SECOND AMENDMENT TO SECOND AMENDED
AND RESTATED LOAN AND SECURITY AGREEMENT
THIS SECOND AMENDMENT TO SECOND AMENDED AND RESTATED LOAN AND
SECURITY AGREEMENT (the "Amendment"), is made and entered into as of the
18th day of September, 1997 by and among PILGRIM'S PRIDE CORPORATION, a
Delaware corporation ("Borrower"), each of the Banks signatory hereto
(hereinafter referred to individually as a ABank@ and collectively as the
"Banks"), and CREDITANSTALT-BANKVEREIN, as agent for the Banks (in such
capacity, together with its successors and assigns in such capacity
hereinafter referred to as the "Agent").
W I T N E S S E T H:
WHEREAS, Borrower, the Banks and the Agent are parties to that
certain Loan and Security Agreement, dated as of June 3, 1993 (the
"Original Loan Agreement"), which provided for a term loan (the "Original
Facility") in the original principal amount of Twenty-Eight Million
Dollars ($28,000,000.00);
WHEREAS, by that certain Amended and Restated Loan and Security
Agreement dated July 29, 1994 (the "Amended and Restated Loan
Agreement"), the Borrower, the Banks and the Agent amended and restated
the Original Loan Agreement (a) to continue the Original Facility at its
then current outstanding balance of $21,700,000.00; (b) to make a
standby/term loan (the AExisting Standby/Term Facility@) to Borrower to
be utilized on or before June 20, 1995 (the "Conversion Date"); and
(c) to make certain other changes as more fully set forth therein;
WHEREAS, by letter agreement of the parties dated June 19, 1995, the
Amended and Restated Loan Agreement was amended to extend the Conversion
Date to September 20, 1995;
WHEREAS, Xxxx Xxxxxxx Mutual Life Insurance Company, a Massachusetts
corporation, (AHancock@) or its assignee has heretofore released its Lien
on the Mortgaged Property, evidenced by (i) that certain promissory note
dated February 1, 1988, executed by the Borrower and payable to Xxxxxxx'x
order in the original principal amount of $20,000,000, secured by that
certain Deed of Trust, Mortgage and Security Agreement dated February 1,
1988, executed by the Borrower for the benefit of Xxxxxxx, and recorded
in Volume 182, Page 315, aforesaid Records, amended by instruments
recorded in Volume 656, page 163, aforesaid Records and Volume 698, page
77, assigned to Agriculture Production Credit Association ("APCA") by
instrument recorded at file number 2798, aforesaid Records, and (ii) that
certain promissory note dated April 25, 1991, executed by the Borrower
for the benefit of Xxxxxxx, and recorded in Volume 656, Page 168, Deed of
Trust Records, Xxxxx County, Texas, amended by instrument recorded in
Volume 698, page 77, aforesaid Records, assigned to APCA by instrument
recorded at file number 2798, aforesaid Records.
WHEREAS, by that certain Second Amended and Restated Loan and
Security Agreement dated as of July 31, 1995 (the "Agreement") the
Borrower, the Banks and the Agent amended and restated the Amended and
Restated Loan Agreement (a) to continue the Original Facility at its then
current outstanding balance of $15,400,000.00; (b) to continue the
Existing Standby/Term Facility at its then current outstanding balance of
$10,000,000.00; (c) to make an additional term loan to Borrower in the
original principal amount of $5,000,000.00 (the "Term Facility"); and
(d) to make certain other changes as more fully set forth therein;
WHEREAS, by that certain First Amendment to Second Amended and
Restated Loan and Security Agreement dated as of May 30, 1996, the
Borrower, the Banks and the Agent amended the Agreement to change the
interest rate and modify certain financial covenants set forth therein;
WHEREAS, the Borrower, the Banks and the Agent wish to amend the
Agreement further (a) to continue the Original Facility at its current
balance of $13,300,000.00; (b) to continue the Existing Standby/Term
Facility at its current outstanding balance of $8,664,000.00; (c) to
continue the Term Facility at its current outstanding balance of
$4,666,000.00; (d) to make an additional term loan to Borrower; (e) to
xxxxx x Xxxx to Agent in additional collateral; (f) to modify certain
financial covenants set forth therein; and (g) to make certain other
changes as more fully set forth herein;
NOW, THEREFORE, for and in consideration of the premises, the terms
and conditions set forth herein, and for other good and valuable
consideration, the sufficiency and receipt of all of which are
acknowledged by Borrower, Borrower, the Banks and Agent agree as follows:
1. DEFINED TERMS. Defined terms used herein, as indicated by the
initial capitalization thereof, shall have the same respective meanings
ascribed to such terms in the Agreement unless otherwise specifically
defined herein.
