Exhibit B-4(f)(10)
EXECUTION COUNTERPART
AMENDMENT OF
2000 NOTE AGREEMENT
This Amendment, dated October 23, 2001 ("Amendment") to that
certain Consolidated, Amended and Restated Note Agreement (the
"Note Agreement") dated as of November 3, 2000, between Gold Xxxx
Inc. (the "Company") and The Prudential Insurance Company of
America ("Prudential") both on its own behalf and as asset
manager for Gateway Recovery Trust.
WHEREAS, the parties hereto have executed and delivered that
certain Note Agreement;
WHEREAS, concurrent with the execution and delivery of the
Note Agreement, the Company also entered into the Bank Agreement;
WHEREAS, the parties to the Bank Agreement are amending and
restating such agreement;
WHEREAS, the Company has requested that Prudential agree to
conform the covenants in the Note Agreement to match those found
in the amended and restated Bank Agreement;
WHEREAS, Prudential is willing to enter into this Amendment
subject to the satisfaction of conditions and terms set forth
herein;
WHEREAS, capitalized terms used herein and not otherwise
defined shall have the meanings set forth in the Note Agreement;
and
NOW, THEREFORE, in consideration of the foregoing and other
good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as
follows:
A. Pursuant to paragraph 11C of the Note Agreement the Company
and Prudential hereby agree that the Note Agreement shall be
amended as follows:
1. Paragraph 5A. Paragraph 5A(1) is amended in its
entirety to read as follows:
"5A(1) General Information. The Company covenants
that it will deliver to each Significant Holder in triplicate:
(i) as soon as practicable and in any event within
45 days after the end of each Fiscal Quarter (other than the
fourth Fiscal Quarter) in each Fiscal Year,
(1) statements of operations, patrons' and other
equity and comprehensive income (loss) and cash flows
for the period from the beginning of the current Fiscal
Year to the end of such Fiscal Quarter, and
(2) balance sheet as at the end of such Fiscal
Quarter,
setting forth in each case in comparative form figures for
the corresponding period in the preceding Fiscal Year, all
in reasonable detail and satisfactory in form to the
Required Holder(s) and certified by an authorized financial
officer of the Company as fairly presenting, in all material
respects, the financial condition of the Company and its
Consolidated Subsidiaries as of the end of such period and
the results of their operations for the period then ended in
accordance with GAAP, subject to changes resulting from
normal year-end adjustments and the inclusion of abbreviated
footnotes; provided, however, that delivery pursuant to
clause (iii) below of copies of the Quarterly Report on Form
10-Q of the Company for such Fiscal Quarter filed with the
Securities and Exchange Commission shall be deemed to
satisfy the requirements of this clause (i) with respect to
the Consolidated Statements;
(ii) as soon as practicable and in any event within 90
days after the end of each Fiscal Year,
(1) statements of operations, patrons' and other
equity and comprehensive income (loss) and cash flows
for such year, and
(2) a balance sheet as at the end of such year,
setting forth in each case in comparative form corresponding
Consolidated figures from the preceding annual audit, all in
reasonable detail and satisfactory in scope to the Required
Holder(s) and reported on by independent public accountants
of recognized standing selected by the Company whose report
shall be without limitation as to the scope of the audit and
reasonably satisfactory in substance to the Required
Holder(s); provided, however, that delivery pursuant to
clause (iii) below of copies of the Annual Report on Form
10-K of the Company for such year filed with the Securities
and Exchange Commission shall be deemed to satisfy the
requirements of this clause (ii) with respect to the
Consolidated statements;
(iii) if the Company or any of its Subsidiaries
shall become a public company, promptly upon transmission
thereof, copies of all such financial statements, proxy
statements, notices and reports as it shall send to its
public stockholders and copies of all registration
statements (without exhibits) and all reports (other than
any registration statement filed on Form S-8) which it files
with the Securities and Exchange Commission (or any
governmental body or agency succeeding to the functions of
the Securities and Exchange Commission);
(iv) Promptly (a) after notice thereof being delivered
to the Company or any Subsidiary, notice of the commencement
of any audit of any federal, state or other income tax
return of the Company or any Subsidiary, and (b) upon
receipt thereof, a copy of each other report submitted to
the Company or any Subsidiary by independent accountants in
connection with any annual, interim or special audit made by
them of the books of the Company or any Subsidiary;
(v) promptly upon receipt thereof, a copy of each
report, survey, study, evaluation or assessment or, promptly
upon request therefor, any other document prepared by any
consultant, engineer, environmental authority or other
Person (other than work product of the Company's legal
counsel) relating to compliance by the Company or any
Subsidiary with any Environmental Laws, if the cost of
remediation, repair or compliance may be reasonably expected
to exceed $1,000,000 in any one case or in the aggregate;
(vi) with reasonable promptness, upon the request of
the holder of any Note, provide such holder, and any
qualified institutional buyer designated by such holder,
such financial and other information as such holder may
reasonably determine to be necessary in order to permit
compliance with the information requirements of Rule 144A
under the Securities Act in connection with the resale of
Notes, except at such times as the Company is subject to the
reporting requirements of section 13 or 15(d) of the
Exchange Act. For the purpose of this clause (vii), the
term "qualified institutional buyer" shall have the meaning
specified in Rule 144A under the Securities Act;
(vii) immediately upon the effective date of any
amendment or modification of the Bank Agreement (including
without limitation any adjustment to the borrowing base
thereunder), any such amendment or modification; and
(viii) with reasonable promptness, such other
financial data as a Significant Holder may reasonably
request."
