting for equity increases which are non-cash;
(xvii) investments in CoBank's cash investment
program; and
(xviii) make or permit to remain outstanding
investments in any money market fund that invests only in
investments described in subsections (iii), (iv), (v), (vi),
(vii), or (viii) of this Section.
10.4 Sale of Stock and Indebtedness of Subsidiaries.
Without the prior written consent of CoBank, which consent shall
be at the sole discretion of CoBank, Borrower shall not and shall
not permit any Subsidiary to sell or otherwise dispose of, or
part with control of, any shares of Stock or Indebtedness of any
Subsidiary, except (a) to Borrower or another Loan Party, (b) all
shares of Stock and Indebtedness of any Subsidiary at the time
owned by or owed to Borrower and all Subsidiaries may be sold as
an entirety for a cash consideration which represents the fair
value (as determined in good faith by the Board of Directors of
Borrower) at the time of sale of the shares of Stock and
Indebtedness so sold, provided that the assets of such Subsidiary
do not constitute a Substantial Part of the Consolidated Assets
of Borrower and all Subsidiaries and that the earnings of such
Subsidiary shall not have constituted a Substantial Part of
Consolidated Net Earnings for any of the three fiscal years then
most recently ended, and further provided that, at the time of
such sale, such Subsidiary shall not own, directly or indirectly,
any shares of Stock or Indebtedness of any other Subsidiary
(unless all of the shares of Stock and Indebtedness of such other
Subsidiary owned, directly or indirectly, by the Borrower and all
Subsidiaries are simultaneously being sold as permitted by this
Section), and (c) dispositions of Stock permitted by
Section10.5(d).
10.5 Merger and Sale of Assets. Borrower shall not and
shall not permit any Subsidiary to enter into any transaction of
merger, consolidation, pooling of interest, joint venture,
syndicate or other combination with any other Person or sell,
lease, transfer, contribute as capital, or otherwise dispose of
all or a Substantial Part of the consolidated assets of Borrower
and all Subsidiaries or assets which shall have contributed a
Substantial Part of Consolidated Net Earnings for any of the
three fiscal years then most recently ended, in any single
transaction or series of related transactions, to any Person,
except that:
(a) any Subsidiary may merge with (i) Borrower,
provided that Borrower shall be the continuing or surviving
corporation, or (ii) any one or more other Subsidiaries, provided
that if any Loan Party is party to such merger, a Loan Party
shall be the continuing or surviving corporation;
(b) any Subsidiary may sell, lease or otherwise
dispose of any of its assets to Borrower or another Loan Party;
(c) any Subsidiary may sell or otherwise dispose of
all or substantially all of its assets subject to the conditions
specified in Section 10.4 with respect to a sale of the Stock of
such Subsidiary; and
(d) (i) Borrower may sell or otherwise dispose of its
interests in Agratech Seeds Inc., a Georgia corporation, and (ii)
Agratech Seeds Inc. may sell or otherwise dispose of its
interests in Agratech Seeds Argentina S.A., provided, in each
case, that (x) the net proceeds of any such sale or other
disposition, if any, are contributed to Borrower, or (y) such
sale or disposition results in favorable federal tax treatment,
or a federal tax deduction pursuant to Section 170 of the Code.
10.6 Sale and Lease-Back. Borrower shall not and shall not
permit any Subsidiary to enter into any arrangement, with any
Person or under which such other Person is a party, providing for
the leasing by Borrower or any Subsidiary of real or personal
property, used by Borrower or any Subsidiary in the operations of
Borrower or any Subsidiary, which has been or is sold or
transferred by Borrower or any Subsidiary to any other Person to
whom funds have been or are to be advanced by such other Person
on the security of such rental obligations of Borrower or such
Subsidiary except to the extent that the total amount of such
arrangements involve, at any one time, assets or property which
constitute an amount equal to or less than ten percent (10%) of
Consolidated Capital Assets.
10.7 Sale or Discount of receivables. Borrower shall not
and shall not permit any Subsidiary to sell with recourse or
discount or otherwise sell for less than the face value thereof,
any of its notes or accounts receivable.