2. AMENDMENTS.
(a) The Agreement is hereby amended by adding the following
definitions to Section 1.1:
"FACILITY C TERM LOANS" shall mean, collectively, the
loans made pursuant to Section 2.1(d) hereof, and "FACILITY C
TERM LOAN" shall mean any loan made pursuant to Section 2.1(d)
hereof.
"FACILITY C TERM NOTE" or "FACILITY C TERM NOTES" shall
have the meanings given to such terms in Section 2.1(d) hereof.
"NEW DEED OF TRUST" shall mean the Deed of Trust,
Assignment of Rents and Security Agreement dated as of
September 18, 1997, recorded or to be recorded in the Camp
County, Texas Deed Records, executed by Borrower, conveying a
first Lien security interest in the Camp County Mortgaged
Property to secure the repayment of the Loans and the
performance of the Obligations, and all amendments thereto.
"CAMP COUNTY LAND" shall mean the real estate or interest
therein described in EXHIBIT "A-2" attached hereto and
incorporated herein by this reference, all fixtures or other
improvements situated thereon and all rights, titles and
interests appurtenant thereto.
"CAMP COUNTY MORTGAGED PROPERTY" shall mean the Camp
County Land, the Leases and Equipment and all other property
(real, personal or mixed) which is conveyed by the New Deed of
Trust or any other Loan Document in which a lien therein is
created.
"FOURTH DEED OF TRUST" shall mean the Deed of Trust,
Assignment of Rents and Security Agreement dated as of
September 18, 1997, recorded or to be recorded in the Xxxxx
County, Texas Deed Records, executed by Borrower conveying a
fourth Lien security interest in the Xxxxx County Mortgaged
Property to secure repayment of the Loans and performance of
the Obligations, and all amendments thereto.
"SECOND AMENDMENT CLOSING DATE" shall mean the date this
Amendment has been signed by Borrower, the Banks and the Agent
and has become effective in accordance with Section 3 hereof.
"XXXXX COUNTY LAND" shall mean the real estate or interest
therein described in EXHIBIT "A" attached hereto and
incorporated herein by reference, all fixtures or other
improvements situated thereon and all rights, titles and
interests appurtenant thereto.
"XXXXX COUNTY MORTGAGED PROPERTY" shall mean the Xxxxx
County Land, the Leases and Equipment relating thereto and all
other property (real, personal or mixed) which is conveyed by
the Deed of Trust, the Second Deed of Trust, the Third Deed of
Trust, the Fourth Deed of Trust or any other Loan Document in
which a lien therein is created.
(b) The Agreement is hereby amended by deleting the definitions of
the following terms in their entirety from Section 1.1 and substituting
in lieu thereof the following definitions:
"LAND" shall mean the Xxxxx County Land and the Camp County
Land.
"LOAN" shall mean either a Term Loan, a Standby/Term Loan,
a Facility B Term Loan or a Facility C Term Loan, and "LOANS"
shall mean, collectively, all Term Loans, Standby/Term Loans,
Facility B Term Loans and Facility C Term Loans. Loans may be
either Eurodollar Loans or Base Rate Loans, each of which is a
"type" of Loan.
"LOAN DOCUMENTS" shall mean this Agreement, the Deed of
Trust, the Second Deed of Trust, the Third Deed of Trust, the
Fourth Deed of Trust, the New Deed of Trust, the Notes, any
financing statements covering portions of the Collateral and
any and all other instruments, documents, and agreements now or
hereafter executed and/or delivered by Borrower or its
Subsidiaries in connection herewith, or any one, more, or all
of the foregoing, as the context shall require, and "LOAN
DOCUMENT" shall mean any one of the Loan Documents.
