EXHIBIT 10.5
AG CAPITAL COMPANY
FIRST AMENDED AND RESTATED CREDIT AGREEMENT
THIS FIRST AMENDED AND RESTATED CREDIT AGREEMENT made and entered
into as of February 13, 1998 (the "Effective Date"), by and between Minnesota
Valley Irrigation, Inc., a Minnesota corporation (the "Borrower"), whose address
is X.X. Xxx 000, Xxxxxxx 00 Xxxx, Xxxxxx, Xxxxxxxxx 00000, and AG CAPITAL
COMPANY, a Delaware corporation (the "Lender"), whose address is 1500 Radisson
Tower, 000 Xxxxx 0xx Xxxxxx, Xxxxx, Xxxxx Xxxxxx 00000, amends and restates that
certain Ag Capital Company Loan Agreement, dated as of October 31, 1997 (herein
the "Prior Agreement") among the Borrower and the Lender.
RECITALS
1. The Lender and the Borrower have agreed that the terms and
conditions of the Prior Agreement should be amended and restated to clarify
certain provisions thereof for the benefit of both parties.
2. The Lender and the Borrower hereby agree that from and after the
Effective Date, the Prior Agreement shall be deemed amended and restated in its
entirety as set forth below.
NOW, THEREFORE, for and in consideration of the loans and advances
to be made by the Lender to the Borrower hereunder, the mutual covenants,
promises and agreements contained herein, and other good and valuable
consideration the receipt and sufficiency of which are hereby acknowledged, the
Borrower and the Lender agree as follows:
The following terms when used in this Credit Agreement shall, except
where the context otherwise requires, have the following meanings both in the
singular and plural forms thereof:
1. DEFINITIONS
"Acceptable Accounts Receivable" means any receivable owned by the
Borrower, less than 90 days old, which is in form and subject to documentation
acceptable to Lender.
"Advance" means any advance by the Lender made under the Seasonal
Commitment.
"Affiliate" means any corporation, association, partnership, joint
venture or other business entity directly or indirectly controlling or
controlled by, or under direct or indirect common control of, the Borrower or
any of its Subsidiaries.
"Assignee" has the meaning set forth in Section 9.14.
"Borrower" means Minnesota Valley Irrigation, Inc., a Minnesota
corporation.
"Borrowing Base Certificate" means the certificate in the form
attached hereto which sets forth the Borrowing Base as of the date indicated
thereon.
"Borrowing Base" means, at any time, the lesser of (a) $4,000,000 or
(b) the sum of (i) eighty five percent (85%) of Acceptable Accounts Receivable;
(ii) sixty five percent (65%) of new and used wholegoods and parts inventory,
net of unpaid accounts payable on such inventories; plus (iii) twenty percent
(20%) of eligible work in process, if any, all as determined in accordance with
GAAP.
"Business Day" means any day on which the Lender is open for the
transaction of business of the kind contemplated by this Credit Agreement.
"Change of Control" means the occurrence of any of the following
circumstances:
(a) any person or two or more persons acting in concert acquire
beneficial ownership (within the meaning of Rule 13d-3 of the
SEC under the Securities Exchange Act of 1934), directly or
indirectly, of securities of the Borrower (or other securities
convertible into such securities) representing 25% or more of
the combined voting power of all securities of the Borrower
entitled to vote in the election of directors; or
(b) during any period, whether commencing before or after the date
hereof, the membership of the Board of Directors of the
Borrower changes for any reason (other than by reason of
death, disability, or scheduled retirement) so that the
majority of the Board of Directors is made up of persons who
were not directors at the beginning of such period.
"Collateral" means all of the assets of the Borrower or any other
party in which the Lender holds a security interest pursuant to any of the Loan
Documents.
"Credit Agreement" means this First Amended and Restated Credit
Agreement, as originally executed and as may be amended, modified, supplemented,
or restated from time to time by written agreement between the Borrower and the
Lender.
"Current Assets" means, at any date, the aggregate amount of all
assets of the Borrower that are classified as current assets, on a consolidated
basis, in accordance with GAAP.
"Current Liabilities" means, at any time, the aggregate amount of
all liabilities of the Borrower that are classified as current liabilities, on a
consolidated basis, in accordance with GAAP (including taxes and other proper
accruals and the matured portion of any indebtedness).
"Debt" means (i) all items of indebtedness or liability that, in
accordance with GAAP, would be included in determining total liabilities as
shown on the liabilities side of a balance sheet as at the date of which Debt is
to be determined; (ii) indebtedness secured by any mortgage, pledge, lien or
security interest existing on property owned by the Person whose Debt is being
determined, whether or not the indebtedness secured thereby shall have been
assumed; (iii) all obligations, contingent or otherwise, relative to the face
amount of all letters of credit, whether or not drawn, and banker's acceptances
issued for the account of such Person, and (iv) guaranties, endorsements (other
than for purposes of collection in the ordinary course of business) and other
contingent obligations in respect of, or to purchase or otherwise acquire
indebtedness of others.
"Default" means any event which if continued uncured would, with
notice or lapse of time or both, constitute an Event of Default.
"Environmental Laws" has the meaning set forth in Section 5.17
"Equity to Asset Ratio" means the ratio of the total equity
(including minority interests and subordinate debt) of the Borrower to the total
assets of the Borrower, as determined on a combined basis, in accordance with
GAAP.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended and as may be further amended from time to time, and the rules and
regulations promulgated thereunder by any governmental agency or authority, as
from time to time in effect.
"Event of Default" means any event of default described in Section
88817 hereof.
"GAAP" means the generally accepted accounting principles in the
United States in effect from time to time including, but not limited to,
Financial Accounting Standards Board (FASB) Standards and Interpretations,
Accounting Principles Board (APB) Opinions and Interpretations, Committee on
Accounting Procedure (CAP) Accounting Research Bulletins, and certain other
accounting principles which have substantial authoritative support.
"Hazardous Substance" has the meaning set forth in Section 5.17
hereof.
"Lender" means Ag Capital Company, a Delaware corporation, its
successors and assigns.
"Lien" means any lien, security interest, pledge, mortgage,
statutory or tax lien, or other encumbrance of any kind whatsoever (including
without limitation, the lien or retained security title of a conditional
vendor), whether arising under a security instrument or as a matter of law,
judicial process or otherwise or by an agreement of the Borrower to grant any
lien or security interest or to pledge, mortgage or otherwise encumber any of
its assets.
"Loan" means the Seasonal Loan.
