THIRD AMENDMENT AND WAIVER
TO CREDIT AGREEMENT
-------------------
THIRD AMENDMENT AND WAIVER, dated as of April 3, 2002, to the
Credit Agreement referred to below (this "Amendment") among Agway, Inc., a
---------
Delaware corporation, Feed Commodities International LLC, a Delaware limited
liability company, Xxxxxxxx Agronomic Consulting Service LLC, a Delaware limited
liability company, Agway General Agency, Inc., a New York corporation, Country
Best Xxxxx, LLC, a Delaware limited liability company, Country Best-XxXxxxx LLC,
a Delaware limited liability company, Agway Energy Products LLC, a Delaware
limited liability company ("AEP"), Agway Energy Services-PA, Inc., a Delaware
---
corporation, and Agway Energy Services, Inc., a Delaware corporation, (the
foregoing entities are sometimes collectively referred to herein as the
"Borrowers" and individually as a "Borrower"); the other Credit Parties
--------- --------
signatory hereto; GENERAL ELECTRIC CAPITAL CORPORATION, a Delaware corporation
(in its individual capacity, "GE Capital"), for itself, as Lender, and as Agent
----------
for Lenders, and the other Lenders signatory hereto from time to time.
W I T N E S S E T H
- - - - - - - - - -
WHEREAS, Borrowers, the other Credit Parties signatory
thereto, Agent, and Lenders signatory thereto are parties to that certain Credit
Agreement, dated as of March 28, 2001 (including all annexes, exhibits and
schedules thereto, and as amended, restated, supplemented or otherwise modified
from time to time, the "Credit Agreement"); and
----------------
WHEREAS, Agent and Lenders have agreed to amend and waive
certain provisions of the Credit Agreement, in the manner, and on the terms and
conditions, provided for herein;
NOW THEREFORE, in consideration of the premises and for other
good and valuable consideration, the receipt, adequacy and sufficiency of which
are hereby acknowledged, the parties hereto hereby agree as follows:
1. Definitions. Capitalized terms not otherwise defined herein
-----------
shall have the meanings ascribed to them in the Credit Agreement or Annex A
-------
thereto.
2. Waiver. The parties hereto acknowledge that Borrowers
------
failed to comply with the following covenants set forth in Section 6.10 and
------------
Annex G of the Credit Agreement for the Fiscal Quarter ending March 31, 2002:
-------
(a) Minimum EBITDA (Agway Operations);
(b) Minimum EBITDA (Agriculture);
(c) Minimum EBITDA (Country Products);
(d) Minimum EBITDA (Energy); and
(e) Minimum Senior Interest Coverage Ratio.
Agent and Lenders hereby waive as of the Amendment Effective
Date all Events of Default arising solely from Borrowers' failure to comply with
such covenants for the Fiscal Quarter ending March 31, 2002.
3. Section 1.4 of the Credit Agreement is hereby amended as of the
-----------
Amendment Effective Date by deleting in clause (D) the phrase "Four Hundred and
Fifty Five Million Dollars ($455,000,000)" and inserting in lieu thereof "Four
Hundred and Fifty Million Dollars ($450,000,000)".
