November 1, 20240000821026false00008210262024-11-012024-11-01
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
______________________
FORM 8-K
______________________
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
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| Date of Report (Date of Earliest Event Reported): | November 1, 2024 |
__________________________________________
The Andersons, Inc.
__________________________________________
(Exact name of registrant as specified in its charter)
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| Ohio | | 000-20557 | | 34-1562374 |
| (State of incorporation or organization) | | (Commission File Number) | | (I.R.S. Employer Identification No.) |
1947 Briarfield Boulevard
Maumee, Ohio 43537
(Address of principal executive offices) (Zip Code)
(419) 893-5050
(Registrant’s telephone number, including area code)
__________________________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
[☐] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[☐] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[☐] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[☐] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
__________________________________________
Securities registered pursuant to Section 12(b) of the Act:
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| Title of each class: | | Trading Symbol | | Name of each exchange on which registered: |
| Common stock, $0.00 par value, $0.01 stated value | | ANDE | | The NASDAQ Stock Market LLC |
__________________________________________
Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
[☐] Emerging growth company
[☐] If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Item 1.01 Entry into a Material Definitive Agreement
On November 1, 2024, The Andersons, Inc. (the "Company") entered into a definitive purchase agreement ("Purchase Agreement") to purchase a 65% ownership interest in Skyland Grain, LLC ("Skyland") for $85.0 million, subject to customary working capital adjustments. The purchase was completed on November 1, 2024 and funded by cash on hand. The Company's 65% ownership of Skyland's equity will result in the consolidation of Skyland’s results in the Company's consolidated financial statements.
Effective, November 1, 2024, in conjunction with the Purchase Agreement noted above, Skyland, a consolidated subsidiary of the Company, entered into an amended and restated credit agreement (the "Credit Agreement") with COBANK, ACB and Farm Credit Mid-America, PCA. The Credit Agreement provides for a three-year $300 million revolving credit facility and $78 million of term notes consisting of several individual tranches of debt, with various payment schedules, and all with maturities of 5 years or less. The proceeds are being used to refinance Skyland's existing debt after the acquisition. The $300 million revolving credit facility and $67 million of the term notes will bear interest at variable rates, which are based on the Secured Overnight Financing Rate plus an applicable spread, with the remaining $11 million of term notes bearing fixed interest rates between 4.0% - 5.8%. The Credit Agreement is secured by the assets of Skyland and is non-recourse to the Company.
The foregoing description of the Purchase Agreement is not complete and is qualified in its entirety by reference to the Purchase Agreement, a copy of which is attached to this Current Report on Form 8-K as Exhibit 10.1 and is incorporated herein by reference.
The foregoing description of the Credit Agreement is not complete and is qualified in its entirety by reference to the Credit Agreement, a copy of which is attached to this Current Report on Form 8-K as Exhibit 10.2 and is incorporated herein by reference.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant
The information contained in Item 1.01 is incorporated by reference herein.
Item 8.01 Other Events
The Company has issued a press release announcing the Purchase Agreement which is included as exhibit 99.1 and is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits:
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| Exhibit No. | | Description |
| | |
| 10.1 | | |
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| 10.2 | | |
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| 99.1 | | |
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| 104 | | Inline XBRL for the cover page of this Current Report on Form 8-K |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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| | The Andersons, Inc. |
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| November 6, 2024 | | By: | /s/ Brian A. Valentine |
| | | |
| | | Brian A. Valentine |
| | | Executive Vice President
and Chief Financial Officer |
INTEREST PURCHASE AGREEMENT
among
SKYLAND GRAIN, L.L.C.,
SKYLAND CO-OP, INC.
and
THE ANDERSONS, INC.
dated as of
November 1, 2024
Exhibits to the agreement below have been redacted as they are both not material and confidential.
TABLE OF CONTENTS
ARTICLE I DEFINITIONS 1
Section 1.01 Definitions 1
ARTICLE II PURCHASE AND SALE 1
Section 2.01 Purchase and Sale 1
Section 2.02 Purchase Price 1
Section 2.03 Additional Payments and Adjustments 1
Section 2.04 Transactions to be Effected at the Closing 5
Section 2.05 Closing 6
Section 2.06 Withholding 6
ARTICLE III REPRESENTATIONS AND WARRANTIES OF SLG AND CO-OP 7
Section 3.01 Organization and Authority of SLG. 7
Section 3.02 Organization, Authority and Qualification of Co-op 7
Section 3.03 Capitalization 8
Section 3.04 No Subsidiaries 8
Section 3.05 No Conflicts; Consents 8
Section 3.06 Financial Statements 9
Section 3.07 Undisclosed Liabilities 9
Section 3.08 Absence of Certain Changes, Events and Conditions. 9
Section 3.09 Material Contracts. 12
Section 3.10 Title to Assets; Real Property 13
Section 3.11 Condition and Sufficiency of Assets 14
Section 3.12 Intellectual Property. 15
Section 3.13 Inventory. 17
Section 3.14 Accounts Receivable. 17
Section 3.15 Customers and Suppliers. 17
Section 3.16 Insurance. 18
Section 3.17 Legal Proceedings; Governmental Orders. 18
Section 3.18 Compliance With Laws; Permits. 19
Section 3.19 Environmental Matters. 19
Section 3.20 Employee Benefit Matters. 21
Section 3.21 Employment Matters. 24
Section 3.22 Taxes. 26
Section 3.23 CARES Act. 27
Section 3.24 Books and Records. 28
Section 3.25 Related Party Transactions. 28
Section 3.26 Brokers. 28
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF BUYER 28
Section 4.01 Organization and Authority of Buyer. 28
Section 4.02 No Conflicts; Consents. 29
Section 4.03 Investment Purpose. 29
Section 4.04 Brokers. 29
Section 4.05 Sufficiency of Funds. 29
Section 4.06 Legal Proceedings. 29
Section 4.07 Non-Reliance 29
Section 4.08 Accredited Investor Status 30
ARTICLE V COVENANTS 30
Section 5.01 Public Announcements. 30
Section 5.02 Further Assurances. 30
Section 5.03 Cron Lawsuit 30
Section 5.04 Termination of Management and Personal Services Agreement 30
Section 5.05 Hansen-Mueller Facilities 31
ARTICLE VI INDEMNIFICATION 31
Section 6.01 Survival 31
Section 6.02 Indemnification by SLG and Co-op 31
Section 6.03 Indemnification by Buyer 32
Section 6.04 Tax Indemnification 32
Section 6.05 Certain Limitations 33
Section 6.06 Indemnification Procedures 33
Section 6.07 Tax Treatment of Indemnification Payments 35
Section 6.08 Effect of Investigation. 35
Section 6.09 Setoff. 35
Section 6.10 Exclusive Remedies 36
ARTICLE VII ENVIRONMENTAL INDEMNITY 36
Section 7.01 Environmental Indemnification 36
Section 7.02 Indemnification Procedures 38
Section 7.03 Survival 38
ARTICLE VIII TAX MATTERS 38
Section 8.01 Transfer Taxes 38
Section 8.02 Certain Tax Elections 38
Section 8.03 Straddle Periods 39
Section 8.04 Tax Treatment 39
ARTICLE IX MISCELLANEOUS 40
Section 9.01 Expenses 40
Section 9.02 Notices 40
Section 9.03 Interpretation 42
Section 9.04 Disclosure Schedules 42
Section 9.05 Headings 42
Section 9.06 Severability 42
Section 9.07 Entire Agreement 42
Section 9.08 Successors and Assigns 43
Section 9.09 No Third-Party Beneficiaries 43
Section 9.10 Amendment and Modification; Waiver 43
Section 9.11 Governing Law; Submission to Jurisdiction; Waiver of Jury Trial 43
Section 9.12 Specific Performance 44
Section 9.13 Counterparts 44
List of Exhibits and Appendices:
Exhibits:
Exhibit A – Sample Working Capital Calculation
Exhibit B – Sample Calculation of Closing Indebtedness
Exhibit C – Producer Notes
Exhibit D – Form of Real Estate Purchase Agreement for Hansen-Mueller Facilities
Appendices:
APPENDIX 1 – Defined Terms
INTEREST PURCHASE AGREEMENT
This Interest Purchase Agreement (this “Agreement”), dated as of November 1, 2024 (the “Effective Date”), is entered into by and among Skyland Grain, L.L.C., a Kansas limited liability company (“SLG”), Skyland Co-op, Inc., a Kansas corporation organized and existing pursuant to the Kansas Cooperative Marketing Act (“Co-op”), and The Andersons, Inc., an Ohio corporation (“Buyer”) (each, a “Party” and, collectively, the “Parties”).
