EXHIBIT 10.4
AG CAPITAL COMPANY
FIRST AMENDED AND RESTATED CREDIT AGREEMENT
THIS FIRST AMENDED AND RESTATED CREDIT AGREEMENT made and entered
into as of December 18, 1997 (the "Effective Date"), by and between RDO
EQUIPMENT CO., a Delaware corporation (the "Borrower"), whose address is 0000
Xxxxx Xxxxxxxxxx Xxxxx, X.X. Xxx 0000, Xxxxx, Xxxxx Xxxxxx, 00000-0000, and AG
CAPITAL COMPANY, a Delaware corporation (the "Lender"), whose address is 1500
Radisson Tower, 000 Xxxxx 0xx Xxxxxx, Xxxxx, Xxxxx Xxxxxx 00000, amends and
restates that certain Ag Capital Company Loan Agreement, dated as of October 31,
1997 (herein the "Prior Agreement") among the Borrower and the Lender.
RECITALS
1. The Lender and the Borrower have agreed that the terms and
conditions of the Prior Agreement should be amended and restated to clarify
certain provisions thereof for the benefit of both parties.
2. The Lender and the Borrower hereby agree that from and after the
Effective Date, the Prior Agreement shall be deemed amended and restated in its
entirety as set forth below.
NOW, THEREFORE, for and in consideration of the loans and advances
to be made by the Lender to the Borrower hereunder, the mutual covenants,
promises and agreements contained herein, and other good and valuable
consideration the receipt and sufficiency of which are hereby acknowledged, the
Borrower and the Lender agree as follows:
The following terms when used in this Credit Agreement shall, except
where the context otherwise requires, have the following meanings both in the
singular and plural forms thereof:
1. DEFINITIONS
"Advance" means any advance by the Lender made under either of the
Seasonal Commitments. (The face amount of any letter of credit issued by the
Lender for the account of the Borrower shall be deemed an Advance hereunder).
"Affiliate" means any corporation, association, partnership, joint
venture or other business entity directly or indirectly controlling or
controlled by, or under direct or indirect common control of, the Borrower or
any of its Subsidiaries.
"Assignee" has the meaning set forth in Section 20.14.
"Borrower" means RDO Equipment Co., a Delaware corporation.
"Business Day" means any day on which the Lender is open for the
transaction of business of the kind contemplated by this Credit Agreement.
"Change of Control" means the occurrence of any of the following
circumstances:
(a) any person or two or more persons acting in concert acquire
beneficial ownership (within the meaning of Rule 13d-3 of the
SEC under the Securities Exchange Act of 1934), directly or
indirectly, of securities of the Borrower (or other securities
convertible into such securities)
representing 25% or more of the combined voting power of all
securities of the Borrower entitled to vote in the election of
directors; or
(b) during any period, whether commencing before or after the date
hereof, the membership of the Board of Directors of the
Borrower changes for any reason (other than by reason of
death, disability, or scheduled retirement) so that the
majority of the Board of Directors is made up of persons who
were not directors at the beginning of such period.
"Collateral" means all of the assets of the Borrower or any other
party in which the Lender holds a security interest pursuant to any of the Loan
Documents.
"Credit Agreement" means this First Amended and Restated Credit
Agreement, as originally executed and as may be amended, modified, supplemented,
or restated from time to time by written agreement between the Borrower and the
Lender.
"Current Assets" means, at any date, the aggregate amount of all
assets of the Borrower that are classified as current assets, on a consolidated
basis, in accordance with GAAP.
"Current Liabilities" means, at any time, the aggregate amount of
all liabilities of the Borrower that are classified as current liabilities, on a
consolidated basis, in accordance with GAAP (including taxes and other proper
accruals and the matured portion of any indebtedness).
"Debt" means (i) all items of indebtedness or liability that, in
accordance with GAAP, would be included in determining total liabilities as
shown on the liabilities side of a balance sheet as at the date of which Debt is
to be determined; (ii) indebtedness secured by any mortgage, pledge, lien or
security interest existing on property owned by the Person whose Debt is being
determined, whether or not the indebtedness secured thereby shall have been
assumed; (iii) all obligations, contingent or otherwise, relative to the face
amount of all letters of credit, whether or not drawn, and banker's acceptances
issued for the account of such Person, and (iv) guaranties, endorsements (other
than for purposes of collection in the ordinary course of business) and other
contingent obligations in respect of, or to purchase or otherwise acquire
indebtedness of others.
"Default" means any event which if continued uncured would, with
notice or lapse of time or both, constitute an Event of Default.
"Environmental Laws" has the meaning set forth in Section 16.17.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended and as may be further amended from time to time, and the rules and
regulations promulgated thereunder by any governmental agency or authority, as
from time to time in effect.
"Event of Default" means any event of default described in Section
19 hereof.
"Fixed Rate" means such rate of interest as may be quoted to
Borrower by Lender at Lender's sole discretion upon request made by Borrower
before 11:00 a.m. (central time) at least two Business Days prior to the
beginning of the calendar month specified by Borrower in such request for
Interest Rate Periods as specified by Borrower in such request.
"Fixed Rate Amount" means the amount of any Loan which accrues
interest at a Fixed Rate, which shall be specified in any request by the
Borrower to Lender for a Fixed Rate, and which must be in increments of
$100,000, unless otherwise agreed to by the Lender.
"GAAP" means the generally accepted accounting principles in the
United States in effect from time to time including, but not limited to,
Financial Accounting Standards Board (FASB) Standards and Interpretations,
Accounting Principles Board (APB) Opinions and Interpretations, Committee on
Accounting Procedure (CAP) Accounting Research Bulletins, and certain other
accounting principles which have substantial authoritative support.
"Government Yield" means as of any date of determination the yield
(converted as necessary to the equivalent semi-annual compound rate) on U.S.
Treasury securities having a maturity date closest to the weighted average
maturity of the relevant Loan (to the scheduled installment dates), as published
in The Wall Street Journal (or, if not so published, as determined by the Lender
by using the average quotes obtained by the Lender from three primary dealers
that market U.S. Treasury securities in the secondary market). "U.S. Treasury
securities" means actively traded U.S. Treasury bonds, bills and notes and, if
more than one issue of U.S. Treasury securities is scheduled to mature at or
about the time of the end of the weighted average maturity of the Loan, then to
the extent possible the U.S. Treasury security issued most recently prior to the
date of determination will be chosen as the basis of the Government Yield.
"Hazardous Substance" has the meaning set forth in Section 16.16
hereof.
"Interest Differential" means as of the date of any full or partial
prepayment on any Loan, the Government Yield with respect to such Loan measured
on the date the rate at which interest on such Loan is accruing immediately
prior to such prepayment is set, minus the Government Yield with respect to such
Loan as of the date of such prepayment.
"Interest Rate Period" means the period specified by the Lender in
response to a request by the Borrower that any Fixed Rate Amount of any Loan
accrue interest at a Fixed Rate. All Interest Rate Periods shall be months, but
in no event shall end later than the Maturity with respect to the Seasonal Loan,
and the final maturity date for each other Loan.
"Issuance Spread" is the amount by which the rate per annum at which
interest accrues on any Loan as of any date such rate is set exceeded the
Government Yield as of such date.
"Lender" means Ag Capital Company, a Delaware corporation, its
successors and assigns.
"Letter of Credit I" shall mean the standby letter of credit issued
by the St. Xxxx Bank for Cooperatives for the benefit of Xxxxxxx X. Xxxxxx in
the face amount not to exceed Three Hundred Forty-Five Thousand Dollars
($345,000) in form and substance satisfactory to the Lender and the Borrower.
"Letter of Credit Note I" means the note No. 29220 in the stated
amount of the Letter of Credit I, or if less, in the amount of any reimbursement
obligations as they arise under the Letter of Credit I.
"Letter of Credit II" shall mean the standby letter of credit issued
by the St. Xxxx Bank for Cooperatives for the benefit of Xxxxxxx X. Xxxxxx in
the face amount not to exceed Five Hundred Fifteen Thousand Dollars ($515,000)
in form and substance satisfactory to the Lender and the Borrower.
"Letter of Credit Note II" means the note No. 292201 in the stated
amount of the Letter of Credit II, or if less, in the amount of any
reimbursement obligations as they arise under the Letter of Credit II.
"Leverage Ratio" means the ratio of the total liabilities (including
Debt) of the Borrower to the Tangible Net Worth of the Borrower, as determined
on a consolidated basis, in accordance with GAAP.
"LIBOR" for any day during any calendar month means the rate of
interest per annum determined by the Lender to be the arithmetic mean (rounded
upward, if necessary, to the nearest 1/100th of 1%) of the rates of interest per
annum notified to the Lender by at least two (2) major banks in the London
interbank eurodollar market as the rate of interest at which dollar deposits in
the approximate amount of the investment associated with such one month period
would be offered to major banks in the London interbank market at their request,
in each case at or about 11:00 a.m. (Fargo time) on the second Business Day
prior to the commencement of such calendar month.
"Lien" means any lien, security interest, pledge, mortgage,
statutory or tax lien, or other encumbrance of any kind whatsoever (including
without limitation, the lien or retained security title of a conditional
vendor), whether arising under a security instrument or as a matter of law,
judicial process or otherwise or by an agreement of the Borrower to grant any
lien or security interest or to pledge, mortgage or otherwise encumber any of
its assets.
"Loan" means any of the Seasonal Loan I, Seasonal Loan II, Term Loan
I, Term Loan II, Term Loan III, Term Loan IV, Term Loan V, Term Loan VI, Term
Loan VII, Letter of Credit I and Letter of Credit II.
"Loan Documents" means this Credit Agreement and the Subject Notes
and such other documents as the Lender may reasonably require as security for,
or otherwise executed in connection with, any loan hereunder, all as originally
executed and as may be amended, modified or supplemented from time to time by
written agreement between the parties thereto.
"Material Adverse Occurrence" means any occurrence which materially
adversely affects the present or prospective financial condition or operations
of the Borrower, or which impairs, or may impair, in the Lender's reasonable
judgment, the ability of the Borrower to perform its obligations under the Loan
Documents.