2. Paragraph 5K. Paragraph 5K(i) is amended in its
entirety to read as follows:
"(i) offer to prepay the Notes pursuant to paragraph
4B, as provided in clause (ii) below:
(a) in an amount equal to 100% of the Net
Proceeds of Stock or any offering by the Company of
Subordinated Debt (other than an offering that
increases the outstandings under the Company's
Subordinated Loan Certificates or Subordinated Capital
Certificates of Interest in existence prior to November
3, 2000 and described on Schedule 5K hereto). Such
prepayment shall be due immediately upon the receipt by
the Company of such net proceeds.
(b) in amounts equal to (i) 100% of the net
proceeds from any sale or other disposition by the
Company of any inventory (other than sales of inventory
in the ordinary course), (ii) 50% of the net proceeds
of any sale or other disposition by the Company of any
of the SSC Securities, and (iii) 100% of the net
proceeds from any other sale or other disposition
(other than sales of inventory in the ordinary course
of business), or series of related sales or
dispositions, by the Company of any assets not
otherwise referenced above in this paragraph 5K(i)(b),
where the net proceeds exceed $1,000,000, other than
any sale of (A) the assets of the Pork Division, (B)
the ADM Shares to the extent the net proceeds from the
sale of the ADM Shares are used to repay the Rabobank
Total Return Swap, or (C) any Stock of the Company in
AgraTech Seeds, Inc., CF Industries (a cooperative
marketing association in which the Company holds an
equity interest), or InTrade (an international
cooperative marketing association). Each such
prepayment of net proceeds shall be due immediately
upon the receipt by the Company of such net proceeds."
3. Paragraph 5M. The following paragraph 5M shall be
added:
"5M. Delivery of Pledge Agreement and ADM Shares. If the
Rabobank Total Return Swap is terminated in accordance with its
provisions, the Company immediately shall cause GK Finance to
execute and deliver to the Collateral Agent, for the benefit of
the Secured Parties (as defined in the Intercreditor Agreement),
the Pledge Agreement, and to deliver to the Collateral Agent the
ADM Shares and such stock powers, executed in blank, as the
Collateral Agent shall request."
4. Paragraph 6. Paragraph 6 of the Note Agreement shall
be amended and restated in its entirety to read as follows:
"6. NEGATIVE COVENANTS.
So long thereafter as any Note is outstanding and unpaid,
the Company covenants as follows:
6A(1) Minimum Consolidated Tangible Net Worth. The
Company's Consolidated Tangible Net Worth (less any gain or loss
as a result of accumulated other comprehensive income, as defined
by GAAP) shall as of September 30, 2001, and at all times
thereafter, be at least $225,000,000, plus the sum of (i) 50% of
the Reported Net Income of the Company and its Consolidated
Subsidiaries (to the extent positive) for the Fiscal Quarter
ending September 30, 2001, and each Fiscal Quarter thereafter on
a cumulative basis (taken as one accounting period), but
excluding from such calculations of Reported Net Income for
purposes of this clause (i) any Fiscal Quarter in which the
Reported Net Income of the Company and its Consolidated
Subsidiaries is negative, and (ii) 100% of the cumulative Net
Proceeds of Capital Stock received during any period after June
30, 2001.
6A(2) Current Ratio. The Company shall not permit, as
of September 30, 2001, and at anytime thereafter, the ratio of
Consolidated Current Assets to Consolidated Current Liabilities
to be less than 1.10 to 1.00 calculated on a quarterly basis.
6A(3) Interest Coverage Ratio. The Company shall not
permit, as of September 30, 2001, and as of the last day of each
Fiscal Quarter thereafter, the ratio of EBIT to Interest Expense,
each for the four Fiscal Quarter period then ended, to be less
than 1.40 to 1.00.
6A(4) Senior Coverage Ratio. The Company shall not
permit the Senior Debt Coverage Ratio to be greater than the
ratio set forth opposite the relevant Fiscal Quarter in the
following table:
Fiscal Quarter Ratio
First Quarter 2002 4.00 to 1.00
Second Quarter 2002 3.75 to 1.00
Third Quarter 2002 3.50 to 1.00
Fourth Quarter 2002 3.50 to 1.00
First Quarter, 2003, 3.25 to 1.00
and thereafter
6A(5) Consolidated Total Adjusted Debt to Total Capital
Ratio. The Company shall not permit the ratio of Consolidated
Total Adjusted Debt to Total Capital to exceed the ratio set
forth opposite the relevant Fiscal Quarter in the following
table:
Fourth Fiscal Quarter Fiscal Year 2001 through
Fourth Fiscal Quarter Fiscal Year 2002 0.65 to 1.00
First Fiscal Quarter Fiscal Year 2003 through
Fourth Fiscal Quarter Fiscal Year 2003 0.60 to 1.00
Thereafter 0.60 to 1.00
6A(6) Fixed Charge Coverage. The Company shall not
permit the ratio of (i) EBIT plus Consolidated Lease Expense, in
each case for the period of eight Fiscal Quarters of the Company
most recently ended at such time, to (ii) Consolidated Interest
Expense plus Consolidated Lease Expense for such period to be
less than the ratio set forth opposite the relevant Fiscal
Quarter in the following table:
Fourth Fiscal Quarter Fiscal Year 2001 0.25 to 1.00
First Fiscal Quarter Fiscal Year 2002 0.35 to 1.00
Second Fiscal Quarter Fiscal Year 2002 0.75 to 1.00
