EXHIBIT 10.2(b)
March 25, 1999
Southern States Cooperative, Incorporated
0000 Xxxx Xxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxxx X. Xxxxxxx
Senior Vice President and Chief Financial Officer
Re: Consent
Gentlemen:
Reference is made to the Revolving Credit Agreement, dated as of January
12, 1999, among Southern States Cooperative, Incorporated, a Virginia
agricultural cooperative corporation (the "Company"), CoBank, ACB in its
individual capacity ("CoBank"), as Bank and in its capacity as Administrative
Agent and Documentation Agent, First Union National Bank ("First Union"), as
Bank and in its capacity as Syndication Agent, NationsBank, N.A.
("NationsBank"), as Bank and in its capacity as Syndication Agent, Nationsbanc
Xxxxxxxxxx Securities LLC, in its capacity as Lead Arranger, and FMB Bank, as
Bank, Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A., "Rabobank
Nederland", New York Branch ("Rabobank"), as Bank, Banque Nationale de Paris
(Chicago Branch), as Bank, Crestar Bank, as Bank and in its capacity as Co-
Agent, DG Bank Deutsche Genossenschaftsbank AG Cayman Islands Branch, as Bank,
and Wachovia Bank, N.A., as Bank and in its capacity as Co-Agent, as amended by
that certain First Amendment to Revolving Credit Agreement dated as of February
3, 1999 (as so amended, the "Credit Agreement"). Capitalized terms used herein
and not defined herein have the meanings ascribed thereto in the Credit
Agreement.
The Company has indicated that it will enter into (i) the Amendment No.2 to
the Bridge Loan Agreement dated as of March , 1999, by and among the
----
Company, NationsBank, N.A., as administrative agent, and First Union National
Bank and CoBank, as co-agents, substantially in the form attached hereto as
Exhibit A (the "Second Amendment"), pursuant to which, among other things, the
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maturity date of the term loan made by the lenders thereunder shall be extended
from April 7, 1999 to October 8, 1999, (ii) an amendment to the GoldKist
Commitment Letter dated March 25, 1999 by and between the Company and Gold Xxxx
Inc., substantially in the form attached hereto as Exhibit B (the "GoldKist
---------
Commitment Letter Amendment"), pursuant to which, among other things, the
obligation of GoldKist thereunder to purchase Junior Preferred Securities shall
be extended from April 2, 1999 to October 5, 1999 and the payment of the
purchase price for any Junior Preferred Securities shall be required to be made
directly to NationsBank in repayment of the outstanding principal amount under
the Bridge Loan Agreement, and (iii) a collateral assignment of rights under the
Rabobank Letter of Credit dated as of March , 1999 by the Company in favor of
--
NationsBank, N.A., as administrative agent
Southern States Cooperative, Incorporated
March 25, 1999
Page 2
the form attached hereto as Exhibit C (the "Collateral Assignment"; together
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with the Second Amendment and the GoldKist Commitment Letter Amendment referred
to herein collectively as the "Amendment Documents"), pursuant to which, among
other things, the Company's rights to draw under such letter of credit shall be
assigned, and any payments thereunder shall be directed, to NationsBank to repay
the outstanding principal amount under the Bridge Loan Agreement.
The Company hereby represents and warrants to the Administrative Agent and
the Banks that, except for the items described in the next succeeding paragraph
for which a consent has been requested, the execution, delivery and performance
of the Amendment Documents, does not, and when consummated, will not, violate
any term or provision of the Credit Agreement or create a Potential Default or
Event of Default thereunder.
