AMENDMENT NO. 8 TO
LOAN AGREEMENT
This Amendment No. 8 to Loan Agreement (this "Amendment"), dated as of
August 1, 2002, is entered into with reference to the Loan Agreement (as
amended, supplemented or otherwise modified from time to time, the "Loan
Agreement") dated as of November 29, 1999 currently among Apio, Inc., a Delaware
corporation (successor by merger and name change to Xxxx Acquisition
Corporation, a Delaware corporation) ("Borrower"), each lender from time to time
a party thereto (each a "Lender" and collectively, the "Lenders"), Bank of
America, N.A., as Issuing Lender, and Bank of America, N.A., as Administrative
Agent (in such capacity, the "Administrative Agent"). Capitalized terms not
otherwise defined herein shall have the meanings set forth in the Loan
Agreement. Section references herein relate to the Loan Agreement unless
otherwise stated.
The parties hereto hereby agree as follows:
1. Section 1.1 - Definition of "Revolver Termination Date". The definition
of "Revolver Termination Date" contained in Section 1.1 is hereby amended in
full to read as follows:
"Revolver Termination Date" means November 1, 2002, or such later
anniversary of such date as may be established pursuant to Section 2.6.
2. Landec Equity Contributions. Borrower hereby represents, warrants and
covenants that: (a) upon completion of the sale of Dock Resins Corporation, a
wholly owned subsidiary of Landec, which sale is anticipated to close on or
prior to October 27, 2002, Landec will make a subordinated loan to Borrower (the
"Dock Resins Subordinated Loan") in an amount sufficient to repay the
outstanding principal amount of the Term Loan plus any accrued and unpaid
interest, fees or other costs associated therewith due and owing to the Lenders
(collectively, the "Term Loan Outstandings"), which subordinated loan shall be
evidenced by a Subordinated Promissory Note (or other similar documentation) in
form and substance satisfactory to the Administrative Agent, and (b) one hundred
percent (100%) of the proceeds of the Dock Resins Subordinated Loan will be used
to repay the Term Loan Outstandings. Each of the parties hereto hereby agrees
that the Dock Resins Subordinated Loan shall (a) constitute a "Subordinated
Obligation" under the Loan Agreement and the Landec Subordination Agreement, (b)
constitute a Permitted Contribution made on the date of this Amendment for a
purpose that is hereby consented to by the Lenders and (c) for purposes of
Section 2.7(e) of the Loan Agreement, not constitute a Landec Equity
Contribution. Each of the parties hereto further agrees that the Subordinated
Promissory Note referred to above (a) constitutes a "Subordinated Obligation
Document" under the Landec Subordination Agreement and (b) that (i) the failure
of Landec to make the Dock Resins Subordinated Loan or (ii) the failure of
Borrower to repay the Term Loan Outstandings within two (2) days following the
closing of the Dock Resins Subordinated Loan, shall constitute an Event of
Default under the Loan Agreement.
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3. Base Rate Margin. Effective upon satisfaction of the conditions set
forth in Section 4 of this Amendment, notwithstanding any applicable Pricing
Level with respect to any Pricing Period, the Base Rate Margin with respect to
all Revolving Loans shall be 2%.
4. Effectiveness. This Amendment shall become effective on such date (the
"Effective Date") as the Administrative Agent shall have received, in form and
substance satisfactory to the Administrative Agent and the Lenders, (a) duly
executed counterparts of this Amendment and (b) a Certificate of a Responsible
Official of Borrower certifying as to the incumbency of the Responsible Official
executing this Amendment.
5. Post-Closing Condition. Borrower hereby covenants and agrees that it
shall cause Landec and Cal Ex Trading Company to duly execute and deliver to the
Administrative Agent not later than September 9, 2002, counterparts of Annex I
attached hereto, signed by each Party thereto. Borrower further agrees that the
failure to satisfy this condition shall constitute an Event of Default under the
Loan Agreement.
6. Representations and Warranties. Except (i) for representations and
warranties which expressly relate to a particular date or which are no longer
true and correct as a result of a change permitted by the Loan Agreement or the
other Loan Documents or (ii) as disclosed by Borrower and approved in writing by
the Requisite Lenders, the Borrower hereby represents and warrants that each
representation and warranty made by Borrower in Article 4 of the Loan Agreement
(other than Sections 4.6 (first sentence), 4.11, and 4.18) are true and correct
as of the date hereof as though such representations and warranties were made on
and as of the date hereof. Without in any way limiting the foregoing, Borrower
represents and warrants to the Administrative Agent and the Lenders that no
Default or Event of Default has occurred and remains continuing or will result
from the consents, waivers, amendments or transactions set forth herein or
contemplated hereby.