"Maturity" of the Seasonal Note means the earlier of (a) the date on
which the Seasonal Note becomes due and payable upon the occurrence of an Event
of Default; or (b) the Termination Date.
"Mortgages" means the mortgages dated January 31, 1996 expressly
securing Term Note IV, and other obligations to Lender, and mortgages dated June
16, 1992 expressly securing Term Note I, February 24, 1992 expressly securing
Term Note II and October 14, 1991, expressly securing Term Note III and as
provided in each such mortgage, other obligations to Lender.
"Mortgage Secured Notes and Loans" has the meaning set forth in
Section 13.8.
"Person" means any natural person, corporation, firm, association,
government, governmental agency or any other entity, whether acting in an
individual fiduciary or other capacity.
"Premises" has the meaning set forth in Section 16.17 hereof.
"Reference Rate" means for any day the rate of interest indicated as
the "prime rate" in the "Money Rates" section of the Wall Street Journal for
such day (or if no such rate is published for such day for the earliest
preceding day for which such rate is published). If such rate ceases to be
published, the "Reference Rate" shall mean a comparable rate determined by the
Lender as indicated in a written notice to the Borrower."
"Regulatory Change" means any change after the date hereof in any
(or the adoption after the date hereof of any new) (a) Federal or state law or
foreign law applying to the Lender (or its successors or
assigns); or (b) regulation, interpretation, directive or request (whether or
not having the force of law) applying or in the reasonable opinion of the Lender
(or its successors or assigns) applicable to, the Lender (or its successors or
assigns) of any court or governmental authority charged with the interpretation
or administration of any law referred to in clause (a) of this definition or of
any fiscal, monetary, or other authority having jurisdiction over the Lender (or
its successors or assigns).
"Seasonal Commitment" means the Lender's obligation to extend
Advances to the Borrower under Sections 2 and 3, as the context may require.
"Seasonal Loan I" means, at any date, the aggregate amount of all
Advances made by the Lender to the Borrower pursuant to Section 2 hereof.
"Seasonal Note I" means the note No. 29210, dated October 31, 1997,
in the original principal amount of Fifteen Million Dollars ($15,000,000.00)
made by the Borrower payable to the order of the Lender, together with all
extensions, renewals, modifications, substitutions and changes in form thereof
effected by written agreement between the Borrower and the Lender.
"Seasonal Loan II" means, at any date, the aggregate amount of all
Advances made by the Lender to the Borrower pursuant to Section 3 hereof.
"Seasonal Note II" means the note No. 292101, dated October 31,
1997, in the original principal amount of Five Million Dollars ($5,000,000.00)
made by the Borrower payable to the order of the Lender, together with all
extensions, renewals, modifications, substitutions and changes in form thereof
effected by written agreement between the Borrower and the Lender.
"Security Agreement" means the Security Agreement dated as of
January 31, 1997 executed by the Borrower in favor of the Lender, as originally
executed and as may be amended, modified or supplemented from time to time by
written agreement between the Borrower and the Lender, and various other
security agreements previously executed in favor of the Lender by Borrower.
"Subject Note(s)" means the Seasonal Note I, the Seasonal Note II,
the Letter of Credit Note I, the Letter of Credit Note II and the Term Notes.
"Subsidiary" means any corporation of which more than fifty percent
(50%) of the outstanding capital stock having ordinary voting power to elect a
majority of the board of directors of such corporation (irrespective of whether,
at the time, stock of any other class or classes of such corporation shall have
or might have voting power by reason of the happening of any contingency) is at
the time, directly or indirectly, owned by the Borrower and/or one or more
Subsidiary or Affiliate.
"Tangible Net Worth" means, at any date, the excess, if any, of the
Borrower's total assets over the Borrower's total liabilities on such date,
excluding from total assets the aggregate amount carried as assets on the books
of the Borrower for goodwill, licenses, patents, trademarks, trade names
treasury stock, unamortized debt discount and expenses, leasehold improvements,
copyrights, franchises, organization costs, write-ups in the book value of the
assets of the Borrower resulting from a revaluation thereof, and any other
intangible assets, all as determined in accordance with GAAP.
"Term Loan I" means the loan evidenced by the Term Note I (No.
4550).
"Term Note I" means the note No. 4550, dated June 16, 1992, in the
original principal amount of Eighty Thousand Dollars ($80,000), made by the
Borrower payable to the order of the Lender, together
with all extensions, renewals, modifications, substitutions and changes in form
thereof effected by written agreement between the Borrower and the Lender.
"Term Loan II" means the loan evidenced by the Term Note II (No.
4560).
"Term Note II" means the note No. 4560, dated February 24, 1992, in
the original principal amount of One Hundred Fifty-Eight Thousand Three Hundred
Sixty-Eight and 78/100 Dollars ($158,368.78) made by the Borrower payable to the
order of the Lender, together with all extensions, renewals, modifications,
substitutions and changes in form thereof effected by written agreement between
the Borrower and the Lender.
"Term Loan III" means the loan evidenced by the Term Note III (No.
4910).
"Term Note III" means the note No. 4910, dated October 14, 1991, in
the original principal amount of Three Hundred Fifty Thousand Dollars ($350,000)
made by the Borrower payable to the order of the Lender, together with all
extensions, renewals, modifications, substitutions and changes in form thereof
effected by written agreement between the Borrower and the Lender.
"Term Loan IV" means the loan evidenced by the Term Note IV (No.
20020).
"Term Note IV" means the note No. 20020, dated January 29, 1996 in
the original principal amount of Eight Hundred Ninety-Eight Thousand Two Hundred
Dollars ($898,200) made by the Borrower payable to the order of the Lender,
together with all extensions, renewals, modifications, substitutions and changes
in form thereof effected by written agreement between the Borrower and the
Lender.
"Term Loan V" means the loan evidenced by the Term Note V (No.
24900).
"Term Note V" means the note Xx. 00000, dated October 18, 1996 in
the original principal amount of Three Hundred Fifty-Five Thousand Dollars
($355,000) made by the Borrower payable to the order of the Lender, together
with all extensions, renewals, modifications, substitutions and changes in form
thereof effected by written agreement between the Borrower and the Lender.
"Term Loan VI" means the loan evidenced by the Term Note VI (No.
27370).
"Term Note VI" means the note No. 27370, dated January 31, 1997 in
the original principal amount of One Million Eight Hundred Fifty-Five Thousand
Seven Hundred and Three Dollars ($1,855,703) made by the Borrower payable to the
order of the Lender, together with all extensions, renewals, modifications,
substitutions and changes in form thereof effected by written agreement between
the Borrower and the Lender.
"Term Loan VII" means the loan evidenced by the Term Note VII (No.
27380).
"Term Note VII" means the note No. 27380, dated January 31, 1997 in
the original principal amount of Two Million Five Hundred Fifty-Nine Thousand
Dollars ($2,559,000) made by the Borrower payable to the order of the Lender,
together with all extensions, renewals, modifications, substitutions and changes
in form thereof effected by written agreement between the Borrower and the
Lender.
"Term Notes" means Term Note I (No. 4550), Term Note II (No. 4560),
Term Note III (No. 4910), Term Note IV (No. 20020), Term Note V (No. 24900),
Term Note VI (No. 27370) and Term Note VII (No. 27380).
"Termination Date" means the earlier of (a) June 1, 1998; or (b) the
date upon which the obligation of the Lender to make Advances is terminated
pursuant to Section 2.7 or Section 3.7 .
"Working Capital" means the Borrower's Current Assets minus its
Current Liabilities (other than deferred income taxes and any current portion of
liabilities otherwise included in the Current Liabilities).
2. THE SEASONAL LOAN I
2.1. Commitment for Seasonal Loan I. Subject to the Conditions of
Lending set forth in Section 15 hereof, the Lender agrees to make
Advances under Seasonal Loan I to the Borrower from time to time
from the date of this Credit Agreement through the Termination Date,
provided, however, that the Lender shall not be obligated to make
any such Advance, if after giving effect to such Advance, the
aggregate outstanding principal amount of all such Advances would
exceed Fifteen Million Dollars ($15,000,000). Within the limits set
forth above, the Borrower may borrow, repay and reborrow amounts
under the Seasonal Note I.
2.2. The Seasonal Note I. All Advances shall be evidenced by, and
the Borrower shall repay such Advances to the Lender in accordance
with, the terms of the Seasonal Note I but in no event later than
the date of Maturity; including without limitation the provision of
the Seasonal Note I that the principal amount payable thereunder at
any time shall not exceed the then unpaid principal amount of all
Advances under Seasonal Loan I made by the Lender.
2.3. Records of Advances and Payments. The aggregate amount of all
unpaid Advances under Seasonal Loan I set forth on the records of
the Lender shall be rebuttable presumptive evidence of the principal
amount owing and unpaid on the Seasonal Note I.
2.4. Payments and Interest on the Seasonal Note I.
(a) Except to the extent any part thereof is a Fixed Rate Amount,
the Borrower agrees to pay interest on the outstanding
principal amount of the Seasonal Note I from the date hereof
until paid in full at a per annum rate equal to the Reference
Rate, minus 0.375%.
(b) Interest accrued on the Seasonal Note I through Maturity shall
be payable for each month on the fifteenth (15th) day of the
following calendar month, commencing January 15, 1998, and at
Maturity when the entire outstanding principal amount shall be
due and payable. Interest accrued after Maturity shall be
payable upon demand.
2.5. Manner of Borrowing. The Borrower shall give the Lender written
or telephonic notice of each requested Advance under Seasonal Loan I
by not later than 1:00 p.m. (Minneapolis time) on the date such
Advance is to be made. Each Advance under Seasonal Loan I shall be
deposited to an account designated by the Borrower or as otherwise
indicated in the corresponding request by the Borrower.
2.6. Payments. Any other provision of this Credit Agreement to the
contrary notwithstanding, the Borrower shall make all payments of
interest on and principal of the Seasonal Note I to the Lender at
its office shown on the first page hereof (or to such other
locations as may from time to time be specified by the Lender).