Third Fiscal Quarter Fiscal Year 2002 1.00 to 1.00
Fourth Fiscal Quarter Fiscal Year 2002 1.25 to 1.00
First Fiscal Quarter Fiscal Year 2003 1.25 to 1.00
Second Fiscal Quarter Fiscal Year 2003 1.25 to 1.00
Third Fiscal Quarter Fiscal Year 2003 1.25 to 1.00
Fourth Fiscal Quarter Fiscal Year 2003 1.25 to 1.00
Thereafter 1.25 to 1.00
6A(7) Consolidated Total Adjusted Debt to EBITDA. The
Company shall not permit the ratio of Consolidated Total Adjusted
Debt as of the end of any Fiscal Quarter of the Company to the
sum of EBITDA for the Fiscal Quarter then ending and the
preceding seven Fiscal Quarters (divided by two), to be greater
than the ratio set forth opposite the relevant Fiscal Quarter in
the following table:
Fourth Fiscal Quarter Fiscal Year 2001 8.50 to 1.00
First Fiscal Quarter Fiscal Year 2002 7.75 to 1.00
Second Fiscal Quarter Fiscal Year 2002 4.50 to 1.00
Third Fiscal Quarter Fiscal Year 2002 4.25 to 1.00
Fourth Fiscal Quarter Fiscal Year 2002 3.75 to 1.00
First Fiscal Quarter Fiscal Year 2003 3.50 to 1.00
Second Fiscal Quarter Fiscal Year 2003 3.50 to 1.00
Third Fiscal Quarter Fiscal Year 2003 3.50 to 1.00
Thereafter 3.50 to 1.00
6B. Limitation on Restricted Payments. The Company will
not pay or declare any dividend or make any other distribution on
or on account of any class of its Stock or other equity or make
cash distributions of equity (including cash patronage refunds),
or make interest payments on equity, or redeem, purchase or
otherwise acquire, directly or indirectly, any shares of its
Stock or other equity, or redeem, purchase or otherwise acquire,
directly or indirectly, any Subordinated Debt, including, but not
limited to, its Subordinated Capital Certificates of Interest,
Subordinated Loan Certificates and Cumulative Preferred
Certificates of Interest (except required redemptions as provided
in the indentures pursuant to which such Subordinated Debt was
issued), or permit any Subsidiary to do any of the above (all of
the foregoing being herein called "Restricted Payments") except
that the Company may make (a) cash patronage refunds in Fiscal
Year 2002 and thereafter in an amount, for each Fiscal Year, not
to exceed 10% of the member earnings for such Fiscal Year, and
(b) present value cashing retirement and death payments (net of
any amount the Company receives as insurance proceeds) in an
aggregate amount not to exceed $5,000,000 in any Fiscal Year;
provided that the Company shall not make any Restricted Payments
upon the occurrence and during the continuance of a Default or
Event of Default. So long as no Default or Event of Default
shall have occurred and be continuing, there shall not be
included in the definition of Restricted Payments: (x) dividends
paid, or distributions made, in Stock of the Company or (y)
exchanges of Stock of one or more classes of the Company, except
to the extent that cash or other value is involved in such
exchange. Moreover, nothing in this Paragraph 6B shall prevent
any Subsidiary from making any Restricted Payments to the Company
or to any other Related Party that directly owns Stock of such
Subsidiary. The term "equity" as used in this Paragraph 6B shall
include the Company's common stock, preferred stock, if any,
other equity certificates, and notified equity accounts of
patrons.
6C. Liens. The Company shall not, and shall not permit any
Subsidiary to, create, assume or suffer to exist any Lien upon
any of its property or assets whether now owned or hereafter
acquired, except:
(a) Liens existing prior to the date of this Agreement, as
set forth on Schedule 6C attached hereto;
(b) Liens for taxes not yet due, and Liens for taxes or
Liens imposed by ERISA that are being contested in good faith by
appropriate proceedings and with respect to which adequate
reserves are being maintained;
(c) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, materialmen and other Liens imposed by
law created in the ordinary course of business for amounts not
yet due or that are being contested in good faith by appropriate
proceedings and with respect to which adequate reserves are being
maintained;
(d) Liens incurred or deposits made in the ordinary course
of business in connection with workers' compensation,
unemployment insurance and other types of social security, or to
secure the performance of tenders, statutory obligations, surety
and appeal bonds, bids, leases, government contracts, performance
and return-of-money bonds and other similar obligations
(exclusive of obligations for the payment of borrowed money);
(e) Liens securing purchase money debt, provided that (i)
the Lien in each instance does not extend beyond the assets
acquired with the purchase money debt, and (ii) the aggregate of
such debt so secured does not exceed five percent (5%) of
Consolidated Net Worth;
(f) Liens consisting of encumbrances in the nature of
zoning restrictions, easements and rights or restrictions of
record on the use of real property, which do not materially
detract from the value of such property or impair the use thereof
in the business of such Person;
(g) Liens securing the obligations due to the parties to
the Intercreditor Agreement; and
(h) Liens against the ADM Shares created in connection with
the Rabobank Total Return Swap.
