EXHIBIT 4.10
XXXXX HORTICULTURE, INC.
SIXTH AMENDMENT TO CREDIT
AGREEMENT
This SIXTH AMENDMENT TO CREDIT AGREEMENT (this "Amendment") is dated as
of February __, 1997 and entered into by and among XXXXX HORTICULTURE, INC.
(formerly known as Xxxxx Nurseries Inc.), a California corporation ("Company"),
SUN GRO HORTICULTURE INC., a Nevada corporation ("Sun Gro"), SUN GRO
HORTICULTURE CANADA LTD., a Canadian corporation ("Sun Gro Canada"; together
with Company and Sun Gro, collectively, "Borrowers"), the financial institutions
listed on the signature pages hereof ("Lenders") and BT COMMERCIAL CORPORATION,
as agent for Lenders ("Agent"), and, for purposes of Section 4 hereof, the
Credit Support Parties (as defined in Section 4 hereof) listed on the signature
pages hereof, and is made with reference to that certain Credit Agreement dated
as of August 4, 1995, as amended by that certain First Amendment thereto, that
certain Second Amendment thereto, that certain Third Amendment thereto, that
certain Fourth Amendment thereto and that certain Fifth Amendment and Consent
thereto (as so amended, the "Credit Agreement"), by and among Borrowers, Lenders
and Agent. Capitalized terms used herein without definition shall have the same
meanings herein as set forth in the Credit Agreement.
RECITALS
WHEREAS, Borrowers and Lenders desire to amend the Credit Agreement to
amend the definition of the terms "Company Borrowing Base", "Sun Gro Borrowing
Base" and "Eligible Inventory";
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, the parties hereto agree as follows:
Section 1. AMENDMENTS TO THE CREDIT AGREEMENT
Subsection 1.1 of the Credit Agreement is hereby amended by deleting
the two references to "$30,000,000" appearing in the term "Company Borrowing
Base" and substituting therefor "$38,000,000" for each such reference and by
deleting the two references to "$30,000,000" appearing in the term "Sun Gro
Borrowing Base" and substituting therefor "$38,000,000" for each such reference.
Subsection 1.1 of the Credit Agreement is hereby further amended by
adding the following immediately before the "or" appearing at the end of clause
(c) of the definition of the term "Eligible Inventory": "provided, however, that
prior to July 31, 1997, any Inventory which is located on property that was
formerly leased by
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FRN and that is currently leased by Company shall not be excluded from the
definition of 'Eligible Inventory' solely because such Inventory is not subject
to a Collateral Access Agreement executed by the lessor of such property."
Section 2. CONDITIONS TO EFFECTIVENESS
Section 1 of this Amendment shall become effective only upon the
satisfaction of all of the following conditions precedent (the date of
satisfaction of such conditions being referred to herein as the "Sixth Amendment
Effective Date"):
A. On or before the Sixth Amendment Effective Date, Company shall
deliver to Lenders (or to Agent for Lenders with sufficient originally executed
copies, where appropriate, for each Lender and its counsel) (i) executed copies
of this Amendment, (ii) resolutions of Board of Directors of each of Holdings
and each Borrower approving and authorizing the execution, delivery, and
performance of this Amendment certified as of the Sixth Amendment Effective Date
by its corporate secretary or an assistant secretary as being in full force and
effect without modification or amendment, and (iii) signature and incumbency
certificates of officers of each of Holdings and each Borrower executing this
Amendment.
B. On or before the Sixth Amendment Effective Date, all corporate and
other proceedings taken or to be taken in connection with the transactions
contemplated hereby and all documents incidental thereto not previously found
acceptable by Agent, acting on behalf of Lenders, and its counsel shall be
satisfactory in form and substance to Agent and such counsel, and Agent and such
counsel shall have received all such counterpart originals or certified copies
of such documents as Agent may reasonably request.
Section 3. BORROWERS' REPRESENTATIONS AND
WARRANTIES
In order to induce Lenders to enter into this Amendment and to amend
the Credit Agreement in the manner provided herein, each Borrower represents and
warrants to each Lender that the following statements are true, correct and
complete:
A. Corporate Power and Authority. Each Loan Party party hereto has all
requisite corporate power and authority to enter into this Amendment and to
carry out the transactions contemplated by, and perform its obligations under,
the Credit Agreement as amended by this Amendment (the "Amended Agreement").
B. Authorization of Agreements. The execution and delivery of this
Amendment and the performance of the Amended Agreement have been duly authorized
by all necessary corporate action on the part of each Loan Party party hereto.