The Company has requested the written consent of the Administrative Agent
and Requisite Banks to the amendment of the Bridge Loan Agreement and the
GoldKist Commitment Letter and the assignment of the Rabobank Letter of Credit
in accordance with the terms of the Amendment Documents. In reliance upon the
representations and warranties provided by the Company to the Administrative
Agent and Banks by which the Company has requested such consent, the
Administrative Agent and each of the Banks signatory hereto, constituting
Requisite Banks, hereby consents to the amendment of the Bridge Loan Agreement
and the GoldKist Commitment Letter and the assignment of the Rabobank Letter of
Credit in accordance with the terms of the Amendment Documents. The consent in
the immediately preceding sentence applies solely to the Potential Default and
Event of Default under Section 6.01 and clauses (a) and (c) of Section 6.10 of
the Credit Agreement that otherwise would result from the amendment of the
Bridge Loan Agreement and the GoldKist Commitment Letter and the assignment of
the Rabobank Letter of Credit pursuant to the Amendment Documents. The consent
provided for above shall be void ab initio and of no force and effect whatsoever
--------------
if the form and substance of the final, fully executed, Amendment Documents are
not substantially the same as the form of such documents attached hereto as
Exhibits A, B and C. Without limiting the foregoing sentence, the Administrative
-------------------
Agent and each of the Banks expressly reserves any and all rights it may have
under the Credit Agreement or any other Loan Documents arising out of or in
connection with any Potential Default or Event of Default thereunder and not
specifically waived herein.
Except as expressly modified by this consent agreement, the terms and
provisions of the Credit Agreement, are hereby ratified and confirmed and shall
continue in full force and effect. Without limiting any conditions to
effectiveness set forth above, the consent provided herein is to be effective
only upon receipt by the Administrative Agent of an execution counterpart of
this consent agreement signed by the Requisite Banks and the Company; and is
conditioned upon the correctness of all representations and warranties made by
the Company herein. This consent
Southern States Cooperative, Incorporated
March 25, 1999
Page 3
agreement shall be governed by, construed and enforced in accordance with the
laws of the Commonwealth of Virginia, without reference to the conflicts or
choice of law principles thereof.
Please evidence your acknowledgment of and agreement to the foregoing by
executing this letter below in the place indicated.
Sincerely,
COBANK, ACB, as Administrative Agent
and Bank
/s/ Xxxx X. X'Xxxxxxxx
--------------------------------
Vice President
--------------------------------
Accepted and agreed to as of
the date first written above:
FIRST UNION NATIONAL BANK,
as Bank
By: /s/ Xxxxxx XxXxxxxxx
------------------------------
Title: Vice President
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NATIONSBANK, N.A., as Bank
By: /s/ Xxxxxxx X. Xxxxxxx
------------------------------
Title: Vice President
------------------------------
Southern States Cooperative, Incorporated
March 25, 1999
Page 4
FMB BANK,
as Bank
By: /s/ Xxxxx Xxxxxxx Xxxxxxxxxxx
------------------------------------------
Title: Xxxxx Xxxxxxx Xxxxxxxxxxx, Vice President
------------------------------------------
COOPERATIEVE CENTRALE RAIFFEISEN-
BOERENLEENBANK B.A., "RABOBANK
NEDERLAND", NEW YORK BRANCH, as Bank
By: /s/ Xxxxxxx X.X. Xxxxxxxxxxx
------------------------------------------
Title: Michiel X.X. Xxxxxxxxxxx
Vice President
------------------------------------------
By: /s/ X. Xxxxxx X. Xxxxx
------------------------------------------
X. Xxxxxx X. Xxxxx
Title: Vice President
------------------------------------------
BANQUE NATIONALE de PARIS
(CHICAGO BRANCH), as Bank
By: /s/ Xxxxxx Xxxxxx du Xxxxxx
------------------------------------------
Title: Executive Vice President & General Manager