"MATURITY DATE" shall mean June 30, 2003.
"MORTGAGED PROPERTY" shall mean the Xxxxx County Mortgaged
Property, the Camp County Mortgaged Property and all other
property (real, personal or mixed) on which a Lien is placed or
granted to secure the repayment or the performance of the
Obligations.
"NOTES" shall mean, collectively, the Term Notes, the
Standby/Term Notes, the Facility B Term Notes and the Facility
C Term Notes.
"OBLIGATIONS" shall mean the Loans and any and all other
indebtedness, liabilities and obligations of Borrower and its
Subsidiaries, or any of them, to any Bank of every kind and
nature (including, without limitation, interest charges,
expenses, attorneys= fees and other sums chargeable to Borrower
by Agent or any Bank and future advances made to or for the
benefit of Borrower), arising under this Agreement, the Deed of
Trust, the Second Deed of Trust, the Third Deed of Trust, the
Fourth Deed of Trust, the New Deed of Trust or the other Loan
Documents, whether direct or indirect, absolute or contingent,
primary or secondary, due or to become due, now existing or
hereafter acquired.
(c) Subsections 2.1(a)(ii), 2.1(b)(ii) and 2.1(c)(ii) are hereby
amended to provide that, from and after the Second Amendment Closing
Date, the quarterly installments of principal of the Term Loans, the
Standby/Term Loans and the Facility B Term Loans, respectively, shall be
payable on March 15, June 15, September 15, and December 15 of each year,
commencing December 15, 1997, and continuing through June 15, 2003, in
the quarterly installment amount set forth in each such subsection, with
a final installment due and payable on each such category of Loans on the
Maturity Date in an amount equal to the then-outstanding unpaid aggregate
principal amount thereof, together with all accrued but unpaid interest
thereon.
(d) The Agreement is hereby amended by inserting the following
Subsection 2.1(d) immediately following Subsection 2.1(c) thereof:
(d) FACILITY C TERM LOANS.
(i) Subject to the terms and conditions hereof and
provided there exists no Default or Event of Default, each Bank
severally agrees to make on the Second Amendment Closing Date loans
(each a "Facility C Term Loan" and collectively the "Facility C Term
Loans"), as requested by Borrower in accordance with the provisions
of Section 2.3 hereof, to Borrower in an aggregate amount of
Thirteen Million Three Hundred Seventy Thousand and No 100 Dollars
($13,370,000.00). The Facility C Term Loans made by each Bank shall
be evidenced by a promissory note, substantially in the form of
EXHIBIT "C-3" attached hereto, payable to such Bank in the principal
face amount of such Bank's Loan Percentage of the Facility C Term
Loans (together with any and all amendments, modifications and
supplements thereto, and any renewals, replacements or extensions
thereof (including, but not limited to, pursuant to Sections 13.4
and 13.4(e) hereof), in whole or in part, individually a "Facility C
Term Note" and collectively the "Facility C Term Notes"). Facility
C Term Loans, once borrowed and repaid, may not be reborrowed.
(ii) The aggregate principal amount of the Facility C
Term Loans shall be repayable in twenty-two (22) quarterly
installments of principal, payable on March 15, June 15,
September 15 and December 15 of each year, commencing December 15,
1997, and continuing through June 15, 2003, with the first nineteen
(19) such installments each being in an amount equal to Forty-Nine
Thousand Five Hundred and No/100 Dollars ($49,500.00), and with the
next three (3) such installments each being in an amount equal to
Seven Hundred Forty-Nine Thousand Five Hundred and No/100 Dollars
($749,500.00), and with a final payment due and payable on the
Maturity Date in an amount equal to the then-outstanding unpaid
aggregate principal amount of the Facility C Term Loans, together
with all accrued but unpaid interest thereon.