"Loan Documents" means this Credit Agreement, the Subject Note, the
Security Agreement, and such other documents as the Lender may reasonably
require as security for, or otherwise executed in connection with, any loan
hereunder, all as originally executed and as may be amended, modified or
supplemented from time to time by written agreement between the parties thereto.
"Material Adverse Occurrence" means any occurrence which materially
adversely affects the present or prospective financial condition or operations
of the Borrower, or which impairs, or may impair, in the Lender's reasonable
judgment, the ability of the Borrower to perform its obligations under the Loan
Documents.
"Maturity" of the Seasonal Note means the earlier of (a) the date on
which the Seasonal Note becomes due and payable upon the occurrence of an Event
of Default; or (b) the Termination Date.
"Net Working Capital" means Current Assets, plus the then current
portion of the Borrower's long-term Debt, minus Current Liabilities, all as
determined on a consolidated basis, in accordance with GAAP.
"Person" means any natural person, corporation, firm, association,
government, governmental agency or any other entity, whether acting in an
individual fiduciary or other capacity.
"Premises" has the meaning set forth in Section 5.17 hereof.
"Reference Rate" means for any day the rate of interest indicated as
the "prime rate" in the "Money Rates" section of the Wall Street Journal, for
such day (or if no such rate is published for such day for the earliest
preceding day for which such rate is published). If such rate ceases to be
published, the "Reference Rate" shall mean a comparable rate determined by the
Lender as indicated in a written notice to the Borrower."
"Regulatory Change" means any change after the date hereof in any
(or the adoption after the date hereof of any new) (a) Federal or state law or
foreign law applying to the Lender (or its successors or assigns); or (b)
regulation, interpretation, directive or request (whether or not having the
force of law) applying or in the reasonable opinion of the Lender (or its
successors or assigns) applicable to, the Lender (or its successors or assigns)
of any court or governmental authority charged with the interpretation or
administration of any law referred to in clause (a) of this definition or of any
fiscal, monetary, or other authority having jurisdiction over the Lender (or its
successors or assigns).
"Seasonal Commitment" means the sum of Four Million Dollars
($4,000,000.00) or the Lender's obligation to extend Advances to the Borrower
under Section 2, as the context may require.
"Seasonal Loan" means, at any date, the aggregate amount of all
Advances made by the Lender to the Borrower pursuant to Section 2 hereof.
"Seasonal Note" means the Seasonal Note, dated October 31, 1997, in
the original principal amount of Four Million Dollars ($4,000,000.00) made by
the Borrower payable to the order of the Lender, together with all extensions,
renewals, modifications, substitutions and changes in form thereof effected by
written agreement between the Borrower and the Lender.
"Security Agreement" means the Security Agreement, dated October 2,
1995, executed by the Borrower in favor of the Lender, and such other previously
executed security agreements, as originally executed and as may be amended,
modified or supplemented from time to time by written agreement between the
Borrower and the Lender.
"Subject Note(s)" means the Seasonal Note.
"Subsidiary" means any corporation of which more than fifty percent
(50%) of the outstanding capital stock having ordinary voting power to elect a
majority of the board of directors of such corporation (irrespective of whether,
at the time, stock of any other class or classes of such corporation shall have
or might have voting power by reason of the happening of any contingency) is at
the time, directly or indirectly, owned by the Borrower and/or one or more
Subsidiary or Affiliate.
"Termination Date" means the earlier of (a) June 1, 1998; or (b) the
date upon which the obligation of the Lender to make Advances is terminated
pursuant to Section 2.7.
2. THE SEASONAL LOAN
2.1. Commitment for Seasonal Loan. Subject to the Conditions of
Lending set forth in Section 4 hereof, the Lender agrees to make
Advances to the Borrower from time to time from the date of this
Credit Agreement through the Termination Date, provided, however,
that the Lender shall not be obligated to make any Advance, if after
giving effect to such Advance, the aggregate outstanding principal
amount of all Advances would exceed Four Million Dollars
($4,000,000.00). Within the limits set forth above, the Borrower may
borrow, repay and reborrow amounts under the Seasonal Note.
2.2. The Seasonal Note. All Advances shall be evidenced by, and the
Borrower shall repay such Advances to the Lender in accordance with,
the terms of the Seasonal Note; including without limitation the
provision of the Seasonal Note that the principal amount payable
thereunder at any time shall not exceed the then unpaid principal
amount of all Advances made by the Lender.
2.3. Records of Advances and Payments. The aggregate amount of all
unpaid Advances set forth on the records of the Lender shall be
rebuttable presumptive evidence of the principal amount owing and
unpaid on the Seasonal Note.
2.4. Payments and Interest on the Seasonal Note.
(a) The Borrower agrees to pay interest on the outstanding
principal amount of the Seasonal Note from the date hereof
until paid in full at a rate per annum equal to Reference Rate
minus 0.375 percentage points.
(b) After the date hereof, interest accrued on the Seasonal Note
through Maturity shall be payable for each calendar month on
the fifteenth (15th) day of the following calendar month,
commencing March 15, 1998, and at Maturity, when the entire
outstanding principal amount shall be due and payable.
Interest accrued after Maturity shall be payable upon demand.
2.5. Manner of Borrowing. The Borrower shall give the Lender written
or telephonic notice of each requested Advance by not later than
1:00 p.m. (Minneapolis time) on the date such Advance is to be made.
Each Advance shall be deposited to an account designated by the
Borrower or as otherwise indicated in the corresponding request by
the Borrower.
2.6. Payments. Any other provision of this Credit Agreement to the
contrary notwithstanding, the Borrower shall make all payments of
interest on and principal of the Seasonal Note to the Lender at its
office shown on the first page hereof (or to such other locations as
may from time to time be specified by the Lender).
2.7. Termination. The obligation of the Lender to make Advances
shall terminate:
(a) Upon receipt by the Lender of three (3) days' written notice
of termination from the Borrower given at any time when no
amount is outstanding under the Seasonal Note;
(b) Immediately and without further action upon the occurrence of
an Event of Default of the nature referred to in Subsection
8.1(d) or
(c) Immediately when any Event of Default (other than one of the
nature specified in Subsection 8.1(d)) shall have
occurred and be continuing and either (i) the Lender shall
have demanded payment of the Seasonal Note or (ii) the Lender
shall elect to terminate such obligation by giving notice to
Borrower.
3. GENERAL PROVISIONS
3.1. Computation of Interest.
(a) All computations of interest on the outstanding principal
amount of each Subject Note shall be computed on the basis of
a year comprised of 360 days. Each change in the interest
rate payable on each Subject Note due to a change in the
Reference Rate shall take place simultaneously with the
corresponding change in the Reference Rate. Whenever any
payment to be made by or to the Lender or other holder(s) of
any Subject Note shall otherwise be due on a day which is not
a Business Day, such payment shall be made on the next
succeeding Business Day, and such extension of time shall be
included in computing the fees or interest payable on such
next succeeding Business Day.
