STATUSED REVOLVING CREDIT SUPPLEMENT
Exhibit 10.4
Loan No. RI0340S01
STATUSED REVOLVING CREDIT SUPPLEMENT
THIS SUPPLEMENT to the Master Loan Agreement dated February 17, 2006, (the “MLA”), is entered
into as of February 17, 2006, and effective March 1, 2007, or such earlier date as Agent (as that
term is defined in the MLA) may establish in its sole discretion, (the “Effective Date”) between
FARM CREDIT SERVICES OF AMERICA, FLCA (“Farm Credit”) and ADVANCED BIOENERGY, LLC, Fairmont,
Nebraska (the “Company”).
SECTION 1. The Revolving Credit Facility. On the terms and conditions set forth in the MLA
and this Supplement, Farm Credit agrees to make loans to the Company during the period set forth
below in an aggregate principal amount not to exceed, at any one time outstanding, the lesser of
$5,000,000.00 (the “Commitment”), or the “Borrowing Base” (as calculated pursuant to the Borrowing
Base Report attached hereto as Exhibit A). Within the limits of the Commitment, the Company may
borrow, repay and reborrow.
SECTION 2. Purpose. The purpose of the Commitment is to finance eligible grain inventory and
equity in Chicago Board of Trade (“CBOT”) futures positions.
SECTION 3. Term. The term of the Commitment shall be from the Effective Date hereof, up to
and including March 1, 2008, or, if earlier, the date which is twelve (12) months after the
Effective Date, or such later date as Agent may, in its sole discretion, authorize in writing.
SECTION 4. Interest. The Company agrees to pay interest on the unpaid balance of the loans in
accordance with one or more of the following interest rate options, as selected by the Company:
(A) Agent Base Rate. At a rate per annum equal at all times to the rate of interest
established by Agent from time to time as its “Agent Base Rate”, which Rate is intended by Agent to
be a reference rate and not its lowest rate. The Agent Base Rate will change on the date
established by Agent as the effective date of any change therein and Agent agrees to notify the
Company of any such change.
(B) Quoted Rate. At a fixed rate per annum to be quoted by Agent in its sole discretion in
each instance. Under this option, rates may be fixed on such balances and for such periods, as may
be agreeable to Agent in its sole discretion in each instance, provided that: (1) the minimum
fixed period shall be 30 days; (2) amounts may be fixed in increments of $100,000.00 or multiples
thereof; and (3) the maximum number of fixes in place at any one time shall be five.
(C) LIBOR. At a fixed rate per annum equal to “LIBOR” (as hereinafter defined) plus 3.10%.
Under this option: (1) rates may be fixed for “Interest Periods” (as hereinafter defined) one
month; (2) amounts may be fixed in increments of $100,000.00 or multiples thereof; (3) the maximum
number of fixes in place at any one time shall be five; and (4) rates may only be fixed on a
“Banking Day” (as hereinafter defined) on 3 Banking Days’ prior written notice. For purposes
hereof: (a) “LIBOR” shall mean the rate (rounded upward to the nearest sixteenth and adjusted for
reserves required on “Eurocurrency Liabilities” (as hereinafter defined) for banks subject to “FRB
Regulation D” (as herein defined) or required by any other federal law or regulation) quoted by the
British Bankers Association (the “BBA”) at 11:00 a.m. London time 2 Banking Days before the
commencement of the Interest Period for the offering of U.S. dollar deposits in the London
interbank market for the Interest Period designated
-2-
by the Company, as published by Bloomberg or another major information vendor listed on BBA’s
official website; (b) “Banking Day” shall mean a day on which Agent is open for business, dealings
in U.S. dollar deposits are being carried out in the London interbank market, and banks are open
for business in New York City and London, England; (c) “Interest Period” shall mean a period
commencing on the date this option is to take effect and ending on the numerically corresponding
day in the next calendar month; provided, however, that: (i) in the event such ending day is not a
Banking Day, such period shall be extended to the next Banking Day unless such next Banking Day
falls in the next calendar month, in which case it shall end on the preceding Banking Day; and (ii)
if there is no numerically corresponding day in the month, then such period shall end on the last
Banking Day in the relevant month; (d) “Eurocurrency Liabilities” shall have meaning as set forth
in “FRB Regulation D”; and (e) “FRB Regulation D” shall mean Regulation D as promulgated by the
Board of Governors of the Federal Reserve System, 12 CFR Part 204, as amended.
