EXHIBIT 10.28
SECOND ADDENDUM TO THIRD AMENDED AND RESTATED LOAN AGREEMENT
This Second Addendum to Third Amended and Restated Loan Agreement (the "First
Addendum") is entered into as of the ___ day of February, 2003, by and between
▇▇▇▇ Deere Construction & Forestry Company ("JDCFC"), Deere Credit, Inc. ("Deere
Credit"), and ▇▇▇▇ Deere Company, a division of Deere & Company ("Deere &
Company") (JDCFC, Deere Credit and Deere & Company are hereinafter collectively
referred to as the "Lender") and RDO Agriculture Equipment Co. ("RDO
Agriculture"), RDO Construction Equipment Co. ("RDO Construction"), RDO
Financial Services Co. ("RDO Financial Services"), and RDO Material Handling Co.
("RDO Material Handling") (RDO Agriculture, RDO Construction, RDO Financial
Services and RDO Material Handling are hereinafter collectively referred to as
the "Borrower").
RECITALS
WHEREAS, Lender and Borrower entered into that certain Third Amended and
Restated Loan Agreement dated as of December 16, 2002 (the "Loan Agreement");
and
WHEREAS, Lender and Borrower wish to amend the Loan Agreement to further clarify
and amend certain provisions in the Loan Agreement;
NOW, THEREFORE, in consideration of the mutual covenants contained in this First
Addendum, and other good and valuable consideration, the receipt and sufficiency
of which is expressly acknowledged, the parties hereto agree to replace Section
11. Financial Covenants, in its entirety with the following:
11. FINANCIAL COVENANTS.
Except as otherwise indicated herein, any financial terms used in
connection with financial covenants herein are used in accordance with
generally acceptable accounting principles. Terms used in this Loan
Agreement that are not described in Section 1 of this Loan Agreement are
defined in the manual captioned "Comparative Management Review" published
by Deere & Company annually.
For purposes of this Section 11, the financial requirements contained
herein will be based on the consolidated financial information of the
Guarantor as defined herein.
The following financial requirements will be maintained as of the end of
each fiscal quarter beginning with the first full fiscal quarter following
execution of this Agreement:
(i) the ratio of Consolidated Total Liabilities minus Subordinated
Indebtedness to the sum of Tangible Net Worth plus Subordinated
Indebtedness to be less than or equal to 4.5 to 1;
(ii) the ratio of the Consolidated EBIT on a rolling four-quarter basis to
Consolidated Interest Expense at the end of each of the following
fiscal quarters end to be greater than or equal to .65 to 1.00 for the
fiscal quarter ended July 31, 2002, 1.00 to 1.00 for the fiscal
quarter ended October 31, 2002 and 1.25 to 1.00 beginning on January
31, 2003 and for all quarters thereafter;
SECOND ADDENDUM TO
THIRD AMENDED AND RESTATED LOAN AGREEMENT
Further, the following financial requirement(s) will be maintained as of
the end of each fiscal year:
(i) the Tangible Net Worth plus Subordinated Indebtedness at any time must
be greater than $50.0 million at all times.
Additionally, Borrower agrees to provide Lender with a covenant compliance
certificate concurrently with the submission of the required financial
statements each quarter detailing each financial covenant, the level of
performance required by the financial covenant, and the actual level of
performance achieved relating to the financial covenants. Borrower agrees
that the Covenant Compliance Certificate shall be certified as true and
accurate by a financial officer of Borrower and/or Guarantor. Any covenant
waivers provided to the Borrower at the Borrower's request from the Lender
as a result of non-compliance with financial covenants are subject to a
Five Thousand Dollar ($5,000.00) fee per waiver. This fee is due and
payable at the time of the waiver request.
Except as expressly amended by this Second Addendum, the terms and conditions of
the Loan Agreement and any previous Addendums remain in full force and effect.
This Second Addendum constitutes the complete understanding of the parties
hereto and supersedes all prior understandings of the parties relating to the
matters discussed herein. This Second Addendum may only be amended or modified
by the terms of a written instrument signed by all parties hereto. This Second
Addendum shall be governed by and construed in accordance with the laws of the
State of Iowa.
IN WITNESS WHEREOF, the parties hereto have executed this Second Addendum
effective as of the date first above written.
LENDER: BORROWER:
▇▇▇▇ DEERE CONSTRUCTION RDO AGRICULTURE EQUIPMENT CO.
& FORESTRY COMPANY
By: /s/ ▇▇▇ ▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇ ▇▇▇▇▇▇ Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Title: Mgr., Whsl Finance Title: Treasurer
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▇▇▇▇ DEERE COMPANY, A DIVISION OF RDO CONSTRUCTION EQUIPMENT CO.
DEERE & COMPANY
By: /s/ J.R. Spear By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name: J. R. Spear Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Title: Mgr., Ag Whsl Finance Title: Treasurer
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SECOND ADDENDUM TO
THIRD AMENDED AND RESTATED LOAN AGREEMENT
DEERE CREDIT, INC. RDO FINANCIAL SERVICES CO.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Title: Div. Fin. Mgr. Title: Treasurer
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RDO MATERIAL HANDLING CO.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Title: Treasurer
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