(b) No provision of this Credit Agreement or any Subject Note
shall require the payment or permit the collection of interest
in excess of the rate permitted by applicable law.
3.2. Default Rate; Late Payment. Notwithstanding anything to the
contrary herein, upon the occurrence and during the continuation of
an Event of Default, the Borrower shall pay interest on the
outstanding principal amount of each of the Subject Notes at a rate
per annum equal to the greater of (i) two percent (2%) in excess of
the rate applicable to the unpaid principal amount of each such
Subject Note immediately before the occurrence of such Event of
Default or (ii) two percent (2%) in excess of the Reference Rate in
effect from time to time. In addition, the Borrower shall be
obligated to pay $25.00 with respect to any installment on any
Subject Note paid after the date it is due, to compensate Lender for
the administrative expenses associated with such past-due payments,
subject to the maximum allowable late payment under North Dakota
law.
3.3. Security. The indebtedness, liabilities and other obligations
of the Borrower to the Lender under each Subject Note and this
Credit Agreement are secured by, inter alia, security interests
granted pursuant to all security interests, liens and mortgages
heretofore or hereafter granted by the Borrower to the Lender as
security for the obligations to the Lender.
3.4 Manner of Payments. Any other provision of this Credit Agreement
to the contrary notwithstanding, the Borrower shall make all
payments of interest on and principal of the Subject Notes to the
Lender at its office shown on the first page hereof.
3.5 Increased Costs. If any Regulatory Change or other change in any
existing law, rule or regulation or in the interpretation or
administration thereof by any governmental authority, central bank
or comparable agency shall subject the Lender or one or more of its
sources of financing to increased costs, the Borrower shall pay to
the Lender within fifteen (15) days of demand therefor, Borrower's
pro rata share (based on the amount of all loans outstanding from
the Lender) of any such amount required to compensate the Lender or
such other Persons for such costs.
3.6. Collateral Allocation. To the extent the Lender receives
proceeds of any Collateral after the exercise of remedies provided
for in Section 8.2: (a) proceeds of accounts and inventory shall
be applied first to any obligations of the Borrower relating to or
arising under the Seasonal Note and Loan, and then to all the other
obligations to the Lender under the Loan Documents; (b) proceeds of
all other Collateral shall be applied first to all the obligations
of the Borrower to the Lender under the Loan Documents, other than
those relating to or arising under the Seasonal Note and Loan , and
then to all other obligations to the Lender under the Loan
Documents, pro rata in accordance with the respective principal
amounts thereof.
3.7. Loan Agreement Reference. Any reference in any Subject Note to
any Loan Agreement or Credit Agreement shall be deemed to be a
reference to this Credit Agreement, as it may from time to time be
amended, modified or restated. Any conflict between the terms of any
Subject Note, and the terms of this Credit Agreement shall be
resolved in favor of the terms of this Credit Agreement.
4. CONDITIONS OF LENDING
4.1. Conditions Precedent. This Credit Agreement and the Lender's
obligations hereunder are subject to receipt, on or prior to the
date hereof, by the Lender of the following, each to be in form and
substance satisfactory to the Lender, unless the Lender waives
receipt of any of the following in writing:
(a) This Credit Agreement and the Subject Notes each appropriately
completed and duly executed by the Borrower;
(b) The Security Agreement and corresponding financing
statement(s) appropriately completed and duly executed by the
Borrower;
(c) The Guaranty of any Person, as required by the Lender,
appropriately completed and duly executed by the Guarantor.
(d) A current UCC financing statement search, federal and state
tax lien search, judgment and bankruptcy search, reflecting
results satisfactory to the Lender, on the Borrower from the
appropriate filing offices as required by the Lender;
(e) A Certificate of Good Standing for the Borrower issued by the
Secretary of State in all states where the Borrower is
qualified to do business;
(f) A copy of the Borrower's Bylaws, together with all amendments,
certified by the Secretary of the Borrower to be a true and
correct copy thereof;
(g) A copy of the Articles of Incorporation of the Borrower,
together with all amendments, certified by the Secretary of
State of the state of the Borrower's incorporation to be a
true and correct copy thereof;
(h) A certified copy of the resolutions of the Board of Directors
of the Borrower authorizing or ratifying the transactions
contemplated hereby, and the execution, delivery and
performance of the Loan Documents, and designating the
officers authorized to execute the Loan Documents to which the
Borrower is a party and to perform the obligations of the
Borrower thereunder;
(i) A certificate of the Secretary of the Borrower certifying the
names of the officers authorized to execute the Loan
Documents, together with a sample of the true signature of
each such officer;
(j) A favorable opinion of counsel for the Borrower, satisfactory
to the Lender, as to the matters set forth in Subsections 5.1,
5.2, 5.3, 5.5, 5.7 and 5.9 (delivered not later than March 31,
1998), and other matters as requested by the Lender,
satisfactory to the Lender and its counsel;
(k) Policies or certificates of insurance evidencing insurance
coverage required under this Credit Agreement and any other of
the Loan Documents;
(l) A completed Borrowing Base Certificate each dated as of the
most recent month end.
(m) Such other documents, information and actions as the Lender
may reasonably request.
4.2. Conditions Precedent to all Loans and Advances. The obligation
of the Lender to make any Advance hereunder, including the initial
Advance, is subject to the satisfaction of each of the following,
unless waived in writing by the Lender:
(a) The representations and warranties set forth in Section 5 are
true and correct in all material respects on the date hereof
and on the date of any Advance (as if made on the date of such
Advance, except to the extent that such representations and
warranties expressly relate solely to an earlier date).
(b) No Default or Event of Default shall have occurred and be
continuing.
(c) No litigation, arbitration or governmental investigation or
proceeding shall be pending, or, to the knowledge of the
Borrower, threatened, against the Borrower or affecting the
business or operations of the Borrower which was not
previously disclosed to the Lender and which, if determined
adversely to the Borrower, would have a material adverse
effect on the operation or financial condition of the
Borrower.
(d) No Default or Event of Default shall result from the making of
any Advance.
(e) No Material Adverse Occurrence shall have occurred and be
continuing.
(f) Each request for an Advance and each acceptance of the
proceeds of such request by the Borrower shall constitute a
representation and warranty by the Borrower that on the date
of acceptance of such proceeds (both immediately before and
after giving effect to such acceptance) the statements made in
Section 5 are true and correct with the same effect as if then
made, except to the extent such statements expressly relate
solely to an earlier date.
5. REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Lender as follows:
5.1. Organization, etc. The Borrower is a corporation validly
organized and existing and in good standing under the laws of the
State of Minnesota, has full power and authority to own its property
and conduct its business substantially as presently conducted by it
and is duly qualified and licensed to do business and is in good
standing as a foreign corporation in each other jurisdiction where
the nature of its business makes such qualification or licensing
necessary. The Borrower has full power and authority to enter into
and perform its obligations under the Loan Documents and to obtain
the Loans and Advances hereunder.
5.2. Due Authorization. The execution, delivery and performance by
the Borrower of the Loan Documents have been duly authorized by all
necessary corporate action, do not require any approval or consent
of, or any registration, qualification or filing with, any
governmental agency or authority or any approval or consent of any
other Person (including, without limitation, any stockholder, do not
and will not conflict with, result in any violation of or constitute
any default under, any provision of the Borrower's Articles of
Incorporation or Bylaws, any agreement binding on or applicable to
the Borrower or any of its property, or any law or governmental
regulation or court decree or order, binding upon or applicable to
the Borrower or of any of its property and will not result in the
creation or imposition of any Lien on any of its property pursuant
to the provisions of any agreement binding on or applicable to the
Borrower or any of its property except pursuant to the Loan
Documents.
5.3. Validity of the Loan Documents. The Loan Documents to which the
Borrower is a party are the legal, valid and binding obligations of
the Borrower and are enforceable in accordance with their terms,
subject only to bankruptcy, insolvency, reorganization, moratorium
or similar laws, rulings or decisions at the time in effect
affecting the enforceability of rights of creditors generally and to
general equitable principles which may limit the right to obtain
equitable remedies.
5.4. Financial Information. The financial statements of the Borrower
furnished to the Lender have been and will be prepared in accordance
with GAAP consistently applied by the Borrower and present fairly
the financial condition of the Borrower as of the dates thereof and
for the periods covered thereby. The Borrower is not aware of any
contingent liabilities or obligations which would, upon becoming
non-contingent liabilities or obligations, be a Material Adverse
Occurrence. Since the date of the most recent such statements,
neither the condition (financial or otherwise), the business nor the
properties of the Borrower have been materially and adversely
affected in any way.
5.5. Litigation, Other Proceedings. Except as previously disclosed
to and approved of in writing by the Lender, there is no action,
suit or proceeding at law or equity, or before or by any
governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, pending or, to the knowledge
of the Borrower, threatened, against the Borrower or any of its
property, which is reasonably likely to result in a Material Adverse
Occurrence; and the Borrower is not in default with respect to any
final judgment, writ, injunction, decree, rule or regulation of any
court or governmental department, commission, board, bureau, agency
or instrumentality, domestic or foreign, where such default would be
a Material Adverse Occurrence.
5.6. Title to Assets. Except for Liens permitted by Section 7.2, the
Borrower has good and marketable title to all of its assets, real
and personal.
5.7. Lien Priority. The Liens created by the Security Agreement are
attached and first, perfected Liens on the Collateral.
5.8. Guarantees and Indebtedness. Except as disclosed on financial
statements of the Borrower furnished to the Lender, the Borrower is
not a party to any material contract of guaranty or suretyship and
none of its assets is subject to any contract of that nature and the
Borrower is not indebted to any other party, except the Lender.
5.9. Margin Stock. No part of any Loan or Advance hereunder shall be
used at any time by the Borrower to purchase or carry margin stock
(within the meaning of Regulation G, T, U or X promulgated by the
Board of Governors of the Federal Reserve System) or to extend
credit to others for the purpose of purchasing or carrying any
margin stock. The Borrower is not engaged principally, or as one of
its important activities, in the business of extending credit for
the purposes of purchasing or carrying any such margin stock. No
part of the proceeds of any Loan or Advance hereunder will be used
by the Borrower for any purpose which violates, or which is
inconsistent with, any regulations promulgated by the Board of
Governors of the Federal Reserve System.
5.10. Taxes. The Borrower has filed all federal, state and other
income tax returns which are required to be filed through the date
of this Credit Agreement and has paid all taxes as shown on said
returns, and all taxes due or payable without returns and all
assessments received to the extent such taxes and assessments have
become due. All tax liabilities of the Borrower are adequately
provided for on its books, including interest and penalties. No
income tax liability of a material
nature has been asserted by taxing authorities for taxes in excess
of those already paid. The Borrower has made all required
withholding deposits.
5.11. Accuracy of Information. All factual information furnished by
or on behalf of the Borrower to the Lender for purposes of or in
connection with this Credit Agreement or any transaction
contemplated by this Credit Agreement is, and all other such factual
information furnished by or on behalf of the Borrower to the Lender
in the future, will be true and accurate in every material respect
on the date as of which such information is dated or certified. No
such information contains any material misstatement of fact or omits
any material fact or any fact necessary to prevent such information
from being misleading.
5.12. Material Agreements. The Borrower is not a party to any
agreement or instrument or subject to any restriction that
materially and adversely affects its business, property or assets,
operations or condition (financial or otherwise).
5.13. Defaults. The Borrower is not in default in the performance,
observance or fulfillment of any of the obligations, covenants or
conditions contained in any: (a) agreement to which such entity is a
party, which default might have a material adverse effect on the
business, properties or assets, operations, or condition (financial
or otherwise) of the Borrower; or (b) instrument evidencing any
indebtedness or under any agreement relating to such indebtedness.
5.14. ERISA. (a) No Reportable Event has occurred and is continuing
with respect to any Plan; (b) the Pension Benefit Guaranty
Corporation or any successor entity has not instituted proceedings
to terminate any Plan; and (c) each Plan of the Borrower has been
maintained and funded in all material respects in accordance with
its terms and with ERISA. All undefined capitalized terms used in
this Section shall have the meanings ascribed to them in ERISA.
5.15. Financial Status. The Borrower is not insolvent (as such term
is defined in Section 101(32) of the United States Bankruptcy Code
of 1978, as amended or Minnesota Statutes Section 513.42, as
amended) and will not be rendered insolvent (as such term is defined
in Section 101(32) of the United States Bankruptcy Code of 1978, as
amended or Minnesota Statutes Section 513.42, as amended) by
execution of this Credit Agreement or any other of the Loan
Documents, or consummation of the transactions contemplated thereby.
5.16. Survival of Representations. All representations and
warranties contained in this Section 5 shall survive the delivery of
the Notes and the making of the Loans and Advances evidenced thereby
and any investigation at any time made by or on behalf of Lender
shall not diminish its rights to rely thereon.