7. Fees and Expenses. Borrower hereby agrees to reimburse the
Administrative Agent and the Lenders for the Administrative Agents and Lenders'
reasonable costs and expenses (including reasonable attorney's fees and
expenses) incurred in connection with the negotiation and drafting of this
Amendment and the transaction contemplated hereby together with any and all
other fees and expenses currently due and owing to the Administrative Agent
and/or the Lenders. Borrower further agrees that, commencing on the date hereof,
it shall satisfy its obligations under Section 11.3 of the Loan Agreement not
later than five (5) days after receipt of an invoice with respect thereto from
the Administrative Agent. Each of the parties hereto hereby agrees that the
failure to satisfy the requirements of this Section 8 shall constitute an Event
of Default under the Loan Agreement.
8. Amendment Fee. On the Effective Date, or as soon thereafter as may be
agreed upon by the Lenders, the Borrower shall pay to the Administrative Agent,
for the ratable accounts of the Lenders, an amendment fee of $20,000.
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9. Confirmation. In all respects, the terms of the Loan Agreement and the
other Loan Documents, in each case as amended hereby or by the documents
referenced herein, are hereby confirmed.
IN WITNESS WHEREOF, Borrower, the Administrative Agent and the Lenders
have executed this Agreement as of the date first set forth above by their duly
authorized representatives.
APIO, INC., a Delaware corporation
By:
-------------------------------------
Name:
--------------------------------
Title:
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BANK OF AMERICA, N.A., as Administrative
Agent, Issuing Lender and sole Lender
By:
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Xxxxx Xxxxxxxx, Senior Vice President
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ANNEX I TO AMENDMENT NO. 8
CONSENT AND REAFFIRMATION OF GUARANTOR AND PLEDGOR
Each of the undersigned guarantors and pledgors hereby consents to the
execution, delivery and performance by Borrower and the Administrative Agent of
the foregoing Amendment No. 8 to Loan Agreement ("Amendment No. 7"). In
connection therewith, each of the undersigned expressly and knowingly reaffirms
its liability under each of the Loan Documents to which it is a Party and
expressly agrees (a) to be and remain liable under the terms of each such Loan
Document, and (b) that it has no defense, offset or counterclaim whatsoever
against the Administrative Agent or the Lenders with respect to any such Loan
Document.
Each of the undersigned further agrees that each Loan Document to which it
is a Party shall remain in full force and effect and is hereby ratified and
confirmed.
Each of the undersigned further agrees that the execution of this Consent
and Reaffirmation of Guarantor and Pledgor is not necessary for the continued
validity and enforceability of any Loan Document to which it is a Party, but is
executed to induce the Administrative Agent and the Lenders to approve of and
otherwise enter into the Amendment No. 8.
Landec hereby represents, warrants and covenants that: (a) upon completion
of the sale of Dock Resins Corporation, a wholly owned subsidiary of Landec,
which sale is anticipated to close on or prior to October 27, 2002, Landec will
make a subordinated loan to Borrower (the "Dock Resins Subordinated Loan") in an
amount sufficient to repay the outstanding principal amount of the Term Loan
plus any accrued and unpaid interest, fees or other costs associated therewith
due and owing to the Lenders (collectively, the "Term Loan Outstandings"), which
subordinated loan shall be evidenced by a Subordinated Promissory Note (or
similar documentation) in form and substance satisfactory to the Administrative
Agent, and (b) Landec will cause Borrower to use one hundred percent (100%) of
the proceeds of the Dock Resins Subordinated Loan to repay the Term Loan
Outstandings. Landec hereby agrees that the Dock Resins Subordinated Loan shall
(a) constitute a "Subordinated Obligation" under the Loan Agreement and the
Landec Subordination Agreement, (b) constitute a Permitted Contribution made on
the date of this Amendment for a purpose that is hereby consented to by the
Lenders and (c) for purposes of Section 2.7(e) of the Loan Agreement, not
constitute a Landec Equity Contribution. Landec further agrees that the
Subordinated Promissory Note referred to above (a) constitutes a "Subordinated
Obligation Document" under the Landec Subordination Agreement and (b) that (i)
the failure of Landec to make the Dock Resins Subordinated Loan or (ii) the
failure of Borrower to repay the Term Loan Outstandings within two (2) days
following the closing of the Dock Resins Subordinated Loan, shall constitute an
Event of Default under the Loan Agreement and the Loan Documents.
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IN WITNESS WHEREOF, each of the undersigned, intending to be legally bound
hereby, has caused this Consent and Reaffirmation of Guarantor and Pledgor to be
executed as of September __, 2002.
LANDEC CORPORATION,
a California corporation
By:
-------------------------------------
Name:
--------------------------------
Title:
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CAL EX TRADING COMPANY,
a California corporation
By:
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Name:
--------------------------------
Title:
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