RECITALS
WHEREAS, Co-op owns a 74.41% Interest (as defined in SLG’s Fifth Amended and Restated Operating Agreement, dated April 1, 2021 (the “Current Operating Agreement”));
WHEREAS, Archer-Daniels-Midland Company, a Delaware corporation (“ADM”) owns the remaining 25.59% Interest of SLG (the “ADM Interest”);
WHEREAS, ADM has expressed a desire to terminate its membership in SLG, and SLG is willing to redeem the ADM Interest for a total purchase price of $29,350,000 (the “ADM Redemption Transaction”) pursuant to an Interest Redemption Agreement, of even date herewith, by and between ADM and SLG in the form previously agreed by the Parties (the “ADM Redemption Agreement”);
WHEREAS, Buyer is interested in purchasing a 65% Interest in SLG (the “Purchased Interest”); and
WHEREAS, SLG wishes to issue to Buyer, and Buyer wishes to purchase from SLG, the Purchased Interest, subject to the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and agreements hereinafter set forth and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
ARTICLE I
DEFINITIONS
Section I.1Definitions. Initially capitalized terms defined in Appendix 1 shall have the meanings given to them in Appendix 1. Other initially capitalized terms not defined in Appendix 1 but defined in the preamble, the recitals or elsewhere in this Agreement shall have the meanings given to them where they are defined.
ARTICLE II
PURCHASE AND SALE
Section II.1Purchase and Sale. Subject to the terms and conditions set forth herein, at the Closing, SLG shall sell and issue to Buyer, and Buyer shall purchase from SLG, the Purchased Interest for the consideration specified in Section 2.02.
Section II.2Purchase Price. Subject to adjustment as provided in Section 2.03, the aggregate purchase price for the Purchased Interest shall be Eighty-Five Million Dollars ($85,000,000) (the “Purchase Price”).
Section II.3Additional Payments and Adjustments.
(a)Payment of Transaction Expenses. Co-op shall be solely liable for the payment of all Transaction Expenses of SLG as of the Effective Date, including those set forth in the Closing Transaction Expenses Certificate (the “Closing Transaction Expenses”). If Co-op is unable to pay such Closing Transaction Expenses at Closing, SLG will pay on Co-op’s behalf all such Closing Transaction Expenses and Co-op shall execute and deliver to SLG an unsecured promissory note (with interest at 8% compounded monthly, and a balloon payment of all principal and interest due 365 days after execution) evidencing Co-op’s obligation for the payment of such Closing Transaction Expenses. If any unpaid Transaction Expenses (the “Unpaid Transaction Expenses”) exist and are payable by SLG after Closing, and Co-op is unable to pay such Unpaid Transaction Expenses, SLG will pay on Co-op’s behalf all such Unpaid Transaction Expenses and Co-op shall execute and deliver to SLG an unsecured promissory note (with interest at 8% compounded monthly, and a balloon payment of all principal and interest due 365 days after execution) evidencing Co-op’s obligation for the payment of such Unpaid Transaction Expenses.
(b)Indebtedness Adjustment.
(i)The Purchase Price was calculated under the assumption that the Indebtedness of SLG at Closing (“Closing Indebtedness”) would be equal to the Indebtedness of SLG as of July 31, 2024. As of July 31, 2024, the Indebtedness of SLG was $61,243,327 (“Target Indebtedness”).
(ii)A sample calculation of Closing Indebtedness, as if the Closing were September 30, 2024, is attached as Exhibit B.
(iii)Within ninety (90) days after the Effective Date, Buyer will prepare and deliver to Co-op a statement setting forth its calculation of Closing Indebtedness. If Co-op disputes this statement, the Parties will follow the procedure in Section 2.03(e) mutatis mutandis.
(iv)The post-closing adjustment under this Section 2.03 will be either (1) a payment from Co-op to Buyer in an amount, if any, by which the Closing Indebtedness is greater than the Target Indebtedness or (2) a payment from Buyer to Co-op in the amount, if any, by which the Closing Indebtedness is less than the Target Indebtedness (the “Indebtedness Post-Closing Adjustment”).
(c)Working Capital Adjustment.
(i)The Purchase Price was calculated under the assumption that the Adjusted Working Capital of SLG at Closing would be equal to the Adjusted Working Capital of SLG as of July 31, 2024. As of July 31, 2024, the Adjusted Working Capital of SLG was ($8,881,188) (“Target Working Capital”).
(ii)A sample calculation of the Adjusted Closing Working Capital, including such adjustments and credits as agreed to by the Parties, as if the Effective Date were September 30, 2024 is attached as Exhibit A.
(d)Post-Closing Adjustment.
(i)Within ninety (90) days after the Effective Date, Buyer will prepare and deliver to Co-op a statement setting forth its calculation of Adjusted Closing Working Capital, which statement will contain a balance sheet of SLG as of the Effective Date (without giving effect to the transactions contemplated herein or in the ADM Redemption Agreement), a calculation of Adjusted Closing Working Capital (the “Adjusted Closing Working Capital Statement”) and a certificate of the Treasurer of Buyer certifying that the Adjusted Closing Working Capital Statement was prepared in accordance with (1) GAAP applied using the same accounting methods, practices, principles, policies and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were used in the preparation of the Audited Financial Statements for the most recent fiscal year end as if such Adjusted Closing Working Capital Statement was being prepared as of a fiscal year end and (2) the methodology used in Exhibit A.
(ii)The post-closing adjustment will be either (1) a payment from Buyer to Co-op in the amount, if any, by which the Adjusted Closing Working Capital (as determined in accordance with Section 2.03(c)) is greater than the Target Working Capital or (2) a payment from Co-op to Buyer in the amount, if any, by which the Adjusted Closing Working Capital is less than the Target Working Capital (the “Working Capital Post-Closing Adjustment,” and together with the Indebtedness Post-Closing Adjustment, the “Post-Closing Adjustment”).
(e)Examination and Review.
(i)Examination. After receipt of the Adjusted Closing Working Capital Statement, Co-op will have thirty (30) days (the “Review Period”) to review the Adjusted Closing Working Capital Statement. During the Review Period, Co-op and Co-op’s accountants will have customary access to the work papers prepared by Buyer or Buyer’s accountants and the books and records of SLG to the extent that they relate to the Adjusted Closing Working Capital Statement.
(ii)Objection. On or prior to the last day of the Review Period, Co-op may object to the Adjusted Closing Working Capital Statement by delivering to Buyer a written statement setting forth Co-op’s objections in reasonable detail, indicating each disputed item or amount and the basis for Co-op’s disagreement therewith (the “Statement of Objections”). If Co-op fails to deliver the Statement of Objections before the expiration of the Review Period, the Adjusted Closing Working Capital Statement and the Post-Closing Adjustment, as the case may be,
reflected in the Adjusted Closing Working Capital Statement will be deemed to have been accepted by Co-op. If Co-op delivers the Statement of Objections before the expiration of the Review Period, Buyer and Co-op will negotiate in good faith to resolve such objections within 30 days after the delivery of the Statement of Objections (the “Resolution Period”), and, if the same are so resolved within the Resolution Period, the Post-Closing Adjustment and the Adjusted Closing Working Capital Statement with such changes as may have been previously agreed in writing by Buyer and Co-op, will be final and binding.
(iii)Resolution of Disputes. If Co-op and Buyer fail to reach an agreement with respect to all of the matters set forth in the Statement of Objections before expiration of the Resolution Period, then any amounts remaining in dispute (“Disputed Amounts”) will be submitted for resolution to KCoe Isom, LLP (a/k/a Pinion Global) or, if KCoe Isom, LLP is unable to serve, Buyer and Co-op will appoint by mutual agreement the office of an impartial nationally recognized firm of independent certified public accountants other than SLG’s, Co-op’s or Buyer’s accountants (the “Independent Accountant”) who, acting as experts and not arbitrators, will resolve the Disputed Amounts only and make any adjustments to the Post-Closing Adjustment and the Adjusted Closing Working Capital Statement. All adjustments will be made without regard to materiality. The Independent Accountant will only decide the specific items under dispute by the Parties and their decision for each Disputed Amount must be within the range of values assigned to each such item in the Adjusted Closing Working Capital Statement and the Statement of Objections, respectively. None of the Parties shall have ex-parte communications with the Independent Accountant.
(iv)Fees of the Independent Accountant. The fees and expenses of the Independent Accountant will be paid by Co-op, on the one hand, and by Buyer, on the other hand, based upon the percentage that the aggregate of the Disputed Amounts not awarded to Co-op or Buyer, respectively, bears to the aggregate of the Disputed Amounts asserted by Co-op and Buyer.