10.8 Hedging Contracts. Borrower shall not, and shall not
permit any Subsidiary to, enter into any Hedging Contract except:
(a) bona fide hedging transactions in commodities that represent
production inputs or products to be marketed, or in commodities
needed in operations to meet manufacturing or market demands,
provided that (i) long positions and/or options sold on corn and
wheat shall in no event cover more than thirty-nine weeks of
Borrower's anticipated requirements for feed ingredients, and
none of such positions and/or options shall cover more than six
and one-half weeks of such anticipated requirements unless they
have been entered into in compliance with Borrower's Corporate
Policy For Futures Contracts approved by Borrower's Board of
Directors on April 24, 1998 and have been approved by the
Borrower's Hedging Committee, (ii) long positions and/or options
sold on soybean meal shall in no event cover more than thirty-
nine weeks of Borrower's anticipated requirements for feed
ingredients, and none of such positions and/or options shall
cover more than six and one-half weeks of such anticipated
requirements unless they have been entered into in compliance
with Borrower's Corporate Policy For Futures Contracts approved
by Borrower's Board of Directors on April 24, 1998 and have been
approved by the Borrower's Hedging Committee, and (iii) short
positions on corn shall not exceed 2,000,000 bushels, and shall
at all times relate to corn owned or contracted for purchase by
Borrower; and (b) foreign exchange contracts, currency swap
agreements, interest rate exchange agreements, interest rate cap
agreements, interest rate collar agreements, and other similar
agreements and arrangements which are reasonably related to
existing indebtedness or to monies to be received or paid in
foreign currencies.
10.9 Issuance of Stock by Subsidiaries. Borrower shall not
permit any Subsidiary (either directly or indirectly by the
issuance of rights or options for, or securities convertible
into, such shares) to issue, sell or dispose of any shares of its
Stock of any class (other than directors' qualifying shares, if
any) except to Borrower or another Subsidiary.
10.10 Capital Expenditures. Borrower and its
Subsidiaries shall not, on a consolidated basis, directly or
indirectly, make Capital Expenditures in excess of: (a) the
following annual limits (i) in Fiscal Year 2003, $40,000,000.00,
(ii) in Fiscal Year 2004, $40,000,000.00, plus any carry forward
from Fiscal Year 2003, (iii) in Fiscal Year 2005, $50,000,000.00,
plus any carry forward from Fiscal Year 2004; plus (b) in
connection with the "tray pack operations" at Borrower's location
in Live Oak, Florida, in excess of $30,000,000 in the aggregate
after June 29, 2002, however, the amount described in this clause
(b) shall not be available until (i) the Temporary Revolving
Credit Facility matures and is fully repaid, and (ii) Borrower
has generated EBITDA, for the immediately preceding four (4)
Fiscal Quarters, of at least $100,000,000.00.
10.11 Indebtedness for Money Borrowed. Borrower shall
not, and shall not permit any Subsidiary to, create, incur,
assume, or suffer to exist any Indebtedness for Money Borrowed,
except for the following:
(a) Indebtedness existing under this Credit Agreement
and the other Loan Documents;
(b) Indebtedness (including guaranties) which may be
deemed to exist pursuant to any performance, surety, appeal or
similar bonds obtained by Borrower or any of its Subsidiaries in
the ordinary course of business;
(c) Indebtedness for Money Borrowed in existence on
the date hereof, and set forth on Exhibit 10.11 hereto; provided,
however in connection with the mortgage facility on the corporate
headquarters building owned by GC Properties as set forth on
Exhibit 10.11 , such mortgage facility may be increased by an
amount not to exceed $5,000,000 after the date hereof;
(d) Subordinated Debt;
(e) Unsecured Indebtedness for Money Borrowed owing by
any Loan Party to any other Loan Party;
(f) Indebtedness under the Temporary Revolving Credit
Facility;
(g) Indebtedness existing under the Rabobank Agreement
and the other loan documents (including, without limitation, all
Loans and Letter of Credit Obligations incurred or issued under
the Rabobank Agreement);
(h) Reimbursement obligations under letters of credit
issued by any of the Lenders under the Rabobank Agreement,
provided that the aggregate principal amount of such
reimbursement obligations does not exceed $25,000,000 at any one
time (exclusive of Letters of Credit issued under the Rabobank
Agreement); and
(i) Indebtedness existing under the Prudential
Agreement.
10.12 Transactions with Affiliates. Borrower shall not,
and shall not permit any Subsidiary to, enter into or be a party
to any transaction or arrangement with any Affiliate (including,
without limitation, the purchase from, sale to or exchange of
property with, or the rendering of any service by or for, any
Affiliate), except (a) in the ordinary course of and pursuant to
the reasonable requirements of Borrower's or such Subsidiary's
business and upon fair and reasonable terms no less favorable to
Borrower or such Subsidiary than would obtain in a comparable
arm's-length transaction with a Person other than an Affiliate,
or (b) for transactions between Loan Parties.
10.13 Creation of Subsidiaries. Borrower shall not, and
shall not permit any Subsidiary to, create any Subsidiary after
the Closing Date unless (a) such Subsidiary is a Wholly Owned
Subsidiary, (b) such Subsidiary is organized under the laws of a
jurisdiction within the United States of America, (c) such
Subsidiary executes at the time of its creation the Security
Agreement (as defined in the Intercreditor Agreement), together
with applicable Uniform Commercial Code financing statements, the
Subsidiary Guaranty and the Contribution Agreement (either
directly or by executing a supplement thereto) and the Stock of
such Subsidiary is pledged to the Collateral Agent as Collateral,
(d) an opinion of counsel, acceptable to the Collateral Agent, is
delivered to the Lenders and CoBank confirming the due
organization of such Subsidiary, the enforceability of the
Security Agreement, the Subsidiary Guaranty and the Contribution
Agreement against such Subsidiary, and such other matters as the
Collateral Agent may reasonably request, and (e) no Event of
Default exists immediately prior to or after the creation of the
Subsidiary.