5.17. Environmental Matters.
(a) Definitions. As used in this Credit Agreement, the following
terms shall have the following meanings:
(i) "Environmental Law" means any federal, state, local or
other governmental statute, regulation, law or ordinance
dealing with the protection of human health and the
environment.
(ii) "Hazardous Substances" means pollutants, contaminants,
hazardous substances, hazardous wastes, petroleum and
fractions thereof, and all other chemicals, wastes,
substances and materials listed in, regulated by or
identified in any Environmental Law.
(iii) "Premises" means all premises where the Borrower
conducts its business and has any rights of possession.
(b) To the Borrower's best knowledge, there are not present in, on
or under the Premises any Hazardous Substances in such form or
quantity as to create any liability or obligation for either
the Borrower or the Lender under common law of any
jurisdiction or under any Environmental Law, and no Hazardous
Substances have ever been stored, buried, spilled, leaked,
discharged, emitted or released in, on or under the Premises
in such a way as to create any such liability.
(c) There are not and there never have been any requests, claims,
notices, investigations, demands, administrative proceedings,
hearings or litigation, relating in any way to the Premises or
the Borrower, alleging liability under, violation of, or
noncompliance with any Environmental Law or any license,
permit or other authorization issued pursuant thereto. To the
Borrower's best knowledge, no such matter is threatened or
impending.
(d) To the Borrower's best knowledge, the Premises are not and
never have been listed on the National Priorities List, the
Comprehensive Environmental Response, Compensation and
Liability Information System or any similar federal, state or
local list, schedule, log, inventory or database.
5.18. Subsidiaries. The Borrower has the Subsidiaries listed on the
financial statements previously delivered to the Lender.
6. AFFIRMATIVE COVENANTS
As long as there remains any amount outstanding under the Subject
Notes or the Lender has any obligation to make Advances under the Seasonal
Commitment, the Borrower shall, unless waived in writing by the Lender:
6.1. Financial Statements and Reports. Furnish to the Lender, at the
times set forth below, the following financial statements, reports
and information:
(a) As soon as available, but in any event within one hundred
twenty five (125) days after each fiscal year end, annual
audited financial statements of the Borrower, and Subsidiaries
prepared on a consolidated basis, certified by certified
public accountants satisfactory to the Lender to have been
prepared in accordance with GAAP consistently applied;
(a) As soon as available, but in any event within thirty (30) days
after the last day of each monthly fiscal period unaudited
financial statements of the Borrower consisting of a balance
sheet and the related statements of income, retained earnings
and cash flows prepared on a consolidated basis dated as of
the last Business Day of such quarterly fiscal period in form
and detail as reasonably required by the Lender certified by
the chief financial officer of the Borrower to have been
prepared from the records of the Borrower on the basis of
accounting principles consistently applied by the Borrower;
(c) As soon as available, but in any event within ninety (90) days
following each fiscal year-end, an operating budget and cash
flow forecast for the fiscal year immediately following such
fiscal year-end.
(d) Promptly upon obtaining knowledge thereof, notice of the
occurrence of any Default or Event of Default and of the
violation by the Borrower of any law, rule or regulation, the
non-compliance with which could be reasonably expected to be a
Material Adverse Occurrence;
(e) To the extent applicable, promptly after the sending or filing
thereof, copies of all regular and periodic financial reports
which the Borrower shall file with the U.S. Securities and
Exchange Commission, or any national securities exchange;
(f) As soon as available, but in any event within thirty (30) days
after the last day of each monthly fiscal period, a Borrowing
Base certificate.
(g) Such other information concerning the business, operations and
condition (financial or otherwise) of the Borrower as the
Lender may reasonably request.
6.2. Maintenance of Corporate Existence. Maintain and preserve its
corporate existence.
6.3. Taxes. Pay and discharge as the same shall become due and
payable, all taxes, assessments and other governmental charges and
levies against or on any of its property, as well as claims of any
kind which, if unpaid, might become a Lien upon any of its
properties, unless such tax, levy, charge assessment or Lien is
being contested in good faith by the Borrower and is supported by an
adequate book reserve. The Borrower shall make all required
withholding deposits.
6.4. Notices. As soon as practicable, give notice to the Lender of:
(a) The commencement of any litigation relating to the Borrower
which might reasonably result in a Material Adverse Occurrence
or relating to the transactions contemplated by this Credit
Agreement;
(b) The commencement of any material arbitration or governmental
proceeding or investigation not previously disclosed to the
Lender which has been instituted or, to the knowledge of the
Borrower, is threatened against the Borrower or its property
which might reasonably result in a Material Adverse
Occurrence;
(c) Any Reportable Event or "prohibited transaction" or the
imposition of a Withdrawal Liability, within the meaning of
ERISA, in connection with any Plan and, when known, any action
taken by the Internal Revenue Service, Department of Labor or
Pension Benefit Guaranty Corporation with respect thereto, and
any adverse development which occurs in any litigation,
arbitration or governmental investigation or proceeding
previously disclosed to the Lender which if determined
adversely to the Borrower would constitute a Material Adverse
Occurrence; and
(d) Any Default or Event of Default under this Credit Agreement.
6.5. Compliance with Laws. Carry on its business activities in
substantial compliance with all applicable federal or state laws and
all applicable rules, regulations and orders of all governmental
bodies and offices having power to regulate or supervise its
business activities. The Borrower
shall maintain all material rights, liens, franchises, permits,
certificates of compliance or grants of authority required in the
conduct of its business. Without limiting the foregoing
undertakings, the Borrower specifically agrees that it will comply
with all applicable Environmental Laws and obtain and comply with
all permits, licenses and similar approvals required by any
Environmental laws, and will not generate, use, transport, treat,
store or dispose of any Hazardous Substances in such a manner as to
create any liability or obligation under the common law of any
jurisdiction or any Environmental Law.
6.6. Books and Records. Keep books and records reflecting all of its
business affairs and transactions in accordance with GAAP
consistently applied and permit the Lender, and its representatives,
at reasonable times and intervals, to visit all of its offices,
discuss its financial matters with officers of the Borrower and its
independent public accountants (and by this provision the Borrower
authorizes its independent public accountants to participate in such
discussions) and examine any of its books and other corporate
records.