(v)Determination by Independent Accountant. The Independent Accountant will make a determination as soon as practicable within thirty (30) days (or such other time as the Parties agree in writing) after their engagement, and their resolution of the Disputed Amounts and their adjustments to the Adjusted Closing Working Capital Statement and/or the Post-Closing Adjustment will be conclusive and binding upon the Parties.
(f)Payments of Post-Closing Adjustment. If the Post-Closing Adjustment results in a payment due to Buyer, then Co-op will pay Buyer an amount equal to the Post-Closing Adjustment within five (5) Business Days after determination of the Post-Closing Adjustment as described in this Section 2.03. If the Post-Closing Adjustment results in a payment due to Co-op, then Buyer will pay Co-op an amount equal to the
Post-Closing Adjustment within five (5) Business Days after determination of the Post-Closing Adjustment as described in this Section 2.03. If Co-op is unable to pay any Post-Closing Adjustment as otherwise required by this Section 2.03(f), SLG will pay the Post-Closing Adjustment on Co-op’s behalf and Co-op shall execute and deliver to SLG an unsecured promissory note (with interest at 8% compounded monthly, and a balloon payment of all principal and interest due 365 days after execution) evidencing Co-op’s obligation for the payment of such Post-Closing Adjustment.
(g)Reserve for Producer Notes. The Parties acknowledge that SLG has not taken adequate reserves for certain long term notes listed on Exhibit C with a balance of $4,369,009 (the “Outstanding Amount”). The Parties have agreed that an appropriate reserve for such Notes is $1,557,487 (the “Reserve”), which would result in Co-op paying the amount of the Reserve to Buyer at Closing. The Parties have agreed to forebear this payment by Co-op for a period of 36 months from Closing (i.e., until October 31, 2027), while SLG attempts to collect the Outstanding Amount. On or before November 30, 2027, SLG will report to the Parties the amount of these long-term notes that were deemed uncollectible and the Co-op will pay Buyer the amount deemed uncollectible (not to exceed the Reserve) within five (5) business days after receipt of the report.
(h)Adjustments for Tax Purposes. Any payments made pursuant to Section 2.03(b)-(g) will be treated as an adjustment to the Purchase Price by the Parties for Tax purposes, unless otherwise required by Law.
Section II.4Transactions to be Effected at the Closing.
(a)At the Closing, Buyer shall:
(i)deliver to SLG:
(A)$65,650,000, by wire transfer of immediately available funds to an account designated in writing by SLG to Buyer no later than one Business Day prior to the Effective Date; and SLG will then in turn pay, on behalf of Co-op, the Closing Transaction Expenses specified on the Closing Transaction Expenses Certificate by wire transfer of immediately available funds to the accounts and in the amounts specified on the Closing Transaction Expenses Certificate;
(B)duly executed copies of all Ancillary Documents; and
(C)a good standing certificate of Buyer from the Ohio Secretary of State; and
(ii)pay to ADM, on behalf of SLG, $19,350,000, by wire transfer of immediately available funds to an account designated in writing by ADM to SLG (and by SLG to Buyer) no later than one Business Day prior to the Effective Date.
(b)At the Closing, SLG or Co-op, as applicable, shall deliver to Buyer:
(i)duly executed copies of all Ancillary Documents;
(ii)the CoBank Documents;
(iii)all consents, authorizations, orders and approvals from the Governmental Authorities referred to in Section 3.05 in form and substance reasonably satisfactory to Buyer;
(iv)Reserved.
(v)the Promissory Note (as defined in the ADM Redemption Agreement) and other documents required pursuant to the ADM Redemption Agreement (e.g., Bidding Rights and Access Agreement);
(vi)a copy of the ADM W-9 referred to in Section 3.22(q);
(vii)evidence that ADM has properly conveyed and transferred to SLG all of the ADM Assets (as defined in the ADM Contribution Agreement);
(viii)copies of issued title policies to SLG and/or Co-op with respect to the ADM Assets in accordance with Section 9 of the ADM Contribution Agreement from Frazee Abstract & Title, Inc.;
(ix)confirmation from the Plan Sponsor of the Co-op Retirement Plan: (A) that SLG is a continuing Participating Employer (as defined in the C-op Retirement Plan); and (B) that the performance of this Agreement and the consummation of the transactions contemplated hereby do not constitute nor will be deemed to be a withdrawal event for purposes of the Plan;
(x)the Plan Participation Agreement required by the Plan Sponsor, executed by Co-op and SLG;
(xi)the resignations of the Resigning SLG Directors;
(xii)the Closing Transaction Expenses Certificate;
(xiii)a good standing certificate of SLG from the Kansas Secretary of State; and
(xiv)a good standing certificate of Co-op from the Kansas Secretary of State.
(c)The closing under the ADM Redemption Transaction will occur simultaneously with the Closing.
Section II.5Closing. Subject to the terms and conditions of this Agreement, the purchase and issuance of the Purchased Interest contemplated hereby shall take place on the Effective Date and simultaneous with the execution of this Agreement (the “Closing”).
Section II.6Withholding. Buyer shall be entitled to deduct and withhold from amounts otherwise payable pursuant to this Agreement such amounts as are required to be deducted and withheld under applicable Law. Buyer shall provide Co-op and SLG with written notice of its intent to deduct or withhold prior to such deduction or withholding, which notice shall set forth an explanation of the reason for the deduction or withholding, the amount being deducted or withheld and the third party to which the deduction or withholding will be paid. To the extent that amounts are so withheld and paid over to an appropriate third party by Buyer, such withheld amounts shall be treated for all purposes of this Agreement as having been paid to the Person in respect of which such deduction and withholding was made.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SLG AND CO-OP
SLG and Co-op, jointly and severally, represent and warrant to Buyer that the statements contained in this ARTICLE III are true and correct as of the Effective Date.
Section III.1Organization and Authority of SLG. SLG is a limited liability company duly organized, validly existing and in good standing under the Laws of the State of Kansas. SLG has full limited liability company power and authority to enter into this Agreement and the Ancillary Documents to which SLG is or will be a party, to carry out its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby. The execution and delivery by SLG of this Agreement and any Ancillary Document to which SLG is or will be a party, the performance by SLG of its obligations hereunder and thereunder, and the consummation by SLG of the transactions contemplated hereby and thereby have been duly authorized by all requisite limited liability company action on the part of SLG. This Agreement has been duly executed and delivered by SLG, and (assuming due authorization, execution and delivery by Co-op and Buyer) this Agreement constitutes a legal, valid and binding obligation of SLG enforceable against SLG in accordance with its terms, except as such enforceability may be limited by the Equitable Exceptions. When each Ancillary Document to which SLG is or will be a party has been duly executed and delivered by SLG (assuming due authorization, execution and delivery by each other party thereto), such Ancillary Document will constitute a legal, valid and binding obligation of SLG enforceable against it in accordance with its terms, except as such enforceability may be limited by the Equitable Exceptions. Section 3.01 of the Disclosure Schedules sets forth each jurisdiction in which SLG is licensed or qualified to do business, and SLG is duly licensed or qualified to do business and is in good standing in each jurisdiction in which the properties owned or leased by it or the operation of its business as currently conducted makes such licensing or qualification necessary.
Section III.2Organization, Authority and Qualification of Co-op. Co-op is a corporation organized and existing pursuant to the Kansas Cooperative Marketing Act, duly organized, validly existing and in good standing under the Laws of the State of Kansas. Co-op has full corporate power and authority to enter into this Agreement and the Ancillary Documents to which Co-op is or will be a party, to carry out its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby. The execution and delivery by Co-op of this Agreement and any Ancillary Document to which Co-op is or will be a party, the performance by Co-op of its obligations hereunder and thereunder, and the consummation by Co-op of the transactions contemplated hereby and thereby have been duly authorized by all requisite corporate action on the
part of Co-op. This Agreement has been duly executed and delivered by Co-op, and (assuming due authorization, execution and delivery by SLG and Buyer) this Agreement constitutes a legal, valid and binding obligation of Co-op enforceable against Co-op in accordance with its terms, except as such enforceability may be limited by the Equitable Exceptions. When each Ancillary Document to which Co-op is or will be a party has been duly executed and delivered by Co-op (assuming due authorization, execution and delivery by each other party thereto), such Ancillary Document will constitute a legal, valid and binding obligation of Co-op enforceable against it in accordance with its terms, except as such enforceability may be limited by the Equitable Exceptions.