10.14 Change in Fiscal Year. Borrower shall not change
its Fiscal Year.
ARTICLE 11. INDEMNIFICATION
11.1 General; Stamp Taxes; Intangibles Tax. Borrower agrees
to indemnify and hold CoBank and its directors, officers,
employees, agents, professional advisers and representatives
("Indemnified Parties") harmless from and against any and all
claims, damages, losses, liabilities, costs or expenses
whatsoever which CoBank or any other Indemnified Party may incur
(or which may be claimed against any such Indemnified Party by
any Person), including attorneys' fees incurred by any
Indemnified Party, arising out of or resulting from: (a) the
material inaccuracy of any representation or warranty of or with
respect to Borrower in this Credit Agreement or the other Loan
Documents; (b) the material failure of Borrower to perform or
comply with any covenant or obligation of Borrower under this
Credit Agreement or the other Loan Documents; or (c) the exercise
by CoBank of any right or remedy set forth in this Credit
Agreement or the other Loan Documents, provided that Borrower
shall have no obligation to indemnify any Indemnified Party
against claims, damages, losses, liabilities, costs or expenses
to the extent that a court of competent jurisdiction renders a
final non-appealable determination that the foregoing are solely
the result of the willful misconduct or gross negligence of such
Indemnified Party. In addition, Borrower agrees to indemnify and
hold the Indemnified Parties harmless from and against any and
all claims, damages, losses, liabilities, costs or expenses
whatsoever which CoBank or any other Indemnified Party may incur
(or which may be claimed against any such Indemnified Party by
any Person), including attorneys' fees incurred by any
Indemnified Party, arising out of or resulting from the
imposition or nonpayment by Borrower of any stamp tax,
intangibles tax, or similar tax imposed by any state, including
any amounts owing by virtue of the assertion that the property
valuation used to calculate any such tax was understated.
Borrower shall have the right to assume the defense of any claim
as would give rise to Borrower's indemnification obligation under
this Section with counsel of Borrower's choosing so long as such
defense is being diligently and properly conducted and Borrower
shall establish to the Indemnified Party's satisfaction that the
amount of such claims are not, and will not be, material in
comparison to the liquid and unrestricted assets of Borrower
available to respond to any award which may be granted on account
of such claim. So long as the conditions of the preceding
sentence are met, Indemnified Party shall have no further right
to reimbursement of attorney's fees incurred thereafter. The
obligation to indemnify set forth in this Section shall survive
the termination of this Credit Agreement and other covenants.
11.2 Indemnification Relating to Hazardous Substances.
Borrower shall not locate, produce, treat, transport,
incorporate, discharge, emit, release, deposit or dispose of any
Hazardous Substance in, upon, under, over or from any property
owned or held by Borrower, except in accordance with all
Environmental Regulations; Borrower shall not permit any
Hazardous Substance to be located, produced, treated,
transported, incorporated, discharged, emitted, released,
deposited, disposed of or to escape in, upon, under, over or from
any property owned or held by Borrower, except in accordance with
Environmental Regulations; and Borrower shall comply with all
Environmental Regulations which are applicable to such property.
If CoBank reasonably believes that an Environmental Regulation
has been violated by Borrower's activities upon property owned or
held by Borrower, and if CoBank so requests, Borrower shall have
prepared an environmental review, audit, assessment and/or report
relating to the subject property, at Borrower's sole cost and
expense, by an engineer or other environmental expert acceptable
to CoBank. Borrower shall indemnify the Indemnified Parties
against, and shall reimburse the Indemnified Parties for, any and
all claims, demands, judgments, penalties, liabilities, costs,
damages and expenses, including court costs and attorneys' fees
incurred by the Indemnified Parties (prior to trial, at trial and
on appeal) in any action against or involving the Indemnified
Parties, resulting from any breach of the foregoing covenants in
this Section or the covenants in Section 9.5 hereof, or from the
discovery of any Hazardous Substance in, upon, under or over, or
emanating from, such property, it being the intent of Borrower
and the Indemnified Parties that the Indemnified Parties shall
have no liability or responsibility for damage or injury to human
health, the environmental or natural resources caused by, for
abatement and/or clean-up of, or otherwise with respect to,
Hazardous Substances by virtue of the interest of CoBank in the
property created by any documents securing Bank Debt (including
without limitation the Loan Documents) or as the result of CoBank
exercising any of its rights or remedies with respect thereto,
including but not limited to becoming the owner thereof by
foreclosure or conveyance in lieu of foreclosure; provided that
such indemnification as it applies to the exercise by CoBank of
its rights or remedies with respect to the Loan Documents shall
not apply to claims arising solely with respect to Hazardous
Substances brought onto such property by CoBank while engaged in
activities other than operations substantially the same as the
operations previously conducted on such property by Borrower.