(e) The Agreement is hereby amended by deleting Section 4.2 thereof
in its entirety and substituting in lieu thereof a new Section 4.2 to
read as follows:
4.2 XXXXX COUNTY MORTGAGED PROPERTY. As additional
security for the Obligations, Borrower has heretofore granted
to Agent, for the benefit of the Banks, a first (except for
prior liens expressly permitted thereby) priority lien on and
security interest in the Xxxxx County Mortgaged Property,
evidenced by the Deed of Trust, a second (except for prior
Liens expressly permitted thereby) priority Lien on and
security interest in the Xxxxx County Mortgaged Property,
evidenced by the Second Deed of Trust, and a third (except for
prior Liens expressly permitted thereby) priority Lien on and
security interest in the Xxxxx County Mortgaged Property,
evidenced by the Third Deed of Trust and Borrower has of even
date herewith granted to Agent, for the benefit of the Banks, a
fourth (except for prior Liens expressly permitted thereby)
priority Lien on and security interest in the Xxxxx County
Mortgaged Property, evidenced by the Fourth Deed of Trust,
recorded or to be recorded in the Xxxxx County, Texas Deed
Records.
(f) The Agreement is hereby amended by inserting a new Section 4.5
to read as follows:
4.5 CAMP COUNTY MORTGAGED PROPERTY. As additional
security for the Obligations, Borrower has of even date
herewith granted to Agent, for the benefit of the Banks, a
first (except for prior liens expressly permitted thereby)
priority Lien on and security interest in the Camp County
Mortgaged Property, evidenced by the New Deed of Trust,
recorded or to be recorded in the Camp County, Texas Deed
Records.
(g) The Agreement is hereby amended by deleting Section 9.13
thereof in its entirety and substituting in lieu thereof new Section 9.13
to read as follows:
9.13 EVENT OF DEFAULT UNDER DEED OF TRUST, SECOND DEED OF
TRUST, THIRD DEED OF TRUST, FOURTH DEED OF TRUST OR NEW DEED OF
TRUST. There occurs an AEvent of Default@ under the Deed of
Trust, the Second Deed of Trust, the Third Deed of Trust, the
Fourth Deed of Trust or the New Deed of Trust.
(h) The Agreement is hereby amended by deleting Section 10.7
thereof in its entirety and substituting in lieu thereof new Section 10.7
to read as follows:
10.7 REMEDIES UNDER DEED OF TRUST, SECOND DEED OF TRUST,
THIRD DEED OF TRUST, FOURTH DEED OF TRUST AND NEW DEED OF
TRUST. The right of the Agent to sell or otherwise dispose of
all or any of the Mortgaged Property, in the manner provided
for in the Deed of Trust, the Second Deed of Trust, the Third
Deed of Trust, the Fourth Deed of Trust and the New Deed of
Trust, all other rights and remedies available to the Agent
under the Deed of Trust, the Second Deed of Trust, the Third
Deed of Trust, the Fourth Deed of Trust and the New Deed of
Trust.
(i) The Agreement is hereby amended by adding thereto EXHIBIT "A-2" and
EXHIBIT "C-2" attached hereto and by this reference incorporated in and made a
part of the Agreement.
(j) The Agreement is hereby amended by deleting SCHEDULE 5.2 and
SCHEDULE 5.17 attached thereto in their entirety and substituting in lieu
thereof new SCHEDULE 5.2 and SCHEDULE 5.17, respectively, attached hereto and
by this reference incorporated in the Agreement.