Section III.3Capitalization.
(a)The Purchased Interest constitutes 65% of the total issued and outstanding Interests of SLG. The Purchased Interest has been duly authorized, is validly issued, fully paid and non-assessable, free and clear of all Encumbrances, except Encumbrances contained within the Current Operating Agreement. Upon consummation of the transactions contemplated by this Agreement, Buyer will own the Purchased Interest, free and clear of all Encumbrances, except Encumbrances contained within the Amended and Restated Operating Agreement.
(b)All of the Interests in SLG were issued in compliance with applicable Laws. No Interests were issued in violation of any agreement, arrangement or commitment to which SLG or Co-op is a party or is subject to or in violation of any preemptive or similar rights of any Person.
(c)Except as provided in the Current Operating Agreement and the ADM Redemption Agreement, there are no outstanding or authorized options, warrants, convertible securities or other rights, agreements, arrangements or commitments of any character relating to the membership interests of SLG or obligating SLG, Co-op or ADM to issue or sell any membership interests of, or any other interest in, SLG. SLG does not have outstanding or authorized any stock appreciation, phantom stock, profit participation or similar rights. Except for the Current Operating Agreement and the ADM Redemption Agreement, there are no voting trusts, stockholder agreements, proxies or other agreements or understandings in effect with respect to the voting or transfer of any of the membership interests in SLG.
Section III.4No Subsidiaries. Except as set forth on Section 3.04 of the Disclosure Schedules, SLG does not own, or have any capital stock or other equity, ownership or profit sharing interests in any other Person, or the right or obligation to acquire any capital stock or other equity, ownership or profit sharing interests in any other Person.
Section III.5No Conflicts; Consents. The execution, delivery and performance by SLG and Co-op of this Agreement and the Ancillary Documents to which it is or will be a party, and the consummation of the transactions contemplated hereby and thereby, do not and will not: (a) conflict with or result in a violation or breach of, or default under, any provision of the Organizational Documents of SLG or Co-op; (b) conflict with or result in a violation or breach of any provision of any Law or Governmental Order applicable to SLG or Co-op; (c) except as set forth in Section 3.05
of the Disclosure Schedules, require the consent, notice or other action by any Person under, result in a violation or breach of, constitute a default or an event that, with or without notice or lapse of time or both, would constitute a default under, result in the acceleration of or create in any party the right to accelerate, terminate, modify or cancel any Material Contract to which SLG or Co-op is a party or by which SLG or Co-op is bound or to which any of their respective properties and assets are subject or any Permit affecting the properties, assets or business of SLG; or (d) result in the creation or imposition of any Encumbrance other than Permitted Encumbrances on any properties or assets of SLG. Except as set forth in Section 3.05 of the Disclosure Schedules, no consent, approval, Permit, Governmental Order, declaration or filing with, or notice to, any Governmental Authority is required by or with respect to SLG or Co-op in connection with the execution and delivery of this Agreement and the Ancillary Documents to which SLG or Co-op is or will be a party and the consummation of the transactions contemplated hereby and thereby.
Section III.6Financial Statements. Complete copies of SLG’s audited financial statements consisting of the balance sheet of SLG as of January 31 in each of the fiscal years 2022, 2023 and 2024 and the related statements of comprehensive income, cash flows, and members’ capital for the years then ended (the “Audited Financial Statements”), and unaudited financial statements consisting of the balance sheet SLG as at September 30, 2024 and related income statement for the eight-month period then ended (the “Interim Financial Statements” and together with the Audited Financial Statements, the “Financial Statements”) have been delivered to Buyer. Except as set forth in Section 3.06 of the Disclosure Schedules, the Financial Statements have been prepared in accordance with GAAP applied on a consistent basis throughout the period involved, subject, in the case of the Interim Financial Statements, to normal and recurring year-end adjustments (the effect of which will not be materially adverse) and the absence of notes (that, if presented, would not differ materially from those presented in the Audited Financial Statements). The Financial Statements are based on the books and records of SLG, and fairly present in all material respects the financial condition of SLG as of the respective dates they were prepared and the results of the operations of SLG for the periods indicated. The balance sheet of SLG as of January 31, 2024 is referred to herein as the “Balance Sheet” and the date thereof as the “Balance Sheet Date” and the balance sheet of SLG as of September 30, 2024 is referred to herein as the “Interim Balance Sheet” and the date thereof as the “Interim Balance Sheet Date.” SLG maintains a standard system of accounting established and administered in accordance with GAAP.
Section III.7Undisclosed Liabilities. SLG has no liabilities, obligations or commitments of any nature whatsoever, asserted or unasserted, known or unknown, absolute or contingent, accrued or unaccrued, matured or unmatured or otherwise (“Liabilities”), except (a) those that are adequately reflected or reserved against in the Balance Sheet as of the Balance Sheet Date and (b) those which have been incurred in the ordinary course of business consistent with past practice since the Balance Sheet Date and which are not, individually or in the aggregate, material in amount.
Section III.8Absence of Certain Changes, Events and Conditions. Since the Balance Sheet Date, the business of SLG has been conducted in the ordinary course of business consistent with past practice, and there has not been, with respect to SLG, any:
(a)except as set forth in Section 3.08(a) of the Disclosure Schedules, event, occurrence or development that has had, or could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect;
(b)amendment of Organizational Document of SLG;
(c)split, combination or reclassification of any membership interests;
(d)issuance, sale or other disposition of any of its membership interests, or grant of any options, warrants or other rights to purchase or obtain (including upon conversion, exchange or exercise) any of its membership interests;
(e)except pursuant to the ADM Redemption Agreement, declaration or payment of any dividends or distributions on or in respect of any of its membership interests or redemption, purchase or acquisition of its membership interests;
(f)material change in any method of accounting or accounting practice of SLG, except as required by GAAP or as disclosed in the notes to the Financial Statements;
(g)material change in SLG’s cash management practices and its policies, practices and procedures with respect to collection of accounts receivable, establishment of reserves for uncollectible accounts, accrual of accounts receivable, inventory control, prepayment of expenses, payment of trade accounts payable, accrual of other expenses, deferral of revenue and acceptance of customer deposits;
(h)except as set forth in Section 3.08(h) of the Disclosure Schedules, entry into any Contract that would constitute a Material Contract;
(i)except as set forth in Section 3.08(i) of the Disclosure Schedules, incurrence, assumption or guarantee of any indebtedness for borrowed money except unsecured current obligations and Liabilities incurred in the ordinary course of business consistent with past practice;
(j)transfer, assignment, sale or other disposition of any of the assets shown or reflected in the Balance Sheet or cancellation of any debts or entitlements;
(k)transfer or assignment of or grant of any license or sublicense under or with respect to any SLG Intellectual Property or SLG IP Agreements;
(l)abandonment or lapse of or failure to maintain in full force and effect any SLG IP Registration, or failure to take or maintain reasonable measures to protect the confidentiality of any Trade Secrets included in SLG Intellectual Property;
(m)material damage, destruction or loss (whether or not covered by insurance) to its property;
(n)except as set forth in Section 3.08(n) of the Disclosure Schedules, capital investment in, or loan to, any other Person;
(o)except with respect to the CoBank Indebtedness and Liabilities, acceleration, termination, material modification to or cancellation of any Material Contract to which SLG is a party or by which it is bound;
(p)material capital expenditures;
(q)imposition of any Encumbrance (other than Permitted Encumbrances) upon any of SLG’s properties, membership interests or assets, tangible or intangible;
(r)except as set forth on Section 3.08(r) of the Disclosure Schedules, (i) grant of any bonuses, whether monetary or otherwise, or increase in any wages, salary, severance, pension or other compensation or benefits in respect of its current or former employees, officers, directors, independent contractors or consultants, other than as provided for in any written agreements, required by applicable Law or in the ordinary course of business consistent with past practices, (ii) except in the ordinary course of business, change in the terms of employment for any employee or any termination of any employees for which the aggregate costs and expenses exceed $100,000, or (iii) action to accelerate the vesting or payment of any compensation or benefit for any current or former employee, officer, director, independent contractor or consultant;
(s)hiring or promoting of any person with a salary (or expected total compensation exclusive of benefits) in excess of $100,000;
(t)except as set forth in Section 3.08(t) of the Disclosure Schedules adoption, modification or termination of any (i) employment, severance, retention or other agreement with any current or former employee, officer, director, independent contractor or consultant, (ii) Benefit Plan or (iii) collective bargaining or other agreement with a Union, in each case whether written or oral;
(u)loan to (or forgiveness of any loan to), or entry into any other transaction with, any of its current or former members, directors, officers or employees;
(v)entry into a new line of business or abandonment or discontinuance of any existing line of business;
(w)adoption of any plan of merger, consolidation, reorganization, liquidation or dissolution or filing of a petition in bankruptcy under any provisions of federal or state bankruptcy Law or consent to the filing of any bankruptcy petition against it under any similar Law;
(x)purchase, lease or other acquisition of the right to own, use or lease any property or assets for an amount in excess of $250,000, individually (in the case of a lease, per annum) or $500,000 in the aggregate (in the case of a lease, for the entire term
of the lease, not including any option term), except for purchases of inventory or supplies in the ordinary course of business consistent with past practice;
(y)except for the APC Merger, acquisition by merger or consolidation with, or by purchase of a substantial portion of the assets or stock of, or by any other manner, any business of any Person or any division thereof;
(z)action by SLG to make, change or rescind any Tax election, amend any Tax Return or take any position on any Tax Return, take any action, omit to take any action or enter into any other transaction that would have the effect of increasing the Tax liability or reducing any Tax asset of Buyer in respect of any Post-Closing Tax Period; or
(aa)Contract to do any of the foregoing, or any action or omission that would result in any of the foregoing.
