FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT AND WAIVER
THIS
FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT AND WAIVER
(this
“Amendment”)
is
entered into as of September 1, 2007, by and among Apio,
Inc.,
a
Delaware corporation (“Borrower”),
and XXXXX
FARGO BANK, NATIONAL ASSOCIATION
(“Bank”).
Recitals
WHEREAS,
Borrower is currently indebted to Bank pursuant to the terms and conditions
of
that certain Amended and Restated Credit Agreement, dated as of November 1,
2005, by and among Borrower and Bank (as amended, modified and/or supplement
from time to time, the “Credit
Agreement”).
WHEREAS,
Borrower has informed Bank that pursuant to that certain Certificate of
Ownership and Merger executed on August 6, 2007 (the “Merger
Instrument”)
by Apio
Acquisition Corporation, (i) Apio Acquisition Corporation merged into
Borrower and (ii) Borrower’s Certificate of Incorporation was amended and
restated.
WHEREAS,
Borrower is in default of the following covenants in the Credit Agreement due
to
the transactions effectuated by the Merger Instrument: (i) Section 6.7
(Investments and Subsidiaries), (ii) Section 6.20 (Consolidation and
Merger; Asset Acquisitions) and (iii) Section 6.27 (Constituent
Documents) (such defaults, collectively, the “Existing
Defaults”).
WHEREAS,
Bank
has agreed to provide waivers of the Existing Defaults and Bank and Borrower
have agreed to certain changes in the terms and conditions set forth in the
Credit Agreement and have agreed to amend the Credit Agreement to reflect such
changes.
NOW,
THEREFORE,
for
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree that the Credit Agreement shall be
amended as follows:
1. Definitions.
Each
capitalized term used and not otherwise defined herein has the meaning ascribed
thereto in the Credit Agreement.
2. Waiver.
Subject
to the satisfaction of the conditions precedent set forth in Section 6
hereof, Bank hereby agrees that each of the Events of Default under
Section 7.1(b) of the Credit Agreement directly resulting from the Existing
Defaults shall be deemed waived.
3. Amendments
to Credit Agreement.
Subject
to the satisfaction of the conditions precedent set forth in Section 6
hereof, the Credit Agreement is hereby amended as follows:
(a) Section 6.2(b)
of the Credit Agreement is hereby amended by changing the timing of delivery
of
detailed lists of Borrower’s customers with contact names and addresses from
semi-annual delivery to delivery upon request of Bank.
(b) Section 6.3
of the Credit Agreement is hereby amended by amending and restating in its
entirety such Section as follows:
Section
6.3. Financial
Covenants.
(a) [Reserved].
(b) Minimum
Tangible Net Worth.
From
and after May 28, 2007, Borrower, together with the other Companies, will
maintain, at all times, Tangible Net Worth, determined as of the end of each
fiscal quarter, at an amount not less than $26,000,000 plus
75% of
cumulative Net Income realized since May 2007 up to such fiscal quarter
end.
(c) Minimum
Net Income.
From and
after May 28, 2007, Borrower, together with the other Companies, will
achieve (together with the other Companies) during each period described below,
consolidated Net Income, of not less than the amount set forth in the table
below opposite such period:
|
Fiscal
Year to Date Period Ending
|
Minimum
Net Income
|
|
August 31
of each year
|
$1,000,000
|
|
November 30
of each year
|
$2,000,000
|
|
February 28
or 29, as applicable,
of
each year
|
$3,000,000
|
|
May 31
of each year
|
$4,000,000
|
(d) Capital
Expenditures.
From
and after May 28, 2007, Borrower together with the other Companies will not
incur financed or unfinanced Capital Expenditures of more than $6,000,000 in
the
aggregate during any fiscal year.
(e) Maximum
Leverage.
From and
after May 28, 2007, Borrower, together with the other Companies, will
maintain Total Liabilities divided by Tangible Net Worth, as of the end of
each
fiscal quarter, at not greater than 1.00:1.00.