------------------------------------------
CRESTAR BANK,
as Bank
By: /s/
------------------------------------------
Title: Senior Vice President
------------------------------------------
Southern States Cooperative, Incorporated
March 25, 1999
Page 5
DG BANK DEUTSCHE GENOSSENSCHAFTSBANK
AG CAYMAN ISLANDS BRANCH, as Bank
By: /s/ Xxxx X. Xxxxxx
-----------------------------------
Xxxx X. Xxxxxx
Title: Vice President
-----------------------------------
By: /s/ Xxxxx X. Xxxxx
-----------------------------------
Title: Xxxxx X. Xxxxx, CPA
-----------------------------------
Vice President
WACHOVIA BANK, N.A.,
as Bank
By: /s/ Xxxxxxxxxxx Xxxxx
-----------------------------------
Title: Senior Vice President
-----------------------------------
SOUTHERN STATES COOPERATIVE, INCORPORATED
By: /s/ Xxxxxxxx Xxxxxxx
-----------------------------------
Title: Senior Vice President and Treasurer
-----------------------------------
EXHIBIT A
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[Bridge Loan Amendment to be attached]
EXHIBIT B
---------
[GoldKist Commitment Letter Amendment to be attached]
EXHIBIT C
---------
[Rabobank Letter of Credit Amendment to be attached]
EXHIBIT A
AMENDMENT NO 2
THIS AMENDMENT NO.2 (the "Amendment"), dated as of March l999, to
--------- --
the Credit Agreement referenced below, is by and among SOUTHERN STATES
COOPERATIVE, INCORPORATED, a Virginia agricultural cooperative corporation, the
lenders identified herein, NATIONSBANK, N.A., as Administrative Agent, and FIRST
UNION NATIONAL BANK and COBANK, ACB, as Co-Agents. Terms used but not otherwise
defined shall have the meanings provided in the Credit Agreement.
WITNESSETH
WHEREAS, a $225 million credit facility has been established in favor
of Southern States Cooperative, Incorporated, a Virginia agricultural
cooperative corporation (the "Borrower"), pursuant to the terms of that Term
--------
Loan Credit Agreement dated as of October 9, 1998 (as amended and modified, the
"Credit Agreement") among the Borrower, the Lenders identified therein,
----------------
NationsBank, N.A., as Administrative Agent, and First Union National Bank and
CoBank, ACB, as Co-Agents;
WHEREAS, the Borrower has requested certain modifications to the
Credit Agreement;
WHEREAS, such modifications require the consent of all the Lenders;
WHEREAS, the Lenders have consented to the requested modifications on
the terms and conditions set forth herein;
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties agree as follows:
1. The Credit Agreement is amended in the following respects:
1.1 In Section 1.1, the following definitions are amended or added to read
as follows:
"Applicable Percentage" means, for any day, (a) in the case of
---------------------
Eurodollar Loans, a per annum rate equal to 0.50% and (b) in the case
of Base Rate Loans, a per annum rate equal to 0.0%; provided,
--------
however, upon the occurrence of a default with respect to any
-------
financial covenant under the Michigan Livestock Credit Agreement or
the Statesman Financial Corporation Credit Agreement, the Applicable
Percentage shall be, for any day, (a) in the case of Eurodollar Loans,
a per annum rate equal to 1.00% and (b) in the case of Base Rate
Loans, a per annum rate equal to 0.0%.
"Debt Transaction" means, with respect to the Borrower or any of
----------------
its
Subsidiaries, any sale, issuance placement of Funded Debt, whether or
not evidenced by promissory note or other written evidence of
indebtedness.
"GoldKist Commitment Letter" means that certain commitment letter
--------------------------
dated as October 13, 1998 between GoldKist and the Borrower relating
to the commitment of GoldKist to purchase up to $100 million of
preferred securities from the Borrower, as amended and restated from
time to time.
"Michigan Livestock Credit Agreement" means that certain
-----------------------------------
Revolving Credit Agreement dated as of November 6,1998 among Michigan
Livestock Credit Corporation, the banks party thereto, and CoBank,
ACB, as agent for the Banks, as amended and restated from time to
time.