4. Section 1.5(a) of the Credit Agreement is hereby amended as of
--------------
the Amendment Effective Date by deleting such section in its entirety and
inserting in lieu thereof the following new section to read as follows:
"(a) Borrowers shall pay interest to Agent, for the ratable benefit of
Lenders in accordance with the various Loans being made by each
Lender, in arrears on each applicable Interest Payment Date, at the
following rates: (i) with respect to the Revolving Credit Advances,
the Index Rate plus the Applicable Revolver Index Margin per annum or,
at the election of Borrower Representative, the applicable LIBOR Rate
plus the Applicable Revolver LIBOR Margin per annum, based on the
aggregate Revolving Credit Advances outstanding from time to time; and
(ii) with respect to the Swing Line Loan, the Index Rate plus the
Applicable Revolver Index Margin per annum:
The Applicable Margins are as follows:
Applicable Revolver Index Margin 2.50%
Applicable Revolver LIBOR Margin 4.00%
Applicable L/C Margin 4.00%
Applicable Unused Line Fee Margin 0.375%"
5. Section 5.11 of the Credit Agreement is hereby amended as of the
------------
Amendment Effective Date by deleting such section in its entirety and inserting
in lieu thereof the following new section:
"Section 5.11 Subordinated Indebtedness and Preferred Stock. Borrowers
------------ ---------------------------------------------
shall have at the following times outstanding Preferred Stock,
2
Subordinated Debt and outstanding notes under the Milford Note Program
no less than, in the aggregate principal amount, (i) Four Hundred
Fifty Million Dollars ($450,000,000) for the period February 1 through
October 31 of any Fiscal Year, (ii) Four Hundred Forty Million Dollars
($440,000,000) for the period November 1 through December 31 of any
Fiscal Year; and (iii) Four Hundred Forty Five Million Dollars
($445,000,000) for the period January 1, through January 31 of any
Fiscal Year."
6. Section 6.14 of the Credit Agreement is hereby amended as of the
------------
Amendment Effective Date by deleting in clause (D) of the second
proviso the phrase "Four Hundred and Fifty Five Million Dollars"
($455,000,000) and inserting in lieu thereof "Four Hundred and Fifty
Million Dollars ($450,000,000)".
7. Annex A of the Credit Agreement is hereby amended as of the
-------
Amendment Effective Date by:
(a) deleting the definition of "Commitments" and inserting in lieu
thereof:
"`Commitments'" means (a) as to any Lender, the
-------------
aggregate of such Lender's Revolving Loan Commitment (including
without duplication the Swing Line Lender's Swing Line Commitment as a
subset of its Revolving Loan Commitment) as set forth on Annex J to
-------
the Agreement or in the most recent Assignment Agreement executed by
such Lender and (b) as to all Lenders, the aggregate of all Lenders'
Revolving Loan Commitments (including without duplication the Swing
Line Lender's Swing Line Commitment as a subset of its Revolving Loan
Commitment), which aggregate commitment shall be One Hundred Fifty
Million Dollars ($150,000,000) on the Amendment Effective Date (as
defined in the Third Amendment and Waiver to Credit Agreement dated as
of April 3, 2002), as to each of clauses (a) and (b), as such
Commitments may be reduced, amortized or adjusted from time to time in
accordance with the Agreement."
(b) deleting the definition of "Revolving Loan Commitment" and
inserting in lieu thereof:
"'Revolving Loan Commitment' means (a) as to any Lender, the aggregate
---------------------------
commitment of such Lender to make Revolving Credit Advances or incur
Letter of Credit Obligations as set forth on Annex J to the Agreement
-------
or in the most recent Assignment Agreement executed by such Lender and
(b) as to all Lenders, the aggregate commitment of all Lenders to make
3
Revolving Credit Advances or incur Letter of Credit Obligations, which
aggregate commitment shall be One Hundred Fifty Million Dollars
($150,000,000) on the Amendment Effective Date (as defined in the
Third Amendment and Waiver to Credit Agreement dated as of April 3,
2002), as such amount may be adjusted, if at all, from time to time in
accordance with the Agreement."
8. Annex G of the Credit Agreement is hereby amended as of the
-------
Amendment Effective Date by deleting such Annex in its entirety and replacing it
with a new Annex G attached hereto as Exhibit A.
------- ---------
9. Annex J of the Credit Agreement is hereby amended as of the
-------
Amendment Effective Date by deleting such Annex in its entirety and replacing it
with a new Annex J attached hereto as Exhibit B.
------- ----------
10. Disclosure Schedule (5.1) is hereby amended and supplemented by
---------------------------
inserting as an assumed name under Agway, Inc., the trade name "CPG
Technologies" registered in the states of California, Florida, New York and
Pennsylvania.