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C. No Conflict. The execution and delivery by each Loan Party party
hereto of this Amendment and the performance by each Loan Party party hereto of
the Amended Agreement do not and will not (i) violate any provision of any law
or any governmental rule or regulation applicable to Holdings or any of its
Subsidiaries, the Certificate or Articles of Incorporation or Bylaws of Holdings
or any of its Subsidiaries or any order, judgment or decree of any court or
other agency of government binding on Holdings or any of its Subsidiaries, (ii)
conflict with, result in a breach of or constitute (with due notice or lapse of
time or both) a default under any Contractual Obligation of Holdings or any of
its Subsidiaries, (iii) result in or require the creation or imposition of any
Lien upon any of the properties or assets of Holdings or any of its Subsidiaries
(other than any Liens created under any of the Loan Documents in favor of Agent
on behalf of Lenders), or (iv) require any approval of stockholders or any
approval or consent of any Person under any Contractual Obligation of Holdings
or any of its Subsidiaries, except for such approvals or consents which have
been obtained on or before the Sixth Amendment Effective Date and disclosed in
writing to Lenders.
D. Governmental Consents. The execution and delivery by the Loan
Parties party hereto of this Amendment and the performance by the Loan Parties
party hereto of the Amended Agreement do not and will not require any
registration with, consent or approval of, or notice to, or other action to,
with or by, any federal, state or other governmental authority or regulatory
body.
E. Binding Obligation. This Amendment and the Amended Agreement have
been duly executed and delivered by each Loan Party party hereto and are the
legally valid and binding obligations of such Loan Party, enforceable against
such Loan Party in accordance with their respective terms, except as may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
relating to or limiting creditors' rights generally or by equitable principles
relating to enforceability.
F. Incorporation of Representations and Warranties From Credit
Agreement and the Other Loan Documents. The representations and warranties
contained in Section 5 of the Credit Agreement and contained in the other Loan
Documents are and will be true, correct and complete in all material respects on
and as of the Sixth Amendment Effective Date (both before and after giving
effect to this Amendment) to the same extent as though made on and as of that
date, except to the extent such representations and warranties specifically
relate to an earlier date, in which case they were true, correct and complete in
all material respects on and as of such earlier date.
G. Absence of Default. Other than a potential breach by Company of
subsection 7.6B as of December 31, 1996, no event has occurred and is continuing
or will result from the consummation of the transactions contemplated by this
Amendment that would constitute an Event of Default or a Potential Event of
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Default. In no event shall the execution and delivery of this Amendment be
deemed to be a waiver of any breach of subsection 7.6B.
Section 4. ACKNOWLEDGEMENT AND CONSENT
Company is a party to the Company Guaranty, the Company Security
Agreement, the Company Pledge Agreement, the Company Trademark Security
Agreement, the Company Patent Security Agreement and the Collateral Account
Agreement pursuant to which Company has (i) guarantied the Obligations and (ii)
created liens in favor of Agent on certain Collateral to secure the Obligations
and to secure its obligations under the Company Guaranty. Sun Gro is a party to
the Domestic Subsidiary Guaranty, the Domestic Subsidiary Security Agreement,
the Domestic Subsidiary Pledge Agreement, the Domestic Subsidiary Trademark
Security Agreement, the Domestic Subsidiary Patent Security Agreement and the
Collateral Account Agreement pursuant to which Sun Gro has (i) guarantied the
Obligations and (ii) created liens in favor of Agent on certain Collateral to
secure the Obligations and to secure the obligations of Sun Gro under the
Domestic Subsidiary Guaranty. Sun Gro Canada is a party to the Canadian
Subsidiary Security Agreement and the Canadian Subsidiary Pledge Agreement
pursuant to which Company has created liens in favor of Agent on certain
Collateral to secure the Obligations. Holdings is a party to the Holdings
Guaranty and the Holdings Pledge Agreement pursuant to which Holdings has (i)
guarantied the Obligations and (ii) pledged certain Collateral to Agent to
secure the obligations of Holdings under the Holdings Guaranty. Company, Sun
Gro, Sun Gro Canada and Holdings are collectively referred to herein as the
"Credit Support Parties", and the Guaranties and Collateral Documents referred
to above are collectively referred to herein as the "Credit Support Documents".
Each Credit Support Party hereby acknowledges that it has reviewed the
terms and provisions of the Credit Agreement and this Amendment and consents to
the amendment of the Credit Agreement effected pursuant to this Amendment. Each
Credit Support Party hereby confirms that each Credit Support Document to which
it is a party or otherwise bound and all Collateral encumbered thereby will
continue to guaranty or secure, as the case may be, to the fullest extent
possible the payment and performance of all "Obligations," "Guarantied
Obligations" and "Secured Obligations," as the case may be (in each case as such
terms are defined in the applicable Credit Support Document), including without
limitation the payment and performance of all such "Obligations," "Guarantied
Obligations" or "Secured Obligations," as the case may be, in respect of the
Obligations of Borrowers now or hereafter existing under or in respect of the
Amended Agreement and the Notes defined therein.