"Revolving Credit Agreement" means that certain Revolving Credit
--------------------------
Agreement dated as of January 12, 1999 by and among the Borrower, the
banks referred to therein, CoBank, ACB, as Administrative Agent and
Documentation Agent, First Union National Bank and NationsBank, N.A.,
as Syndication Agents, Crestar Bank and Wachovia Bank, N.A., as Co-
Agents. and NationsBanc Xxxxxxxxxx Securities LLC, as Lead Arranger,
as amended and restated from time to time.
"Statesman Financial Corporation Credit Agreement" means that
------------------------------------------------
certain Revolving Credit Agreement dated as of January 12. 1999 by and
among Statesman Financial Corporation, the banks referred to therein,
CoBank, ACB, as Administrative Agent and Documentation Agent, First
Union National Bank and NationsBank, N.A., as Syndication Agents,
Crestar Bank and Wachovia Bank, N.A., as Co-Agents, and NationsBanc
Xxxxxxxxxx Securities LLC, as Lead Arranger, as amended and restated
from time to time.
1.2 In Section 1.1 of the Credit Agreement, the definitions of
"Investment" and "Permitted Liens" are deleted in their entirety.
1.3 Section 2.1(c) of the Credit Agreement is amended to read as follows:
(c) Repayment. The Term Loans shall be duo and payable in full
---------
on October 8, 1999.
1.4 Section 6.1 through Section 6.18 of the Credit Agreement are deleted
in their entirety, and a new Section 6.1. is added to read as follows:
6.1 Incorporation of Covenants from Revolving Credit Agreement.
----------------------------------------------------------
The affirmative covenants contained in Article V, the negative
covenants contained in Article VI and the financial covenants
contained in Article VII, respectively, of the Revolving Credit
Agreement as in effect on the date of Amendment No. 2 (collectively,
the "Incorporated Covenants"), together with the related definitions
----------------------
set forth in Section 1.01 of the Revolving Credit Agreement as
in effect on the date of Amendment No.2. are incorporated herein by
reference with the same effect as if stated at length herein; provided
--------
that references therein (a) to "this Agreement" or "the Credit
Agreement" shall be deemed to include this Credit Agreement, (b)
references therein to "Bank" or "Banks" shall be deemed to include the
Lenders under this Credit Agreement and (c) references to the
"Administrative Agent" shall be deemed to include the Administrative
Agent under this Credit Agreement. The Borrower covenants and agrees
that the Incorporated Covenants shall be as binding on the Borrower as
if set forth fully herein.
1.5 A new Section 6.2 is added to read as follows:
6.2 Placement of Preferred Securities. If the Borrower has not
---------------------------------
issued preferred securities in a registered public offering or in Rule
144A transaction by September 15, 1999, the Borrower shall immediately
begin the process required to complete the issuance and delivery of
preferred securities to GoldKist pursuant to the GoldKist Commitment
Letter. The Administrative Agent shall have the right to review and
approve the process.
1.6 Clause (c) of Section 7.1 of the Credit Agreement is amended to read
as follows:
(c) failure to observe or comply with (A) the financial covenants
in Article VII of the Incorporated Covenants or the negative covenants
in Article VI of the Incorporated Covenants (except in the case of
negative covenants contained in Article VI of the Incorporated
Covenants, those defaults which may occur or arise other than on
account of or by affirmative or intentional act of the Borrower or
Subsidiary or event or condition which the Borrower shall with
know1edge permit to exist, all of which shall be subject to the
provisions of clause (B) hereof), inclusive, or (B) any of the other
covenants or provisions contained herein or in any other Credit
Document and such failure to observe or comply shall continue for a
period of 30 days after the earlier of actual knowledge of a
responsible officer of the Borrower or notice to the Borrower thereof,
or
2. This Amendment shall be effective upon satisfaction of the following
conditions precedent:
(a) Execution of this Amendment by the Borrower and all of the
Lenders;
(b) Receipt by the Administrative Agent of an opinion of counsel
to the Borrower relating to this Amendment and the transactions
contemplated herein, which opinion shall be in form and substance
satisfactory to the Lenders;
(c) Receipt by the Administrative Agent of an opinion of counsel
to GoldKist relating to the GoldKist Commitment Letter, which opinion
shall be in form and substance satisfactory to the Lenders;
(d) Receipt by the Administrative Agent of a certified copy of an
amendment to the GoldKist Commitment Letter which shall (i) extend the
Purchase Date (as defined in the GoldKist Commitment Letter) to
October 5, 1999 and (ii) provide that any payment made thereunder in
respect of the Preferred Securities (as defined in the GoldKist
Commitment Letter) shall be made directly to the Administrative Agent,
which amendment shall be in form and substance satisfactory to the
Lenders;
(e) Receipt by the Administrative Agent of certified copy of the
consent to the GoldKist Commitment Letter by (i) CoBank, ACB, (ii)
Prudential Insurance Company of America and (iii) RaboBank, as Agent
under that certain Credit Agreement dated as of August 4, 1998 by and
among XxxxXxxx, as borrower, and various banks and lending
institutions, as lenders;
(f) Receipt by the Administrative Agent of a certified copy of an
amendment to the Revolving Credit Agreement to allow for this
Amendment, the amendment to the GoldKist Commitment Letter and the
collateral assignment of the RaboBank Letter of Credit, which
amendment shall be in form and substance satisfactory to the Lenders;
(g) Receipt by the Administrative Agent of certified copy of the
Michigan Livestock Credit Agreement and all amendments thereto (which
shall include an amendment extending the termination date to at least
October 8, 1999), which shall be in form and substance satisfactory to
the Lenders;
(h) Execution by the Borrower and the Administrative Agent, and
acknowledgment thereof by RaboBank, of a collateral assignment of the
Letter of Credit to the Administrative Agent, which shall be in form
and substance satisfactory to the Lenders;
(i) Receipt by the Administrative Agent of (i) the original
RaboBank Letter of Credit and (ii) an undated draw certificate
executed by Southern States relating to the RaboBank Letter of Credit;
and
(j) Receipt by the Administrative Agent, for the ratable benefit
of the Lenders, of a fee equal to 5 basis points (0.05%) on aggregate
outstanding principal amount of the Term Loan.
3. Except as modified hereby, all of the terms and provisions of the
Credit Agreement (including Schedules and Exhibits) shall remain in
force and effect.
4. The Borrower agrees to pay all reasonable costs and expenses of the
Administrative Agent in connection with the preparation, execution and
delivery of this Amendment, including without limitation the
reasonable fees and expenses of Xxxxx & Xxx Xxxxx, PLLC.
5. This Amendment may be executed in any number of counterparts, each of
which when so executed and delivered shall be deemed an original and
it shall not be necessary in making proof of this Amendment to produce
or account for more than one such counterpart.
6. This Amendment shall be deemed to be a contract made under, and for
all purposes shall be construed in accordance with the laws of the
Commonwealth of Virginia.
[Remainder of Page intentionally Left Blank]
IN WITNESS WHEREOF, each of the parties hereto has caused a
counterpart of this Amendment to be duly executed end delivered as of the date
first above written.
BORROWER: SOUTHERN STATES COOPERATIVE, INCORPORATED,
-------- a Virginia agricultural cooperative corporation
By:__________________________________________
Name:
Title:
LENDERS: NATIONSBANK, N.A.,
------- as Administrative Agent and as a Lender
By:__________________________________________
Name:
Title:
FIRST UNION NATIONAL BANK,
as Co-Agent and as a Lender
By:__________________________________________
Name:
Title:
COBANK, ACB,
as Co-Agent and as a Lender
By:__________________________________________
Name:
Title:
EXHIBIT B
Draft 3/10/99
[GoldKist stationery]
March __, 1999
Southern States Cooperative, Inc.