6D. Restrictions on Loans, Advances, Investments, Asset
Acquisitions and Contingent Liabilities. The Company shall not,
and shall not permit any Subsidiary to (i) make or permit to
remain outstanding any loan or advance to, or extend credit other
than credit extended in the normal course of business to any
Person that is not an Affiliate of the Company, or (ii)
guarantee, endorse or otherwise be or become contingently liable,
directly or indirectly, in connection with the obligations, Stock
or dividends of any Person, or (iii) own, purchase or acquire any
Stock, obligations or securities of, or any other interest in, or
make any capital contribution to, any Person, or (iv) acquire
all, or substantially all, of the assets of any Person, in a
single or a series of related transactions; except that the
Company or any Subsidiary may:
(a) (x) make or permit to remain outstanding loans or advances
to any other Related Party, or (y) guarantee or otherwise become
liable for obligations of any other Related Party to the extent
such obligation that is guaranteed is incurred in the ordinary
course of business of such Related Party or is Indebtedness
otherwise permitted to be incurred by such Related Party
(including guarantee obligations under the Subsidiary Guaranty);
(b) acquire and own Stock, obligations or securities received in
settlement of debts (created in the ordinary course of business)
owing to the Company or any Subsidiary;
(c) own, purchase or acquire prime commercial paper and
certificates of deposit in United States commercial banks (whose
long-term debt is rated "A" or better by Xxxxx'x Investors
Service or Standard and Poor's Corporation), in each case due
within one year from the date of purchase and payable in the
United States in Dollars;
(d) own, purchase and acquire obligations of the United States
Government or any agency thereof, in each case due within one
year from the date of purchase;
(e) own, purchase and acquire obligations guaranteed by the
United States Government, in each case due within one year from
the date of purchase;
(f) own, purchase and acquire repurchase agreements of United
States commercial banks (whose long-term debt is rated "A" or
better by Xxxxx'x Investors Service or Standard and Poor's
Corporation) for terms of less than one year in respect of the
foregoing certificates and obligations;
(g) own, purchase and acquire tax-exempt securities maturing
within one year from the date of purchase and rated "A" or better
by Xxxxx'x Investors Service or Standard and Poor's Corporation;
(h) own, purchase and acquire adjustable rate preferred stocks
rated "A" or better by Xxxxx'x Investors Service or Standard and
Poor's Corporation;
(i) endorse negotiable instruments for collection in the
ordinary course of business;
(j) make or permit to remain outstanding travel and other like
advances to officers and employees in the ordinary course of
business;
(k) (x) permit to remain outstanding investments in the
Subsidiaries of the Company in existence as of October 23, 2001
and (y) make or permit to remain outstanding investments in any
Subsidiary (whether in existence on November 3, 2000 or created
thereafter) in accordance with Paragraph 6N, if such Subsidiary
is a Related Party;
(l) make or permit to remain outstanding loans from Agratrade
Financing, Inc., a Wholly Owned Subsidiary of the Company, to
members and non-members of the Company (provided that all such
loans are made to facilitate the business of the Company) in an
aggregate amount not to exceed $20,000,000;
(m) make or permit to remain outstanding investments in the
Xxxxxx-Xxxxxxx Midland Company existing on the date hereof plus
increases due to normal dividend reinvestment plans, stock
splits, stock dividends or similar arrangements;
(n) make or permit to remain outstanding investments described
on Schedule 6D attached hereto;
(o) make or permit to remain outstanding investments in GC
Properties in an aggregate amount not exceeding $500,000 during
the term of the Note Agreement;
(p) guarantee or otherwise be or become contingently liable for
obligations of Young Pecan not to exceed an aggregate amount of
$65,000,000;
(q) have increases in existing investments arising from non-cash
notified equity or other equity methods of accounting for equity
increases which are non-cash;
(r) guarantee the obligations of GK Finance arising pursuant to
the Rabobank Total Return Swap; and
(s) make or permit to remain outstanding investments in any
money market fund that invests only in investments described in
subsections (c), (d), (e), (f), (g), or (h) of this Xxxxxxxxx 0X.
0X. Sale of Stock and Indebtedness of Subsidiaries.
Without the prior written consent of Prudential, which consent
shall be at its sole discretion, the Company shall not, and shall
not permit any Subsidiary to, sell or otherwise dispose of, or
part with control of, any shares of Stock or Indebtedness of any
Subsidiary, except to the Company or another Related Party, and
except that all shares of Stock and Indebtedness of any
Subsidiary at the time owned by or owed to the Company and all
Subsidiaries may be sold as an entirety for a cash consideration
that represents the fair value (as determined in good faith by
the Board of Directors of the Company) at the time of sale of the
shares of Stock and Indebtedness so sold, provided that the
assets of such Subsidiary do not constitute a Substantial Part of
the Consolidated Assets of the Company and all Subsidiaries and
that the earnings of such Subsidiary shall not have constituted a
Substantial Part of Consolidated Net Earnings for any of the
three Fiscal Years then most recently ended, and further provided
that, at the time of such sale, such Subsidiary shall not own,
directly or indirectly, any shares of Stock or Indebtedness of
any other Subsidiary (unless all of the shares of Stock and
Indebtedness of such other Subsidiary owned, directly or
indirectly, by the Company and all Subsidiaries are
simultaneously being sold as permitted by this Paragraph 6E).
6F. Merger and Sale of Assets. The Company shall not, and
shall not permit any Subsidiary to, enter into any transaction of
merger, consolidation, pooling of interest, joint venture,
syndicate or other combination with any other Person or sell,
lease, transfer, contribute as capital, or otherwise dispose of
all or a Substantial Part of the consolidated assets of the
Company and all Subsidiaries or assets that shall have
contributed a Substantial Part of Consolidated Net Earnings for
any of the three Fiscal Years then most recently ended, in any
single transaction or series of related transactions, to any
Person, except that:
(a) any Subsidiary may merge with (i) the Company, provided
that the Company shall be the continuing or surviving
corporation, or (ii) any one or more other Subsidiaries provided
that if any Loan Party is party to such merger, a Loan Party
shall be the continuing or surviving corporation;
(b) any Subsidiary may sell, lease or otherwise dispose of
any of its assets to the Company or another Related Party; and
(c) any Subsidiary may sell or otherwise dispose of all or
substantially all of its assets subject to the conditions
specified in paragraph 6E with respect to a sale of the Stock of
such Subsidiary.
6G. Sale and Lease-Back. The Company shall not, and shall
not permit any Subsidiary to, enter into any arrangement, with
any Person or under which such other Person is a party, providing
for the leasing by the Company or any Subsidiary of real or
personal property, used by the Company or any Subsidiary in the
operations of the Company or any Subsidiary, that has been or is
sold or transferred by the Company or any Subsidiary to any other
Person to whom funds have been or are to be advanced by such
other Person on the security of such rental obligations of the
Company or such Subsidiary except to the extent that the total
amount of such arrangements involve, at any one time, assets or
property that constitute an amount equal to or less than ten
percent (10%) of Consolidated Capital Assets.