2.7. Termination. The obligation of the Lender to make Advances
under Seasonal Loan I shall terminate:
(a) Upon receipt by the Lender of three (3) days' written notice
of termination from the Borrower given at any time when no
amount is outstanding under the Seasonal Note I;
(b) Immediately and without further action upon the occurrence of
an Event of Default of the nature referred to in Subsection
19.1((d)) or
(c) Immediately when any Event of Default (other than one of the
nature specified in Subsection 19.1((d))) shall have occurred
and be continuing and either (i) the Lender shall have
demanded payment of the Seasonal Note I or (ii) the Lender
shall elect by giving notice to Borrower.
3. THE SEASONAL LOAN II
3.1. Commitment for Seasonal Loan II. Subject to the Conditions of
Lending set forth in Section 15 hereof, the Lender agrees to make
Advances under Seasonal Loan II to the Borrower from time to time
from the date of this Credit Agreement through the Termination Date,
provided, however, that the Lender shall not be obligated to make
any such Advance, if after giving effect to any such Advance, the
aggregate outstanding principal amount of all such Advances would
exceed Five Million Dollars ($5,000,000). Within the limits set
forth above, the Borrower may borrow, repay and reborrow amounts
under the Seasonal Note II.
3.2. The Seasonal Note II. All Advances shall be evidenced by, and
the Borrower shall repay such Advances to the Lender in accordance
with, the terms of the Seasonal Note II but in no event later than
the date of Maturity; including without limitation the provision of
the Seasonal Note II that the principal amount payable thereunder at
any time shall not exceed the then unpaid principal amount of all
Advances under Seasonal Loan II made by the Lender.
3.3. Records of Advances and Payments. The aggregate amount of all
unpaid Advances set forth on the records of the Lender shall be
rebuttable presumptive evidence of the principal amount owing and
unpaid on the Seasonal Note II.
3.4. Payments and Interest on the Seasonal Note II.
(a) Except to the extent any part thereof is a Fixed Rate Amount,
the Borrower agrees to pay interest on the outstanding
principal amount of the Seasonal Note II from the date hereof
until paid in full at a per annum rate equal to the Reference
Rate minus 0.375%.
(b) Interest accrued on the Seasonal Note II through Maturity
shall be payable for each month on the fifteenth (15th) day of
the following calendar month, commencing January 15, 1998, and
at Maturity when the entire outstanding principal amount shall
be due and payable. Interest accrued after Maturity shall be
payable upon demand.
3.5. Manner of Borrowing. The Borrower shall give the Lender written
or telephonic notice of each requested Advance under Seasonal Loan
II by not later than 1:00 p.m. (Minneapolis time) on the date such
Advance is to be made. Each Advance under Seasonal Loan II shall be
deposited to an account designated by the Borrower or as otherwise
indicated in the corresponding request by the Borrower.
3.6. Payments. Any other provision of this Credit Agreement to the
contrary notwithstanding, the Borrower shall make all payments of
interest on and principal of the Seasonal Note II to the Lender at
its office shown on the first page hereof (or to such other
locations as may from time to time be specified by the Lender).
3.7. Termination. The obligation of the Lender to make Advances
under Seasonal Loan II shall terminate:
(a) Upon receipt by the Lender of three (3) days' written notice
of termination from the Borrower given at any time when no
amount is outstanding under the Seasonal Note II;
(b) Immediately and without further action upon the occurrence of
an Event of Default of the nature referred to in Subsection
19.1((d)) or
(c) Immediately when any Event of Default (other than one of the
nature specified in Subsection 19.1((d))) shall have occurred
and be continuing and either (i) the Lender shall have
demanded payment of the Seasonal Note II or (ii) the Lender
shall elect by giving notice to Borrower.
4. THE TERM LOAN I
4.1. Term Loan. The Lender has previously made Term Loan I to the
Borrower, of which the principal amount of $23,761.50 is currently
outstanding.
4.2. Term Note I. To evidence the Term Loan I made by the Lender to
the Borrower hereunder, the Borrower has executed and delivered to
the Lender the Term Note I. The Borrower agrees to pay to the Lender
amounts outstanding under the Term Note I in installments as set
forth in said note, with all outstanding principal and accrued
interest due and payable October 1, 1999.
4.3. Payments and Interest on the Term Note I.
(a) Except to the extent any part thereof is a Fixed Rate Amount,
the Borrower agrees to pay interest on the unpaid principal
balance of the Term Note I outstanding from time to time at a
rate per annum equal to the Reference Rate.
(b) After the date hereof, the principal and accrued interest on
the amount outstanding under Term Note I through the end of
each calendar month hereafter shall be payable on the
fifteenth (15th) day following the end of each such calendar
month in equal monthly payments of $1,200 commencing January
15, 1998 and continuing on the fifteenth (15th) day of each
calendar month thereafter until October 1, 1999, when the
entire amount of principal and interest shall be due and
payable in full. Lender shall have the right to adjust the
amount of such payments to maintain the original 7 year
amortization to the extent required by changes in the rate at
which interest accrues on Term Note I.
5. TERM LOAN II
5.1. Term Loan II. The Lender has previously made Term Loan II to
the Borrower, of which the principal amount of $79,057.40 is
currently outstanding.
5.2. Term Note II. To evidence the Term Loan II made by the Lender
to the Borrower hereunder, the Borrower has executed and delivered
to the Lender the Term Note II. The Borrower
agrees to pay to the Lender amounts outstanding under the Term Note
II in installments as set forth in said note, with all outstanding
principal and accrued interest due and payable February 15, 2001.
5.3. Payments and Interest on the Term Note II.
(a) The Borrower agrees to pay interest on the unpaid principal
balance of the Term Note II outstanding from time to time at a
rate per annum equal to 9.90% computed on the basis of a year
of 365 days.
(b) After the date hereof, the principal and accrued interest on
the amount outstanding under Term Note II through the end of
each calendar month hereafter shall be payable on the
fifteenth (15th) day following the end of each such calendar
month in equal monthly payments of $2,045 commencing January
15, 1998 and continuing on the fifteenth (15th) day of each
calendar month thereafter until February 15, 2001, when the
entire amount of principal and interest shall be due and
payable in full.
6. TERM LOAN III
6.1. Term Loan III. The Lender has previously made Term Loan III to
the Borrower, of which the principal amount of $173,258.57 is
currently outstanding.
6.2. Term Note III. To evidence the Term Loan III made by the Lender
to the Borrower hereunder, the Borrower has executed and delivered
to the Lender the Term Note III. The Borrower agrees to pay to the
Lender amounts outstanding under the Term Note III in installments
as set forth in said note, with all outstanding principal and
accrued interest due and payable October 1, 2001.
6.3. Payments and Interest on the Term Note III.
(a) The Borrower agrees to pay interest on the unpaid principal
balance of the Term Note III outstanding from time to time at
a rate per annum equal to 9.70% computed on the basis of a
year of 365 days.
(b) After the date hereof, the principal and accrued interest on
the amount outstanding under Term Note III through the end of
each calendar month hereafter shall be payable on the
fifteenth (15th) day following the end of each such calendar
month in equal monthly payments of $4,567.33 commencing
January 15, 1998 and continuing on the fifteenth (15th) day of
each calendar month thereafter until October 1, 2001, when the
entire amount of principal and interest shall be due and
payable in full.
7. TERM LOAN IV
7.1. Term Loan IV. The Lender has previously made Term Loan IV to
the Borrower, of which the principal amount of $845,626.23 is
currently outstanding.
7.2. Term Note IV. To evidence the Term Loan IV made by the Lender
to the Borrower hereunder, the Borrower has executed and delivered
to the Lender the Term Note IV. The Borrower agrees to pay to the
Lender amounts outstanding under the Term Note IV in installments as
set forth in said note, with all outstanding principal and accrued
interest due and payable February 1, 2006.
7.3. Payments and Interest on the Term Note IV.
(a) Except to the extent any part thereof is a Fixed Rate Amount,
the Borrower agrees to pay interest on the unpaid principal
balance of the Term Note IV outstanding from time to time at a
rate per annum equal to the Reference Rate.
(b) After the date hereof, the principal and accrued interest on
the amount outstanding under Term Note IV through the end of
each calendar month hereafter shall be payable on the
fifteenth (15th) day following the end of each such calendar
month in equal monthly payments of $8,370 commencing January
15, 1998 and continuing on the fifteenth (15th) day of each
calendar month thereafter until February 1, 2006, when the
entire amount of principal and interest shall be due and
payable in full. Lender shall have the right to adjust the
amount of such payments to maintain the original 15 year
amortization to the extent required by changes in the rate
interest accrues on Term Note IV.
8. TERM LOAN V
8.1. Term Loan V. The Lender has previously made Term Loan V to the
Borrower, of which the principal amount of $295,000.00 is currently
outstanding.
8.2. Term Note V. To evidence the Term Loan V made by the Lender to
the Borrower hereunder, the Borrower has executed and delivered to
the Lender the Term Note V. The Borrower agrees to pay to the Lender
amounts outstanding under the Term Note V in installments as set
forth in said note, with all outstanding principal and accrued
interest due and payable December 1, 2002.
8.3. Payments and Interest on the Term Note V.
(a) Except to the extent any part thereof is a Fixed Rate Amount,
the Borrower agrees to pay interest on the unpaid principal
balance of the Term Note V outstanding from time to time at a
rate per annum equal to the Reference Rate.
(b) After the date hereof, the principal and accrued interest on
the amount outstanding under Term Note V through the end of
each calendar quarter hereafter shall be payable on the
fifteenth (15th) day following the end of each such calendar
quarter in equal quarterly payments of $15,000 of principal,
plus interest accrued through such period, commencing January
15, 1998 and continuing on the fifteenth (15th) day following
each calendar quarter thereafter until December 1, 2002, when
the entire amount of principal and interest shall be due and
payable in full.
9. TERM LOAN VI
9.1. Term Loan VI. The Lender has previously made Term Loan VI to
the Borrower, of which the principal amount of $1,762,928.00 is
currently outstanding.