0000 Xxxx Xxxxx Xxxxxx
P. O. Box 26234
Richmond, Virginia 23260
Amendment to Commitment Letter dated October 13, 1998
-----------------------------------------------------
Ladies and Gentlemen:
This letter will serve to amend our commitment letter to you dated
October 13, 1998, and the Terms Sheet attached thereto, in the following
respects:
1. The purchase date specified in section 1 of the Terms Sheet shall
be amended to delete "April 2, 1999" and to insert in lieu
thereof "[October 1], 1999"; and the words "175 days after
October 9, 1998" shall be amended to read "[358]" days after
October 9, 1998."
2. Payment by GoldKist Inc. for any securities of Southern States
Cooperative, Inc. ("Southern States") purchased under the
commitment letter dated October 13, 1998, as amended hereby,
shall [if requested by NationsBank, N.A.] be made directly to
NationsBank, N.A., as Administrative Agent for the account of
Southern States, in order to repay outstanding indebtedness under
Southern States' Senior Bridge Facilty.
3. The letter of credit issued by Cooperative Centrale Raiffeisen-
BoerenleenBank, B.A.-"RaboBank Nederland", New York Branch
("RaboBank") pursuant to section 4 of the Terms Sheet shall, with
the consent of RaboBank, be amended to make Southern States'
rights thereunder assignable to NationsBank, N.A., as
Administrative Agent, and for payment thereunder to be made, [if
requested by NationsBank, N.A.,] directly to NationsBank, N.A.,
as Administrative Agent, for the account of Southern States.
In all other respects, the commitment letter dated October 13, 1998,
and the Terms Sheet attached thereto, shall remain unchanged and in full force
and effect.
Sincerely,
--------------------------------
M.A. Stimpert
Senior Vice President
Agreed to by Southern States Cooperative, Inc.
----------------------------------------------
Xxxxx X. Xxxxxxxx
President and Chief Executive Officer
EXHIBIT C
COMMONWEALTH OF VIRGINIA COLLATERAL ASSIGNMENT OF RIGHTS
UNDER LETTER OF CREDIT AND
CITY OF RICHMOND DURABLE POWER OF ATTORNEY
THIS COLLATERAL ASSIGNMENT OF RIGHTS UNDER LETTER OF CREDIT AND
DURABLE POWER OF ATTORNEY (this "Assignment") is made as of March , 1999, by
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SOUTHERN STATES COOPERATIVE, INCORPORATED, a Virginia agricultural cooperative
corporation (the "Assignor" or "Southern States"), to NATIONSBANK, N.A., as
-------- ---------------
administrative agent for the holders of the Secured Obligations (the "Assignee"
--------
or the "Administrative Agent").
--------------------
WITNESSETH
WHEREAS, Southern States agreed to purchase the GoldKist Inputs
Business pursuant to the terms of that Asset Purchase Agreement dated as of July
23, 1998 (the "GKIB Purchase Agreement") between Southern States, as purchaser,
------------------------
and GoldKist, Inc. ("GoldKist"), as seller;
--------
WHEREAS, a $225 million bridge loan facility (the "Bridge Loan" or
-----------
"Bridge Loan Facility") was established in favor of Southern. States pursuant to
------- -------------
the terms of that Credit Agreement dated as of October 8,1998 (as amended and
modified, the "Bridge Credit Agreement") among Southern States, the lenders
-----------------------
identified therein (the "Lenders") and NationsBank, N.A., as Administrative
-------
Agent, for the purpose of, among other things, financing the acquisition of' the
GoldKist Inputs Business pursuant to the GKIB Purchase Agreement;
WHEREAS, in order to facilitate establishment of the Bridge Loan
Facility and the sale of the GoldKist Inputs Business, GoldKist agreed pursuant
to that Commitment Letter dated as of October 13, 1998 (as amended and modified,
the "GoldKist Preferred Securities Purchase Agreement") between Southern States
------------------------------------------------
and GoldKist to purchase from Southern States up to $100 million in preferred
securities in the event Southern States were not so issue at least $100 million
in publicly offered or privately placed preferred securities;
WHEREAS, the purchase obligations of GoldKist under the GoldKist
Preferred Securities Purchase Agreement were secured by an irrevocable standby
letter of credit no. SB 14112 dated October 13, 1998 issued by Cooperative
Centrale Raiffeisen-BoerenleenBank, B.A. - "RaboBank Nederland", New York Branch
(as amended and modified, the "Rabobank Letter of Credit') to Southern States,
