AMENDMENT TO THE MASTER LOAN AGREEMENT
Exhibit
10.1
AMENDMENT
TO
THE
THIS
AMENDMENT
is
entered into as of September 22, 2008, between CoBANK,
ACB
(“CoBank”) and SOUTH
DAKOTA SOYBEAN PROCESSORS, LLC, Volga, South Dakota
(the
“Company”).
BACKGROUND
CoBank
and the Company are parties to a Master Loan Agreement dated October 6, 2005
(such agreement, as previously amended, is hereinafter referred to as the
“MLA”). CoBank and the Company now desire to amend the MLA. For that reason, and
for valuable consideration (the receipt and sufficiency of which are hereby
acknowledged), CoBank and the Company agree as follows:
I. Section
9(E) of the MLA is hereby amended and restated to read as follows:
SECTION
9. Negative Covenants.
Unless
otherwise agreed to in writing by CoBank, while this agreement is in effect
the
Company will not:
(E) Loans
and Investments.
Make any
loan or advance to any person or entity, or purchase any capital stock,
obligations or other securities of, make any capital contribution to, or
otherwise invest in any person or entity, or form or create any partnerships
or
joint ventures except:
(i)
trade
credit extended in the ordinary course of business; and (ii) loans or advances
by the Company to Urethane Soy Systems Company in an aggregate principal amount
not to exceed $8,500,000.00 at any one time outstanding.
2. Except
as
set forth in this amendment, the MLA, including all amendments thereto, shall
continue in fill force and effect as written,
IN
WITNESS WHEREOF,
the
parties have caused this amendment to be executed by their duly authorized
officers as of the date shown above.
CoBANK,
ACB
|
SOUTH
DAKOTA SOYBEAN
|
|||
PROCESSORS,
LLC
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||||
By:
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/s/
Xxxxx Xxxxx
|
By:
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/s/
Xxxxxx Xxxxxxxxx
|
|
Xxxxx:
|
Assistant
Corporate Secretary
|
Title:
|
CEO
|
Exhibit
10.1
NOTICE
TO BORROWER
THE
FOLLOWING DISCLOSURE RELATES TO THE AT RISK NATURE OF THE EQUITY
INVESTMENT REQUIRED AS A CONDITION TO AN EXTENSION OF CREDIT. PLEASE
READ THESE MATERIALS CLOSELY WHEN EVALUATING THE PROPOSED CREDIT
TERMS.
You
have
received, or the bank has made available to you, the bank’s most recent annual
report, the most recent quarterly report, a copy of the Bylaws, and a copy
of
the current Capital Plan.
As
a
condition to the extension of credit, borrowers are required to own equity
in
the bank. Equity ownership requirements are established by the board of
directors from time to time as set forth in the Capital Plan. Currently the
Capital Plan requires each active stockholder to own a minimum investment of
the
bank’s capital of $1,000 or 2 percent of the loan, whichever is less. After this
minimum level is achieved, all future capitalization requirements will be made
through retained patronage earnings and no additional out-of-pocket equity
purchases beyond the initial investment will be required. Equity of owners
whose
current investment is above target level will be available for retirement
until the target equity level is reached. The Capital Plan may be amended from
time to time by the board of directors. Such amendments may increase the amount
of capital required to be invested to maintain a loan.
Equity
will be retired and patronage distributions will be made in accordance with
theBylaws
and Capital Plan, as may be amended from time to time. ALL EQUITY IN THE BANK:
(1) IS RETIREABLE ONLY AT THE DISCRETION OF THE BOARD OF
DIRECTORS AND
THEN
ONLY IF MINIMUM CAPITAL STANDARDS ESTABLISHED BY LAW ARE MET; AND (2) IS AN
INVESTMENT IN THE BANK THAT IS AT RISK AND SHOULD NOT BE CONSIDERED EQUIVALENT
TO A COMPENSATING BALANCE. AT PRESENT, THE BANK MEETS ITS MINIMUM CAPITAL
STANDARDS AND KNOWS OF NO REASON WHY IT SHOULDNT CONTINUE TO MEET THOSE
STANDARDS ON THE BANK’S NEXT EARNINGS DISTRIBUTION DATE.
Exhibit
10.1
STATUSED
REVOLVING CREDIT SUPPLEMENT
THIS
SUPPLEMENT to
the
Master
Loan
Agreement dated October 6, 2005 (the “MLA”),
is entered
into as of September 22, 2008 between CoBANK,
ACB (“CoBank”)
and
SOUTH
DAKOTA SOYBEAN
PROCESSORS, LLC, Volga, South Dakota
(the
“Company”), and amends and restates the Supplement dated July 17, 2008 and
numbered RJBO51S01G.