11. Amendment Fee. To induce Agent and Lenders to enter into this
-------------
Amendment, Borrowers hereby agree to pay Agent, for the ratable benefit of
Lenders, an amendment fee in the amount of $200,000 in immediately available
funds, payable on the AmendmentEffective Date.
12. Representations and Warranties. To induce Agent and Lenders to
------------------------------
enter into this Amendment, Borrowers make the following representations and
warranties to Agent and Lenders:
(a) The execution, delivery and performance of this Amendment
and the performance of the Credit Agreement, as amended by this Amendment
(the "Amended Credit Agreement"), by Borrowers: (a) are within each Borrower's
------------------------
organizational power; (b) have been duly authorized by all necessary or proper
corporate and shareholder action; (c) do not contravene any provision of any
Borrower's charter or bylaws or equivalent organizational documents; (d) do not
violate any law or regulation, or any order or decree of any court or
Governmental Authority; (e) do not conflict with or result in the breach or
termination of, constitute a default under or accelerate or permit the
acceleration of any performance required by, any indenture, mortgage, deed of
trust, lease, agreement or other instrument to which any Borrower is a party or
by which any Borrower or any of its property is bound; (f) do not result in the
creation or imposition of any Lien upon any of the property of any Borrower
other than those in favor of Agent pursuant to the Loan Documents; and (g) do
not require the consent or approval of any Governmental Authority or any other
Person.
(b) This Amendment has been duly executed and delivered by or on
behalf of Borrowers.
4
(c) Each of this Amendment and the Amended Credit Agreement
constitutes a legal, valid and binding obligation of each Borrower and each of
the other Credit Parties party thereto, enforceable against each in accordance
with its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).
(d) No Default has occurred and is continuing after giving
effect to this Amendment.
(e) No action, claim, lawsuit, demand, investigation or
proceeding is now pending or, to the knowledge of any Credit Party, threatened
against any Credit Party, at law, in equity or otherwise, before any court,
board, commission, agency or instrumentality of any Governmental Authority, or
before any arbitrator or panel of arbitrators, (i) which challenges any
Borrower's or, to the extent applicable, any other Credit Party's right, power,
or competence to enter into this Amendment or perform any of their respective
obligations under this Amendment, the Amended Credit Agreement or any other Loan
Document, or the validity or enforceability of this Amendment, the Amended
Credit Agreement or any other Loan Document or any action taken under this
Amendment, the Amended Credit Agreement or any other Loan Document or (ii)
except for items on Disclosure Schedule (3.13) or notifications sent to Agent
---------------------------
since the Closing Date, which if determined adversely, is reasonably likely to
have or result in a Material Adverse Effect. Except for items on Disclosure
----------
Schedule (3.13) or notifications sent to Agent since the Closing Date, to the
----------------
knowledge of each Borrower, there does not exist a state of facts which is
reasonably likely to give rise to such proceedings.
(f) The representations and warranties of each Borrower and the
other Credit Parties contained in the Credit Agreement and each other Loan
Document shall be true and correct on and as of the Amendment Effective Date
with the same effect as if such representations and warranties had been made on
and as of such date, except that any such representation or warranty which is
expressly made only as of a specified date need be true only as of such date.
13. No Other Amendments/Waivers. Except as expressly amended herein,
---------------------------
the Credit Agreement and the other Loan Documents shall be unmodified and shall
continue to be in full force and effect in accordance with their terms. In
addition, except as specifically provided herein, this Amendment shall not be
deemed a waiver of any term or condition of any Loan Document and shall not be
deemed to prejudice any right or rights which Agent, for itself and Lenders, may
now have or may have in the future under or in connection with any Loan Document
or any of the instruments or agreements referred to therein, as the same may be
amended from time to time.