------------------ -------
as beneficiary;
WHEREAS, Southern States has requested extension of the maturity date
of the Bridge Loan;
WHEREAS, the lenders under the Bridge Loan Facility have required this
Collateral Assignment, among other things, as a condition to the extension of
the maturity date of the Bridge Loan;
NOW, THEREFORE, IN ORDER to secure the payment of the loans and
obligations owing under the Bridge Credit Agreement and the other Credit
Documents as referenced and defined therein (including interest accruing after
bankruptcy or insolvency, regardless of whether such interest is allowed as a
claim in the bankruptcy or insolvency proceeding) (collectively, the "Secured
-------
Obligations") and as an essential and integral part of the security therefor,
-----------
and in consideration of the premises and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Assignor does
hereby immediately and absolutely sell, assign, transfer and set over to the
Administrative Agent, and its successors and assigns in such capacity, the
rights, interests and privileges which the Assignor has and may have in the
Rabobank Letter of Credit, any additional letters of credit issued in
replacement thereof or as additional security for the purchase obligations of
GoldKist under the GoldKist Preferred Securities Purchase Agreement, as such
additional letters of credit may be amended, modified, extended, renewed or
replaced from time to time (collectively, the "Subject Letters of Credit"), with
-------------------------
all proceeds, issues, income and profits due and becoming due therefrom, and
neither the acceptance of this Assignment nor collection of sums due under the
Subject Letters of Credit shall constitute a waiver of any rights of the holders
of the Secured Obligations under the Bridge Credit Agreement or other operative
documents relating thereto.
1. Payment of Proceeds Under the Subject Letters of Credit. For so
-------------------------------------------------------
long as this Assignment shall be in effect, any and all proceeds of any drawings
under the Subject Letters of Credit will be paid directly to the Administrative
Agent as follows (or pursuant to alternative written payment instructions
provided by the Administrative Agent to the issuer of the Subject Letter of
Credit):
NationsBank, N.A., as Administrative Agent
Charlotte, North Carolina
ABA no:
Acct. no.:
Attn: Agency Services
Phone: (312) 828-
Fax: (312) 828-
Reference: Southern States Cooperative, Incorporated
The Assignor will give notice to the issuers of the Subject Letters of Credit of
the payment instructions and other provisions of this Assignment and take such
other action as necessary or appropriate to give effect hereto.
2. Durable Power of Attorney. The Assignor hereby grants to the
-------------------------
Administrative Agent a durable power of attorney, and hereby designates the
Administrative
Agent as its attorney-in-fact, to execute and deliver, for and on behalf of the
Assignor, all drafts, draw certificates, instruments, affidavits and
certificates as may be necessary or convenient to exercise the Assignor's rights
under the Letter of Credit. This durable power of attorney is coupled with an
interest and shall be irrevocable without the prior written consent of' the
Administrative Agent. So long as no Event of Default (as defined in the Bridge
Credit Agreement) shall exist under any of the Credit Documents, however, the
Administrative Agent agrees that it will not exercise this durable power of
attorney.
3. Delivery of' RaboBank Letter of Credit. Concurrently with the
--------------------------------------
Assignor's execution of this Assignment, the Assignor has delivered the original
RaboBank Letter of Credit to the Administrative Agent.
4. Indemnity. Neither the Administrative Agent nor any Lender shall
---------
be obligated to perform or discharge any obligation or duty to be performed or
discharged by the Assignor under the Subject Letters of Credit, and the Assignor
hereby agrees to indemnify the Administrative Agent and the Lenders for, and to
save them harmless from, any liability arising from the exercise of any rights
under the Subject Letter of Credit or from this Assignment, except in the event
of the Administrative Agent's gross negligence or willful misconduct
(specifically including the Administrative Agent's failure to keep the Letter of
Credit in its possession).