3. CONDITIONS PRECEDENT; EFFECTIVENESS. Subject to the other
terms and conditions hereof, this Amendment, and the amendments and terms
set forth herein, shall not become effective until the following
conditions have been met to the sole and complete satisfaction of Agent
and its counsel:
(a) Agent shall have received the following documents, each duly
executed and delivered to the Agent, for the benefit of the
Banks, and each to be satisfactory in form and substance to
Agent and its counsel:
(i) this Amendment;
(ii) the Facility C Term Note;
(iii) the Fourth Deed of Trust;
(iv) the New Deed of Trust;
(v) a Reaffirmation of that certain Environmental
Indemnity Agreement dated June 3, 1993, reaffirming
the warranties and representations made by Borrower
thereunder;
(vi) a certificate signed by the executive president and
chief financial officer of Borrower dated as of the
Second Amendment Closing Date, stating that the
representations and warranties set forth in Article 5
of the Agreement are true and correct in all material
respects on and as of such date with the same effect
as though made on and as of such date, stating that
Borrower is on such date in compliance with all the
terms and conditions set forth in the Agreement on
its part to be observed and performed, and stating
that on such date, and after giving effect to the
making of any initial Loan no Default or Event of
Default has occurred or is continuing;
(vii) a certificate of the Secretary of Borrower dated as
of the Second Amendment Closing Date certifying
(1) that there have been no amendments to the
Certificate of Incorporation of Borrower since May
30, 1996; (2) that there have been no amendments to
the By-laws of Borrower since May 30, 1996, other
than the amendment dated December 4, 1996, attached
thereto; (3) that attached thereto is a true and
complete copy of Resolutions adopted by the Board of
Directors of Borrower, authorizing the execution,
delivery and performance of this Amendment and the
other Loan Documents; and (4) as to the incumbency
and genuineness of the signatures of the officers of
Borrower executing this Agreement or any of the other
Loan Documents;
(viii) copies of all filing receipts or acknowledgments
issued by any governmental authority to evidence any
filing or recordation necessary to perfect the Liens
of Agent in the Collateral and evidence in a form
acceptable to the Majority Banks that such Liens
constitute valid and perfected first priority Liens;
(ix) a Good Standing Certificate for Borrower and a
Certification of Account Status, issued by the
Secretary of the State of Texas, dated as of a date
close to the Second Amendment Closing Date;
(x) certified copies of Borrower=s casualty and liability
insurance policies with evidence of the payment of
the premium therefor, together, in the case of such
casualty policies, with loss payable and mortgagee
endorsements on Agent=s standard form naming Agent as
loss payee;
(xi) the written opinion of Xxxxxx & Carlton, counsel to
Borrower, dated as of the Second Amendment Closing
Date, in form and content acceptable to Banks and
Agent, as to the transactions contemplated by this
Amendment;
(xii) assurance from a title insurance company
satisfactory to the Agent and the Banks that such
title insurance company is committed to cause the
Fourth Deed of Trust and the New Deed of Trust to be
recorded and, upon recordation of the Fourth Deed of
Trust and the New Deed of Trust to issue its ALTA
lender's title insurance policy in a form acceptable
to the Agent and in amounts satisfactory to the
Agent, showing the Fourth Deed of Trust as the
Ainsured mortgage@ and insuring the validity and
priority of the Fourth Deed of Trust as a Lien upon
the Xxxxx County Mortgaged Property, subject only to
the First Deed of Trust, the Second Deed of Trust,
and the Third Deed of Trust and to the Permitted
Liens described in clauses (b) - (d) of the
definition thereof; and
(xiii) such other documents, instruments and agreements
with respect to the transactions contemplated by this
Amendment, in each case in such form and containing
such additional terms and conditions as may be
reasonably satisfactory to the Majority Banks, and
containing, without limitation, representations and
warranties which are customary and usual in such
documents.
(b) Upon the satisfaction of the foregoing conditions precedent,
this Amendment shall become effective as of September 18, 1997.
4. REPRESENTATIONS AND WARRANTIES; NO DEFAULT.
(a) To induce the Banks to enter into this Amendment and to
continue to make advances to Borrower pursuant to the Agreement, as
amended hereby, Borrower hereby represents and warrants that all
Borrower's representations and warranties contained in the Agreement, as
amended, and the other Loan Documents are true and correct on and as of
the date of Borrower's execution of this Amendment, and no Event of
Default, nor any event or condition which, with notice, lapse of time, or
both, would constitute an Event of Default, has occurred and is
continuing as of such date under any Loan Document.
(b) Borrower hereby further represents and warrants (i) Borrower
has the power and authority to enter into this Amendment and to perform
all of its obligations hereunder; (ii) the execution and delivery of this
Amendment has been duly authorized by all necessary action (corporate or
otherwise) on the part of Borrower; and (iii) the execution and delivery
of this Amendment and performance hereof by Borrower does not and will
not violate the Articles or Certificate of Incorporation, By-laws or
other organizational documents of Borrower and does not and will not
violate or conflict with any law, order, writ, injunction, or decree of
any court, administrative agency or other governmental authority
applicable to Borrower or its properties.
5. EXPENSES. Borrower agrees to pay, immediately upon demand by
the Banks, all costs, expenses, attorneys' fees, and other charges and
expenses incurred by the Banks in connection with the negotiation,
preparation, execution and delivery of this Amendment and other
instrument, document, agreement or amendment executed in connection with
this Amendment.
