EXHIBIT 10.1
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LIMITED WAIVER TO LOAN AND SECURITY AGREEMENT
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This LIMITED WAIVER TO LOAN AND SECURITY AGREEMENT (this "WAIVER") dated as
of May 29, 2007 is by and among Xxxxx Nurseries, Inc., a California corporation,
the parties hereto as lenders (each individually, a "Lender" and collectively,
"Lenders" as hereinafter further defined) and Bank of America, N.A., in its
capacity as agent for Lenders (in such capacity, "Agent"). Capitalized terms
used and not otherwise defined herein shall have the meanings assigned to them
in the Loan Agreement (defined below).
R E C I T A L S:
WHEREAS, Borrower, the Agent and the Lenders have entered into that certain
Loan and Security Agreement dated as of January 18, 2007 (as amended, the "LOAN
AGREEMENT"); and
WHEREAS, Borrower, Agent and Lenders have agreed to extend the date for
providing audited financial statements and waive certain Events of Default upon
the terms and conditions contained herein;
NOW, THEREFORE, in consideration of the premises contained herein, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:
Section 1 LIMITED WAIVER TO THE LOAN AGREEMENT. Borrower acknowledges that
certain Events of Default exist (or may arise) under Section 11.1 of the Loan
Agreement as a result of (a) Borrower's failure to deliver annual audited
financial statements for the year ending December 31, 2006 as required by that
certain Limited Waiver to Loan and Security Agreement dated as of April 30, 2007
among the parties hereto, (b) Borrower's failure to provide notice of default
under the Indenture for failure to provide the audited financial statements for
the year ending December 31, 2006 and unaudited financial statements for the
fiscal quarter ending March 31, 2007 (and related public filings) as required by
Section 10.1.3(c) of the Loan Agreement and (c) the Borrower's restatement of
its 2004 audited financial statements as described on the schedule dated April
27, 2007 and previously delivered by the Borrower to the Required Lenders which
restatement may be material and a breach of the representation made in Section
9.1.8 of the Loan Agreement (collectively, the "Events of Default"). Immediately
upon the satisfaction of each of the conditions precedent set forth in SECTION 2
below, the Agent and Required Lenders hereby waive the Events of Default;
PROVIDED, that Borrower shall (x) deliver such audited financial statements for
the fiscal year ending December 31, 2006 required by Section 10.1.2 of the Loan
Agreement (together with any other financial information and documents required
to be delivered in connection with such financial statements) and (y) deliver
the audited financial statements for the year ending December 31, 2006 and
unaudited financial statements for the fiscal quarter ending March 31, 2007 (and
all related public filings) required by the Indenture and cure any related
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defaults thereunder, in each case under clauses (x) and (y) by no later than
June 28, 2007, the failure of which shall cause such waiver to be terminated and
result in such Events of Default continuing to exist under the Loan Agreement.
The foregoing is a limited waiver and shall not constitute a waiver of any other
Default or Event of Default that may exist or arise or constitute a waiver or
modification to any other term or condition set forth in the Loan Agreement.
Section 2 CONDITIONS TO EFFECTIVENESS. The effectiveness of the waiver set forth
in SECTION 1 above is subject to the satisfaction of each of the following
conditions:
(a) Agent shall have received a duly executed counterpart of this
Waiver from Borrower and the Required Lenders; and
(b) Agent shall have received a reaffirmation from Parent of its
Guaranty.
Section 3 REPRESENTATIONS, WARRANTIES AND COVENANTS. Borrower represents,
warrants and covenants to Agent and Lenders, upon the effectiveness of this
Waiver that:
(a) NO DEFAULT; ETC. No Default or Event of Default has occurred and
is continuing after giving effect to this Waiver or would result from the
execution or delivery of this Waiver or the consummation of the
transactions contemplated hereby.
(b) CORPORATE POWER AND AUTHORITY; AUTHORIZATION. Borrower has the
power and authority to execute and deliver this Waiver.
(c) EXECUTION AND DELIVERY. Borrower has duly executed and delivered
this Waiver.
(d) ENFORCEABILITY. This Waiver constitutes the legal, valid and
binding obligations of Borrower, enforceable against Borrower in accordance
with its terms, except as enforcement may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the
enforcement of creditors' right generally, and by general principles of
equity.
Section 4 MISCELLANEOUS.
(a) EFFECT; RATIFICATION. Borrower acknowledges that all of the
reasonable legal expenses incurred by Agent in connection herewith shall be
reimbursable under SECTION 3.4 of the Loan Agreement. The waiver set forth
herein is effective solely for the purposes set forth herein and shall be
limited precisely as written, and shall not be deemed to (i) be a consent
to any amendment, waiver or modification of any other term or condition of
any Loan Document or (ii) prejudice any right or rights that any Lender may
now have or may have in the future under or in connection with any Loan
Document. This Waiver shall be construed in connection with and as part of
the Loan Documents and all terms, conditions, representations, warranties,
covenants and agreements set forth in the Loan Documents, except as herein
amended are hereby ratified and confirmed and shall remain in full force
and effect.
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(b) COUNTERPARTS; ETC. This Waiver may be executed in any number of
counterparts, each such counterpart constituting an original but all
together one and the same instrument. Delivery of an executed counterpart
of this Waiver by fax shall have the same force and effect as the delivery
of an original executed counterpart of this Waiver. Any party delivering an
executed counterpart of this Waiver by fax shall also deliver an original
executed counterpart, but the failure to do so shall not affect the
validity, enforceability or binding effect of this Waiver.
(c) GOVERNING LAW. This Waiver shall be deemed a Loan Document and
shall be governed by, and construed and interpreted in accordance with the
internal laws of the State of New York but excluding any principles of
conflicts of law.
(d) REAFFIRMATION. Parent hereby reaffirms all of its obligations as a
guarantor of the Obligations pursuant to its Guaranty dated as of January
18, 2007.
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, Agent, Lenders and Borrower have caused this Limited
Waiver to Loan and Security Agreement to be duly executed as of the day and year
first above written.
BORROWER:
XXXXX NURSERIES, INC.
By: /S/ XXXXXXX X. XXXXXXXX
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Title: CFO
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Name: XXXXXXX X. XXXXXXXX
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PARENT:
XXXXX HORTICULTURE, INC.
By: /S/ XXXXXXX X. XXXXXXXX
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Title: CFO
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Name: XXXXXXX X. XXXXXXXX
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AGENT AND LENDERS:
BANK OF AMERICA, N.A., as Agent and a Lender
By:/S/ XXXXX XXXXX
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Title: VICE PRESIDENT
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Name: XXXXX XXXXX
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PNC BANK, NATIONAL ASSOCIATION, as a Lender
By: /S/ XXXXXXX X. XXXX
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Title: VICE PRESIDENT
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Name: XXXXXXX X. XXXX
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GMAC COMMERCIAL FINANCE LLC, as a Lender
By:/S/ XXXXXX XXXXXXXXXX
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Title: DIRECTOR
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Name: XXXXXX XXXXXXXXXX
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