SECOND AMENDMENT AND WAIVER
TO CREDIT AGREEMENT
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SECOND AMENDMENT AND WAIVER, dated as of January 31, 2002, to the
Credit Agreement referred to below (this "Amendment") among Agway, Inc., a
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Delaware corporation, Feed Commodities International LLC, a Delaware limited
liability company, Xxxxxxxx Agronomic Consulting Service LLC, a Delaware limited
liability company, Agway General Agency, Inc., a New York corporation, Country
Best Xxxxx, LLC, a Delaware limited liability company, Country Best-XxXxxxx LLC,
a Delaware limited liability company, Agway Energy Products LLC, a Delaware
limited liability company ("AEP"), Agway Energy Services-PA, Inc., a Delaware
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corporation, and Agway Energy Services, Inc., a Delaware corporation, (the
foregoing entities are sometimes collectively referred to herein as the
"Borrowers" and individually as a "Borrower");the other Credit Parties signatory
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hereto; GENERAL ELECTRIC CAPITAL CORPORATION, a Delaware corporation (in its
individual capacity, "GE Capital"), for itself, as Lender, and as Agent for
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Lenders, and the other Lenders signatory hereto from time to time.
W I T N E S S E T H
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WHEREAS, Borrowers, the other Credit Parties signatory thereto,
Agent, and Lenders signatory thereto are parties to that certain Credit
Agreement, dated as of March 28, 2001 (including all annexes, exhibits and
schedules thereto, and as amended, restated, supplemented or otherwise modified
from time to time, the "Credit Agreement"); and
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WHEREAS, Agent and Lenders have agreed to amend and waive certain
provisions of the Credit Agreement, in the manner, and on the terms and
conditions, provided for herein;
NOW THEREFORE, in consideration of the premises and for other good
and valuable consideration, the receipt, adequacy and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:
1. Definitions. Capitalized terms not otherwise defined herein
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shall have the meanings ascribed to them in the Credit Agreement or Annex A
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thereto.
2. Waiver. The parties hereto acknowledge that Borrowers
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failed to comply with the following covenants set forth in Section 6.10 and
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Annex G of the Credit Agreement for the period commencing December 23, 2000 and
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ending December 31, 2001:
(a) Minimum EBITDA (Agway Operations); and
(b) Minimum Senior Interest Coverage Ratio.
Agent and Lenders hereby waive as of the Amendment Effective Date
all Events of Default arising solely from Borrowers' failure to comply with such
covenants for the period commencing December 23, 2000 and ending December 31,
2001.
3. Annex G of the Credit Agreement is hereby amended as of the
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Amendment Effective Date by deleting (i) the financial covenant for Minimum
EBITDA (Agway Operations) for the period December 23, 2000 through December 31,
2001 in the amount of $8,300,000 and inserting in lieu thereof a financial
covenant for Minimum EBITDA (Agway Operations) for the period December 23, 2000
through December 31, 2001 in the amount of $4,200,000 and (ii) the financial
covenant for Minimum Senior Interest Coverage Ratio for the period of four
Fiscal Quarters commencing December 23, 2000 and ending December 31, 2001 of
".80x" and inserting in lieu thereof a financial covenant for Minimum Senior
Interest Coverage Ratio for the period of Four Fiscal Quarters commencing
December 23, 2000 and ending December 31, 2001 of ".45x".
4. Amendment Fee. To induce Agent and Lenders to enter into this
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Amendment, Borrowers hereby agree to pay Agent, for the ratable benefit of
Lenders, an amendment fee in the amount of $125,000 in immediately available
funds, payable on the Amendment Effective Date.
5. Representations and Warranties. To induce Agent and Lenders
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to enter into this Amendment, Borrowers make the following representations and
warranties to Agent and Lenders:
(a) The execution, delivery and performance of this Amendment
and the performance of the Credit Agreement, as amended by this Amendment (the
"Amended Credit Agreement"), by Borrowers: (a) are within each Borrower's
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organizational power; (b) have been duly authorized by all necessary or proper
corporate and shareholder action; (c) do not contravene any provision of any
Borrower's charter or bylaws or equivalent organizational documents; (d) do not
violate any law or regulation, or any order or decree of any court or
Governmental Authority; (e) do not conflict with or result in the breach or
termination of, constitute a default under or accelerate or permit the
acceleration of any performance required by, any indenture, mortgage, deed of
trust, lease, agreement or other instrument to which any Borrower is a party or
by which any Borrower or any of its property is bound; (f) do not result in the
creation or imposition of any Lien upon any of the property of any Borrower
other than those in favor of Agent pursuant to the Loan Documents; and (g) do
not require the consent or approval of any Governmental Authority or any other
Person.
(b) This Amendment has been duly executed and delivered by or on
behalf of Borrowers.
(c) Each of this Amendment and the Amended Credit Agreement
constitutes a legal, valid and binding obligation of each Borrower and each of
the other Credit Parties party thereto, enforceable against each in accordance
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with its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).
(d) No Default has occurred and is continuing after giving effect
to this Amendment.
(e) No action, claim, lawsuit, demand, investigation or
proceeding is now pending or, to the knowledge of any Credit Party, threatened
against any Credit Party, at law, in equity or otherwise, before any court,
board, commission, agency or instrumentality of any Governmental Authority, or
before any arbitrator or panel of arbitrators, (i) which challenges any
Borrower's or, to the extent applicable, any other Credit Party's right, power,
or competence to enter into this Amendment or perform any of their respective
obligations under this Amendment, the Amended Credit Agreement or any other Loan
Document, or the validity or enforceability of this Amendment, the Amended
Credit Agreement or any other Loan Document or any action taken under this
Amendment, the Amended Credit Agreement or any other Loan Document or (ii)
except for items on Disclosure Schedule (3.13) or notifications sent to Agent
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since the Closing Date, which if determined adversely, is reasonably likely to
have or result in a Material Adverse Effect. Except for items on Disclosure
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Schedule (3.13) or notifications sent to Agent since the Closing Date, to the
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knowledge of each Borrower, there does not exist a state of facts which is
reasonably likely to give rise to such proceedings.