(c) Exhibit C
to the Credit Agreement is replaced in its entirety with Exhibit C attached
hereto and all references in the Credit Agreement and the other Loan Documents
to “Exhibit C” shall be interpreted as references to Exhibit C
hereto.
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(d) Schedules 5.1,
5.2, 5.11, 6.4 and 6.5 to the Credit Agreement are each replaced in their
entirety with the corresponding Schedule attached hereto and all references
in
the Credit Agreement and the other Loan Documents to any such Schedule shall
be
interpreted as a reference to the corresponding Schedule hereto.
4. Survival
of Terms; Interpretation.
Except
as specifically provided herein, all terms and conditions of the Credit
Agreement remain in full force and effect, without waiver or modification.
This
Amendment and the Credit Agreement shall be read together, as one document.
The
Recitals hereto, including the terms defined therein, are incorporated herein
by
this reference and acknowledged by Borrower to be true, correct and
accurate.
5. Representations,
Warranties and Covenants.
Borrower hereby remakes all representations and warranties contained in the
Credit Agreement (except to the extent that such representations and warranties
relate solely to an earlier date and after giving effect to the amendments
to
the Credit Agreement set forth in this Amendment) and reaffirms all covenants
set forth therein. Borrower further certifies that as of the date of this
Amendment (after
giving effect to the waivers set forth in Section 2 hereof) there
exists no Event of Default as defined in the Credit Agreement, nor any
condition, act or event which with the giving of notice or the passage of time
or both would constitute any such Event of Default.
6. Effective
Date.
This
Amendment will become effective as of the date first set forth above (the
“Effective
Date”),
provided that all of the following conditions precedent have been satisfied
on
or before September 30, 2007: (a) Bank shall have received a duly
executed original (or, if elected by Bank, an executed facsimile copy, to be
followed promptly by delivery of an executed original) of this Amendment,
executed by Borrower; (b) Bank shall have received a duly executed original
(or, if elected by Bank, an executed facsimile copy, to be followed promptly
by
delivery of an executed original) of the Guarantor’s Consent and Reaffirmation
attached hereto, executed by Landec Corporation; (c) Borrower shall have
paid to Bank an amendment fee of $5,000.00; and (d) all of the
representations and warranties contained herein (or incorporated herein by
reference) are true and correct as of the Effective Date.
7. Counterparts.
This
Amendment may be executed in two or more counterparts, each of which shall
be
deemed to be an original but all of which together shall constitute one and
the
same instrument. Delivery of an executed counterpart of a signature page to
this
Amendment by telefacsimile shall be as effective as delivery of a manually
executed counterpart of this Amendment.
8. Severability.
If any
term or provision of this Amendment shall be deemed prohibited by or invalid
under any applicable law, such provision shall be invalidated without affecting
the remaining provisions of this Amendment or the Credit Agreement.
9. Governing
Law.
This
Amendment shall be governed by and construed in accordance with the internal
laws of the State of California.
10. Non-Impairment.
Except
as expressly provided herein, nothing in this Agreement shall alter or affect
any provision, condition, or covenant contained in the Loan Documents or affect
or impair any rights, powers, or remedies of Bank, it being the intent of the
parties hereto that the provisions of the Loan Documents shall continue in
full
force and effect except as expressly modified hereby.
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IN
WITNESS WHEREOF,
the
parties hereto have caused this Amendment to be executed as of the day and
year
first written above.
|
APIO,
INC.
|
XXXXX
FARGO BANK, NATIONAL ASSOCIATION
|
|||
| By: | By: | |||
|
Xxxxxxxx Xxxxxx Chief
Financial Officer
|
Xxx
Xxxxxx
Vice
President
|
|||
FIRST
MODIFICATION TO LINE OF CREDIT NOTE
THIS
FIRST MODIFICATION TO LINE OF CREDIT NOTE (this
“Modification”)
is
entered into as of September 1, 2007, by and between Apio,
Inc.