5
14. Outstanding Indebtedness; Waiver of Claims. Each Borrower and
---------------------------------------------
the other Credit Parties hereby acknowledges and agrees that as of April 3, 2002
the aggregate outstanding principal amount of the Revolving Loan is
$16,268,447.69 and that such principal amount is payable pursuant to the Credit
Agreement without defense, offset, withholding, counterclaim or deduction of any
kind. Borrowers and each other Credit Party hereby waives, releases, remises and
forever discharges Agent, Lenders and each other Indemnified Person from any and
all claims, suits, actions, investigations, proceedings or demands arising out
of or in connection with the Credit Agreement (collectively, "Claims"), whether
------
based in contract, tort, implied or express warranty, strict liability, criminal
or civil statute or common law of any kind or character, known or unknown, which
any Borrower or any other Credit Party ever had, now has or might hereafter have
against Agent or Lenders which relates, directly or indirectly, to any acts or
omissions of Agent, Lenders or any other Indemnified Person on or prior to the
Amendment Effective Date, provided, that no Borrower nor any other Credit Party
--------
waives any Claim solely to the extent such Claim relates to the Agent's or any
Lender's gross negligence or willful misconduct.
15. Expenses. Each Borrower and the other Credit Parties hereby
--------
reconfirms its respective obligations pursuant to Sections 1.9 and 11.3 of the
------------- ----
Credit Agreement and pursuant to the GE Capital Fee Letter, to pay and reimburse
Agent, for itself and Lenders, for all reasonable costs and expenses (including,
without limitation, reasonable fees of counsel) incurred in connection with the
negotiation, preparation, execution and delivery of this Amendment and all other
documents and instruments delivered in connection herewith.
16. Effectiveness. This Amendment shall become effective as of April
-------------
3, 2002 (the "Amendment Effective Date") only upon satisfaction in full in the
------------------------
judgment of Agent of each of the following conditions:
(a) Amendment. Agent shall have received six (6) original copies of
this Amendment duly executed and delivered by Agent, the Requisite Lenders and
Borrowers.
(b) Payment of Expenses. Borrowers shall have paid to Agent all
-------------------
costs, fees and expenses owing in connection with this Amendment and the other
Loan Documents and due to Agent (including, without limitation, reasonable legal
fees and expenses).
(c) Representations and Warranties. The representations and
------------------------------
warranties of or on behalf of the Credit Parties in this Amendment shall be
shall be true and correct on and as of the Amendment Effective Date.
17. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
6
18. Counterparts. This Amendment may be executed by the parties
------------
hereto on any number of separate counterparts and all of said counterparts taken
together shall be deemed to constitute one and the same instrument.
[SIGNATURE PAGES FOLLOW]
7
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed and delivered as of the day and year first above
written.
BORROWERS
AGWAY, INC.
FEED COMMODITIES INTERNATIONAL LLC
XXXXXXXX AGRONOMIC CONSULTING SERVICE LLC
COUNTRY BEST-XXXXXXX LLC
AGWAY ENERGY PRODUCTS LLC
AGWAY ENERGY SERVICES-PA, INC.
AGWAY ENERGY SERVICES, INC.
COUNTRY BEST XXXXX, LLC
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------------------
Name: Xxxxx X. Xxxxxxx
--------------------------------------------
Title: Treasurer
--------------------------------------------
AGWAY GENERAL AGENCY, INC.