6H. Sale or Discount of Receivables. The Company shall
not, and shall not permit any Subsidiary to, sell with recourse
or discount or otherwise sell for less than the face value
thereof, any of its notes or accounts receivable.
6I. Hedging Contracts. The Company shall not, and shall
not permit any Subsidiary to, enter into any Hedging Contract
except: (a) bona fide hedging transactions in commodities that
represent production inputs or products to be marketed, or in
commodities needed in operations to meet manufacturing or market
demands, provided that (i) long positions and/or options sold on
corn and wheat shall in no event cover more than twenty-six weeks
of the Company's anticipated requirements for feed ingredients,
and none of such positions and/or options shall cover more than
six and one-half weeks of such anticipated requirements unless
they have been entered into in compliance with the Company's
Corporate Policy For Futures Contracts approved by the Company's
Board of Directors on April 24, 1998 and have been approved by
the Company's Hedging Committee, (ii) long positions and/or
options sold on soybean meal shall in no event cover more than
twenty-six weeks of the Company's anticipated requirements for
feed ingredients, and none of such positions and/or options shall
cover more than six and one-half weeks of such anticipated
requirements unless they have been entered into in compliance
with the Company's Corporate Policy For Futures Contracts
approved by the Company's Board of Directors on April 24, 1998
and have been approved by the Company's Hedging Committee, and
(iii) short positions on corn shall not exceed 2,000,000 bushels,
and shall at all times relate to corn owned or contracted for
purchase by the Company; and (b) foreign exchange contracts,
currency swap agreements, interest rate exchange agreements,
interest rate cap agreements, interest rate collar agreements,
and other similar agreements and arrangements that are reasonably
related to existing indebtedness or to monies to be received or
paid in foreign currencies.
6J. Issuance of Stock by Subsidiaries. The Company shall
not permit any Subsidiary (either directly or indirectly by the
issuance of rights or options for, or securities convertible
into, such shares) to issue, sell or dispose of any shares of its
Stock of any class (other than directors' qualifying shares, if
any) except to the Company or another Subsidiary.
6K. Capital Expenditures. The Company and its Subsidiaries
shall not, on a consolidated basis, directly or indirectly, make
Capital Expenditures in the aggregate (a) in Fiscal Year 2002
exceeding $61,500,000, or (b) in Fiscal Year 2003 exceeding
$55,000,000 plus the amount of any available but unused Capital
Expenditures from Fiscal Year 2002.
6L. Indebtedness for Money Borrowed. The Company shall
not, and shall not permit any Subsidiary to, create, incur,
assume, or suffer to exist any Indebtedness for Money Borrowed,
except for the following:
(a) the Notes;
(b) Indebtedness existing under the Bank Agreement and the
other loan documents executed thereunder (including, without
limitation, all Loans and Letter of Credit Obligations (as such
terms are defined in the Bank Agreement));
(c) Indebtedness (including guaranties) that may be deemed
to exist pursuant to any performance, surety, appeal or similar
bonds obtained by the Company or any of its Subsidiaries in the
ordinary course of business;
(d) Indebtedness for Money Borrowed in existence on the
date hereof and set forth on Schedule 6L.
(e) Subordinated Debt;
(f) unsecured Indebtedness for Money Borrowed owing by any
Related Party to any other Related Party; and
(g) reimbursement obligations under letters of credit
issued by any of the lenders under the Bank Agreement, provided
that the aggregate principal amount of such reimbursement
obligations does not exceed $20,000,000 at any one time
(exclusive of Letters of Credit issued under the Bank Agreement).
6M. Transactions with Affiliates. The Company shall not,
and shall not permit any Subsidiary to, enter into or be a party
to any transaction or arrangement with any Affiliate (including,
without limitation, the purchase from, sale to or exchange of
property with, or the rendering of any service by or for, any
Affiliate), except (a) in the ordinary course of and pursuant to
the reasonable requirements of the Company's or such Subsidiary's
business and upon fair and reasonable terms no less favorable to
the Company or such Subsidiary than it would obtain in a
comparable arm's-length transaction with a Person other than an
Affiliate, or (b) for transactions between Loan Parties.
6N. Creation of Subsidiaries. Except for the creation of
the Argentine Subsidiary, the Company shall not, and shall not
permit any Subsidiary to, create any Subsidiary unless (a) such
Subsidiary is a Wholly Owned Subsidiary, (b) such Subsidiary is
organized under the laws of a jurisdiction within the United
States of America, (c) such Subsidiary executes at the time of
its creation the Security Agreement (together with applicable
Uniform Commercial Code financing statements), the Subsidiary
Guaranty Agreement and the Contribution Agreement (either
directly or by executing a supplement thereto) and the Stock of
such Subsidiary is pledged to the Agent as Collateral (as such
term is defined in Section 3.21 of the Bank Agreement), (d) an
opinion of counsel, acceptable to Prudential, is delivered to
Prudential confirming the due organization of such Subsidiary,
the enforceability of the Security Agreement, the Subsidiary
Guaranty Agreement and the Contribution Agreement against such
Subsidiary, and such other matters as the Agent may reasonably
request, and (e) no Event of Default has occurred and is
continuing immediately prior to or after the creation of the
Subsidiary.
6O. Bank Agreement. The Company will not amend, modify or
supplement the Bank Agreement to (i) permit any additional
mandatory prepayments thereunder, (ii) require the reduction of
the commitments to lend thereunder (iii) change the amortization
of any term loan thereunder or (iv) permit the prepayment of any
term loan thereunder."