(“Borrower”),
and
Xxxxx
Fargo bank, national association (“Bank”).
RECITALS
WHEREAS,
Borrower is currently indebted to Bank pursuant to the terms and conditions
of
that certain Amended and Restated Line of Credit Note in the maximum principal
amount of $7,000,000.00, executed by Borrower and payable to the order of
Bank,
dated as of November 1, 2005 (the “Line
of Credit Note”),
which
Note is subject to the terms and conditions of that certain Amended and Restated
Credit Agreement between Borrower and Bank dated as of November 1, 2005, as
amended from time to time (the “Credit
Agreement”).
WHEREAS,
Bank
and Borrower have agreed to certain changes in the terms and conditions set
forth in the Line of Credit Note, and have agreed to modify the Line of Credit
Note to reflect such changes.
NOW,
THEREFORE,
for
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree that the Line of Credit Note shall
be
modified as follows:
1. Paragraph
(a) Interest
of the
Section of the Note titled “INTEREST”
is
hereby deleted in its entirety and the following substituted
therefor:
(a) Interest.
The
outstanding principal balance of this Note shall bear interest (computed
on the
basis of a 360-day year for Libor
and a
365/366 day year for Prime Rate, actual days elapsed) either (i) at a
fluctuating rate per annum three-quarters percent (0.75%) below the Prime
Rate
in effect from time to time, or (ii) at a fixed rate per annum determined
by
Bank to be one and one-half percent (1.50%) above Libor
in
effect on the first day of the applicable Fixed Rate Term. When interest
is
determined in relation to the Prime Rate, each change in the rate of interest
hereunder shall become effective on the date each Prime Rate change is announced
within Bank. With respect to each Libor
selection hereunder, Bank is hereby authorized to note the date, principal
amount, interest rate and Fixed Rate Term applicable thereto and any payments
made thereon on Bank’s books and records (either manually or by electronic
entry) and/or on any schedule attached to this Note, which notations shall
be
prima facie evidence of the accuracy of the information noted.
2. The
last
sentence of Paragraph (a) Borrowing
and Repayment
of the
Section of the Note titled “BORROWING
AND REPAYMENT”
is
hereby deleted in its entirety, and the following substituted
therefor:
The
outstanding principal balance of this Note shall be due and payable in full
on
August 31, 2009.
3. The
effective date of the changes set forth herein shall be September 1, 2007.
The effectiveness of this Modification is subject to the satisfaction of
all
conditions provided in that certain First Amendment to Amended and Restated
Credit Agreement, dated as of September 1, 2007, between Borrowers and
Bank.
4. Except
as
expressly set forth herein, all terms and conditions of the Line of Credit
Note
remain in full force and effect, without waiver or modification. All terms
defined in the Line of Credit Note or the Credit Agreement shall have the
same
meaning when used in this Modification. This Modification and the Line of
Credit
Note shall be read together, as one document.
5. Borrower
certifies that as of the date of this Modification there exists no Event
of
Default under the Line of Credit Note, nor any condition, act or event which
with the giving of notice or the passage of time or both would constitute
any
such Event of Default. Borrower further certifies that, notwithstanding the
modifications set forth herein, all of the Collateral securing the Line of
Credit Note shall remain subject to the lien, charge or encumbrance of the
deed
of trust, mortgage, security agreement or other document pursuant to which
such
lien, charge or encumbrance is created, and nothing contained herein or done
pursuant hereto shall affect or be construed to affect the priority of the
lien,
charge or encumbrance of any such deed of trust, mortgage, security agreement
or
other document over any other liens, charges or encumbrances.
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In
Witness whereof,
the
parties hereto have caused this Modification to be executed as of the day
and
year first written above.
|
APIO,
INC.
|
XXXXX
FARGO BANK, NATIONAL ASSOCIATION
|
|||
| By: | By: | |||
|
Xxxxxxxx Xxxxxx Chief
Financial Officer
|
Xxx
Xxxxxx
Vice
President
|
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