9.2. Term Note VI. To evidence the loan made by the Lender to the
Borrower hereunder, the Borrower has executed and delivered to the
Lender the Term Note. The Borrower agrees to pay to the Lender
amounts outstanding under the Term Note VI in installments as set
forth in said note, with all outstanding principal and accrued
interest due and payable February 1, 2002.
9.3. Payments and Interest on the Term Note VI.
(a) Except to the extent any part thereof is a Fixed Rate Amount,
the Borrower agrees to pay interest on the unpaid principal
balance of the Term Note VI outstanding from time to time at a
rate per annum equal to the Reference Rate.
(b) After the date hereof, the principal and accrued interest on
the amount outstanding under Term Note VI through the end of
each quarterly period ending immediately prior to the
following described payment dates hereafter shall be payable
on the fifteenth (15th) day following the end of each such
quarterly period in quarterly payments of $30,925 of
principal, plus interest accrued through such period,
commencing February 15, 1998 and continuing on the fifteenth
(15th) day of each of May, August, December and February
thereafter until February 1, 2002, when the entire amount of
principal and interest shall be due and payable in full.
10. TERM LOAN VII
10.1. Term Loan VII. The Lender has previously made Term Loan VII to
the Borrower, of which the principal amount of $2,175,150.00 is
currently outstanding.
10.2. Term Note VII. To evidence the loan made by the Lender to the
Borrower hereunder, the Borrower has executed and delivered to the
Lender the Term Note. The Borrower agrees to pay to the Lender
amounts outstanding under the Term Note VII in installments as set
forth in said note, with all outstanding principal and accrued
interest due and payable February 1, 2002.
10.3. Payments and Interest on the Term Note VII.
(a) Except to the extent any part thereof is a Fixed Rate Amount,
the Borrower agrees to pay interest on the unpaid principal
balance of the Term Note VII outstanding from time to time at
a rate per annum equal to the Reference Rate.
(b) After the date hereof, the principal and accrued interest on
the amount outstanding under Term Note VII through the end of
each quarterly period ending immediately prior to the
following described payment dates hereafter shall be payable
on the fifteenth (15th) day following the end of each such
quarterly period in quarterly payments of $127,950 of
principal, plus interest accrued through such period,
commencing February 15, 1998 and continuing on the fifteenth
(15th) day of each of May, August, December and February
thereafter until February 1, 2002, when the entire amount of
principal and interest shall be due and payable in full.
11. LETTER OF CREDIT I
11.1. Issuance of Letter of Credit I; Letter of Credit Fee.
(a) The Lender shall cause the Letter of Credit I to be issued
upon request by the Borrower and upon issuance of the Letter
of Credit I, the Borrower shall make and deliver to the Lender
the Letter of Credit Note I.
(b) Upon issuance of the Letter of Credit I, the Borrower agrees
to pay the Lender a commission equal to a per annum rate of
.75% of the face amount thereof payable in full in advance in
quarterly installments due on the first day of each calendar
quarter.
11.2. Repayment of Drawings. Forthwith when a draft or other demand
for payment under the Letter of Credit I is received by the Lender
or the Lender receives notice thereof from any other issuer of such
Letter of Credit I, the Lender shall give notice thereof to the
Borrower by telecopy or telephone, which shall constitute a demand
for payment under the Letter of Credit Note I; provided that the
Borrower shall not be deemed to be in payment default thereunder
until after the second Business Day after such notice.
11.3. Payments and Interest on Letter of Credit Note I.
(a) The Borrower agrees to pay interest on the unpaid principal
balance of the Letter of Credit Note I outstanding from time
to time at a rate equal to the Reference Rate minus .375%.
(b) Payments of principal and interest on amounts outstanding
under the Letter of Credit Note I shall be payable on demand.
11.4. Obligations Absolute. The Borrower's obligation to reimburse
the Lender for payments and disbursements made by the Lender
under or in connection with the Letter of Credit I and to pay
the Letter of Credit Note I shall be absolute and
unconditional under any and all circumstances and irrespective
of any setoff, counterclaim or defense to payment which the
Borrower may have or have had against the Lender, including,
without limitation, any defense based on the failure of the
demand for payment under such Letter of Credit I to conform to
the terms of such Letter of Credit I or the legality,
validity, regularity or enforceability of such Letter of
Credit I or any defense based on the identity of the
transferee of such Letter of Credit I or the sufficiency of
the transfer if such Letter of Credit I is transferable;
provided, however, that the Borrower shall not be obligated to
reimburse the Lender for any wrongful payment or disbursement
made under any Letter of Credit I as a result of acts or
omissions constituting gross negligence or willful misconduct
on the part of the Lender or any of its officers, employees or
agents.
12. LETTER OF CREDIT II
12.1. Issuance of Letter of Credit II; Letter of Credit Fee.
(a) The Lender shall cause the Letter of Credit II to be issued
upon request by the Borrower and upon issuance of the Letter
of Credit II, the Borrower shall make and deliver to the
Lender the Letter of Credit Note II.
(b) Upon issuance of the Letter of Credit II, the Borrower agrees
to pay the Lender a commission equal to a per annum rate of
.75% of the face amount thereof payable in advance in
quarterly installments due on the first day of each calendar
quarter.
12.2. Repayment of Drawings. Forthwith when a draft or other demand
for payment under the Letter of Credit II is received by the Lender
or the Lender receives notice thereof from any other issuer of such
Letter of Credit II, the Lender shall give notice thereof to the
Borrower by telecopy or telephone, which shall constitute a demand
for payment under the Letter of Credit Note II; provided that the
Borrower shall not be deemed to be in payment default thereunder
until after the second Business Day after such notice.
12.3. Payments and Interest on Letter of Credit Note II.
(a) The Borrower agrees to pay interest on the unpaid principal
balance of the Letter of Credit Note II outstanding from time
to time at a rate equal to the Reference Rate minus .375%.
(b) Payments or principal and interest on amounts outstanding
under the Letter of Credit Note II shall be payable on demand.
12.4. Obligations Absolute. The Borrower's obligation to reimburse
the Lender for payments and disbursements made by the Lender under
or in connection with the Letter of Credit II and to pay the Letter
of Credit Note II shall be absolute and unconditional under any and
all circumstances and irrespective of any setoff, counterclaim or
defense to payment which the Borrower may have or have had against
the Lender, including, without limitation, any defense based on the
failure of the demand for payment under such Letter of Credit II to
conform to the terms of such Letter of Credit II or the legality,
validity, regularity or enforceability of such Letter of Credit II
or any defense based on the identity of the transferee of such
Letter of Credit II or the sufficiency of the transfer if such
Letter of Credit II is transferable; provided, however, that the
Borrower shall not be obligated to reimburse the Lender for any
wrongful payment or disbursement made under any Letter of Credit II
as a result of acts or omissions constituting gross negligence or
willful misconduct on the part of the Lender or any of its officers,
employees or agents.
13. GENERAL PROVISIONS
13.1. Computation of Interest.
(a) All computations of interest on the outstanding principal
amount of each Subject Note shall be computed on the basis of
a year comprised of 360 days to the extent such interest is
computed based on LIBOR, 360 days to the extent such interest
is computed based on the Reference Rate, but charged for the
actual number of days elapsed, and such number of days as is
indicated in the confirmation described in Section 14.2 with
respect to any Fixed Rate Amount. Each change in the interest
rate payable on each Subject Note due to a change in the
Reference Rate shall take place simultaneously with the
corresponding change in the Reference Rate. Whenever any
payment to be made by or to the Lender or other holder(s) of
any Subject Note shall otherwise be due on a day which is not
a Business Day, such payment shall be made on the next
succeeding Business Day, and such extension of time shall be
included in computing the fees or interest payable on such
next succeeding Business Day.
(b) No provision of this Credit Agreement or any Subject Note
shall require the payment or permit the collection of interest
in excess of the rate permitted by applicable law.
13.2. Default Rate; Late Payment. Notwithstanding anything to the
contrary herein, upon the occurrence and during the continuation of
an Event of Default, the Borrower shall pay interest on the
outstanding principal amount of each of the Subject Notes at a rate
per annum equal to the greater of (i) two percent (2%) in excess of
the rate applicable to the unpaid principal amount of each such
Subject Note immediately before the occurrence of such Event of
Default or (ii) two percent (2%) in excess of the Reference Rate in
effect from time to time. In addition, the Borrower shall be
obligated to pay $25.00 with respect to any installment on any
Subject Note paid after the date it is due, to compensate Lender for
the administrative expenses associated with such past-due payments,
subject to the maximum allowable late payment under North Dakota
law.
13.3. Security. The indebtedness, liabilities and other obligations
of the Borrower to the Lender under each Subject Note and this
Credit Agreement are secured by, inter alia, security interests
granted pursuant to all security interests, liens and mortgages
heretofore or hereafter granted by the Borrower to the Lender as
security for the obligations to the Lender, except that the Seasonal
Notes I and II and the Letter of Credit Notes I and II are not
secured by any such collateral or agreements, notwithstanding
anything to the contrary therein.
13.4. Voluntary Prepayments. The Borrower may prepay the principal
of any of the Subject Notes, in whole or in part, only so long as
(i) any such prepayment is in a minimum amount of $100,000 or a
multiple thereof; (ii) any such prepayment shall be accompanied by
the interest accrued on the amount prepaid to the date of the
prepayment; (iii) any such prepayment shall be accompanied by the
prepayment premium specified in, and computed in accordance with,
the provisions of Section 13.6 set forth below and (iv) all amounts
prepaid shall be applied in accordance with the terms of such
Subject Note.
13.5. Manner of Payments. Any other provision of this Credit
Agreement to the contrary notwithstanding, the Borrower shall make
all payments of interest on and principal of the Subject Notes to
the Lender at its office shown on the first page hereof.