The foregoing covenants of this Section shall be deemed
continuing covenants for the benefit of the Indemnified Parties,
and any successors and assigns of the Indemnified Parties,
including but not limited to the holder of any certificate of
purchase, any transferee of the title of CoBank or any subsequent
owner of the property, and shall survive the satisfaction or
release of any lien, any foreclosure of any lien and/or any
acquisition of title to the property or any part thereof by
CoBank, or anyone claiming by, through or under CoBank or
Borrower by deed in lieu of foreclosure or otherwise. Any
amounts covered by the foregoing indemnification shall bear
interest from the date incurred at the Default Interest Rate,
shall be payable on demand, and shall be secured by the Security
Documents. The indemnification and covenants of this
Section shall survive the termination of this Credit Agreement
and other covenants.
ARTICLE 12. EVENTS OF DEFAULT; RIGHTS AND REMEDIES
12.1 Events of Default. The occurrence of any of the
following events (each an "Event of Default") shall, at the
option of CoBank, make the entire Bank Debt immediately due and
payable (provided, that in the case of an Event of Default under
Subsection 12.1(f) all amounts owing under the Notes and the
other Loan Documents shall automatically and immediately become
due and payable without any action by or on behalf of CoBank),
and CoBank may exercise all rights and remedies for the
collection of any amounts outstanding hereunder and take whatever
action it deems necessary to secure itself, all without notice of
default, presentment or demand for payment, protest or notice of
nonpayment or dishonor, or other notices or demands of any kind
or character:
(a) The failure of Borrower to pay within five (5)
days of the date when due, whether by acceleration or otherwise,
any of the Bank Debt in accordance with this Credit Agreement or
the other Loan Documents.
(b) Any representation or warranty set forth in any
Loan Document, in any Borrowing Notice, in any financial
statements or reports or projections or forecasts, or in
connection with any transaction contemplated by any such
document, shall prove in any material respect to have been false
or misleading when made by Borrower.
(c) Any default by Borrower in the performance or
compliance with the covenants, promises, conditions or provisions
of Sections (or Subsections) 8.1.2, 8.1.6, 9.3, 9.8, 9.12, and
any of the Sections in Article 10 hereof.
(d) Any default by Borrower in the performance or
compliance with the covenants, promises, conditions or provisions
of Sections (or Subsections) 8.1.4, 9.5, 9.6, 9.7, 9.9, 9.10,
(except as provided in Section 12.1(e)), 9.11, 9.13, or 9.14 of
this Credit Agreement, and such failure continues for thirty (30)
days after Borrower learns of such failure to comply, whether by
Borrower's own discovery or through notice from CoBank
(e) The failure of Borrower to pay when due, or
failure to perform or observe any other obligation or condition
with respect to any of the following obligations to any Person,
beyond any period of grace under the instrument creating such
obligation: (i) any indebtedness for borrowed money or for the
deferred purchase price of property or services, (ii) any
obligations under leases which have or should have been
characterized as capitalized leases, as determined in accordance
with GAAP, or (iii) any contingent liabilities, such as
guaranties, for the obligations of others relating to
indebtedness for borrowed money or for the deferred purchase
price of property or services or relating to obligations under
leases which have or should have been characterized as
capitalized leases, as determined in accordance with GAAP;
provided that no such failure will be deemed to be an Event of
Default hereunder unless and until the aggregate amount owing
under obligations with respect to which such failures have
occurred and are continuing is at least $1,000,000.00.
(f) Borrower applies for or consents to the
appointment of a trustee or receiver for any part of its
properties; any bankruptcy, reorganization, debt arrangement,
dissolution or liquidation proceeding is commenced or consented
to by Borrower; or any application for appointment of a receiver
or a trustee, or any proceeding for bankruptcy, reorganization,
debt management or liquidation is filed for or commenced against
Borrower, and is not withdrawn or dismissed within sixty (60)
days thereafter.
(g) Failure of Borrower to comply with any other
provision of this Credit Agreement or the other Loan Documents
not constituting an Event of Default under any of the preceding
subparagraphs of this Section 12.1, and such failure continues
for thirty (30) days after Borrower learns of such failure to
comply, whether by Borrower's own discovery or through notice
from CoBank.
(h) The entry of one or more judgments in an aggregate
amount in excess of $10,000,000.00 against Borrower not stayed,
discharged or paid within thirty (30) days after entry.