Section III.9Material Contracts.
(a)Section 3.09(a) of the Disclosure Schedules lists each of the following Contracts of SLG (such Contracts, together with all Contracts concerning the occupancy, management or operation of any Real Property (including brokerage contracts) listed or otherwise disclosed in Section 3.10(b) of the Disclosure Schedules and all SLG IP Agreements, being “Material Contracts”):
(i)each Contract of SLG involving aggregate consideration in excess of $200,000 and which, in each case, cannot be cancelled by SLG without penalty or without more than 90 days’ notice;
(ii)all Contracts that require SLG to purchase its total requirements of any product or service from a third party or that contain “take or pay” provisions;
(iii)all Contracts that provide for the indemnification by SLG of any Person or the assumption of any Tax, environmental or other Liability of any Person;
(iv)all Contracts that relate to the acquisition or disposition of any business, a material amount of stock or assets of any other Person or any real property (whether by merger, sale of stock, sale of assets or otherwise);
(v)all broker, distributor, dealer, manufacturer’s representative, franchise, agency, sales promotion, market research, marketing consulting and advertising Contracts to which SLG is a party;
(vi)all employment agreements and Contracts with independent contractors or consultants (or similar arrangements) to which SLG is a party and that are not cancellable without material penalty or without more than 90 days’ notice
(vii)except for Contracts relating to trade payables, all Contracts relating to Indebtedness (including guarantees) of SLG;
(viii)all Contracts with any Governmental Authority to which SLG is a party (“Government Contracts”);
(ix)all Contracts that limit or purport to limit the ability of SLG to compete in any line of business or with any Person or in any geographic area or during any period of time;
(x)any Contracts to which SLG is a party that provide for any joint venture, partnership or similar arrangement by SLG;
(xi)all Contracts between or among SLG on the one hand and Co-op or any Affiliate of Co-op (other than SLG) on the other hand;
(xii)all Contracts between or among SLG on the one hand and ADM or any Affiliate of ADM on the other hand;
(xiii)all collective bargaining agreements or Contracts with any Union to which SLG is a party;
(xiv)all facility management or similar Contracts; and
(xv)any other Contract that is material to SLG and not previously disclosed pursuant to this Section 3.09.
(b)Each Material Contract is in full force and effect and is a legal, valid and binding agreement enforceable against SLG and, to SLG’s Knowledge, the other party or parties thereto, in accordance with its terms. Except as set forth in Section 3.09(b) of the Disclosure Schedules, none of SLG or, to SLG’s Knowledge, any other party thereto is in breach of or default under (or is alleged to be in breach of or default under) in any material respect, or has provided or received any notice of any intention to terminate, any Material Contract. No event or circumstance has occurred that, with notice or lapse of time or both, would constitute an event of default by SLG under any Material Contract or result in a termination thereof or would cause or permit the acceleration or other changes of any right or obligation or the loss of any benefit thereunder. Accurate copies of each Material Contract (including all modifications, amendments and supplements thereto and waivers thereunder) have been made available to Buyer.
(c)Attached as Section 3.09(c) of the Disclosure Schedules is a complete and accurate list, as of the end of the Business Day before the Effective Date, of all grain or other commodities to be purchased by SLG, a list of all grain or other commodities to be sold by SLG, and the relevant terms associated with these purchases and sales (including price, delivery dates, etc.).
Section III.10Title to Assets; Real Property.
(a)SLG has good and valid (and, in the case of owned Real Property, good and marketable fee simple) title to, or a valid leasehold interest in, all Real Property and Personal Property and other assets reflected in the Audited Financial Statements or acquired after the Balance Sheet Date (including all Real Property and Personal Property subject to a facility management or similar Contract), other than properties and assets sold or otherwise disposed of in the ordinary course of business consistent with past practice since the Balance Sheet Date. All properties and assets owned by SLG (including leasehold interests) are free and clear of Encumbrances except for the following (collectively referred to as “Permitted Encumbrances”):
(i)those items set forth in Section 3.10(a) of the Disclosure Schedules;
(ii)liens for Taxes not yet due and payable;
(iii)mechanics, carriers’, workmen’s, repairmen’s or other like liens arising or incurred in the ordinary course of business consistent with past practice or amounts that are not delinquent and that are not, individually or in the aggregate, material to the business of SLG;
(iv)easements, rights of way, zoning ordinances and other similar encumbrances of record affecting Real Property; or
(v)other than with respect to owned Real Property, liens arising under original purchase price conditional sales contracts and equipment leases with third parties entered into in the ordinary course of business consistent with past practice.
(b)Section 3.10(b) of the Disclosure Schedules lists: (i) the street address of each parcel of Real Property; (ii) if such property is leased or subleased by SLG, the landlord under the lease, the rental amount currently being paid, and the expiration of the term of such lease or sublease for each leased or subleased property; and (iii) the current use of such property. With respect to owned Real Property, SLG has delivered or made available to Buyer true, complete and correct copies of the deeds and other instruments (as recorded) by which SLG acquired such Real Property, and copies of all of the title insurance policies, opinions, abstracts and surveys in the possession of SLG or Co-op and relating to the Real Property. With respect to leased Real Property, SLG has delivered or made available to Buyer true, complete and correct copies of any leases affecting the Real Property. SLG is not a sublessor or grantor under any sublease or other instrument granting to any other Person any right to the possession, lease, occupancy or enjoyment of any leased Real Property. The use and operation of the Real Property in the conduct of SLG’s business do not violate in any material respect any Law, covenant, condition, restriction, easement, license, Permit or agreement. Except as set forth in Section 3.10(b) of the Disclosure Schedules, no material improvements constituting a part of the Real Property encroach on real property owned or leased by a Person other than SLG. There are no Actions pending nor, to SLG’s Knowledge, threatened against or affecting the
Real Property or any portion thereof or interest therein in the nature or in lieu of condemnation or eminent domain proceedings.
Section III.11Condition and Sufficiency of Assets. Except as set forth in Section 3.11 of the Disclosure Schedules, the buildings, plants, structures, furniture, fixtures, machinery, equipment, vehicles and other items of tangible Personal Property of SLG are structurally sound, are in good operating condition and repair, and are adequate for the uses to which they are being put, and none of such buildings, plants, structures, furniture, fixtures, machinery, equipment, vehicles and other items of tangible Personal Property is in need of maintenance or repairs except for ordinary, routine maintenance and repairs that are not material in nature or cost. Except as set forth in Section 3.11 of the Disclosure Schedules, the Property of SLG and all Real Property and Personal Property subject to the Facilities Management Agreement is sufficient for the continued conduct of SLG’s business after the Closing in substantially the same manner as conducted prior to the Closing and constitute all of the rights, property and assets necessary to conduct the business of SLG as currently conducted.
Section III.12Intellectual Property.
(a)Section 3.12(a) of the Disclosure Schedules contains a correct, current, and complete list of: (i) all SLG IP Registrations, specifying as to each, as applicable: the title, mark, or design; the record owner and inventor(s), if any; the jurisdiction by or in which it has been issued, registered, or filed; the patent, registration, or application serial number; the issue, registration, or filing date; and the current status; (ii) all unregistered Trademarks included in SLG Intellectual Property; (iii) all proprietary Software of SLG; and (iv) all other SLG Intellectual Property used or held for use in SLG’s business as currently conducted.