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------------------
Name: Xxxxx X. Xxxxxxx
--------------------------------------------
Title: Asst. Treasurer
--------------------------------------------
LENDERS
COBANK, ACB
By: /s/ Xxxxxxx X. Hide
--------------------------------------------
Name: Xxxxxxx X. Hide
--------------------------------------------
Title: Vice President
--------------------------------------------
COOPERATIEVE CENTRALE RAIFFEISEN
-BOERENLEEN BANK B.A., "Rabobank Nederland" New York
Branch
By: /s/ Xxxxx Xxxxx
--------------------------------------------
Name: Xxxxx Xxxxx
--------------------------------------------
Title: Vice President
--------------------------------------------
By: /s/ Xxx Xxxxx
--------------------------------------------
Name: Xxx Xxxxx
--------------------------------------------
Title: Managing Director
--------------------------------------------
GMAC BUSINESS CREDIT, LLC
By: /s/ Xxxxxxx Xxxxxxxxxx
--------------------------------------------
Name: Xxxxxxx Xxxxxxxxxx
--------------------------------------------
Title: SVP Portfolio Management
--------------------------------------------
GENERAL ELECTRIC CAPITAL CORPORATION, as
Agent and Lender
By: /s/ Xxxxxx X. Xxxx
--------------------------------------------
Name: Xxxxxx X. Xxxx
--------------------------------------------
Title: Its Duty Authorized Signatory
Exhibit A
----------
ANNEX G (Section 6.10)
------------
to
CREDIT AGREEMENT
----------------
FINANCIAL COVENANTS
-------------------
Borrowers shall not breach or fail to comply with any of the following
financial covenants, each of which shall be calculated in accordance with GAAP
consistently applied:
(a) Maximum Capital Expenditures. Borrowers and their Subsidiaries
----------------------------
(excluding all Telmark Entities, Agway Insurance Company and all of their
respective Subsidiaries) on a consolidated basis shall not make Capital
Expenditures during the following periods that exceed in the aggregate the
amounts set forth opposite each of such periods:
Period Maximum Capital Expenditures per Period
------ ---------------------------------------
December 23, 2000 through June 30, 2001 $ 12,000,000
Fiscal Year ending June 30, 2002 13,000,000
Fiscal Year ending June 30, 2003 13,100,000
June 30, 2003 through March 31, 2004 12,000,000
(b) Minimum Fixed Charge Coverage Ratio. Borrowers and their
-----------------------------------
Subsidiaries (excluding all Telmark Entities, Agway Insurance Company and all of
their respective Subsidiaries) shall have on a consolidated basis at the end of
each Fiscal Quarter set forth below, a Fixed Charge Coverage Ratio for the
12-month period then ended not less than the following:
0.50x for the Fiscal Quarter ending September 30, 2002;
-----
0.55x for the Fiscal Quarter ending December 31, 2002;
-----
0.60x for the Fiscal Quarter ending March 31, 2003;
-----
0.65x for the Fiscal Quarter ending June 30, 2003;
-----
0.65x for the Fiscal Quarter ending September 30, 2003;
-----
0.65x for the Fiscal Quarter ending December 31, 2003; and
-----
0.70x for the Fiscal Quarter ending March 31, 2004.
-----
(c) Minimum EBITDA (Agway Operations). Borrowers and their
---------------------------------
Subsidiaries (excluding all Telmark Entities, Agway Insurance Company and all of
their respective Subsidiaries) on a consolidated basis shall have, at the end of
each Fiscal Quarter set forth below, EBITDA for the 12-month period then ended
(except for any period commencing December 23, 2000 and ending on or prior to
December 31, 2001, which shall be for the periods described below) of not less
than the following:
Period EBITDA
------ ------
December 23, 2000 through June 30, 2001 $16,000,000
December 23, 2000 through September 30, 2001 3,400,000
December 23, 2000 through December 31, 2001 4,200,000
March 31, 2002 (1,000,000)
June 30, 2002 14,000,000
September 30, 2002 32,300,000
December 31, 2002 35,600,000
March 31, 2003 38,000,000
June 30, 2003 41,000,000
September 30, 2003 40,800,000
December 31, 2003 41,800,000
March 31, 2004 44,300,000
(d) Minimum EBITDA (Agriculture). The Agway Agriculture Business
-----------------------------
Unit (as designated on the Agway Operations financial statements) on a
consolidated basis shall have, at the end of each Fiscal Quarter set forth
below, EBITDA for the 12-month period then ended (except for any period