(i) Either (i) any single employer Plan or
Multiemployer Plan fails to maintain the minimum funding standard
required by Section 412 of the Code for any plan year or a waiver
of such standard is sought or granted under Section 412(d) of the
Code, or (ii) any single employer Plan or Multiemployer Plan
subject to Title IV of ERISA is or has been terminated or the
subject of termination proceedings under ERISA, or (iii) Borrower
or a Subsidiary of Borrower or an ERISA Affiliate has incurred a
liability to or on account of any Plan under Section 4062, 4063,
4064, 4201 or 4204 of ERISA, or (iv) Borrower or a Subsidiary of
Borrower has engaged in a prohibited transaction, and there
results from any of the events specified in clauses (i) through
(iv) above a liability to the PBGC or any Plan, or a liability,
penalty or tax under ERISA or Section 4975 of the Code, as the
case may be, equal to or greater than $1,000,000 that is not paid
within 10 days of the due date therefore.
(j) In the event that within thirty (30) days after
the Closing Date the Temporary Revolving Credit Facility has not
been closed and all conditions to Borrower's entitlement to an
advance thereunder (other than a requirement that available
amounts under the Rabobank Agreement be fully drawn) been
satisfied.
(k) The occurrence of an Event of Default under the
Rabobank Agreement; provided however, this clause shall not apply
to any such Event of Default existing on the Closing Date which
(A) has been disclosed in writing to CoBank, and (B) is cured
within thirty (30) days after the Closing Date, unless collection
action is commenced under the Rabobank Agreement on account of
such Event of Default.
12.2 No Advance. CoBank may cancel the Term A Commitment
and the Term B Commitment upon the occurrence of an Event of
Default and shall have no obligation to make an Advance if a
Potential Default or an Event of Default shall occur and be
continuing.
12.3 Rights and Remedies. In addition to the remedies set
forth in Section 12.1 and 12.2 hereof, upon the occurrence of an
Event of Default, CoBank shall, subject to the provisions of the
Intercreditor Agreement, be entitled to exercise all the rights
and remedies provided in the Security Documents and other Loan
Documents and by any applicable law, including, without
limitation, the Uniform Commercial Code as enacted in the state
of Colorado or the state where the Collateral is located at such
time, whichever provides CoBank with greater rights. Each and
every right or remedy granted to CoBank pursuant to this Credit
Agreement and the other Loan Documents, or allowed CoBank by law
or equity, shall be cumulative. Failure or delay on the part of
CoBank to exercise any such right or remedy shall not operate as
a waiver thereof. Any single or partial exercise by CoBank of
any such right or remedy shall not preclude any future exercise
thereof or the exercise of any other right or remedy.
ARTICLE 13. MISCELLANEOUS
13.1 Costs and Expenses. To the extent permitted by law,
Borrower agrees to pay to CoBank, on demand, all out-of-pocket
costs and expenses (a) incurred by CoBank (including, without
limitation, the reasonable fees and expenses of counsel retained
by CoBank, and including fees and expenses incurred for
consulting, appraisal, engineering, inspection, and environmental
assessment services) in connection with the preparation,
negotiation, and execution of the Loan Documents and the
transactions contemplated thereby, and processing each Borrowing
Notice; and (b) incurred by CoBank (including, without
limitation, the reasonable fees and expenses of counsel retained
by CoBank) in connection with the enforcement or protection of
CoBank's rights under the Loan Documents upon the occurrence of
an Event of Default or upon the commencement of an action by
Borrower against CoBank (except that if the court makes a
specific finding that Borrower has prevailed on all or
substantially all of its claims in such action brought by
Borrower, Borrower shall not be obligated to pay the out-of-
pocket costs and expenses of CoBank in connection with such
action), including without limitation collection of the Term Loan
(regardless of whether such enforcement or collection is by court
action or otherwise). CoBank may, at its discretion, pay all
amounts owing pursuant to clause (a) above by an Advance.
Borrower shall not be obligated to pay the costs or expenses of
any Person whose only interest in the Term Loan is as a holder of
a participation interest.
13.2 Service of Process and Consent to Jurisdiction.
Borrower hereby agrees that any litigation with respect to this
Credit Agreement or to enforce any judgment obtained against
Borrower for breach of this Credit Agreement or under the Notes
or other Loan Documents may be brought in the courts of the State
of Colorado and in the United States District Court for the
District of Colorado (if applicable subject matter jurisdictional
requirements are present), as CoBank may elect; and, by execution
and delivery of this Credit Agreement, Borrower irrevocably
submits to such jurisdiction. With respect to litigation
concerning this Credit Agreement or under the Notes or other Loan
Documents within the jurisdiction of the courts of the State of
Colorado or the United States District Court for the District of
Colorado, Borrower hereby irrevocably appoints, until at least
one (1) year following the Maturity Date. The CT Company to
serve as the agent of Borrower to receive for and on behalf of
Borrower at such agent's Denver, Colorado office (presently at
▇▇▇▇ ▇▇▇▇▇▇▇▇), service of process, which service may be made by
mailing a copy of any summons or other legal process to Borrower
in care of such agent. Borrower agrees that Borrower shall
maintain a duly appointed agent in Colorado for service of
summons and other legal process as long as Borrower remains
obligated under this Credit Agreement and shall keep CoBank
advised in writing of the identity and location of such agent.