6. DEFAULTS HEREUNDER. The breach of any representation, warranty
or covenant contained herein or in any document executed in connection
herewith, or the failure to observe or comply with any term or agreement
contained herein or in any document executed in conjunction herewith,
shall constitute an Event of Default under the Documents and the Banks
shall be entitled to exercise all rights and remedies it may have under
the Agreement, any of the other Loan Documents and applicable law.
7. REFERENCES IN LOAN DOCUMENTS. All references in the Agreement
and the other Loan Documents to the Agreement shall hereafter be deemed
to be references to the Agreement as amended hereby and as the same may
hereafter be amended from time to time.
8. NO CLAIMS, OFFSET. Borrower hereby represents, warrants,
acknowledges and agrees to and with the Banks that (a) Borrower does not
hold, to the best of its knowledge, or claim any right of action, claim,
cause of action or damages, either at law or in equity, against the Banks
which arises from, may arise from, allegedly arise from, are based upon
or are related in any manner whatsoever to the Agreement and the Loan
Documents or which are based upon actions or omissions of the Banks in
connection therewith and (b) the Obligations are absolutely owed to the
Banks, without offset, deduction or counterclaim.
9. NO NOVATION. The terms of this Amendment are not intended to
and do not serve to effect a novation as to the Agreement. The parties
hereto expressly do not intend to extinguish any debt or security
interest created pursuant to the Agreement. Instead, it is the express
intention of the parties hereto to affirm the Agreement and the security
created thereby.
10. LIMITATION OF AMENDMENT. Except as expressly set forth herein,
this Amendment shall not be deemed to waive, amend or modify any term or
condition of the Agreement or any of the other Loan Documents, each of
which is hereby ratified and reaffirmed, and which shall remain in full
force and effect, nor to serve as a consent to any matter prohibited by
the terms and conditions thereof.
11. COUNTERPARTS. This Amendment may be executed in any number of
counterparts, and any party hereby may execute any counterpart, each of
which, when executed and delivered, will be deemed to be an original and
all of which, taken together, will be deemed to be but one and the same
agreement.
12. SUCCESSORS AND ASSIGNS. This Amendment shall be binding upon
and inure to the benefit of the successors and permitted assigns of the
parties hereto.
13. SECTION REFERENCES. Section titles and references used in this
Amendment shall be without substantive meaning or content of any kind
whatsoever and are not a part of the agreements among the parties hereto
evidenced hereby.
14. FURTHER ASSURANCES. Borrower agrees to take such further
action as the Banks shall reasonably request in connection herewith to
evidence the amendments herein contained to the Agreement.
15. GOVERNING LAW. This Amendment shall be governed by, and
construed in accordance with, the laws of the State of New York, without
regard to principles of conflicts of law.
[SIGNATURES APPEAR ON NEXT PAGE]
IN WITNESS WHEREOF, the parties hereto have executed this Amendment under
seal as of the date first written above.
"BORROWER"
PILGRIM'S PRIDE CORPORATION
By: \s\ Xxxxxxxx X. Xxxxxx
Name: Xxxxxxxx X. Xxxxxx
Title: Executive President
Attest: \s\ Xxxxxxx X. Xxxxxxx
Name: Xxxxxxx X. Xxxxxxx
Title: Chief Financial Officer,
Secretary and Treasurer
[CORPORATE SEAL]
"AGENT"
CREDITANSTALT-BANKVEREIN
By: \s\ Xxxxxx X. Xxxxxxxx
Xxxxxx X. Xxxxxxxx
Senior Vice President
By: \s\ Xxxx X. Xxxxxx
Name: Xxxx X. Xxxxxx
Title: Senior Associate
[CORPORATE SEAL]
LOAN PERCENTAGE
"BANKS"
100%
CREDITANSTALT-BANKVEREIN
By: \s\ Xxxxxx X. Xxxxxxxx
Xxxxxx X. Xxxxxxxx
Senior Vice President
By: \s\ Xxxx X. Xxxxxx
Name: Xxxx X. Xxxxxx
Title: Senior Associate