commencing December 23, 2000 and ending on or prior to December 31, 2001, which
shall be for the periods described below) of not less than the following:
Period EBITDA
------ ------
December 23, 2000 through June 30, 2001 $ 10,500,000
December 23, 2000 through September30, 2001 4,200,000
December 23, 2000 through December 31, 2001 1,600,000
March 31, 2002 (500,000)
June 30, 2002 (1,750,000)
September 30, 2002 11,100,000
December 31, 2002 12,400,000
March 31, 2003 13,400,000
June 30, 2003 12,600,000
September 30, 2003 12,800,000
December 31, 2003 13,000,000
March 31, 2004 13,400,000
(e) Minimum EBITDA (Country Products). The Agway Country Products
---------------------------------
Group Business Unit (as designated on the Agway Operations financial statements)
on a consolidated basis shall have, at the end of each Fiscal Quarter set forth
below, EBITDA for the 12-month period then ended (except for any period
commencing December 23, 2000 and ending on or prior to December 31, 2001, which
shall be for the periods described below) of not less than the following:
Period EBITDA
------ ------
December 23, 2000 through June 30, 2001 $ (5,400,000)
December 23, 2000 through September 30, 2001 (6,300,000)
December 23, 2000 through December 31, 2001 (5,300,000)
March 31, 2002 (2,000,000)
June 30, 2002 3,400,000
September 30, 2002 8,600,000
December 31, 2002 9,400,000
March 31, 2003 9,800,000
June 30, 2003 10,600,000
September 30, 2003 10,500,000
December 31, 2003 11,200,000
March 31, 2004 12,400,000
(f) Minimum EBITDA (Energy). The Agway Energy Business Unit
-----------------------
(as designated on the Agway Operations financial statements on a consolidated
basis shall have, at the end of each Fiscal Quarter set forth below, EBITDA for
the 12-month period then ended (except for any period commencing December 23,
2000 and ending on or prior to December 31, 2001, which shall be for the periods
described below) of not less than the following:
Period EBITDA
------ ------
December 23, 2000 through June 30, 2001 $ 20,000,000
December 23, 2000 through September 30, 2001 11,800,000
December 23, 2000 through December 31, 2001 20,300,000
March 31, 2002 15,800,000
June 30, 2002 18,000,000
September 30, 2002 18,600,000
December 31, 2002 19,000,000
March 31, 2003 19,400,000
June 30, 2003 21,700,000
September 30, 2003 21,400,000
December 31, 2003 21,500,000
March 31, 2004 22,100,000
(g) Minimum Senior Interest Coverage Ratio. Borrowers and their
--------------------------------------
Subsidiaries (excluding all Telmark Entities, Agway Insurance Company and all of
their respective Subsidiaries) on a consolidated basis shall have at the end of
each Fiscal Quarter set forth below, a Senior Interest Coverage Ratio for the
12-month period then ended (except for any period commencing December 23, 2000
and ending on or prior to December 31, 2001, which shall be for the periods
described below) of not less than the following:
3.0x for the period of two Fiscal Quarters commencing December 23, 2000 and
-----
ending June 30, 2001
.40x for the period of three Fiscal Quarters commencing December 23, 2000
-----
and ending September 30, 2001
.45x for the period of four Fiscal Quarters commencing December 23, 2000
-----
and ending December 31, 2001
2.30x for the Fiscal Quarter ending June 30, 2002
-----
4.0x for the Fiscal Quarter ending September 30, 2002
-----
4.2x for the Fiscal Quarter ending December 31, 2002
-----
4.3x for the Fiscal Quarter ending March 31, 2003
-----
4.8x for the Fiscal Quarter ending June 30, 2003
-----
4.8x for the Fiscal Quarter ending September 30, 2003
-----
4.9x for the Fiscal Quarter ending December 31, 2003
-----
5.0x for the Fiscal Quarter ending March 31, 2004
-----
(h) Minimum Excess Availability. Borrowers and their Subsidiaries
---------------------------
(excluding all Telmark Entities, Agway Insurance Company and all of their
respective Subsidiaries) at all times shall have Borrowing Availability, after
giving effect to Eligible Accounts, Eligible Deferred Accounts and Eligible
Inventory of Borrowers supporting Revolving Credit Advances and all Letter of
Credit Obligations (on a pro forma basis, with trade payables being paid in the
ordinary course, and expenses and liabilities being paid in the ordinary course
of business and without acceleration of sales) of at least Ten Million Dollars
($10,000,000).