5. Representations and Warranties of the Assignor. The Assignor
----------------------------------------------
represents and warrants that (i) the Assignor has full right and title to assign
to the Administrative Agent its rights under the RaboBank Letter of Credit and
any payments, income, proceeds and profits due or to become due thereunder; (ii)
no prior assignment of any interest in the RaboBank Letter of Credit has been
made; (iii) the RaboBank Letter of Credit is in full force and effect, and (iv)
there are no existing defaults under the provisions of the RaboBank Letter of
Credit.
6. Covenants of the Assignor. The Assignor covenants and agrees that
-------------------------
(i) the Assignor shall promptly (but in any event within three (3) Business Days
after receipt thereof by the Borrower) deliver to the Administrative Agent any
additional letters of credit issued in replacement of the RaboBank Letter of
Credit or issued as additional security for the purchase obligations of GoldKist
under the GoldKist Preferred Securities Purchase Agreement; and (ii) without
the prior written consent of the Administrative Agent, the Assignor will not
hereafter cancel, surrender, terminate, or draw upon the Subject Letters of
Credit or materially change, alter or modify the same or execute any other
assignment of the Assignor's rights under the Subject Letters of Credit.
7. Governing Law. This Assignment shall be governed by, and
-------------
construed in accordance with, the laws of the Commonwealth of Virginia.
8. Duration of Assignment. This Assignment shall remain in full
----------------------
force and effect as until the Secured Obligations are paid in full and all
commitments relating thereto are terminated.
9. Security Agreement. It is understood and acknowledged by the
------------------
parties that this Assignment shall constitute a security agreement as defined by
the Uniform Commercial Code in effect in the Commonwealth of Virginia granting a
security interest in all of Assignor's right, title and interest, whether now
existing or hereafter arising, in the Subject Letters of Credit to secure
repayment and performance of all of the Assignor's obligations to the
Administrative Agent including, without limitation, repayment of the Secured
Obligations and compliance with the Assignor's obligations under the Bridge
Credit Agreement.
10. Further Assurances. The Assignor shall take such further actions
------------------
and shall execute such other documents as may be necessary or as may be required
by the Administrative Agent to protect or perfect the liens and security
interests created or intended to be created hereby and otherwise to complete the
transactions contemplated hereby.
[Remainder of Page Intentionally Left Blank]
IN WITNESS WHEREOF, the Assignor has caused this Assignment to be duly
executed under seal by authority duly given as of the date first above written.
SOUTHERN STATES COOPERATIVE, INCORPORATED
a Virginia agricultural cooperative corporation
By:________________________________________
Name:
Title:
ATTEST:
By:__________________________________
Name:
Title:
[CORPORATE SEAL]
ACCEPTED AND AGREED:
NATIONSBANK, N.A.
in its capacity as Administrative Agent
By:__________________________________
Name:
Title:
ACKNOWLEDGMENT:
COOPERATIVE CENTRALE RAIFFEISEN - BOERENLEENBANK B.A. - "RABOBANK NEDERLAND",
NEW YORK BRANCH, in its capacity as issuer of the RaboBank Letter of Credit
By:__________________________________
Name:
Title:
COMMONWEALTH OF VIRGINIA
COUNTY OF ______________________
On this, the _________day of March, 1999, before me, the subscriber, a
notary public in and for the State and County aforesaid, personally appeared
_____________________, __________________________ of Southern States
Cooperative, Incorporated, a Virginia agricultural cooperative corporation, who
acknowledged that he, as such ___________________, being authorized to do so,
executed the foregoing instrument on behalf of said corporation for the purposes
therein contained.
WITNESS my hand and seal the day and year aforesaid.
_______________________________
Notary Public
My Commission Expires:_____________________________