SECTION
1. The Revolving Credit Facility.
On the
terms and conditions set forth in the MLA and this Supplement, CoBank 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 $40,000,000.00 (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 the inventory
and
receivables referred
to in the Borrowing Base Report.
SECTION
3. Term. The
term
of the Commitment shall
be
from the date hereof, up to and including
December 1, 2008, or such later date as CoBank may, in its sole discretion,
authorize in writing.
SECTION
4. Interest.
The
Company agrees to pay interest on
the
unpaid balance of the loan(s) in accordance with one or
more
of the following interest rate options, as selected by the Company:
(A) CoBank
Base Rate.
At
a rate
per
annum equal at all times to 1/2 of
1%
below the rate of interest established by CoBank from time to time as its CoBank
Base Rate, which rate is intended by CoBank
to
be a reference rate and not its lowest rate. The CoBank Base Rate will change
on
the date established by CoBank as the effective date of any change
therein and CoBank agrees to notify the Company
of any such change.
(B) Quoted
Rate.
At a
fixed rate per annum to be quoted by CoBank 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 CoBank 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 $500,000.00 or multiples thereof; and (3)
the maximum
number of fixes in place at any one time shall be ten.
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
telephonically or in writing and must be received by 12:00 Noon Company’s herein
shall be made telephonically
or in writing and must be received by 12:00 Noon Company’s local time. 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
CoBank shall require in a written notice to the Company.
Exhibit
10.1
Statused
Revolving Credit Supplement RIBO5 ISO 1H
SOUTH
DAKOTA SOYBEAN PROCESSORS
Volga,
South Dakota
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,
This
note replaces and supersedes, but does not constitute payment of the
indebtedness evidenced by, the promissory note set forth
in
the
Supplement being amended and
restated
hereby.
SECTION
6. Borrowing Base Reports, Etc.
The
Company agrees to furnish a Borrowing Base Report
to
CoBank
at such times or intervals as CoBank may
from
time
to time request. Until receipt of such a request, the Company agrees to furnish
a Borrowing Base Report to CoBank 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
CoBank
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.
SECTION
7. Letters of Credit.
If
agreeable to CoBank 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 CoBank’s receipt of a duly completed and executed copy of
CoBank’s then current form of Application and Reimbursement Agreement 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 a loan under the
Commitment and
shall
be
repaid in accordance with this Supplement. Each letter of credit must be in
form
and
content acceptable to CoBank and must expire no later than
the
maturity date of the Commitment. 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 CoBank and pay to CoBank (to be held as cash collateral) an amount equal
to such excess.
SECTION
8. Security.
The
Company’s obligations hereunder and, to the extent related hereto, the MLA,
shall be secured as provided in the Security
Section
of the MLA, including without limitation as a future
advance
under any existing mortgage or deed of trust.
-2-
Exhibit
10.1
Statused
Revolving Credit Supplement RIBO5
ISO
1H
SOUTH
DAKOTA
SOYBEAN PROCESSORS
Volga,
South Dakota
SECTION
9. Commitment Fee.
In
consideration of the Commitment, the Company agrees to pay to CoBank 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.
IN
WITNESS WHEREOF,
the
parties have caused this
Supplement
to be executed by their duly
authorized
officers as of the date shown above.
CoBANK,
ACB
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SOUTH
DAKOTA SOYBEAN
|
|||
PROCESSORS,
LLC
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||||
By:
|
/s/
Xxxxx Xxxxx
|
By:
|
/s/
Xxxxxx Xxxxxxxxx
|
|
Xxxxx:
|
Assistant
Corporate Secretary
|
Title:
|
CEO
|
-3-
Exhibit
10.1
EXHIBIT
A
SEASONAL
BORROWING BASE REPORT
CoBank,
ACB
Name
of Borrower
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City,
State
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Date
of Period
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South
Dakota Soybean Processors, LLC (18462590)
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Volga,
South Dakota
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PART
A—ELIGIBLE RECEIVABLES
For
purposes hereof, ELIGIBLE RECEIVABLES shall mean rights to payment for goods
sold and delivered or for services rendered which: (a) are not subject to any
dispute, set-off, or counterclaim; (b) are not owing by an account debtor the
is
subject to a bankruptcy, reorganization, receivership or like proceeding; (c)
are not subject to a lien in favor of any third party, other than liens
authorized by CoBank in writing which are subordinate to CoBank’s lien; (d) are
not owing by an account debtor that is owned or controlled by the borrower,
(e)
are not accounts due more than 30 days from invoice date, (f) are not accounts
with balances past due more than 30 days, (g) are not deemed ineligible by
CoBank. For purposes thereof, CONTRACT RECEIVABLES shall mean all Accrued Gains
& Losses on Open Purchase and Sale Contracts far grain which (a) are not in
dispute. (b) are legally enforceable, and (c) are not subject to a lien except
in favor of CoBank.