5. Paragraph 7A.
(a) Paragraph 7(A)(xi) of the Note Agreement shall be
amended and restated in its entirety to read as follows:
"(xi) any order, judgment or decree is entered in
any proceedings against the Company decreeing the
dissolution of the Company and such order, judgment or
decree remains unstayed and in effect for more than 10 days;
or"
(b) Paragraph 7(A)(xii) of the Note Agreement shall be
amended and restated in its entirety to read as follows:
"(xii) any order, judgment or decree is entered in
any proceedings against the Company or any Subsidiary
decreeing a split-up of the Company or such Subsidiary which
requires the divestiture of assets representing a
Substantial Part, or the divestiture of the Stock of a
Subsidiary whose assets represent a Substantial Part, of the
consolidated assets of the Company and its Subsidiaries
(determined in accordance with GAAP) or which requires the
divestiture of assets, or Stock of a Subsidiary, which shall
have contributed a Substantial Part of the Consolidated Net
Earnings of the Company and its Subsidiaries (determined in
accordance with GAAP) for any of the three Fiscal Years then
most recently ended, and such order, judgment or decree
remains unstayed and in effect for more than 30 days; or"
6. Paragraph 10. Paragraph 10 of the Note Agreement shall
be amended as follows:
(a) The definitions of "ADM Shares", "Affiliate",
"Bank Agreement", "Change of Control", "Consolidated Senior
Debt", "Consolidated Tangible Net Worth", "Consolidated
Total Debt", "Intercreditor Agreement", "Money Borrowed",
"SSC Securities", "Security Agreement", "Subordinated Debt",
"Subsidiary" and "Total Debt" are hereby deleted and
replaced by the following definitions:
"`ADM Shares' shall mean the 3,842,336 shares of the
common stock of Xxxxxx-Xxxxxx-Midland Company owned by GK
Finance.
`Affiliate' shall mean, with respect to any Person, a
Person directly or indirectly controlling or controlled by,
or under direct or indirect common control with, such
Person. A Person shall be deemed to be "controlled by" any
other Person if such other Person possesses, directly or
indirectly, the power (a) to vote 10% or more of the
securities having ordinary voting power for the election of
directors of such Person or (b) to direct or cause the
direction of the management and policies of such
corporation, whether through the ownership of voting
securities, by contract or otherwise. Additionally, for
purposes of this Agreement, Young Pecan shall be considered
an Affiliate of the Company and its Subsidiaries
notwithstanding anything else to the contrary contained
herein.
`Bank Agreement' shall mean that certain Second Amended
and Restated Credit Agreement dated as of the date hereof
among the Company, various banks, lending institutions and
institutional investors party thereto and Cooperatieve
Centrale Raiffeisen-Boerenleenbank B.A., "Rabobank
Nederland", New York Branch, as Agent, as it may be amended,
modified or supplemented in a manner acceptable to
Prudential.
`Change of Control' shall mean the acquisition or
possession by any Person and its Affiliates, directly or
indirectly, of (1) the power (A) to vote 40% or more of the
common stock having ordinary voting power for the election
of directors of the Company or (B) to direct or cause the
direction of the management and policies of the Company,
whether through the ownership of voting common stock, by
contract or otherwise or (2) 40% of the outstanding common
stock of the Company.
`Consolidated Senior Debt' shall mean the sum of (a)
Consolidated Total Adjusted Debt, less (b) any obligations
under the Rabobank Total Return Swap (to the extent included
in Consolidated Total Adjusted Debt), less (c) any amounts
outstanding under any Subordinated Debt of the Company (to
the extent included in Consolidated Total Adjusted Debt),
less (d) any obligations with respect to letters of credit
issued for the account of the Company or any of its
Subsidiaries in the ordinary course of business to the
extent such letters of credit are not drawn upon or, if and
to the extent drawn upon, to the extent such drawing is
reimbursed no later than the tenth Business Day following
receipt by the Company or such Subsidiary of a demand for
reimbursement thereunder, and less (e) any other
Consolidated Total Adjusted Debt subordinated to the
repayment of the Company's obligations to the holders of the
Notes in form and substance satisfactory to the Required
Holders.
`Consolidated Tangible Net Worth' shall mean
Consolidated Net Worth, less the Intangible Assets of the
Company and its Subsidiaries, but including the goodwill (as
reflected on the Company's financial statements delivered
pursuant to paragraph 5A hereof from time to time but not to
exceed $23,900,000) created in connection with the
acquisition by the Company of the outstanding equity of
Golden Poultry Company, Inc. in September, 1997.
`Consolidated Total Debt' shall mean (a) Total Debt of
the Company and its Subsidiaries, plus (b) the Total Debt of
any other Person (other than Young Pecan) which (i) has been
guaranteed by the Company or any Subsidiary or (ii) is
supported by a letter of credit issued for the account of
the Company or any Subsidiary, all consolidated in
accordance with GAAP.
`Intercreditor Agreement' shall mean that certain
Amended and Restated Intercreditor Agreement dated as of
even date herewith among the Company, the various banks,
lending institutions and institutional investors a party to
the Bank Agreement, and Cooperatieve Centrale Raiffeisen-
Boerenleenbank B.A., "Rabobank Nederland", New York Branch,
as amended, modified, supplemented or restated from time to
time in accordance with its terms.
`Money Borrowed' shall mean, as applied to the
Indebtedness of a Person,
(a) Indebtedness for money borrowed including all
revolving and term Indebtedness and all other lines of
credit; or
(b) Indebtedness (other than trade debt of such Person
incurred in the ordinary course of business), whether or not
in any such case the same was for money borrowed:
(i) represented by notes payable, and drafts
accepted, that represent extensions of credit;
(ii) constituting obligations evidenced by
bonds, debentures, notes or similar instruments;
or
(iii) constituting purchase money
indebtedness, conditional sales contracts, title
retention debt instruments or other similar
instruments upon which interest charges are
customarily paid or that are issued or assumed as
full or partial payment for property; or
(c) all reimbursement obligations under any letters of
credit or acceptances; or
(d) Indebtedness that is such by virtue of subsection
(iii) of the definition of Indebtedness, but only to the
extent that the obligations guaranteed are obligations that
would constitute Indebtedness for Money Borrowed.