The receipt by such agent and/or by Borrower of such summons or
other legal process in any such litigation shall be deemed
personal service and acceptance by Borrower for all purposes of
such litigation.
13.3 Jury Waiver. IT IS MUTUALLY AGREED BY AND BETWEEN
COBANK AND BORROWER THAT THEY EACH WAIVE TRIAL BY JURY IN ANY
ACTION, PROCEEDING, OR COUNTERCLAIM BROUGHT BY EITHER OF THEM
AGAINST THE OTHER PARTY ON ANY MATTER WHATSOEVER ARISING OUT OF
OR IN ANY WAY CONNECTED WITH THIS CREDIT AGREEMENT, THE NOTES, OR
THE OTHER LOAN DOCUMENTS.
13.4 Notices. All notices, requests and demands required or
permitted under the terms of this Credit Agreement shall be in
writing and (a) shall be addressed as set forth below or at such
other address as either party shall designate in writing, (b)
shall be deemed to have been given or made: (i) if delivered
personally, immediately upon delivery, (ii) if by telex, telegram
or facsimile transmission, immediately upon sending and upon
confirmation of receipt, (iii) if by nationally recognized
overnight courier service with instructions to deliver the next
Business Day, one (1) Business Day after sending, and (iv) if by
United States Mail, certified mail, return receipt requested,
five (5) days after mailing.
13.4.1 Borrower:
Gold ▇▇▇▇, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇, Chief Financial Officer &
Treasurer
13.4.2 CoBank:
CoBank, ACB
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Vice President
13.5 Successors and Assigns. This Credit Agreement shall be
binding upon and inure to the benefit of Borrower, CoBank, and
their respective successors and assigns, except that Borrower may
not assign or transfer its rights or obligations hereunder
without the prior written consent of CoBank.
13.6 Severability. The invalidity or unenforceability of
any provision of this Credit Agreement or the other Loan
Documents shall not affect the remaining portions of such
documents or instruments; in case of such invalidity or
unenforceability, such documents or instruments shall be
construed as if such invalid or unenforceable provisions had not
been included therein.
13.7 Entire Agreement. This Credit Agreement (together with
all exhibits hereto, which are incorporated herein by this
reference) and the other Loan Documents represent the entire
understanding of CoBank and Borrower with respect to the subject
matter hereof and shall replace and supersede any previous
agreements of the parties with respect to the subject matter
hereof.
13.8 Applicable Law. To the extent not governed by federal
law, this Credit Agreement and the other Loan Documents, and the
rights and obligations of the parties hereto and thereto shall be
governed by and interpreted in accordance with the internal laws
of the State of Colorado, without giving effect to any otherwise
applicable rules concerning conflicts of law.
13.9 Captions. The captions or headings in this Credit
Agreement and any table of contents hereof are for convenience
only and in no way define, limit or describe the scope or intent
of any provision of this Credit Agreement.
13.10 Complete Agreement; Amendments. THIS CREDIT
AGREEMENT, THE NOTES, AND THE OTHER LOAN DOCUMENTS ARE INTENDED
BY THE PARTIES HERETO TO BE A COMPLETE AND FINAL EXPRESSION OF
THEIR AGREEMENT AND MAY NOT BE CONTRADICTED BY EVIDENCE OF ANY
PRIOR OR CONTEMPORANEOUS ORAL AGREEMENT. BY INITIALING IN THE
MARGIN, COBANK AND BORROWER ACKNOWLEDGE AND AGREE THAT NO
UNWRITTEN ORAL AGREEMENT EXISTS BETWEEN THEM WITH RESPECT TO THE
SUBJECT MATTER OF THIS AGREEMENT. This Credit Agreement may not
be modified or amended unless such modification or amendment is
in writing and is signed by Borrower and CoBank. Borrower agrees
that it shall reimburse CoBank for all fees and expenses incurred
by CoBank in retaining outside legal counsel in connection with
any amendment or modification to this Credit Agreement requested
by Borrower.