ELIGIBLE
RECEIVABLES
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AMOUNT
|
|
|
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ADVANCE
RATE
|
|
|
|
ALLOWABLE
ADVANCE
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|||||||
Trade
Receivables 0 - 30 Days
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$
|
-
|
x
|
90
|
%
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=
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$
|
-
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||||||||
Trade
Receivables 31 -50 Days
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$
|
-
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x
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50
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%
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=
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$
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-
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||||||||
Trade
Receivables 61 Days and Over
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$
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-
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x
|
0
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%
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=
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$
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-
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||||||||
Other
Receivables
|
$
|
-
|
x
|
0
|
%
|
=
|
$
|
-
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||||||||
Net
Liquidated Value of Brokerage Accounts
|
$
|
-
|
x
|
90
|
%
|
=
|
$
|
-
|
||||||||
Net
Contract Receivables for Old Crop Beans*
|
$
|
-
|
x
|
80
|
%
|
=
|
$
|
-
|
||||||||
Net
Contract Receivables for new Crop Beans*
|
$
|
-
|
x
|
70
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%
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=
|
$
|
-
|
||||||||
Subtotal-Net
Contract Receivables for Beans
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$
|
-
|
|
|
|
=
|
$
|
- | ||||||||
Old
crop ends September 30. Net Contract
|
||||||||||||||||
Receivables
are Accrued Gains & Losses on Open Purchase & Sale
Contracts
|
||||||||||||||||
TOTAL
PART A
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$
|
-
|
|
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$
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-
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PART
B—ELIGIBLE INVENTORY
For
purposes hereof, ELIGIBLE FARM SUPPLY INVENTORY shall mean inventory which:
(a)
is of a type shown below; (b) is owned by the borrower and not held by the
borrower on consignment or similar basis; (c) is not subject to a lien except
in
favor of CoBank.
|
|
|
|
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ADVANCE
|
|
|
|
ALLOWABLE
|
|
||||||
Types
of Eligible Inventory
|
|
AMOUNT
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|
Deduction
|
|
RATE
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|
|
ADVANCE
|
|||||||
Soybeans*
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$
|
-
|
|
|
x |
90
|
%
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=
|
$
|
-
|
||||||
Less:
Grain Payables
|
|
|
$
|
-
|
x
|
90
|
%
|
=
|
$
|
-
|
||||||
Soybean
Meal**
|
$
|
-
|
|
x
|
90
|
%
|
=
|
$
|
-
|
|||||||
Soybean
Oil**
|
$
|
-
|
|
x
|
90
|
%
|
=
|
$
|
-
|
|||||||
Soybean
Hulls**
|
$
|
-
|
|
x
|
80
|
%
|
=
|
$
|
-
|
|||||||
Other
Inventory
|
$
|
-
|
|
x
|
0
|
%
|
=
|
$
|
-
|
|||||||
TOTAL
PART B
|
$
|
-
|
|
|
|
$
|
-
|
*Valued
at Bid Price FOB Volga, SD
**Valued
at market FOB Volga, SD
***Valued
at the Lower of Cost or Market FOB Volga, SD
PART
C – OBLIGATIONS
Less:
|
OBLIGATIONS
|
|||
Book
overdraft (Bank overdraft net of cash available.)
|
$
|
-
|
||
Demand
Patron Notes / Deposits
|
$
|
-
|
||
Accts
Payable Owed to Suppliers with PMSI Filings
|
$
|
-
|
||
Outstanding
Balance of CoBank Loan(s), (as of date of this report):
(#RIB051S01)
|
$
|
-
|
||
CoBank
Letters of Credit Issued
|
$
|
-
|
||
TOTAL
PART C (NET OBLIGATIONS SUMMARY)
|
$
|
-
|
*EXCESS/OVERADVANCE
(AS OF END OF PERIOD): Total A + B - C
*
IF AN OVERADVANCE IS REPORTED ABOVE, PLEASE CONTACT YOUR RELATIONSHIP MANAGER
IMMEDIATELY WITH: 1) AN UPDATED BORROWING BASE REPORT, AND 2) SPECIFICS OF
ALL
PAYMENTS REMITTED SINCE END OF PERIOD (CHECK NUMBERS, WIRE ROUTING NUMBERS,
ETC.).
I
HEREBY CERTIFY THAT THIS INFORMATION IS CORRECT.
AUTHORIZED
SIGNATURE
(or
Electronic Signature)
|
TITLE
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DATE
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