6.7. Insurance. Procure and maintain insurance with financially
sound and reputable insurers, insurance with respect to the
Collateral and its other property against damage and loss by theft,
fire, collision (in the case of motor vehicles) and such other risks
as are required by the Lender in an amount equal to the fair market
value thereof and, in any event, in an amount sufficient to avoid
the application of any coinsurance provisions and naming the Lender
loss payee. The Borrower shall also procure and maintain other such
insurance including workers compensation insurance, liability and
business interruption insurance, and other insurance as the Lender
may require and/or that may be required under any of the Loan
Documents, all in such amounts as may be required by the Lender.
Policies of all such insurance shall contain an agreement by the
insurer to provide the Lender thirty (30) days prior written notice
of cancellation and an agreement that the Lender's interest shall
not be impaired or invalidated by any act or neglect of the Borrower
nor by the occupation of properties owned or leased by the Borrower
or other properties wherein the Collateral is located for purposes
more hazardous than those permitted by such policies. The Borrower
shall provide evidence of such insurance and the policies of
insurance or copies thereof to the Lender upon request.
6.8. Maintain Property. Maintain and keep its assets, property and
equipment in good repair, working order and condition and from time
to time make or cause to be made all needed renewals, replacements
and repairs.
6.9. Conduct of Business. Continue to engage primarily in the
business being conducted on the date of this Credit Agreement.
6.10. Net Working Capital. Maintain as of the end of each calendar
month Net Working Capital of not less than $1,400,000.
6.11. Equity to Asset Ratio. Maintain as of each calendar month an
Equity to Asset Ratio of not less than .30:1.0. In the event the
Equity to Asset Ratio falls below .30:1.0, the applicable interest
rate to the subject note shall increase to a variable rate of
Reference Rate. Upon the curing of the default, the interest rate on
the subject note shall revert to the initially agreed upon interest
rate effective on the date which the default is cured. It is further
agreed that at no time shall the Equity to Asset Ratio fall below
.20:1.0.
6.12. Further Assurances. The Borrower agrees upon reasonable
request by the Lender to execute and deliver such further
instruments, deeds and assurances, including financing statements
under the Uniform Commercial Code of Minnesota and/or any other
relevant states, and to do such further acts as may be necessary or
proper to carry out more effectively the purposes of this Credit
Agreement and the Loan Documents and, without limiting the
foregoing, to make subject to the liens and security interests of
the Security Agreement and any other of the Loan Documents any
property agreed to be subjected, or intended to be subject, or
covered by the granting clauses of the Security Agreement or such
other of the Loan Documents.
6.13 ERISA Compliance. Comply in all material respects at all times
with all applicable provisions of ERISA and the regulations and
published interpretations thereunder.
7. NEGATIVE COVENANTS
As long as there remains any amount outstanding under the Subject
Notes or the Lender has any obligation to make Advances under the Seasonal Loan
Commitment, the Borrower shall not, unless waived in writing by the Lender:
7.1. Consolidation; Merger; Sale of Assets; Acquisitions.
Consolidate with or merge into or with any other entity; or sell
(other than sales of inventory in the ordinary course of business),
transfer, lease or otherwise dispose of all or a substantial part of
its assets; or acquire a substantial interest in another Person
either through the purchase of all or substantially all of the
assets of that Person or the purchase of a controlling equity
interest in that Person.
7.2. Liens. Create, incur, assume or suffer to exist any Lien or any
of its property, real or personal, except (a) Liens in favor of the
Lender; (b) Liens disclosed to and approved of in writing by the
Lender; (c) Liens for current taxes and assessments which are not
yet due and payable; and (d) purchase money security interests to
secure the indebtedness permitted under Section 7.3 below.
7.3. Additional Indebtedness. Create, incur, assume or suffer to
exist any indebtedness except: (a) indebtedness in favor of the
Lender; (b) current liabilities incurred in the ordinary course of
business; (c) indebtedness existing on the date of this Credit
Agreement and disclosed to and approved of in writing by the Lender;
and (d) purchase money indebtedness incurred in connection with the
acquisition of fixed assets not to exceed $500,000 in the aggregate
during any fiscal year of the Borrower.
7.4. Guaranties. Assume, guarantee, endorse or otherwise become
liable in connection with the indebtedness of any other person or
entity except endorsements of negotiable instruments for deposit or
collection in the ordinary course of business.
7.5. Change in Ownership or Business. Permit a material change in
(a) the ownership or management of the Borrower as in effect on the
date of this Credit Agreement, or (b) the line of business presently
engaged in by the Borrower.
7.6. Dividends. Declare or pay any dividends, purchase, redeem,
retire or otherwise acquire for value any of its capital stock now
or hereafter outstanding, return any capital to its stockholders as
such, or make any distribution of assets to its stockholders as
such, at any time any Default or Event of Default has occurred and
is continuing.
7.7. Investments; Subsidiaries. The Borrower will not purchase or
hold beneficially any stock or other securities or evidences of
indebtedness of, make or permit to exist any loans or advances to,
or create or acquire any Subsidiary or make any investment or
acquire any interest whatsoever in, any other Person, except:
(a) Investments in direct obligations of the United States of
America or any agency or instrumentality thereof whose
obligations constitute the full faith and credit obligations
of the United States of America having a maturity of one (1)
year or less, commercial paper issued by a U.S. corporation
rated "A-1" or "A-2" by Standard & Poor's Ratings Services or
"P-1" or "P-2" by Xxxxx'x Investors Service, investments in
money market mutual funds whose underlying assets are
exclusively investments which would otherwise be permitted
investments under this Section 7.6(a), or repurchase
agreements, certificates of deposit or bankers' acceptances
having a maturity of one (1) year or less issued by members of
the Federal Reserve System having deposits in excess of
$500,000,000 (which certificates of deposit or bankers'
acceptances are fully insured by the Federal Deposit Insurance
Corporation);
(b) Travel advances or loans to officers and employees of the
Borrower (not including contracts made in the ordinary course
of business with any such officers or employees) not exceeding
at any one time an aggregate of $25,000;
(c) Advances in the form of progress payments, prepaid rent or
security deposits;
(d) Existing investments as described in the financial statements
previously delivered to the Lender;
(e) Investments constituting transactions made in the ordinary
course of business of the Borrower;
(f) Investments in wholly-owned subsidiaries of the Borrower
existing as of the date hereof; and
(g) Investments not otherwise permitted in this Section 7.7 not to
exceed $5,000,000 in the aggregate (on a book value basis) at
any time outstanding.