13.6. Funding Losses; Prepayment Premiums.
(a) The Borrower hereby agrees that upon demand by the Lender
(which demand shall be accompanied by a statement setting
forth the basis for the calculations of the amount being
claimed and the Lender's calculation of the amount of such
demand) the Borrower will indemnify the Lender against any
loss or expense which the Lender may have sustained or
incurred (including, without limitation, any net loss or
expense incurred by reason of the liquidation or reemployment
of deposits or other funds acquired by such Bank to fund or
maintain such loans) or which the Lender may be deemed to have
sustained or incurred, as reasonably determined by the Lender,
(i) as a consequence of any failure by the Borrower to make
any payment when due of any amount due hereunder in connection
with any such loans, (ii) due to any failure of the Borrower
to borrow or convert any such Loans accruing interest based on
LIBOR or Fixed Rate Amounts on a date specified therefor in a
notice thereof or (iii) due to any payment or prepayment of
any such loans on a date other than the last day of the
applicable Interest Rate Period (if a Fixed Rate Amount).
(b) If at the time of any prepayment of any Subject Note
hereunder, the Interest Differential is greater than zero, the
Borrower shall pay to the Lender a prepayment premium equal to
the present value (discounted from the previously scheduled
payment dates for interest on the Loan at a rate equal to the
Government Yield with respect to such Loan on the date of
prepayment plus the Issuance Spread) of the product of (a) the
Interest Differential, times (b) the amount prepaid, times (c)
a fraction, the numerator of which is the number of days
scheduled to fall between the interest payment dates on the
Loan and the denominator of which is 365. If the portion
prepaid covers several installments, the Lender may, at its
option, either calculate such payment for each installment or
calculate such payment based on the weighted average maturity
of the portion prepaid.
13.7. Increased Costs. If any Regulatory Change or other change in
any existing law, rule or regulation or in the interpretation or
administration thereof by any governmental authority, central bank
or comparable agency shall subject the Lender or one or more of its
sources of financing to increased costs, the Borrower shall pay to
the Lender within fifteen (15) days of demand therefor, Borrower's
pro rata share (based on the amount of all loans outstanding from
the Lender) of any such amount required to compensate the Lender or
such other Persons for such costs.
13.8. Collateral Allocation. To the extent the Lender receives
proceeds of any Collateral after the exercise of remedies provided
for in Section 19.2: (a) proceeds of accounts and inventory shall be
applied first to any obligations of the Borrower relating to or
arising under the Seasonal Notes and Loans I and II, pro rata in
accordance with the principal amount outstanding thereunder and then
to all the other obligations to the Lender under the Loan Documents;
(b) proceeds of each of the Mortgages shall be applied first to any
obligations of the Borrower relating to or arising under each of the
Term Notes and corresponding Term Loans referenced as expressly
secured thereby in the definition of the term "Mortgages" herein
(the "Mortgage Secured Notes and Loans"), and then to all other
obligations to the Lender under the Loan Documents; and (c) proceeds
of all other Collateral shall be applied first to all the
obligations of the Borrower to the Lender under the Loan Documents,
other than those relating to or arising under the Seasonal Notes and
Loans or the Mortgage Secured Notes and Loans, and then to all other
obligations to the Lender under the Loan Documents, pro rata in
accordance with the respective principal amounts thereof.
13.9. Loan Agreement Reference. Any reference in any Subject Note to
any Loan Agreement or Credit Agreement shall be deemed to be a
reference to this Credit Agreement, as it may from time to time be
amended, modified, supplemented or restated. Any conflict between
the terms of any Subject Note, and the terms of this Credit
Agreement, shall be resolved in favor of the terms of this Credit
Agreement.
14. FIXED RATE AMOUNTS
14.1. Availability. Any Fixed Rate Amount of any Loan may bear
interest at a Fixed Rate. A Loan may accrue a different Fixed Rate
on different Fixed Rate Amounts simultaneously. A Fixed Rate shall
be effective to the extent the Lender responds to any request
therefor by the Borrower prior to the date such Fixed Rate is to
first accrue.
14.2. Confirmation. The Lender shall confirm any Fixed Rate to the
Borrower in writing which shall reference and confirm:
(a) The applicable Subject Note number;
(b) The applicable Fixed Rate Amount;
(c) The applicable Fixed Rate;
(d) The applicable date such Fixed Rate becomes effective;
(e) The number of days which will comprise the year over which
such Fixed Rate is to be computed; and
(f) The date upon which such Fixed Rate expires.
14.3. Rate After Interest Rate Period. Interest on any Fixed Rate
Amount shall accrue at the rate otherwise provided for hereunder
commencing the date following the last day of the corresponding
Interest Rate Period, which may, if the Borrower has appropriately
requested and the Lender has quoted, be a new Fixed Rate.
15. CONDITIONS OF LENDING
15.1. Conditions Precedent. This Credit Agreement and the Lender's
obligations hereunder are subject to receipt on or prior to the date
hereof, by the Lender of the following, each to be in form and
substance satisfactory to the Lender, unless the Lender waives
receipt of any of the following in writing:
(a) This Credit Agreement and the Subject Notes each appropriately
completed and duly executed by the Borrower;
(b) A Certificate of Good Standing for the Borrower issued by the
Secretary of State in all states where the Borrower is
qualified to do business;
(c) A copy of the Borrower's Bylaws, together with all amendments,
certified by the Secretary of the Borrower to be a true and
correct copy thereof;
(d) A copy of the Certificate of Incorporation of the Borrower,
together with all amendments, certified by the Secretary of
State of the state of the Borrower's incorporation to be a
true and correct copy thereof;
(e) A certified copy of the resolutions of the Board of Directors
of the Borrower authorizing or ratifying the transactions
contemplated hereby, and the execution, delivery and
performance of the Loan Documents, and designating the
officers authorized to execute the Loan Documents to which the
Borrower is a party and to perform the obligations of the
Borrower thereunder;
(f) A certificate of the Secretary of the Borrower certifying the
names of the officers authorized to execute the Loan
Documents, together with a sample of the true signature of
each such officer;
(g) A favorable opinion of counsel for the Borrower, satisfactory
to the Lender, as to the matters set forth in Subsections
16.1, 16.2, 16.3, 16.5, 16.7 and 16.9 (delivered not later
than January 15, 1998), and other matters as requested by the
Lender, satisfactory to the Lender and its counsel;
(h) The Security Agreement and Mortgages duly executed by the
Borrower;
(i) Policies or certificates of insurance evidencing insurance
coverage required under this Credit Agreement and any other of
the Loan Documents; and
(j) Such other documents, information and actions as the Lender
may reasonably request.
15.2. Conditions Precedent to all Loans and Advances. The obligation
of the Lender to make any Loan or Advance hereunder, including the
initial Loans and Advances, is subject to the satisfaction of each
of the following, unless waived in writing by the Lender:
(a) The representations and warranties set forth in Section 16 are
true and correct in all material respects on the date hereof
and on the date of any Loan or Advance (as if made on the date
of such Loan or Advance, except to the extent that such
representations and warranties expressly relate solely to an
earlier date).
(b) No Default or Event of Default shall have occurred and be
continuing.
(c) No litigation, arbitration or governmental investigation or
proceeding shall be pending, or, to the knowledge of the
Borrower, threatened, against the Borrower or affecting the
business or operations of the Borrower which was not
previously disclosed to the Lender and which, if determined
adversely to the Borrower, would have a material adverse
effect on the operation or financial condition of the
Borrower.
(d) No Default or Event of Default shall result from the making of
any such Loan or Advance.
(e) No Material Adverse Occurrence shall have occurred and be
continuing.
(f) Each request for a Loan or Advance and each acceptance of the
proceeds of such request by the Borrower shall constitute a
representation and warranty by the Borrower that on the date
of acceptance of such proceeds (both immediately before and
after giving effect to such acceptance) the statements made in
Section 16 are true and correct with the same effect as if
then made, except to the extent such statements expressly
relate solely to an earlier date.
16. REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Lender as follows:
16.1. Organization, etc. The Borrower is a corporation validly
organized and existing and in good standing under the laws of the
State of Delaware, has full power and authority to own its property
and conduct its business substantially as presently conducted by it
and is duly qualified and licensed to do business and is in good
standing as a foreign corporation in each other jurisdiction where
the nature of its business makes such qualification or licensing
necessary. The Borrower has full power and authority to enter into
and perform its obligations under the Loan Documents and to obtain
the loans and Advances hereunder.
16.2. Due Authorization. The execution, delivery and performance by
the Borrower of the Loan Documents have been duly authorized by all
necessary corporate action, do not require any approval or consent
of, or any registration, qualification or filing with, any
governmental agency or authority or any approval or consent of any
other Person (including, without limitation, any stockholder, do not
and will not conflict with, result in any violation of or constitute
any default under, any provision of the Borrower's Articles of
Incorporation or Bylaws, any agreement binding on or applicable to
the Borrower or any of its property, or any law or governmental
regulation or court decree or order, binding upon or applicable to
the Borrower or of any of its property and will not result in the
creation or imposition of any Lien on any of its property pursuant
to the provisions of any agreement binding on or applicable to the
Borrower or any of its property except pursuant to the Loan
Documents.
16.3. Validity of the Loan Documents. The Loan Documents to which
the Borrower is a party are the legal, valid and binding obligations
of the Borrower and are enforceable in accordance with their terms,
subject only to bankruptcy, insolvency, reorganization, moratorium
or similar laws, rulings or decisions at the time in effect
affecting the enforceability of rights of creditors generally and to
general equitable principles which may limit the right to obtain
equitable remedies.
16.4. Financial Information. The financial statements of the
Borrower furnished to the Lender have been and will be prepared in
accordance with GAAP consistently applied by the Borrower and
present fairly the financial condition of the Borrower as of the
dates thereof and for the periods covered thereby. The Borrower is
not aware of any contingent liabilities or obligations which would,
upon becoming non-contingent liabilities or obligations, be a
Material Adverse Occurrence.
Since the date of the most recent such statements, neither the
condition (financial or otherwise), the business nor the properties
of the Borrower have been materially and adversely affected in any
way.