Each Credit Support Party acknowledges and agrees that any of the
Credit Support Documents to which it is a party or otherwise bound shall
continue in full force and effect and that all of its obligations thereunder
shall be valid and enforceable and shall not be impaired or limited by the
execution or effectiveness of this Amendment. Each Credit Support Party
represents and warrants that all repre-
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sentations and warranties contained in the Amended Agreement and the Credit
Support Documents to which it is a party or otherwise bound are true, correct
and complete in all material respects on and as of the Sixth Amendment Effective
Date to the same extent as though made on and as of that date, except to the
extent such representations and warranties specifically relate to an earlier
date, in which case they were true, correct and complete in all material
respects on and as of such earlier date.
Each Credit Support Party (other than Borrowers) acknowledges and
agrees that (i) notwithstanding the conditions to effectiveness set forth in
this Amendment, such Credit Support Party is not required by the terms of the
Credit Agreement or any other Loan Document to consent to the amendments to the
Credit Agreement effected pursuant to this Amendment and (ii) nothing in the
Credit Agreement, this Amendment or any other Loan Document shall be deemed to
require the consent of such Credit Support Party to any future amendments to the
Credit Agreement.
Section 5. MISCELLANEOUS
A. Reference to and Effect on the Credit Agreement and the Other Loan
Documents.
(i) On and after the Sixth Amendment Effective Date, each reference in
the Credit Agreement to "this Agreement", "hereunder", "hereof", "herein" or
words of like import referring to the Credit Agreement, and each reference
in the other Loan Documents to the "Credit Agreement", "thereunder",
"thereof" or words of like import referring to the Credit Agreement shall
mean and be a reference to the Amended Agreement.
(ii) Except as specifically amended by this Amendment, the Credit
Agreement and the other Loan Documents shall remain in full force and effect
and are hereby ratified and confirmed.
(iii) The execution, delivery and performance of this Amendment shall
not, except as expressly provided herein, constitute a waiver of any
provision of, or operate as a waiver of any right, power or remedy of Agent
or any Lender under, the Credit Agreement or any of the other Loan
Documents.
B. Fees and Expenses. Company acknowledges that all costs, fees and
expenses as described in subsection 10.2 of the Credit Agreement incurred by
Agent and its counsel with respect to this Amendment and the documents and
transactions contemplated hereby shall be for the account of Company.
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C. Headings. Section and subsection headings in this Amendment are
included herein for convenience of reference only and shall not constitute a
part of this Amendment for any other purpose or be given any substantive effect.
D. Applicable Law. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED
IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING
WITHOUT LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF
NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.
E. Counterparts; Effectiveness. This Amendment may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed and delivered shall be deemed an
original, but all such counterparts together shall constitute but one and the
same instrument; signature pages may be detached from multiple separate
counterparts and attached to a single counterpart so that all signature pages
are physically attached to the same document. This Amendment (other than the
provisions of Section 1 hereof) shall become effective upon the execution of a
counterpart hereof by Requisite Lenders, Requisite Class Lenders for Domestic
Lenders and each of the other parties hereto and receipt by Company and Agent of
written or telephonic notification of such execution and authorization of
delivery thereof.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered by their respective officers thereunto duly
authorized as of the date first written above.
XXXXX HORTICULTURE, INC. (formerly
known as Xxxxx Nurseries Inc.)
By:
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Title:
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SUN GRO HORTICULTURE INC.
By:
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Title:
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SUN GRO HORTICULTURE CANADA LTD.
By:
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Title:
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XXXXX HOLDINGS, INC., (formerly known as Xxxxx
Horticulture Inc.) (for purposes of Section 4
only) as a Credit Support Party
By:
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Title:
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BT COMMERCIAL CORPORATION, as a Domestic Lender
and as Agent
By:
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Title:
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BT BANK OF CANADA, as a Canadian Lender
By:
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Title:
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BANKERS TRUST COMPANY, as an Issuing Lender
By:
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Title:
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XXXXXX TRUST AND SAVINGS BANK,
as a Domestic Lender
By:
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Title:
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FLEET BANK OF MASSACHUSETTS, N.A.,
as a Domestic Lender and Canadian Lender
By:
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Title:
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LASALLE NATIONAL BANK,
as a Domestic Lender
By:
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Title:
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S-2
NATIONSBANK OF TEXAS, N.A.,
as a Domestic Lender and Canadian Lender
By:
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Title:
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UNION BANK OF CALIFORNIA, N.A.,
as a Domestic Lender and Canadian Lender
By:
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Title:
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XXXXX FARGO BANK, N.A.,
as a Domestic Lender and Canadian Lender
By:
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Title:
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BANK OF MONTREAL,
as a Canadian Lender
By:
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Title:
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S-3