13.11 Additional Costs of Maintaining Loan. Borrower
shall pay to CoBank from time to time such amounts as CoBank may
determine to be necessary to compensate CoBank for any increase
in costs to CoBank which CoBank determines, are attributable to
CoBank's making or maintaining an Advance hereunder or its
obligation to make such Advance, or any reduction in any amount
receivable by CoBank under this Credit Agreement or the Note
payable to it in respect to such Advance or such obligation (such
increases in costs and reductions in amounts receivable being
herein called "Additional Costs"), resulting from any change
after the date of this Credit Agreement in United States federal,
state, municipal, or foreign laws or regulations (including
Regulation D of the Federal Reserve Board), or the adoption or
making after such date of any interpretations, directives, or
requirements applying to a class of banks including CoBank of or
under any United States federal, state, municipal, or foreign
laws or regulations (whether or not having the force of law) by
any court or governmental or monetary authority charged with the
interpretation or administration thereof ("Regulatory Change"),
which: (a) changes the basis of taxation of any amounts payable
to CoBank under this Credit Agreement or the Note payable to
CoBank in respect of such Advance (other than taxes imposed on
the overall net income of CoBank); or (b) imposes or modifies any
reserve, special deposit, or similar requirements relating to any
extensions of credit or other assets of, or any deposits with or
other liabilities of, CoBank; or (c) imposes any other condition
affecting this Credit Agreement or the Note payable to CoBank (or
any of such extensions of credit or liabilities). CoBank will
notify Borrower of any event occurring after the date of this
Credit Agreement which will entitle CoBank to compensation
pursuant to this Section as promptly as practicable after it
obtains knowledge thereof and determines to request such
compensation. CoBank shall include with such notice, a
certificate setting forth in reasonable detail the calculation of
the amount of such compensation. Determinations by CoBank for
purposes of this Section of the effect of any Regulatory Change
on the costs of CoBank of making or maintaining an Advance or on
amounts receivable by CoBank in respect of Advances, and of the
additional amounts required to compensate CoBank in respect of
any Additional Costs, shall be conclusive absent manifest error,
provided that such determinations are made on a reasonable basis.
13.12 Capital Requirements. In the event that the
introduction of or any change in: (a) any law or regulation; or
(b) the judicial, administrative, or other governmental
interpretation of any law or regulation; or (c) compliance by
CoBank or any corporation controlling CoBank with any guideline
or request from any governmental authority (whether or not having
the force of law) has the effect of requiring an increase in the
amount of capital required or expected to be maintained by CoBank
or any corporation controlling CoBank, and CoBank certifies that
such increase is based in any part upon its obligations
hereunder, and other similar obligations, Borrower shall pay to
CoBank such additional amount as shall be certified by CoBank to
Borrower to be the net present value (discounted at the Base
Rate) of (a) the amount by which such increase in capital reduces
the rate of return on capital which CoBank could have achieved
over the period remaining until the applicable Maturity Date but
for such introduction or change, (b) multiplied by the Term
Commitment. CoBank will notify Borrower of any event occurring
after the date of this Credit Agreement that will entitle CoBank
to compensation pursuant to this Section as promptly as
practicable after it obtains knowledge thereof and determines to
request such compensation. CoBank shall include with such notice,
a certificate setting forth in reasonable detail the calculation
of the amount of such compensation. Determinations by CoBank for
purposes of this Section of the effect of any increase in the
amount of capital required to be maintained by CoBank and of the
amount of compensation owed to CoBank under this Section shall be
conclusive absent manifest error, provided that such
determinations are made on a reasonable basis.
13.13 Sale of Participation Interests. CoBank has the
right to participate any part of its interest in the Term Loans
to any Person with the prior written consent of Borrower (which
consent will not be unreasonably withheld), provided that
Borrower shall have no approval rights upon the occurrence and
during the continuance of an Event of Default, and provided
further that no such consent shall be required where the
participant is a Person at least fifty percent (50%) the equity
interest in which is owned by CoBank or which owns at least fifty
percent (50%) of the equity interest in CoBank or at least fifty
percent (50%) of the equity interest of which is owned by the
same Person which owns at least fifty percent (50%) of the equity
interest of CoBank, and CoBank understands and agrees that in the
event of any such participation: (a) its obligations hereunder
will not change on account of such participation; and (b) the
participant will have no rights under this Credit Agreement,
including, without limitation, voting rights or the right to
receive payments or distributions. Notwithstanding any provision
contained herein to the contrary, CoBank may at any time pledge
or assign all or any portion of its interest in the Term Loans to
the Federal Farm Credit Bank in accordance with applicable law.
CoBank reserves the right to sell participations on a non-
patronage basis.
13.14 Replacement Notes. Upon receipt by Borrower of
evidence reasonably satisfactory to it of: (a) the loss, theft,
destruction or mutilation of any Term Notes, and (in case of
loss, theft or destruction) of the agreement of CoBank to
indemnify Borrower, and upon surrender and cancellation of such
Term Note, if mutilated; or (b) the assignment by CoBank of its
interest hereunder and the Term Note relating thereto, or any
portion thereof, pursuant to this Credit Agreement, then Borrower
will pay any unpaid principal and interest (and Funding Losses,
if applicable) then or previously due and payable on such Term
Note and will (upon delivery of such Term Note for cancellation,
unless covered by subparagraph (a) of this Section) deliver in
lieu of such Term Note a new Term Note or, in the case of an
assignment of a portion of CoBank's interest, new Term Notes, for
any remaining balance. All Term Notes executed pursuant to this
Section shall be dated as of the Effective Date. CoBank shall,
as soon as practical after receipt of such new executed Term
Notes, return to Borrower the Term Note which has been replaced
by such new Term Note or Term Notes.