16.5. Litigation, Other Proceedings. Except as previously disclosed
to and approved of in writing by the Lender, there is no action,
suit or proceeding at law or equity, or before or by any
governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, pending or, to the knowledge
of the Borrower, threatened, against the Borrower or any of its
property, which is reasonably likely to result in a Material Adverse
Occurrence; and the Borrower is not in default with respect to any
final judgment, writ, injunction, decree, rule or regulation of any
court or governmental department, commission, board, bureau, agency
or instrumentality, domestic or foreign, where such default would be
a Material Adverse Occurrence.
16.6. Title to Assets. Except for Liens permitted by Section 18.2,
the Borrower has good and marketable title to all of its assets,
real and personal.
16.7. Lien Priority. The Liens created by the Security Agreement are
attached and first, perfected Liens on the Collateral.
16.8. Guarantees and Indebtedness. Except as disclosed on financial
statements of the Borrower furnished to the Lender, the Borrower is
not a party to any material contract of guaranty or suretyship and
none of its assets is subject to any contract of that nature and the
Borrower is not indebted to any other party, except the Lender.
16.9. Margin Stock. No part of any loan or Advance hereunder shall
be used at any time by the Borrower to purchase or carry margin
stock (within the meaning of Regulation G, T, U or X promulgated by
the Board of Governors of the Federal Reserve System) or to extend
credit to others for the purpose of purchasing or carrying any
margin stock. The Borrower is not engaged principally, or as one of
its important activities, in the business of extending credit for
the purposes of purchasing or carrying any such margin stock. No
part of the proceeds of any loan or Advance hereunder will be used
by the Borrower for any purpose which violates, or which is
inconsistent with, any regulations promulgated by the Board of
Governors of the Federal Reserve System.
16.10. Taxes. The Borrower has filed all federal, state and other
income tax returns which are required to be filed through the date
of this Credit Agreement and has paid all taxes as shown on said
returns, and all taxes due or payable without returns and all
assessments received to the extent such taxes and assessments have
become due. All tax liabilities of the Borrower are adequately
provided for on its books, including interest and penalties. No
income tax liability of a material nature has been asserted by
taxing authorities for taxes in excess of those already paid. The
Borrower has made all required withholding deposits.
16.11. Accuracy of Information. All factual information furnished by
or on behalf of the Borrower to the Lender for purposes of or in
connection with this Credit Agreement or any transaction
contemplated by this Credit Agreement is, and all other such factual
information furnished by or on behalf of the Borrower to the Lender
in the future, will be true and accurate in every material respect
on the date as of which such information is dated or certified. No
such information contains any material misstatement of fact or omits
any material fact or any fact necessary to prevent such information
from being misleading.
16.12. Material Agreements. The Borrower is not a party to any
agreement or instrument or subject to any restriction that
materially and adversely affects its business, property or assets,
operations or condition (financial or otherwise).
16.13. Defaults. The Borrower is not in default in the performance,
observance or fulfillment of any of the obligations, covenants or
conditions contained in any: (a) agreement to which such entity is a
party, which default might have a material adverse effect on the
business, properties or assets, operations, or condition (financial
or otherwise) of the Borrower; or (b) instrument evidencing any
indebtedness or under any agreement relating to such indebtedness.
16.14. ERISA. (a) No Reportable Event has occurred and is continuing
with respect to any Plan; (b) the Pension Benefit Guaranty
Corporation or any successor entity has not instituted proceedings
to terminate any Plan; and (c) each Plan of the Borrower has been
maintained and funded in all material respects in accordance with
its terms and with ERISA. All undefined capitalized terms used in
this Section shall have the meanings ascribed to them in ERISA.
16.15. Financial Status. The Borrower is not insolvent (as such term
is defined in Section 101(32) of the United States Bankruptcy Code
of 1978, as amended or Minnesota Statutes Section 513.42, as
amended) and will not be rendered insolvent (as such term is defined
in Section 101(32) of the United States Bankruptcy Code of 1978, as
amended or Minnesota Statutes Section 513.42, as amended) by
execution of this Credit Agreement or any other of the Loan
Documents, or consummation of the transactions contemplated thereby.
16.16. Survival of Representations. All representations and
warranties contained in this Section 16 shall survive the delivery
of the Notes and the making of the loans and Advances evidenced
thereby and any investigation at any time made by or on behalf of
Lender shall not diminish its rights to rely thereon.
16.17. Environmental Matters.
(a) Definitions. As used in this Credit Agreement, the following
terms shall have the following meanings:
(i) "Environmental Law" means any federal, state, local or
other governmental statute, regulation, law or ordinance
dealing with the protection of human health and the
environment.
(ii) "Hazardous Substances" means pollutants, contaminants,
hazardous substances, hazardous wastes, petroleum and
fractions thereof, and all other chemicals, wastes,
substances and materials listed in, regulated by or
identified in any Environmental Law.
(iii) "Premises" means all premises where the Borrower
conducts its business and has any rights of possession.
(b) To the Borrower's best knowledge, there are not present in, on
or under the Premises any Hazardous Substances in such form or
quantity as to create any liability or obligation for either
the Borrower or the Lender under common law of any
jurisdiction or under any Environmental Law, and no Hazardous
Substances have ever been stored, buried, spilled, leaked,
discharged, emitted or released in, on or under the Premises
in such a way as to create any such liability.
(c) There are not and there never have been any requests, claims,
notices, investigations, demands, administrative proceedings,
hearings or litigation, relating in any way to the Premises or
the Borrower, alleging liability under, violation of, or
noncompliance with any Environmental Law or any license,
permit or other authorization issued pursuant thereto. To the
Borrower's best knowledge, no such matter is threatened or
impending.
(d) To the Borrower's best knowledge, the Premises are not and
never have been listed on the National Priorities List, the
Comprehensive Environmental Response, Compensation and
Liability Information System or any similar federal, state or
local list, schedule, log, inventory or database.
16.18. Subsidiaries. The Borrower has the Subsidiaries listed on the
financial statements previously delivered to the Lender.
17. AFFIRMATIVE COVENANTS
As long as there remains any amount outstanding under the Subject
Notes or the Lender has any obligation to make Advances under the Seasonal
Commitment, the Borrower shall, unless waived in writing by the Lender:
17.1. Financial Statements and Reports. Furnish to the Lender, at
the times set forth below, the following financial statements,
reports and information:
(a) As soon as available, but in any event within 125 days after
each fiscal year end, audited financial statements of the
Borrower, and all corporations and subsidiaries, directly or
indirectly controlled by the Borrower, including without
limitation a balance sheet, and the related statements of
income, retained earnings and cash flows, prepared on a
consolidated and consolidating basis certified by certified
public accountants satisfactory to the Lender to have been
prepared in accordance with GAAP consistently applied;
(b) As soon as available, but in any event within forty-five ( 45)
days after the last day of each quarterly fiscal period
unaudited financial statements of the Borrower consisting of a
balance sheet and the related statements of income, retained
earnings and cash flows prepared on a consolidated and
consolidating basis dated as of the last Business Day of such
quarterly fiscal period in form and detail as reasonably
required by the Lender certified by the chief financial
officer of the Borrower to have been prepared from the records
of the Borrower on the basis of accounting principles
consistently applied by the Borrower;
(c) As soon as available, but in any event within ninety (90) days
following each fiscal year-end, an operating budget and cash
flow forecast for the fiscal year immediately following such
fiscal year-end.
(d) Promptly upon obtaining knowledge thereof, notice of the
occurrence of any Default or Event of Default and of the
violation by the Borrower of any law, rule or regulation, the
non-compliance with which could be reasonably expected to be a
Material Adverse Occurrence;
(e) To the extent applicable, promptly after the sending or filing
thereof, copies of all regular and periodic financial reports
which the Borrower shall file with the U.S. Securities and
Exchange Commission, or any national securities exchange;
(f) Such other information concerning the business, operations and
condition (financial or otherwise) of the Borrower as the
Lender may reasonably request.
17.2. Maintenance of Corporate Existence. Maintain and preserve its
corporate existence.
17.3. Taxes. Pay and discharge as the same shall become due and
payable, all taxes, assessments and other governmental charges and
levies against or on any of its property, as well as claims of any
kind which, if unpaid, might become a Lien upon any of its
properties, unless such tax, levy, charge assessment or Lien is
being contested in good faith by the Borrower and is supported by an
adequate book reserve. The Borrower shall make all required
withholding deposits.
17.4. Notices. As soon as practicable, give notice to the Lender of:
(a) The commencement of any litigation relating to the Borrower
which might reasonably result in a Material Adverse Occurrence
or relating to the transactions contemplated by this Credit
Agreement;
(b) The commencement of any material arbitration or governmental
proceeding or investigation not previously disclosed to the
Lender which has been instituted or, to the knowledge of the
Borrower, is threatened against the Borrower or its property
which might reasonably result in a Material Adverse
Occurrence;
(c) Any Reportable Event or "prohibited transaction" or the
imposition of a Withdrawal Liability, within the meaning of
ERISA, in connection with any Plan and, when known, any action
taken by the Internal Revenue Service, Department of Labor or
Pension Benefit Guaranty Corporation with respect thereto, and
any adverse development which occurs in any litigation,
arbitration or governmental investigation or proceeding
previously disclosed to the Lender which if determined
adversely to the Borrower would constitute a Material Adverse
Occurrence; and
(d) Any Default or Event of Default under this Credit Agreement.
17.5. Compliance with Laws. Carry on its business activities in
substantial compliance with all applicable federal or state laws and
all applicable rules, regulations and orders of all governmental
bodies and offices having power to regulate or supervise its
business activities. The Borrower shall maintain all material
rights, liens, franchises, permits, certificates of compliance or
grants of authority required in the conduct of its business. Without
limiting the foregoing undertakings, the Borrower specifically
agrees that it will comply with all applicable Environmental Laws
and obtain and comply with all permits, licenses and similar
approvals required by any Environmental laws, and will not generate,
use, transport, treat, store or dispose of any Hazardous Substances
in such a manner as to create any liability or obligation under the
common law of any jurisdiction or any Environmental Law.