(b)Section 3.12(b) of the Disclosure Schedules contains a correct, current, and complete list of all SLG IP Agreements, specifying for each the date, title, and parties thereto, and separately identifying SLG IP Agreements: (i) under which SLG is a licensor or otherwise grants to any Person any right or interest relating to any SLG Intellectual Property; (ii) under which SLG is a licensee or otherwise granted any right or interest relating to the Intellectual Property of any Person; and (iii) that otherwise relate to SLG’s ownership or use of Intellectual Property, in each case identifying the Intellectual Property covered by such SLG IP Agreement. SLG has provided Buyer with true and complete copies (or in the case of any oral agreements, a complete and correct written description) of all SLG IP Agreements, including all modifications, amendments and supplements thereto and waivers thereunder. Each SLG IP Agreement is a legal, valid and binding Contract on SLG in accordance with its terms and is in full force and effect. Except as set forth in Section 3.12(b) of the Disclosure Schedules, neither SLG nor, to SLG's Knowledge, any other party thereto is, or is alleged to be, in breach of or default under any SLG IP Agreement. SLG has not provided or received any notice of breach of, default under, or intention to terminate (including by non-renewal), any SLG IP Agreement.
(c)SLG is the sole and exclusive legal and beneficial, and with respect to SLG IP Registrations, record, owner of all right, title, and interest in and to SLG Intellectual Property, and has a valid and enforceable right to use all other Intellectual Property used or held for use in or necessary for the conduct of SLG’s business as currently conducted, in each case, free and clear of Encumbrances other than Permitted Encumbrances. All assignments and other instruments necessary to establish, record, and perfect SLG’s ownership interest in SLG IP Registrations have been validly executed, delivered, and filed with the relevant Governmental Authorities and authorized registrars.
(d)Neither the execution, delivery or performance of this Agreement, nor the consummation of the transactions contemplated hereunder, will result in the loss or impairment of, or, except as set forth in Section 3.12(d) of the Disclosure Schedules, require the consent of any other Person in respect of, SLG’s right to own or use any SLG Intellectual Property or Licensed Intellectual Property.
(e)All SLG Intellectual Property and Licensed Intellectual Property are valid and enforceable, and all SLG IP Registrations are subsisting and in full force and effect. SLG has taken all reasonably necessary steps to maintain and enforce SLG Intellectual Property and Licensed Intellectual Property and to preserve the confidentiality of all Trade Secrets included in SLG Intellectual Property. All filings and fees related to SLG IP Registrations required to maintain their enforceability have been submitted and paid to the relevant Governmental Authorities or authorized registrars.
(f)The conduct of SLG’s business as currently and formerly conducted, including the use of SLG Intellectual Property and Licensed Intellectual Property in connection therewith, and the products, processes and services of SLG have not infringed, misappropriated or otherwise violated the Intellectual Property or other rights of any Person. To SLG’s Knowledge, no Person has infringed, misappropriated or otherwise violated any SLG Intellectual Property or Licensed Intellectual Property.
(g)Except as set forth on Section 3.12(g) of the Disclosure Schedules, there are no Actions (including any opposition, cancellation, revocation, review, or other proceeding), pending, or, to SLG’s Knowledge, threatened (including in the form of offers to obtain a license): (i) alleging any infringement, misappropriation, or other violation by SLG of the Intellectual Property of any Person; (ii) challenging the validity, enforceability, registrability, patentability, or ownership of any SLG Intellectual Property or Licensed Intellectual Property or SLG’s right, title, or interest in or to any SLG Intellectual Property or Licensed Intellectual Property; or (iii) by SLG or by the owner of any Licensed Intellectual Property against SLG alleging any infringement, misappropriation, or other violation by any Person of SLG Intellectual Property or such Licensed Intellectual Property. To SLG’s Knowledge, no circumstances exist that could reasonably be expected to give rise to any such Action. SLG is not subject to any Governmental Order that does or could reasonably be expected to restrict or impair the use of any SLG Intellectual Property or Licensed Intellectual Property.
(h)Section 3.12(h) of the Disclosure Schedules contains a correct, current, and complete list of all social media accounts used in SLG’s business. SLG has complied in all material respects with all terms of use, terms of service, and other Contracts and all associated policies and guidelines relating to its use of any social media platforms, sites, or services (collectively, “Platform Agreements”). There are no Actions, pending or, to SLG’s Knowledge, threatened, alleging any (i) breach or other violation of any Platform Agreement by SLG or (ii) defamation, violation of publicity rights of any Person, or any other violation by SLG in connection with its use of social media.
(i)All SLG IT Systems are in good working condition and are sufficient for the operation of SLG’s business as currently conducted. Except as disclosed in Section 3.12(i) of the Disclosure Schedules, in the past five (5) years, there has been no malfunction, failure, continued substandard performance, denial of service, or other cyber incident, including any cyberattack, or other impairment of SLG IT Systems that has resulted or is reasonably likely to result in disruption or damage to the business of SLG and that has not been remedied. SLG has taken commercially reasonable steps to safeguard the confidentiality, availability, security, and integrity of SLG IT Systems, including implementing and maintaining appropriate backup, disaster recovery, and Software and hardware support arrangements.
(j)SLG has complied with all applicable Laws and all internal or publicly posted policies, notices, and statements concerning the collection, use, processing, storage, transfer, and security of personal information in the conduct of SLG’s business. Except as set forth in Section 3.12(j) of the Disclosure Schedules, in the past five (5) years, SLG has not (i) experienced any data breach or other security incident involving personal information in its possession or control or (ii) been subject to or received any notice of any audit, investigation, complaint, or other Action by any Governmental Authority or other Person concerning (A) SLG’s collection, use, processing, storage, transfer, or protection of personal information or (B) violation of any applicable Law concerning privacy, data security, or data breach notification, and to SLG’s Knowledge, there are no facts or circumstances that could reasonably be expected to give rise to any such Action.
Section III.13Inventory. Subject to reserves for obsolete, damaged and unsaleable inventory reflected in the Interim Balance Sheet, all inventory of SLG, whether or not reflected in the Balance Sheet, consists of a quality and quantity usable and salable in the ordinary course of business and in the same material condition as when it acquired such inventory. Except as set forth in Section 3.13 of the Disclosure Schedules, all such inventory is owned by SLG free and clear of all Encumbrances, other than Permitted Encumbrances, and no inventory is held on a consignment basis. SLG has conducted a count of all inventory at its facilities, as of October 31, 2024, and a copy thereof has been provided to Buyer.
Section III.14Accounts Receivable. The accounts receivable reflected on the Interim Balance Sheet and the accounts receivable arising after the Interim Balance Sheet Date (a) have arisen from bona fide transactions entered into by SLG involving the sale of goods or the rendering of
services in the ordinary course of business consistent with past practice; and (b) constitute only valid, undisputed claims of SLG not subject to claims of set-off or other defenses or counterclaims other than normal cash discounts accrued in the ordinary course of business consistent with past practice. The reserve for bad debts shown on the Interim Balance Sheet or, with respect to accounts receivable arising after the Interim Balance Sheet Date, on the accounting records of SLG have been determined in accordance with GAAP, consistently applied, subject to normal year-end adjustments and the absence of disclosures normally made in footnotes.
Section III.15Customers and Suppliers.
(a)Section 3.15(a) of the Disclosure Schedules sets forth (i) each customer who has paid aggregate consideration to SLG for goods or services rendered in an amount greater than or equal to $2,000,000 for each of the two most recent fiscal years (collectively, the “Material Customers”) and (ii) the amount of consideration paid by each Material Customer during such periods. SLG has not received any written (or, to SLG’s Knowledge, oral) notice that any of its Material Customers has ceased, or intends to cease after the Closing, to use its goods or services or to otherwise terminate or materially reduce its relationship with SLG.
(b)Section 3.15(b) of the Disclosure Schedules sets forth (i) each supplier to whom SLG has paid consideration for goods or services rendered in an amount greater than or equal to $2,000,000 for each of the two most recent fiscal years (collectively, the “Material Suppliers”) and (ii) the amount of purchases from each Material Supplier during such periods. SLG has not received any notice, and has no reason to believe, that any of its Material Suppliers has ceased, or intends to cease, to supply goods or services to SLG or to otherwise terminate or materially reduce its relationship with SLG.