`SSC Securities' shall mean the $40,000,000 Series B
Cumulative Redeemable Preferred Stock and the $60,000,000
Series B Capital Securities issued by Southern States
Cooperative or Southern States Capital Trust, respectively,
and purchased by the Company pursuant to the Securities
Purchase Agreement between the Company and Southern States
Cooperative dated as of October 5, 1999.
`Security Agreement' shall mean that certain Amended
and Restated Security Agreement dated as of even date
herewith executed by the Company and its Subsidiaries in
favor of the Collateral Agent for the benefit of the Secured
Parties (as defined therein), in form and substance
satisfactory to the holders of the Notes, as originally
executed or as from time to time supplemented, amended,
restated, renewed, extended or otherwise modified.
`Subordinated Debt' shall mean all Indebtedness for
Money Borrowed wherein the principal and premium, if any,
and interest is subordinated and junior in right of payment
to the prior payment in full of all other Indebtedness of
the Company for Money Borrowed except other Subordinated
Debt and shall include, without limitation, the Subordinated
Capital Certificates of Interest, Subordinated Loan
Certificates, and Cumulative Preferred Capital Certificates
of Interest, issued by the Company.
`Subsidiary' shall mean any corporation, partnership,
joint venture, limited liability company, trust or estate or
other entity in which (or of which) the Company, directly or
indirectly, owns or controls more than 50% of (a) any shares
of Stock or other form of ownership interest of such Person
having general voting power under ordinary circumstances to
vote in the election of the board of directors, managers or
trustees of such Person (irrespective of whether or not at
the time Stock of any other class or classes shall have or
might have voting power by reason of the happening of any
contingency), or (b) the interest in the capital or profits
of such Person.
`Total Debt' shall mean, as to any Person, and include
without duplication:
(a) all Indebtedness for Money Borrowed, including,
without limitation, purchase money mortgages, Capital
Leases, any asset securitization programs that are not non-
recourse, conditional sales contracts and similar title
retention debt instruments (including any current maturities
of such indebtedness), which under GAAP is shown on the
balance sheet as a liability (but excluding reserves for
deferred income taxes and other reserves to the extent such
reserves do not constitute an obligation); and
(b) Guarantees, endorsements (other than endorsements
of negotiable instruments for collection in the ordinary
course of business) and other contingent liabilities
(whether direct or indirect) in connection with the
obligations, Stock or dividends of any other Person; and
(c) obligations under any other contract in connection
with any borrowing which, in effect, is substantially
equivalent to a guarantee (other than any undertaking with
respect to the obligations of Young Pecan); and
(d) obligations with respect to any redeemable
preferred Stock which is required or scheduled to be
redeemed within one year from the date of calculation.
Any obligation secured by a Lien on, or payable out of the
proceeds of production from, property of the Company or any
Subsidiary shall be deemed to be Total Debt of the Company or
such Subsidiary even though such obligation shall not be assumed
by the Company or such Subsidiary.
(b) The definitions of "Acquaculture Division",
"Excess Cash Flow", Net Proceeds of Capital Stock and
"Golden Peanut" are hereby deleted in their entirety.
(c) The following definitions shall be added, in
alphabetical order:
"`Agra Tech Seeds, Inc.' shall mean AgraTrade Seeds
Inc., a Georgia corporation and wholly-owned Subsidiary of
the Company.
`Insurance Subsidiary' shall mean GK Insurance Co., a
Vermont corporation and wholly-owned Subsidiary of the
Company.
`Intangible Assets' of a Person, shall mean the non-
current, non-physical assets of such Person that entitle
such Person to certain legal rights or competitive
advantages, and shall include copyrights, trademarks,
tradenames and other intellectual property, franchises,
goodwill (to the extent positive), organization costs,
licenses and permits.
`Net Proceeds of Stock' shall mean any proceeds
received by the Company or a Consolidated Subsidiary in
respect of the issuance of Stock, after deducting therefrom
all reasonable and customary costs and expenses incurred by
the Company or such Consolidated Subsidiary directly in
connection with the issuance of such Stock, including
without limitation any underwriter's discounts and
commissions.
`Related Party' shall mean the Company and each wholly-
owned Subsidiary of the Company whose Stock is pledged to
the Collateral Agent pursuant to the Security Agreement (or
a supplement thereto), and that has executed and delivered
the Security Agreement (or a supplement thereto) and the
Subsidiary Guaranty Agreement (or a supplement thereto) to
Prudential, together with all applicable financing
statements required under the Uniform Commercial Code, and
such opinions of counsel and other documents as may be
reasonably required by Prudential.
`Security Documents' shall mean the Security Agreement,
the Pledge Agreement (as such term is defined in the Bank
Agreement), the Contribution Agreement and the Subsidiary
Guaranty Agreement.
`Senior Debt Coverage Ratio' shall mean, as of any
fiscal quarter end, the ratio of (a) Consolidated Senior
Debt as of the end of such fiscal quarter, to (b) the sum of
EBITDA for the fiscal quarter then ending and the preceding
seven fiscal quarters (divided by two).
`Stock' shall mean, as applied to any Person, any
stock, share capital, partnership interests or other equity
of such Person, regardless of class or designation, and all
warrants, options, purchase rights, conversion or exchange
rights, voting rights, calls or claims of any character with
respect thereto.
`Wholly Owned Subsidiary' shall mean any Subsidiary all
of the shares of Stock or other ownership interests of which
(except directors' qualifying shares) are at the time
directly or indirectly owned by the Company."