17.6. Books and Records. Keep books and records reflecting all of
its business affairs and transactions in accordance with GAAP
consistently applied and permit the Lender, and its representatives,
at reasonable times and intervals, to visit all of its offices,
discuss its financial matters with officers of the Borrower and its
independent public accountants (and by this provision the Borrower
authorizes its independent public accountants to participate in such
discussions) and examine any of its books and other corporate
records.
17.7. Insurance. Procure and maintain insurance with financially
sound and reputable insurers, insurance with respect to the
Collateral and its other property against damage and loss by theft,
fire, collision (in the case of motor vehicles) and such other risks
as are required by the Lender in an amount equal to the fair market
value thereof and, in any event, in an amount sufficient to avoid
the application of any coinsurance provisions and naming the Lender
loss payee. The Borrower shall also procure and maintain other such
insurance including workers compensation insurance, liability and
business interruption insurance, and other insurance as the Lender
may require and/or that may be required under any of the Loan
Documents, all in such amounts as may be required by the Lender.
Policies of all such insurance shall contain an agreement by the
insurer to provide the Lender thirty (30) days prior written notice
of cancellation and an agreement that the Lender's interest shall
not be impaired or invalidated by any act or neglect of the Borrower
nor by the occupation of properties owned or leased by the Borrower
or other properties wherein the Collateral is located for purposes
more hazardous than those permitted by such policies. The Borrower
shall provide evidence of such insurance and the policies of
insurance or copies thereof to the Lender upon request.
17.8. Maintain Property. Maintain and keep its assets, property and
equipment in good repair, working order and condition and from time
to time make or cause to be made all needed renewals, replacements
and repairs.
17.9. Conduct of Business. Continue to engage primarily in the
business being conducted on the date of this Credit Agreement.
17.10. Working Capital. Maintain at all times the ratio of its Net
Working Capital to liabilities owed to parties providing floor plan
financing to Borrower at not less than 1.0:4.0.
17.11. Leverage Ratio. Maintain as of each fiscal quarter end a
Leverage Ratio of not more than 4.5:1.0.
17.12. Further Assurances. The Borrower agrees upon reasonable
request by the Lender to execute and deliver such further
instruments, deeds and assurances, including financing statements
under the Uniform Commercial Code of Minnesota and/or any other
relevant states, and to do such further acts as may be necessary or
proper to carry out more effectively the purposes of this Credit
Agreement and the Loan Documents and, without limiting the
foregoing, to make subject to the liens and security interests of
the Security Agreement and any other of the Loan Documents any
property agreed to be subjected, or intended to be subject, or
covered by the granting clauses of the Security Agreement or such
other of the Loan Documents.
17.13. ERISA Compliance. Comply in all material respects at all
times with all applicable provisions of ERISA and the regulations
and published interpretations thereunder.
18. NEGATIVE COVENANTS
As long as there remains any amount outstanding under the Subject
Notes or the Lender has any obligation to make Advances under the Seasonal Loan
Commitment, the Borrower shall not, unless waived in writing by the Lender:
18.1. Consolidation; Merger; Sale of Assets; Acquisitions.
Consolidate with or merge into or with any other entity; or sell
(other than sales of inventory in the ordinary course of business),
transfer, lease or otherwise dispose of all or a substantial part of
its assets; or acquire a substantial interest in another Person
either through the purchase of all or substantially all of the
assets of that
Person or the purchase of a controlling equity interest in that
Person; provided that the foregoing shall not prohibit any
transaction immediately after which:
(a) The Borrower is a surviving entity;
(b) Borrower's Tangible Net Worth is not less than the amount
thereof immediately prior thereto; and
(c) The aggregate price paid by the Borrower in all such
transactions in any consecutive twelve (12) month period is
not greater than $100,000,000;
18.2. Liens. Create, incur, assume or suffer to exist any Lien or
any of its property, real or personal, except (a) Liens in favor of
the Lender; (b) Liens disclosed to and approved of in writing by the
Lender; (c) Liens for current taxes and assessments which are not
yet due and payable; and (d) purchase money security interests to
secure the indebtedness permitted under Section 18.3 below.
18.3. Additional Indebtedness. Create, incur, assume or suffer to
exist any indebtedness except: (a) indebtedness in favor of the
Lender; (b) current liabilities incurred in the ordinary course of
business; (c) indebtedness existing on the date of this Credit
Agreement and disclosed to and approved of in writing by the Lender;
and (d) purchase money indebtedness incurred in connection with the
acquisition of fixed assets not to exceed $1,000,000 in the
aggregate during any fiscal year of the Borrower.
18.4. Guaranties. Assume, guarantee, endorse or otherwise become
liable in connection with the indebtedness of any other person or
entity except endorsements of negotiable instruments for deposit or
collection in the ordinary course of business.
18.5. Dividends. Declare or pay any dividends, purchase, redeem,
retire or otherwise acquire for value any of its capital stock now
or hereafter outstanding, return any capital to its stockholders as
such, at any time any Default or Event of Default has occurred and
is continuing.
18.6. Change in Ownership or Business. Permit (a) Change of control,
or (b) the line of business presently engaged in by the Borrower.
18.7. Investments; Subsidiaries. The Borrower will not purchase or
hold beneficially any stock or other securities or evidences of
indebtedness of, make or permit to exist any loans or advances to,
or create or acquire any Subsidiary or make any investment or
acquire any interest whatsoever in, any other Person, except:
(a) Investments in direct obligations of the United States of
America or any agency or instrumentality thereof whose
obligations constitute the full faith and credit obligations
of the United States of America having a maturity of one (1)
year or less, commercial paper issued by a U.S. corporation
rated "A-1" or "A-2" by Standard & Poor's Corporation or "P-1"
or "P-2" by Xxxxx'x Investor Service, investments in money
market mutual funds whose underlying assets are exclusively
investments which would otherwise be permitted investments
under this Section 18.7(a), or repurchase agreements,
certificates of deposit or bankers' acceptances having a
maturity of one (1) year or less issued by members of the
Federal Reserve System having deposits in excess of
$500,000,000 (which certificates of deposit or bankers'
acceptances are fully insured by the Federal Deposit Insurance
Corporation);
(b) Travel advances or loans to officers and employees of the
Borrower (not including contracts made in the ordinary course
of business with any such officers or employees) not exceeding
at any one time an aggregate of $25,000;
(c) Advances in the form of progress payments, prepaid rent or
security deposits;
(d) Existing investments as described in the Borrower's financial
statements;
(e) Investments constituting contracts made in the ordinary course
of business of the Borrower;
(f) Investments in wholly-owned subsidiaries of the Borrower
existing as of the date hereof;
(g) Transitions and investments permitted under Section 18.1; and
(h) Investments not otherwise permitted in this Section 18.7 not
to exceed $1,000,000 in the aggregate (on a book value basis)
at any time outstanding.
19. EVENTS OF DEFAULT AND REMEDIES
19.1. Events of Default. The term "Event of Default" shall mean any
of the following events:
(a) The Borrower shall default in the payment when due, or if
payable on demand, upon demand, of any principal or interest
on any of the Subject Notes; or
(b) The Borrower shall default (other than a default in payment
under subsection (a) above) in the due performance and
observance of any of the covenants contained in any of the
Loan Documents and such default shall continue unremedied for
a period of thirty (30) days after notice from the Lender to
the Borrower thereof; or
(c) An event has occurred which would, at such time or with the
passage of time, constitute an "event of default" (however
legally styled) under any other loan obligation, lease, bond,
debenture, security agreement, note, or instrument or
agreement evidencing Debt and any applicable grace period
specified in such agreement or evidence of Debt has expired;
or
(d) The Borrower shall become insolvent or generally fail to pay
or admit in writing its inability to pay its debts as they
become due; or the Borrower shall apply for, consent to, or
acquiesce in the appointment of a trustee, receiver or other
custodian for itself or any of its property, or make a general
assignment for the benefit of its creditors; or trustee,
receiver or other custodian shall otherwise be appointed for
the Borrower or any of its assets; or any bankruptcy,
reorganization, debt arrangement, or other case or proceeding
under any bankruptcy or insolvency law, or any dissolution or
liquidation proceeding shall be commenced by or against the
Borrower; or the Borrower shall take any action to authorize,
or in furtherance of, any of the foregoing; or
(e) Any representation or warranty set forth in this Credit
Agreement or any other Loan Document shall be untrue in any
material respect on the date as of which the facts set forth
are stated or certified; or
(f) The occurrence of any Material Adverse Occurrence; or
(g) A Reportable Event (as defined under ERISA) shall have
occurred; or
(h) The rendering against the Borrower of a final judgment, decree
or order for the payment of money in excess of $500,000
(unless the payment of such judgment in the amount of such
excess is insured), and the continuance of such judgment,
decree or order unsatisfied for any 30 consecutive day period
without a stay of execution.
(i) The occurrence of a Change of Control; or
(j) The Lender shall in good xxxxx xxxx itself insecure.
19.2. Remedies; Cumulative. If an Event of Default described in
Section 19.1(d) shall occur, the full unpaid balance of each of the
Subject Notes (outstanding balance plus accrued interest) and all
other obligations of the Borrower to the Lender shall automatically
be due and payable without declaration, notice, presentment, protest
or demand of any kind (all of which are hereby expressly waived) and
the obligation of the Lender to make additional Advances shall
automatically terminate. If any other Event of Default shall occur
and be continuing, the Lender may terminate its obligation to make
additional Advances and may declare the outstanding balance of the
each of the Subject Notes and all other obligations of the Borrower
to the Lender to be due and payable without further notice,
presentment, protest or demand of any kind (all of which are hereby
expressly waived), whereupon the full unpaid amount of each of the
Subject Notes and all other obligations of the Borrower to the
Lender shall become immediately due and payable. Upon any Event of
Default, the Lender shall be entitled to exercise any and all rights
and remedies available under any of the Loan Documents or otherwise
available at law or in equity to collect the Subject Notes and all
other obligations of the Borrower to the Lender, to realize upon or
otherwise pursue any and all Collateral and other security
(including without limitation any and all guarantees) for the loans
under this Credit Agreement and to, without notice to the Borrower,
and without further action, apply any and all monies owing by Lender
to the Borrower to the payment of the Subject Notes, and all other
obligations of the Borrower hereunder, in such order as the Lender
elects (subject to Section 13.8).