Section III.16Insurance. Section 3.16 of the Disclosure Schedules sets forth a true and complete list of all current policies or binders of fire, liability, product liability, umbrella liability, real and Personal Property, workers’ compensation, vehicular, directors’ and officers’ liability, fiduciary liability and other casualty and property insurance maintained by SLG relating to the assets, business, operations, employees, officers and directors of SLG (collectively, the “Insurance Policies”) and true and complete copies of the Insurance Policies have been made available to Buyer. The Insurance Policies are in full force and effect and consummation of the transactions contemplated by this Agreement will not cause a termination of any of the Insurance Policies. SLG has not received any written notice of cancellation of, premium increase with respect to, or alteration of coverage under, any of the Insurance Policies. All premiums due on the Insurance Policies have either been paid or, if due and payable prior to Closing, will be paid prior to Closing in accordance with the payment terms of each Insurance Policy. Except as set forth in Section 3.16 of the Disclosure Schedules, the Insurance Policies do not provide for any retrospective premium adjustment or other experience-based liability on the part of SLG. All Insurance Policies (a) are valid and binding in accordance with their terms, (b) are provided by carriers who, to SLG’s Knowledge, are financially solvent, and (c) have not been subject to any lapse in coverage. Except as set forth in Section 3.16 of the Disclosure Schedules, there are no claims
related to the business of SLG pending under any Insurance Policies as to which coverage has been questioned, denied or disputed or in respect of which there is an outstanding reservation of rights. SLG is not in default under, and has not otherwise failed to comply with, in any material respect, any provision contained in any Insurance Policy. The Insurance Policies are sufficient for compliance with all applicable Laws and Material Contracts.
Section I.1Legal Proceedings; Governmental Orders.
(a)Except as set forth in Section 3.17 of the Disclosure Schedules, there are no Actions pending or, to SLG’s Knowledge, threatened (a) against or by SLG or affecting any of its properties or assets (or by or against Co-op and relating to its ownership in SLG or any of Co-op’s assets used by SLG) or (b) against or by SLG, Co-op or any Affiliate of SLG that challenges or seeks to prevent, enjoin or otherwise delay the transactions contemplated by this Agreement. Except as set forth in Section 3.17 of the Disclosure Schedules, to SLG’s Knowledge, no event has occurred or circumstances exist that may give rise to, or serve as a basis for, any such Action.
(b)There are no outstanding Governmental Orders and no unsatisfied judgments, penalties or awards against or affecting SLG or any of its properties or assets. To SLG’s Knowledge, no event has occurred or circumstances exist that may constitute or result in (with or without notice or lapse of time) a violation of any such Governmental Order.
(c)Except as set forth in Section 3.17(c) of the Disclosure Schedules, SLG has fully implemented the recommendations from FTI Consulting, Inc. set forth in its “FTI Engagement Final Results” dated October 16, 2023.
Section III.17Compliance With Laws; Permits.
(a)SLG has complied in all material respects, and is now complying, with all Laws applicable to it or its business, properties or assets.
(b)All Permits required for SLG to conduct its business have been obtained by it and are valid and in full force and effect. All fees and charges with respect to such Permits as of the date hereof have been paid in full. Section 3.18(b) of the Disclosure Schedules lists all current Permits issued to SLG, including the names of the Permits and their respective dates of issuance and expiration. SLG has complied and is now complying in all material respects with the terms of all Permits listed on Section 3.18(b) of the Disclosure Schedules. To SLG’s Knowledge, no event has occurred that, with or without notice or lapse of time or both, would reasonably be expected to result in the revocation, suspension, lapse or limitation of any Permit set forth in Section 3.18(b) of the Disclosure Schedules.
Section III.18Environmental Matters.
(a)Other than as set forth in Section 3.19(a) of the Disclosure Schedules, SLG is currently and has been in compliance in all material respects with all Environmental Laws, and neither SLG nor Co-op has, received from any Person any (i) Environmental Notice or Environmental Claim or (ii) written request for information pursuant to Environmental Law, that, in each case, either remains pending or unresolved, or is the source of ongoing obligations or requirements as of the Effective Date.
(b)SLG and Co-op have obtained and are in material compliance with all Environmental Permits (each of which is disclosed in Section 3.19(b) of the Disclosure Schedules) required for the ownership, lease, operation or use of the business or assets of SLG as currently carried out (including assets subject to a facility management or similar Contract) and all such Environmental Permits are valid and in full force and effect in accordance with Environmental Law. With respect to any such Environmental Permits, SLG and Co-op have undertaken all measures necessary to facilitate transferability of the same, and neither SLG nor Co-op has received any Environmental Notice or written communication regarding any material adverse change in the status or terms and conditions of such Environmental Permits.
(c)Other than as set forth in Section 3.19(c) of the Disclosure Schedules, no real property currently or formerly owned, operated, leased or used by SLG or its predecessors is (i) subject to any continuing investigation, remediation or monitoring obligations pursuant to any Governmental Order or voluntary agreement with a Governmental Authority or (ii) listed on, or has been proposed for listing on, the National Priorities List (or CERCLIS) under CERCLA, or any similar state list.
(d)Except as set forth in Section 3.19(d) of the Disclosure Schedules, there has been no Release of Hazardous Materials in contravention of Environmental Law with respect to the business or assets of SLG or any real property currently or formerly owned, operated, leased or used by SLG (including assets subject to a facility management or similar Contract), and neither SLG nor Co-op has received an Environmental Notice that any real property currently or formerly owned, operated, leased or used in connection with the business of SLG (including soils, groundwater, wetlands, surface water, buildings and other structure located on any such real property) has been contaminated with any Hazardous Material that could reasonably be expected to result in an Environmental Claim against, or a violation of Environmental Law or term of any Environmental Permit by,
Co-op or SLG.
(e)Section 3.19(e) of the Disclosure Schedules contains a complete and accurate list of all active, abandoned or removed aboveground or underground storage tanks, oil-water separators, sump pits, impoundments or waste disposal areas owned or operated by SLG or Co-op.
(f)Section 3.19(f) of the Disclosure Schedules contains a complete and accurate list of all off-site Hazardous Materials treatment, storage, or disposal facilities or locations used by SLG or Co-op and any predecessors as to which SLG or Co-op may
retain liability, and none of these facilities or locations has been placed or proposed for placement on the National Priorities List (or CERCLIS) under CERCLA, or any similar state list, and neither Co-op nor SLG has received any Environmental Notice regarding potential liabilities with respect to such off-site Hazardous Materials treatment, storage, or disposal facilities or locations used by SLG or Co-op.
(g)Neither Co-op nor SLG has retained or assumed, by Contract or operation of Law, any liabilities or obligations of third parties, including any Governmental Authority, under Environmental Law.
(h)SLG has provided or otherwise made available to Buyer and listed in Section 3.19(h) of the Disclosure Schedules all environmental reports, studies, audits, records, sampling data, site assessments, risk assessments, economic models and other similar documents with respect to the business or assets of SLG or any real property currently or formerly owned, operated, leased or used by SLG that are in the possession or control of Co-op or SLG related to compliance with Environmental Laws, Environmental Claims or an Environmental Notice or the Release of Hazardous Materials
(i)To SLG’s Knowledge, there is no condition, event or circumstance concerning the Release or regulation of Hazardous Materials, or any active or pending investigation by any Governmental Authority, that might, after the Effective Date, prevent, impede or materially increase the costs associated with the ownership, lease, operation, performance or use of the business or assets of SLG as currently carried out.
(j)SLG owns and controls all Environmental Attributes (a complete and accurate list of which is set forth in Section 3.19(j) of the Disclosure Schedules) and except for Encumbrances granted to CoBank, SLG has not entered into any Contract or pledge to transfer, lease, license, guarantee, sell, mortgage, pledge or otherwise dispose of or encumber any Environmental Attributes as of the date hereof.
(k)There has been no Action involving a nuisance claim relating to odor, noise, stormwater, leachate, groundwater or other matters potentially affecting third parties or off-site real property.
(l)No real property owned, operated or leased by SLG is subject to any engineering controls, institutional controls, or other activity use limitations or environmental use restrictions pursuant to Environmental Laws
Section III.19Employee Benefit Matters.
(a)Section 3.20(a) of the Disclosure Schedules contains a true and complete list of each pension, benefit, retirement, compensation, employment, consulting, profit-sharing, deferred compensation, incentive, bonus, performance award, phantom equity, equity or equity-based, change in control, retention, severance, vacation, paid time off (PTO), medical, vision, dental, disability, welfare, Code Section 125 cafeteria, fringe benefit, housing, and other similar agreement, plan, policy, program or arrangement (and
any amendments thereto), in each case whether or not reduced to writing and whether funded or unfunded, including each “employee benefit plan” within the meaning of Section 3(3) of ERISA, whether or not tax-qualified and whether or not subject to ERISA, that is or has been maintained, sponsored, contributed to, or required to be contributed to by SLG in the past six (6) years for the benefit of any current or former employee, officer, director, retiree, independent contractor or consultant of SLG or any spouse or dependent of such individual, or under which SLG or any of its ERISA Affiliates has or may have any Liability, or with respect to which Buyer or any of its Affiliates would reasonably be expected to have any Liability, contingent or otherwise (as listed on Section 3.20(a) of the Disclosure Schedules, each, a “Benefit Plan”). SLG has separately identified in Section 3.20(a) of the Disclosure Schedules each Benefit Plan that contains a change in control provision.