B. Conditions of Effectiveness. Upon satisfaction of the
following, the effective date of this Amendment shall be
October 23, 2001. This Amendment shall become effective when,
and only when,
1. Prudential shall have received all of the following
documents, each (unless otherwise indicated) being dated the date
hereof, in form and substance satisfactory to the holders of the
Notes:
(a) executed originals of this Amendment;
(b) a duly executed copy of the Bank Agreement,
amended and restated as of the Closing Date;
(c) a favorable opinion of counsel for the Company
that includes, in addition to other items Prudential may
reasonably request, that no Subsidiary Guarantor approval is
required to execute the amended and restated Subsidiary
Guaranty Agreement delivered in connection with this
Amendment and that the amendment to the Security Agreement
has been duly authorized and is enforceable by its terms;
(d) such other documents, instruments, approvals or
opinions as Prudential may reasonably request; and
(e) executed originals of amended and restated
Subsidiary Guaranty and Contribution Agreements and all
other Security Documents.
2. The Company shall have paid all costs and expenses
(including legal fees) incurred by Prudential; and
3. The representations and warranties contained herein
shall be true on and as of the date hereof, and there shall exist
on the date hereof no Event of Default or Default; there shall
exist no material adverse change in the financial condition,
business operation or prospects of the Company or its
Subsidiaries since December 31, 2000; and the Company shall have
delivered to Prudential an Officer's Certificate to such effect.
C. Representations and Warranties.
1. The Company hereby repeats and confirms each of the
representations and warranties made by it in paragraph 8 of the
Note Agreement, as amended hereby, as though made on and as of
the date hereof, with each reference therein to "this Agreement",
"hereof", "hereunder", "thereof", "thereunder" and words of like
import being deemed to be a reference to the Note Agreement as
amended hereby.
2. The Company further represents and warrants as follows:
(a) The execution, delivery and performance by the
Company of this Amendment are within its corporate powers,
have been duly authorized by all necessary corporate action
and do not contravene (A) its charter or by-laws, (B) law or
(C) any legal or contractual restriction binding on or
affecting the Company; and such execution, delivery and
performance do not or will not result in or require the
creation of any Lien upon or with respect to any of its
properties.
(b) No governmental approval is required for the due
execution, delivery and performance by the Company of this
Amendment, except for such governmental approvals as have
been duly obtained or made and which are in full force and
effect on the date hereof and not subject to appeal.
(c) This Amendment constitutes the legal, valid and
binding obligations of the Company enforceable against the
Company in accordance with its terms.
(d) There are no pending or threatened actions, suits
or proceedings affecting the Company or any of its
Subsidiaries or the properties of the Company or any of its
Subsidiaries before any court, governmental agency or
arbitrator, that may, if adversely determined, materially
adversely affect the financial condition, properties,
business, operations or prospects of the Company and it
Subsidiaries, considered as a whole, or affect the legality,
validity or enforceability of the Note Agreement, as amended
by this Amendment.
D. Miscellaneous.
1. Reference to and Effect on the Note Agreement.
(a) Upon the effectiveness of this Amendment, on and after
the date hereof each reference in the Note Agreement to "this
Agreement", "hereunder", "hereof" or words of like import
referring to the Note Agreement, and each reference in any other
document to "the Note Agreement", "thereunder", "thereof" or
words of like import referring to the Note Agreement, shall mean
and be a reference to the Note Agreement, as amended hereby.
(b) Except as specifically amended and waived above, the
Note Agreement, and all other related documents, are and shall
continue to be in full force and effect and is hereby in all
respects ratified and confirmed.
(c) The execution, delivery and effectiveness of this
Amendment shall not operate as a waiver of any right, power or
remedy of any holder of a Note under the Note Agreement or the
Notes, nor constitute a waiver of any provision of any of the
foregoing.
2. Costs and Expenses. The Company agrees to pay on
demand all costs and expenses incurred by any holder of a Note in
connection with the preparation, execution and delivery of this
Amendment, including, without limitation, the reasonable fees and
out-of-pocket expenses of counsel. The Company further agrees to
pay on demand all costs and expenses, if any (including, without
limitation, reasonable counsel fees and expenses of counsel),
incurred by any holder of a Note in connection with the
enforcement (whether through negotiations, legal proceedings or
otherwise) of this Amendment, including, without limitation,
counsel fees and expenses in connection with the enforcement of
rights under this paragraph 5B.
3. Execution in Counterparts. This Amendment may be
executed in any number of counterparts and by different parties
hereto in separate counterparts, each of which when so executed
and delivered shall be deemed to be an original and all of which
taken together shall constitute but one and the same instrument.
4. Governing Law. This Amendment shall be governed by,
and construed in accordance with, the laws of the State of New
York.
5. Estoppel. To induce Prudential to enter into this
Amendment, the Company hereby acknowledges and agrees that, as of
the date hereof, there exists no right of offset, defense or
counterclaim in favor of the Company against any holder of the
Notes with respect to the obligations of the Company to any such
holder, either with or without giving effect to this Amendment.
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be executed by their respective officers thereunto
duly authorized, as of the date first above written.
GOLD XXXX, INC.
By: /s/ Xxxxxxx X. Xxxx
Xxxxxxx X. Xxxx
Treasurer
THE PRUDENTIAL INSURANCE
COMPANY OF AMERICA
By: /s/ Xxxxx X. Xxxxx
Name: Xxxxx X. Xxxxx
Title: Vice President
THE PRUDENTIAL INSURANCE
COMPANY OF AMERICA, as asset
manager for Gateway Recovery
Trust
By: /s/ Xxxxxxxxx Xxxxxx
Name: Xxxxxxxxx Xxxxxx
Title: Vice President
[14692]