The Company shall select the applicable rate option at the time it requests a loan hereunder and
may, subject to the limitations set forth above, elect to convert balances bearing interest at the
variable rate option to one of the fixed rate options. Upon the expiration of any fixed rate
period, interest shall automatically accrue at the variable rate option unless the amount fixed is
repaid or fixed for an additional period in accordance with the terms hereof. Notwithstanding the
foregoing, rates may not be fixed for periods expiring after the maturity date of the loans. All
elections provided for herein shall be made electronically (if applicable), telephonically or in
writing and must be received by Agent not later than 12:00 Noon Company’s local time in order to be
considered to have been received on that day; provided, however, that in the case of LIBOR rate
loans, all such elections must be confirmed in writing upon Agent’s request. Interest shall be
calculated on the actual number of days each loan is outstanding on the basis of a year consisting
of 360 days and shall be payable monthly in arrears by the 20th day of the following month or on
such other day in such month as Agent shall require in a written notice to the Company; provided,
however, in the event the Company elects to fix all or a portion of the indebtedness outstanding
under the LIBOR interest rate option above, at Agent’s option upon written notice to the Company,
interest shall be payable at the maturity of the Interest Period and if the LIBOR interest rate fix
is for a period longer than 3 months, interest on that portion of the indebtedness outstanding
shall be payable quarterly in arrears on each three-month anniversary of the commencement date of
such Interest Period, and at maturity.
SECTION 5. Promissory Note. The Company promises to repay the unpaid principal balance of the
loans on the last day of the term of the Commitment. In addition to the above, the Company
promises to pay interest on the unpaid principal balance of the loans at the times and in
accordance with the provisions set forth in Section 4 hereof.
SECTION 6. Borrowing Base Reports, Etc. The Company agrees to furnish a Borrowing Base Report
to Agent at such times or intervals as Agent may from time to time request. Until receipt of such
a request, the Company agrees to furnish a Borrowing Base Report to Agent within 30 days after each
month end calculating the Borrowing Base as of the last day of the month for which the Report is
being furnished. However, if no balance is outstanding hereunder on the last day of such month,
then no Report need be furnished. Regardless of the frequency of the reporting, if at any time the
amount outstanding under the Commitment exceeds the Borrowing Base, the Company shall immediately
notify Agent and repay so much of the loans as is necessary to reduce the amount outstanding under
the Commitment to the limits of the Borrowing Base.
-3-
SECTION 7. Letters of Credit. If agreeable to Agent in its sole discretion in each instance,
in addition to loans, the Company may utilize the Commitment to open irrevocable letters of credit
for its account. Each letter of credit will be issued within a reasonable period of time after
receipt of a duly completed and executed copy of Agent’s then current form of application or, if
applicable, in accordance with the terms of any CoTrade Agreement between the parties, and shall
reduce the amount available under the Commitment by the maximum amount capable of being drawn
thereunder. Any draw under any letter of credit issued hereunder shall be deemed an advance under
the Commitment. Each letter of credit must be in form and content acceptable to Agent and must
expire no later than the maturity date of the loans. Notwithstanding the foregoing or any other
provision hereof, the maximum amount capable of being drawn under each letter of credit must be
statused against the Borrowing Base in the same manner as if it were a loan, and in the event that
(after repaying all loans) the maximum amount capable of being drawn under the letters of credit
exceeds the Borrowing Base, then the Company shall immediately notify Agent and pay to Agent (to be
held as cash collateral) an amount equal to such excess.
SECTION 8. Commitment Fee. In consideration of the Commitment, the Company agrees to pay to
Agent a commitment fee on the average daily unused portion of the Commitment at the rate of 1/4 of
1% per annum (calculated on a 360 day basis), payable monthly in arrears by the 20th day following
each month. Such fee shall be payable for each month (or portion thereof) occurring during the
original or any extended term of the Commitment. For purposes of calculating the commitment fee
only, the “Commitment” shall mean the dollar amount specified in Section 1 hereof, irrespective of
the Borrowing Base
SECTION 9. Loan Origination Fee. In consideration of the Commitment, the Company agrees to
pay to Agent on the execution hereof a loan origination fee in the amount of $12,500.00.
IN WITNESS WHEREOF, the parties have caused this Supplement to be executed by their duly
authorized officers as of the date shown above.
| FARM CREDIT SERVICES | ADVANCED BIOENERGY, LLC | |||||||||
| OF AMERICA, FLCA | ||||||||||
By:
|
/s/ Xxxxxx Xxxxxxx | By: | /s/ Xxxxx X. Xxxxxxxxxx III | |||||||
Title:
|
VP | Title: | Chairman | |||||||