(f) The representations and warranties of each Borrower and the
other Credit Parties contained in the Credit Agreement and each other Loan
Document shall be true and correct on and as of the Amendment Effective Date
with the same effect as if such representations and warranties had been made on
and as of such date, except that any such representation or warranty which is
expressly made only as of a specified date need be true only as of such date.
6. No Other Amendments/Waivers. Except as expressly amended
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herein, the Credit Agreement and the other Loan Documents shall be unmodified
and shall continue to be in full force and effect in accordance with their
terms. In addition, except as specifically provided herein, this Amendment shall
not be deemed a waiver of any term or condition of any Loan Document and shall
not be deemed to prejudice any right or rights which Agent, for itself and
Lenders, may now have or may have in the future under or in connection with any
Loan Document or any of the instruments or agreements referred to therein, as
the same may be amended from time to time.
7. Outstanding Indebtedness; Waiver of Claims. Each Borrower and
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the other Credit Parties hereby acknowledges and agrees that as of
January 31, 2002 the aggregate outstanding principal amount of the Revolving
Loan is $00.00 and that such principal amount is payable pursuant to the Credit
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Agreement without defense, offset, withholding, counterclaim or deduction of any
kind. Borrowers and each other Credit Party hereby waives, releases, remises
and forever discharges Agent, Lenders and each other Indemnified Person from
any and all claims, suits, actions, investigations, proceedings or demands
arising out of or in connection with the Credit Agreement (collectively,
"Claims"), whether based in contract, tort, implied or express warranty, strict
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liability, criminal or civil statute or common law of any kind or character,
known or unknown, which any Borrower or any other Credit Party ever had, now has
or might hereafter have against Agent or Lenders which relates, directly or
indirectly, to any acts or omissions of Agent, Lenders or any other Indemnified
Person on or prior to the Amendment Effective Date, provided, that no Borrower
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nor any other Credit Party waives any Claim solely to the extent such Claim
relates to the Agent's or any Lender's gross negligence or willful misconduct.
8. Expenses. Each Borrower and the other Credit Parties hereby
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reconfirms its respective obligations pursuant to Sections 1.9 and 11.3 of the
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Credit Agreement and pursuant to the GE Capital Fee Letter, to pay and reimburse
Agent, for itself and Lenders, for all reasonable costs and expenses (including,
without limitation, reasonable fees of counsel) incurred in connection with the
negotiation, preparation, execution and delivery of this Amendment and all other
documents and instruments delivered in connection herewith.
9. Effectiveness. This Amendment shall become effective as of
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January 31, 2002 (the "Amendment Effective Date") only upon satisfaction in full
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in the judgment of Agent of each of the following conditions:
(a) Amendment. Agent shall have received ten (10) original
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copies of this Amendment duly executed and delivered by Agent, the Requisite
Lenders and Borrowers.
(b) Payment of Expenses. Borrowers shall have paid to Agent
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all costs, fees and expenses owing in connection with this Amendment and the
other Loan Documents and due to Agent (including, without limitation, reasonable
legal fees and expenses).
(c) Representations and Warranties. The representations
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and warranties of or on behalf of the Credit Parties in this Amendment shall be
shall be true and correct on and as of the Amendment Effective Date.
10. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
11. Counterparts. This Amendment may be executed by the parties
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hereto on any number of separate counterparts and all of said counterparts taken
together shall be deemed to constitute one and the same instrument.
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[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment
to be duly executed and delivered as of the day and year first above written.
BORROWERS
AGWAY, INC.
FEED COMMODITIES INTERNATIONAL LLC
XXXXXXXX AGRONOMIC CONSULTING
SERVICE LLC
COUNTRY BEST-XXXXXXX LLC
AGWAY ENERGY PRODUCTS LLC
AGWAY ENERGY SERVICES-PA, INC.
AGWAY ENERGY SERVICES, INC.
COUNTRY BEST XXXXX, LLC
By: /s/ Xxxxx X. Xxxxxxx
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Name: Xxxxx X. Xxxxxxx
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Title: Treasurer
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AGWAY GENERAL AGENCY, INC.
By: /s/ Xxxxx X. Xxxxxxx
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Name: Xxxxx X. Xxxxxxx
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Title: Assistant Treasurer
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LENDERS
COBANK, ACB
By: /s/ Xxxxxxx X. Hide
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Name: Xxxxxxx X. Hide
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Title: Vice President
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COOPERATIEVE CENTRALE RAIFFEISEN-
BOERENLEEN BANK B.A., "Rabobank Nederland"
New York Branch
By: /s/ Xxxxxxxx English, Xxx Xxxxx
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Name: Xxxxxxxx English, Xxx Xxxxx
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Title: Vice President, Managing Director
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GMAC BUSINESS CREDIT, LLC
By: /s/ Xxxxxxx Xxxxx
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Name: Xxxxxxx Xxxxx
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Title: AVP
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GENERAL ELECTRIC CAPITAL CORPORATION,
as Agent and Lender
By: /s/ Xxxxxx X. Xxxx
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Name: Xxxxxx X. Xxxx
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Title: Its Duty Authorized Signatory