Unless otherwise specifically provided herein, any accounting term used in the
Agreement shall have the meaning customarily given such term in accordance with
GAAP, and all financial computations hereunder shall be computed in accordance
with GAAP consistently applied. That certain items or computations are
explicitly modified by the phrase "in accordance with GAAP" shall in no way be
construed to limit the foregoing. If any "Accounting Changes" (as defined below)
occur and such changes result in a change in the calculation of the financial
covenants, standards or terms used in the Agreement or any other Loan Document,
then Borrowers, Agent and Lenders agree to enter into negotiations in order to
amend such provisions of the Agreement so as to equitably reflect such
Accounting Changes with the desired result that the criteria for evaluating
Borrowers' and their Subsidiaries' financial condition shall be the same after
such Accounting Changes as if such Accounting Changes had not been made;
provided, however, that the agreement of Requisite Lenders to any required
-------- -------
amendments of such provisions shall be sufficient to bind all Lenders.
"Accounting Changes" means (i) changes in accounting principles required by the
------------------
promulgation of any rule, regulation, pronouncement or opinion by the Financial
Accounting Standards Board of the American Institute of Certified Public
Accountants (or successor thereto or any agency with similar functions), (ii)
changes in accounting principles concurred in by any Borrower's certified public
accountants; (iii) purchase accounting adjustments under A.P.B. 16 or 17 and
EITF 88-16, and the application of the accounting principles set forth in FASB
109, including the establishment of reserves pursuant thereto and any subsequent
reversal (in whole or in part) of such reserves; and (iv) the reversal of any
reserves established as a result of purchase accounting adjustments. All such
adjustments resulting from expenditures made subsequent to the Closing Date
(including capitalization of costs and expenses or payment of pre-Closing Date
liabilities) shall be treated as expenses in the period the expenditures are
made and deducted as part of the calculation of EBITDA in such period. If Agent,
Borrowers and Requisite Lenders agree upon the required amendments, then after
appropriate amendments have been executed and the underlying Accounting Change
with respect thereto has been implemented, any reference to GAAP contained in
the Agreement or in any other Loan Document shall, only to the extent of such
Accounting Change, refer to GAAP, consistently applied after giving effect to
the implementation of such Accounting Change. If Agent, Borrowers and Requisite
Lenders cannot agree upon the required amendments within 30 days following the
date of implementation of any Accounting Change, then all Financial Statements
delivered and all calculations of financial covenants and other standards and
terms in accordance with the Agreement and the other Loan Documents shall be
prepared, delivered and made without regard to the underlying Accounting Change.
For purposes of Section 8.1, a breach of a Financial Covenant contained in this
-----------
Annex G shall be deemed to have occurred as of any date of determination by
-------
Agent or as of the last day of any specified measurement period, regardless of
when the Financial Statements reflecting such breach are delivered to Agent.
Exhibit B
---------
ANNEX J (from Annex A - Commitments definition)
--------------------------------
to
CREDIT AGREEMENT
----------------
Lender(s)
--------
Revolving Loan Commitment
(including a Swing Line Commitment
of $10,000,000)
$64,285,714.29 General Electric Capital Corporation
Revolving Loan Commitment
$44,571,428.57 CoBank, ACB
Revolving Loan Commitment
$19,714,285.71 Cooperatieve Centrale Raiffeisen-
Boerenleenbank B.A., "Rabobank
Nederland", New York Branch
Revolving Loan Commitment
$21,428,571.43 GMAC Business Credit, LLC