8. EVENTS OF DEFAULT AND REMEDIES
8.1. Events of Default. The term "Event of Default" shall mean any
of the following events:
(a) The Borrower shall default in the payment when due, or if
payable on demand, upon demand, of any principal or interest
on any of the Subject Notes; or
(b) The Borrower shall default (other than a default in payment
under subsection (a) above) in the due performance and
observance of any of the covenants contained in any of the
Loan Documents and such default shall continue unremedied for
a period of thirty (30) days after notice from the Lender to
the Borrower thereof; or
(c) An event has occurred which would, at such time or with the
passage of time, constitute an "event of default" (however
legally styled) under any other loan obligation, lease, bond,
debenture, security agreement, note, or instrument or
agreement evidencing Debt and any applicable grace period
specified in such agreement or evidence of Debt has expired;
or
(d) The Borrower shall become insolvent or generally fail to pay
or admit in writing its inability to pay its debts as they
become due; or the Borrower shall apply for, consent to, or
acquiesce in the appointment of a trustee, receiver or other
custodian for itself or any of its property, or make a general
assignment for the benefit of its creditors; or trustee,
receiver or other custodian shall otherwise be appointed for
the Borrower or any of its assets; or any
bankruptcy, reorganization, debt arrangement, or other case or
proceeding under any bankruptcy or insolvency law, or any
dissolution or liquidation proceeding shall be commenced by or
against the Borrower; or the Borrower shall take any action to
authorize, or in furtherance of, any of the foregoing; or
(e) Any representation or warranty set forth in this Credit
Agreement or any other Loan Document shall be untrue in any
material respect on the date as of which the facts set forth
are stated or certified; or
(f) The occurrence of any Material Adverse Occurrence; or
(g) A Reportable Event (as defined under ERISA) shall have
occurred; or
(h) The rendering against the Borrower of a final judgment, decree
or order for the payment of money in excess of $250,000
(unless the payment of such judgment in the amount of such
excess is insured), and the continuance of such judgment,
decree or order unsatisfied for any 30 consecutive day period
without a stay of execution.
(i) The occurrence of a Change of Control; or
(j) The Lender shall in good xxxxx xxxx itself insecure.
8.2. Remedies; Cumulative. If an Event of Default described in
Section 8.1(d) shall occur, the full unpaid balance of each of the
Subject Notes (outstanding balance plus accrued interest) and all
other obligations of the Borrower to the Lender shall automatically
be due and payable without declaration, notice, presentment, protest
or demand of any kind (all of which are hereby expressly waived) and
the obligation of the Lender to make additional Advances shall
automatically terminate. If any other Event of Default shall occur
and be continuing, the Lender may terminate its obligation to make
additional Advances and may declare the outstanding balance of the
each of the Subject Notes and all other obligations of the Borrower
to the Lender to be due and payable without further notice,
presentment, protest or demand of any kind (all of which are hereby
expressly waived), whereupon the full unpaid amount of each of the
Subject Notes and all other obligations of the Borrower to the
Lender shall become immediately due and payable. Upon any Event of
Default, the Lender shall be entitled to exercise any and all rights
and remedies available under any of the Loan Documents or otherwise
available at law or in equity to collect the Subject Notes and all
other obligations of the Borrower to the Lender, to realize upon or
otherwise pursue any and all Collateral and other security
(including without limitation any and all guarantees) for the loans
under this Credit Agreement and to, without notice to the Borrower,
and without further action, apply any and all monies owing by Lender
to the Borrower to the payment of the Subject Notes, and all other
obligations of the Borrower hereunder, in such order as the Lender
elects (subject to Section 3.6).
9. MISCELLANEOUS
9.1. Waivers, Amendments. The provisions of the Loan Documents may
from time to time be amended, modified, or waived, if such
amendment, modification or waiver is in writing and signed by the
Lender. No failure or delay on the part of the Lender or the
holder(s) of the Subject Notes
in exercising any power or right under any of the Loan Documents
shall operate as a waiver thereof, nor shall any single or partial
exercise of any such power or right preclude any other or further
exercise thereof or the exercise of any other power or right. No
notice to or demand on the Borrower in any case shall entitle it to
any notice or demand in similar or other circumstances.
9.2. Notices. All communications and notices provided under this
Credit Agreement shall be in writing and addressed or delivered to
the Borrower or the Lender at their respective addresses shown on
the first page hereof, or to any party at such other address as may
be designated by such party in a written notice to the other
parties. Such notices shall be delivered by any of the following
means: (i) mailing through the United States Postal Service, postage
prepaid, by registered or certified mail, return receipt requested;
(ii) delivery by reputable overnight delivery service including
without limitation, and by way of example only: Federal Express,
DHL, Airborne Express and Express Mail; or (iii) delivery by
reputable private personal delivery service. Notices delivered in
accordance with (i) above shall be deemed delivered the second
Business Day after deposit in the mail; notices delivered in
accordance with (ii) above shall be deemed delivered the first
Business Day after delivery to the delivery service; and notices
delivered in accordance with (iii) above shall be deemed delivered
the same Business Day as that specified by the notifying party to
the delivery service.
9.3. Costs and Expenses. The Borrower agrees to pay all expenses for
the preparation of this Credit Agreement, including exhibits, and
any amendments to this Credit Agreement as may from time to time
hereafter be required, and the reasonable attorneys fees and legal
expenses of counsel for the Lender, from time to time incurred in
connection with the preparation and execution of this Credit
Agreement and any document relevant to this Credit Agreement, any
amendments hereto or thereto, and the consideration of legal
questions relevant hereto and thereto. The Borrower agrees to
reimburse Lender upon demand for, all out-of-pocket expenses
(including reasonable attorneys fees and legal expenses) in
connection with the Lender's enforcement of the obligations of the
Borrower hereunder or under the Note or any other of the Loan
Documents, whether or not suit is commenced including, without
limitation, attorneys fees, and legal expenses in connection with
any appeal of a lower court's order or judgment. The obligations of
the Borrower under this Section 9.3 shall survive any termination of
this Credit Agreement.
9.4. Interest Limitation. All agreements between the Borrower and
the Lender are hereby expressly limited so that in no contingency or
event whatsoever, whether by reason of acceleration of maturity of
the indebtedness evidenced or secured thereby or otherwise, shall
the rate of interest charged or agreed to be paid to the Lender for
the use, forbearance, loaning or detention of such indebtedness
exceed the maximum permissible interest rate under applicable law
("Maximum Rate"). If for any reason or in any circumstance
whatsoever fulfillment of any provision of this Credit Agreement
and/or the Subject Notes, any document securing or executed in
connection herewith or therewith, or any other agreement between the
Borrower and the Lender, at any time shall require or permit the
interest rate applied thereunder to exceed the Maximum Rate, then
the interest rate shall automatically be reduced to the Maximum
Rate, and if the Lender should ever receive interest at a rate that
would exceed the Maximum Rate, the amount of interest received which
would be in excess of the amount receivable after applying the
Maximum Rate to the balance of the outstanding obligation shall be
applied to the reduction of the principal balance of the outstanding
obligation for which the amount was paid and not to the payment of
interest thereunder. This provision shall control every other
provision of any and all agreements between the Borrower and the
Lender and shall also be binding upon and applicable to any
subsequent holder of any of the Subject Notes.