13.15 Patronage Payments. Borrower acknowledges and
agrees that: (a) only that portion of the Term Loan retained by
CoBank for its own account is entitled to patronage distributions
in accordance with CoBank's bylaws and its practices and
procedures related to patronage distribution; and (b) any
patronage, or similar, payments to which Borrower is entitled on
account its ownership of CoBank Equity Interests or otherwise
will not be based on any portion of the Term Loans in which
CoBank has at any time granted a participation interest.
13.16 Mutual Release. Upon full indefeasible payment
and satisfaction of the Bank Debt and Notes and the other
obligations contained in this Credit Agreement, the parties,
including Borrower, CoBank shall, except as provided in Article
11 hereof with respect to indemnification obligations, thereupon
automatically each be fully, finally, and forever released and
discharged from any further claim, liability, or obligation in
connection with the Bank Debt.
13.17 Application of Intercreditor Agreement. Borrower
and CoBank hereby acknowledge and agree that it is their
intention that this Credit Agreement and the Loan Documents shall
be entitled to the benefits and burdens of the Intercreditor
Agreement and that this Credit Agreement and the Loan Documents
shall be deemed to be the "CoBank Agreements" and the Notes
executed pursuant to this Credit Agreement shall be deemed to be
the "CoBank Notes" as those two terms are defined and used in the
Intercreditor Agreement.
13.18 Liberal Construction. This Credit Agreement
constitutes a fully negotiated agreement between commercially
sophisticated parties, each assisted by legal counsel, and shall
not be construed and interpreted for or against any party hereto.
13.19 Counterparts. This Credit Agreement may be
executed by the parties hereto in separate counterparts, each of
which, when so executed and delivered, shall be an original, but
all such counterparts shall together constitute one and the same
instrument. Each counterpart may consist of a number of copies
hereof, each signed by less than all, but together signed by all
of the parties hereto. Telefax copies of documents or signature
pages bearing original signatures, and executed documents or
signature pages delivered by telefax, shall, in each such
instance, be deemed to be, and shall constitute and be treated
as, an original signed document or counterpart, as applicable.
Any party delivering an executed counterpart of this Credit
Agreement by telefacsimile also shall deliver an original
executed counterpart of this Credit Agreement but the failure to
deliver an original executed counterpart shall not affect the
validity, enforceability, and binding effect of this Credit
Agreement.
13.20 Cancellation of Debt Repurchase Agreement. Upon
(a) the fulfillment of each of the conditions set forth in
Section 8.1 hereof, and (b) CoBank receiving payment in full of
all amounts owing to it by Young Pecan Company under the First
Amended and Restated Credit Agreement dated as of March 30, 2002
by and between CoBank, in its capacity as Agent for the
Syndication Parties named therein (including CoBank as a
Syndication Party), Borrower and Young Pecan Shelling Company,
Inc. shall have no further obligations under the DR Agreement (as
defined in Recital A hereto) and the DR Agreement shall be deemed
to have been cancelled and terminated; provided that if any such
payment is subsequently set aside, recovered, rescinded or
required to be returned for any reason (including, without
limitation, the bankruptcy, insolvency or reorganization of Young
Pecan Company) the obligations of Borrower and Young Pecan
Shelling Company, Inc. under the DR Agreement to which such
payment was applied shall, for the purposes of this Section, be
deemed to have continued in existence, notwithstanding such
applications, and the DR Agreement shall not be deemed to have
been cancelled or terminated and shall be enforceable as to such
obligations as fully as if such applications had never been made.
In the event of the failure to occur of the conditions set forth
in clause (a) and/or clause (b) above, then, in any event, upon
CoBank making a Term B Advance, the maximum joint and several
liability of Borrower under the DR Agreement shall be reduced to
an amount equal to $60,000,000.00 less the amount of such Term B
Advance.
13.21 Advice of Counsel. Borrower acknowledges and
affirms that this Credit Agreement and the Loan Documents have
been fully and freely negotiated, and that Borrower has been
fully advised of all of its rights by its retained counsel.
IN WITNESS WHEREOF, the parties have executed this First
Amended and Restated Credit Agreement as of the date first above
written.
BORROWER:
GOLD ▇▇▇▇, INC., a cooperative
marketing association formed under
the laws of the State of Georgia.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Chief Financial Officer and
Treasurer
COBANK:
COBANK, ACB
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President
Applicable Lending Office (if
different from the address set
forth in Subsection 13.4.2 hereof):
__________________________
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