20. MISCELLANEOUS
20.1. Waivers, Amendments. The provisions of the Loan Documents may
from time to time be amended, modified, or waived, if such
amendment, modification or waiver is in writing and signed by the
Lender. No failure or delay on the part of the Lender or the
holder(s) of the Subject Notes in exercising any power or right
under any of the Loan Documents shall operate as a waiver thereof,
nor shall any single or partial exercise of any such power or right
preclude any other or further exercise thereof or the exercise of
any other power or right. No notice to or demand on the Borrower in
any case shall entitle it to any notice or demand in similar or
other circumstances.
20.2. Notices. All communications and notices provided under this
Credit Agreement shall be in writing and addressed or delivered to
the Borrower or the Lender at their respective addresses shown on
the first page hereof, or to any party at such other address as may
be designated by such party in a written notice to the other
parties. Such notices shall be delivered by any of the following
means: (i) mailing through the United States Postal Service, postage
prepaid, by registered or certified mail, return receipt requested;
(ii) delivery by reputable overnight delivery service including
without limitation, and by way of example only: Federal Express,
DHL, Airborne Express and Express Mail; or (iii) delivery by
reputable private personal delivery service. Notices delivered in
accordance with (i) above shall be deemed delivered the second
Business Day after deposit in the mail; notices delivered in
accordance with (ii) above shall be deemed delivered the first
Business Day after delivery to the delivery service; and notices
delivered in accordance with
(iii) above shall be deemed delivered the same Business Day as that
specified by the notifying party to the delivery service.
20.3. Costs and Expenses. The Borrower agrees to pay all expenses
for the preparation of this Credit Agreement, including exhibits,
and any amendments to this Credit Agreement as may from time to time
hereafter be required, and the reasonable attorneys fees and legal
expenses of counsel for the Lender, from time to time incurred in
connection with the preparation and execution of this Credit
Agreement and any document relevant to this Credit Agreement, any
amendments hereto or thereto, and the consideration of legal
questions relevant hereto and thereto. The Borrower agrees to
reimburse Lender upon demand for, all out-of-pocket expenses
(including reasonable attorneys fees and legal expenses) in
connection with the Lender's enforcement of the obligations of the
Borrower hereunder or under the Note or any other of the Loan
Documents, whether or not suit is commenced including, without
limitation, attorneys fees, and legal expenses in connection with
any appeal of a lower court's order or judgment. The obligations of
the Borrower under this Section 20.3 shall survive any termination
of this Credit Agreement.
20.4. Interest Limitation. All agreements between the Borrower and
the Lender are hereby expressly limited so that in no contingency or
event whatsoever, whether by reason of acceleration of maturity of
the indebtedness evidenced or secured thereby or otherwise, shall
the rate of interest charged or agreed to be paid to the Lender for
the use, forbearance, loaning or detention of such indebtedness
exceed the maximum permissible interest rate under applicable law
("Maximum Rate"). If for any reason or in any circumstance
whatsoever fulfillment of any provision of this Credit Agreement
and/or the Subject Notes, any document securing or executed in
connection herewith or therewith, or any other agreement between the
Borrower and the Lender, at any time shall require or permit the
interest rate applied thereunder to exceed the Maximum Rate, then
the interest rate shall automatically be reduced to the Maximum
Rate, and if the Lender should ever receive interest at a rate that
would exceed the Maximum Rate, the amount of interest received which
would be in excess of the amount receivable after applying the
Maximum Rate to the balance of the outstanding obligation shall be
applied to the reduction of the principal balance of the outstanding
obligation for which the amount was paid and not to the payment of
interest thereunder. This provision shall control every other
provision of any and all agreements between the Borrower and the
Lender and shall also be binding upon and applicable to any
subsequent holder of any of the Subject Notes.
20.5. Severability. Any provision of this Credit Agreement or any
other of the Loan Documents executed pursuant hereto which is
prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such portion or
unenforceability without invalidating the remaining provisions of
this Credit Agreement or such Loan Document or affecting the
validity or enforceability of such provisions in any other
jurisdiction.
20.6. Cross-References. References in this Credit Agreement or in
any other of the Loan Documents executed pursuant hereto to any
Section are, unless otherwise specified, to such Section of this
Credit Agreement or such Loan Document, as the case may be.
20.7. Headings. The various headings of this Credit Agreement or of
any other of the Loan Documents executed pursuant hereto are
inserted for convenience only and shall not affect the meaning or
interpretation of this Credit Agreement or such Loan Document or any
provisions hereof or thereof.
20.8. Governing Law; Venue; Waiver of Jury Trial. Each of the Loan
Documents shall be deemed to be a contract made under and governed
by the laws of the State of North Dakota (without regard to the laws
of conflict of any jurisdiction) as to all matters, including
without limitation, matters of validity, interpretation,
construction, effect, performance and remedies. The Borrower hereby
consents to the personal jurisdiction of the state and federal
courts located in the State of North Dakota in connection with any
controversy related to this Credit Agreement and any other of the
Loan Documents, waives any argument that venue in such forums is not
convenient and agrees that any litigation instigated by the Borrower
against the Lender in connection herewith or therewith shall be
venued in the federal or state court that has jurisdiction over
matters arising in Fargo, North Dakota. THE BORROWER AND LENDER
IRREVOCABLY WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO ANY LOAN
DOCUMENT OR ANY INSTRUMENT OR DOCUMENT DELIVERED THEREUNDER.
20.9. Successors and Assigns. This Credit Agreement shall be binding
upon and shall inure to the benefit of the parities hereto and their
respective successors and assigns, except that Borrower may not
assign or transfer its rights hereunder without the prior written
consent of Lender.
20.10. Recitals Incorporated. The recitals to this Credit Agreement
are incorporated into and constitute an integral part of this Credit
Agreement.
20.11. Multiple Counterparts. This Credit Agreement may be executed
in one or more counterparts and by the different parties on separate
counterparts, each of which shall be deemed to be an original and
all of which shall constitute one and the same instrument.
20.12. Indemnity. In addition to the payment of expenses pursuant to
Section 20.3, the Borrower agreed to indemnify, defend and hold
harmless the Lender, and any of its participants, assignees, parent
corporations, subsidiary corporations, affiliated corporations and
successor corporations, and all present and future officers,
directors, employees, attorneys and agents of the foregoing (the
"Indemnitees") from and against any of the following (collectively,
"Indemnified Liabilities"):
(a) any and all transfer taxes, documentary taxes, assessments or
charges made by any governmental authority by reason of the
execution and delivery of the Loan Documents or the making of
the Advances or the Loans;
(b) any claims, loss or damage to which any Indemnitee may be
subjected if any representation or warranty contained in this
Agreement proves to be incorrect in any respect or as a result
of any violation of the covenant contained in this Agreement;
and
(c) any and all other liabilities, losses, damages, penalties,
judgments, suits, claims, costs and expenses of any kind or
nature whatsoever (including, without limitation, the
reasonable fees and disbursements of counsel) in connection
with the foregoing and any other investigative, administrative
or judicial proceedings, whether or not such Indemnitee shall
be designated a party thereto, which may be imposed on,
incurred by or asserted against any such Indemnitee, in any
manner related to or arising out of or in connection with the
making of the Advances or the Loans and the Loan Documents or
the use or intended use of the proceeds of the Advances or the
Loans.
If any investigative, judicial or administrative proceeding arising
from any of the foregoing is brought against any Indemnitee, upon
such Indemnitee's request, the Borrower, or counsel designated by
the Borrower and satisfactory to the Indemnitee, will resist and
defend such action, suit or proceeding to the extent and in the
manner directed by the Indemnitee, at the Borrower's sole costs and
expense. Each Indemnitee will use its best efforts to cooperate in
the defense of any such action, suit or proceeding. If the foregoing
undertaking to indemnify, defend and hold harmless may be held to be
unenforceable because it violates any law or public policy, the
Borrower shall nevertheless make the maximum contribution to the
payment and satisfaction of each of the Indemnified Liabilities
which is permissible under applicable law. The Borrower's obligation
under this Section 20.12 shall survive the termination of this
Credit Agreement and the discharge of the Borrower's other
obligations hereunder.
20.13. Prior Agreement Superseded; Complete Agreement. This Credit
Agreement amends, restates, and supersedes the Prior Agreement in
its entirety and all obligations, liabilities and indebtedness of
the Borrower incurred or arising thereunder shall be deemed to have
been incurred and arising hereunder. Furthermore, this Credit
Agreement, together with the Loan Documents, comprises the complete
and integrated agreement of the parties on the subject matter hereof
and supersedes all prior agreements, written or oral, on the subject
matter hereof.
Assignments; Participants; Waiver of Claims. Lender may sell, assign
or grant a participation in the Subject Notes, in whole or in part and may
disclose information relating to the Borrower or otherwise relevant to this
Agreement, to such Persons and their financing sources ("Assignees"). No
Assignee shall be deemed a partner or agent of the Lender. The Borrower
irrevocably agrees that any claims it may have or may assert against the Lender
for breach of contract (or related tort claims) shall be personal to the Lender
and shall not be asserted by way of direct claim or offset against any Assignee
or against any Loan sold or assigned to any Assignee (and the Borrower hereby
irrevocably waives any right it otherwise may have, now or hereafter, to assert
any such claim). The Borrower acknowledges that the Assignees shall rely on the
foregoing waiver and agreement.
(REMAINDER OF PAGE INTENTIONALLY LEFT BLANK)
IN WITNESS WHEREOF, the parties hereto have caused this Credit
Agreement to be executed by their respective officers thereunto duly authorized
as of the day and year first above written.
RDO EQUIPMENT CO.,
a Delaware Corporation
By:
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Its:
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AG CAPITAL COMPANY,
a Delaware Corporation
By:
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Its:
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