9.5. Severability. Any provision of this Credit Agreement or any
other of the Loan Documents executed pursuant hereto which is
prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such portion or
unenforceability without invalidating the remaining provisions of
this Credit Agreement or such Loan Document or affecting the
validity or enforceability of such provisions in any other
jurisdiction.
9.6. Cross-References. References in this Credit Agreement or in any
other of the Loan Documents executed pursuant hereto to any Section
are, unless otherwise specified, to such Section of this Credit
Agreement or such Loan Document, as the case may be.
9.7. Headings. The various headings of this Credit Agreement or of
any other of the Loan Documents executed pursuant hereto are
inserted for convenience only and shall not affect the meaning or
interpretation of this Credit Agreement or such Loan Document or any
provisions hereof or thereof.
9.8. Governing Law; Venue; Waiver of Jury Trial. Each of the Loan
Documents shall be deemed to be a contract made under and governed
by the laws of the State of North Dakota (without regard to the laws
of conflict of any jurisdiction) as to all matters, including
without limitation, matters of validity, interpretation,
construction, effect, performance and remedies. The Borrower hereby
consents to the personal jurisdiction of the state and federal
courts located in the State of North Dakota in connection with any
controversy related to this Credit Agreement and any other of the
Loan Documents, waives any argument that venue in such forums is not
convenient and agrees that any litigation instigated by the Borrower
against the Lender in connection herewith or therewith shall be
venued in the federal or state court that has jurisdiction over
matters arising in Fargo, North Dakota. THE BORROWER AND LENDER
IRREVOCABLY WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO ANY LOAN
DOCUMENT OR ANY INSTRUMENT OR DOCUMENT DELIVERED THEREUNDER.
9.9. Successors and Assigns. This Credit Agreement shall be binding
upon and shall inure to the benefit of the parities hereto and their
respective successors and assigns, except that Borrower may not
assign or transfer its rights hereunder without the prior written
consent of Lender.
9.10. Recitals Incorporated. The recitals to this Credit Agreement
are incorporated into and constitute an integral part of this Credit
Agreement.
9.11. Multiple Counterparts. This Credit Agreement may be executed
in one or more counterparts and by the different parties on separate
counterparts, each of which shall be deemed to be an original and
all of which shall constitute one and the same instrument.
9.12. Indemnity. In addition to the payment of expenses pursuant to
Section 9.3, the Borrower agrees to indemnify, defend and hold
harmless the Lender, and any of its participants, assignees, parent
corporations, subsidiary corporations, affiliated corporations and
successor corporations, and all present and future officers,
directors, employees, attorneys and agents of the foregoing (the
"Indemnitees"), from and against any of the following (collectively,
"Indemnified Liabilities"):
(a) any and all transfer taxes, documentary taxes, assessments or
charges made by any governmental authority by reason of the
execution and delivery of the Loan Documents or the making of
the Advances or the Loans;
(b) any claims, loss or damage to which any Indemnitee may be
subjected if any representation or warranty contained in this
Agreement proves to be incorrect in any respect or as a result
of any violation of the covenant contained in this Agreement;
and
(c) any and all other liabilities, losses, damages, penalties,
judgments, suits, claims, costs and expenses of any kind or
nature whatsoever (including, without limitation, the
reasonable fees and disbursements of counsel) in connection
with the foregoing and any other investigative, administrative
or judicial proceedings, whether or not such Indemnitee shall
be designated a party thereto, which may be imposed on,
incurred by or asserted against any such Indemnitee, in any
manner related to or arising out of or in connection with the
making of the Advances or the Loans and the Loan Documents or
the use or intended use of the proceeds of the Advances or the
Loans.
If any investigative, judicial or administrative proceeding arising
from any of the foregoing is brought against any Indemnitee, upon
such Indemnitee's request, the Borrower, or counsel designated by
the Borrower and satisfactory to the Indemnitee, will resist and
defend such action, suit or proceeding to the extent and in the
manner directed by the Indemnitee, at the Borrower's sole costs and
expense. Each Indemnitee will use its best efforts to cooperate in
the defense of any such action, suit or proceeding. If the foregoing
undertaking to indemnify, defend and hold harmless may be held to be
unenforceable because it violates any law or public policy, the
Borrower shall nevertheless make the maximum contribution to the
payment and satisfaction of each of the Indemnified Liabilities
which is permissible under applicable law. The Borrower's obligation
under this Section 9.129.129.1218.12 shall survive the termination
of this Credit Agreement and the discharge of the Borrower's other
obligations hereunder.
9.13. Prior Agreement Superseded; Complete Agreement. This Credit
Agreement amends, restates, and supersedes the Prior Agreement in
its entirety and all obligations, liabilities and indebtedness of
the Borrower incurred or arising thereunder shall be deemed to have
been incurred and arising hereunder. Furthermore, this Credit
Agreement, together with the Loan Documents, comprises the complete
and integrated agreement of the parties on the subject matter hereof
and supersedes all prior agreements, written or oral, on the subject
matter hereof.
9.14. Assignments; Participants; Waiver of Claims. The Lender may
sell, assign or grant a participation in the Subject Notes, in whole
or in part and may disclose information relating to the Borrower or
otherwise relevant to this Agreement, to such Persons and their
financing sources ("Assignees"). No Assignee shall be deemed a
partner or agent of the Lender. The Borrower irrevocably agrees that
any claims it may have or may assert against the Lender for breach
of contract (or related tort claims) shall be personal to the Lender
and shall not be asserted by way of direct claim or offset against
any Assignee or against any Loan sold or assigned to any Assignee
and the Assignee hereby irrevocably waives any right it otherwise
may have, now or hereafter, to assert any such claim). The Borrower
acknowledges that the Assignees shall rely on the foregoing waiver
and agreement.
(REMAINDER OF PAGE INTENTIONALLY LEFT BLANK)
IN WITNESS WHEREOF, the parties hereto have caused this Credit
Agreement to be executed by their respective officers thereunto duly authorized
as of the day and year first above written.
MINNESOTA VALLEY IRRIGATION, INC.,
a Minnesota corporation
By:
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Its:
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AG CAPITAL COMPANY,
a Delaware Corporation
By:
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Its:
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