(b)With respect to each Benefit Plan, SLG has made available to Buyer accurate, current and complete copies of each of the following: (i) where the Benefit Plan has been reduced to writing, the plan document together with all amendments; (ii) where the Benefit Plan has not been reduced to writing, a written summary of all material plan terms; (iii) where applicable, copies of any trust agreements or other funding arrangements, custodial agreements, insurance policies and contracts, administration agreements and similar agreements, and investment management or investment advisory agreements, now in effect; (iv) copies of any summary plan descriptions, summaries of material modifications, summaries of benefits and coverage, COBRA communications, employee handbooks and any other written communications (or a description of any oral communications) relating to any Benefit Plan; (v) in the case of any Benefit Plan that is intended to be qualified under Section 401(a) of the Code, a copy of the most recent determination, opinion or advisory letter from the Internal Revenue Service and any legal opinions issued thereafter with respect to such Benefit Plan’s continued qualification; (vi) in the case of any Benefit Plan for which a Form 5500 must be filed, a copy of the two most recently filed Forms 5500, with all corresponding schedules and financial statements attached; (vii) actuarial valuations and reports related to any Benefit Plans with respect to the two most recently completed plan years; (viii) the most recent nondiscrimination tests performed under the Code; and (ix) copies of material notices, letters or other correspondence from the Internal Revenue Service, U.S. Department of Labor, U.S. Department of Health and Human Services, Pension Benefit Guaranty Corporation or other Governmental Authority relating to the Benefit Plan.
(c)Each Benefit Plan and any related trust has been established, administered and maintained in accordance with its terms and in compliance with all applicable Laws (including ERISA, the Code, the Affordable Care Act and any applicable local Laws). Each Benefit Plan that is intended to be qualified within the meaning of Section 401(a) of the Code (a “Qualified Benefit Plan”) is so qualified and received a favorable and current determination letter from the Internal Revenue Service with respect to the most recent five year filing cycle, or with respect to a prototype or volume submitter plan, can rely on an opinion or advisory letter from the Internal Revenue Service to the prototype plan or volume submitter plan sponsor, to the effect that such Qualified Benefit Plan is so
qualified and that the plan and the trust related thereto are exempt from federal income taxes under Sections 401(a) and 501(a), respectively, of the Code, and nothing has occurred that could reasonably be expected to adversely affect the qualified status of any Qualified Benefit Plan. All benefits, contributions, and premiums relating to each Benefit Plan have been timely paid in accordance with the terms of such Benefit Plan and all applicable Laws and accounting principles, and all benefits accrued, under any unfunded Benefit Plan have been paid, accrued or otherwise adequately reserved to the extent required by, and in accordance with, GAAP. Nothing has occurred up to the Effective Date with respect to any Benefit Plan that has subjected or could reasonably be expected to subject SLG or any of its ERISA Affiliates or, with respect to any period on or after the Effective Date, Buyer or any of its Affiliates, to a penalty under Section 502 of ERISA or to tax or penalty under Sections 4975 or 4980H of the Code.
(d)Section 3.20(a) of the Disclosure Schedules separately identifies each Benefit Plan that is a defined benefit plan (as defined in Section 3(35) of ERISA), a “multiple employer plan” within the meaning of Section 413(c) of the Code or a “multiple employer welfare arrangement” (as defined in Section 3(40) of ERISA) or any multiemployer plan (within the meaning of Section 4001(a)(3) of ERISA), or that is subject to Section 412 of the Code or Section 302 or Title IV of ERISA. Neither SLG nor any ERISA Affiliate has incurred or could incur any actual or contingent liability under Title IV of ERISA. No event has occurred and, to SLG’s Knowledge, no condition exists, that has subjected, or would reasonably be expected to subject, SLG or any of its ERISA Affiliates to any tax, fine, lien, penalty or other liability imposed by ERISA, the Code or any other applicable Law, either directly or by reason of SLG’s affiliation with any ERISA Affiliate.
(e)Except as disclosed in Section 3.20(e) of the Disclosure Schedules, each Benefit Plan can be amended, terminated or contributions may be otherwise discontinued after the Closing in accordance with its terms, without material liabilities to Buyer, SLG or any of their Affiliates other than ordinary administrative expenses typically incurred in a termination event. SLG has no commitment or obligation and has not made any representations to any employee, officer, director, independent contractor or consultant, whether or not legally binding, to adopt, amend, modify or terminate any Benefit Plan or any collective bargaining agreement, in connection with the consummation of the transactions contemplated by this Agreement or otherwise.
(f)Other than as required under Sections 601 to 608 of ERISA or other applicable Law, no Benefit Plan provides post-termination or retiree health benefits to any individual for any reason, and neither SLG nor any of its ERISA Affiliates has any Liability to provide post-termination or retiree health benefits to any individual or ever represented, promised or contracted to any individual that such individual would be provided with post-termination or retiree health benefits.
(g)There is no pending or, to SLG’s Knowledge, threatened Action relating to a Benefit Plan (other than routine claims for benefits), and no Benefit Plan has within
the five years prior to the date hereof been the subject of an examination or audit by a Governmental Authority or the subject of an application or filing under or is a participant in, an amnesty, voluntary compliance, self-correction or similar program sponsored by any Governmental Authority.
(h)There has been no amendment to, announcement by Co-op, SLG or any of their Affiliates relating to, or change in employee participation or coverage under, any Benefit Plan or collective bargaining agreement that would increase the annual expense of maintaining such plan above the level of the expense incurred for the most recently completed fiscal year with respect to any director, officer, employee, independent contractor or consultant, as applicable. None of Co-op, SLG, nor any of their Affiliates has any commitment or obligation or has made any representations to any director, officer, employee, independent contractor or consultant, whether or not legally binding, to adopt, amend, modify or terminate any Benefit Plan or any collective bargaining agreement.
(i)Each Benefit Plan that is subject to Section 409A of the Code has been administered in compliance with its terms and the operational and documentary requirements of Section 409A of the Code and all applicable regulatory guidance (including notices, rulings and proposed and final regulations) thereunder. SLG does not have any obligation to gross up, indemnify or otherwise reimburse any individual for any excise taxes, interest or penalties incurred pursuant to Section 409A of the Code.
(j)Each individual who is classified by SLG as an independent contractor has been properly classified for purposes of participation and benefit accrual under each Benefit Plan.
(k)Neither the execution of this Agreement nor any of the transactions contemplated by this Agreement will (either alone or upon the occurrence of any additional or subsequent events): (i) entitle any current or former director, officer, employee, independent contractor or consultant of SLG to severance pay or any other payment; (ii) accelerate the time of payment, funding or vesting, or increase the amount of compensation (including stock-based compensation) due to any such individual; (iii) limit or restrict the right of SLG to merge, amend, or terminate any Benefit Plan; (iv) increase the amount payable under or result in any other material obligation pursuant to any Benefit Plan; (v) result in “excess parachute payments” within the meaning of Section 280G(b) of the Code; or (vi) require a “gross-up” or other payment to any “disqualified individual” within the meaning of Section 280G(c) of the Code. SLG has made available to Buyer true and complete copies of any Section 280G calculations prepared (whether or not final) with respect to any disqualified individual in connection with the transactions.
Section III.20Employment Matters.
(a)Section 3.21(a) of the Disclosure Schedules contains a list of all persons who are employees, independent contractors or consultants of SLG as of the date hereof,
including any employee who is on a leave of absence of any nature, paid or unpaid, authorized or unauthorized, and sets forth for each such individual the following: (i) name; (ii) title or position (including whether full-time or part-time); (iii) hire or retention date; (iv) current annual base compensation rate or contract fee; (v) commission, bonus or other incentive-based compensation; and (vi) a description of the fringe benefits provided to each such individual as of the date hereof. As of the date hereof, all compensation, including wages, commissions, bonuses, fees and other compensation, payable to all employees, independent contractors or consultants of SLG for services performed on or prior to the date hereof have been paid in full (or accrued in full on the audited balance sheet contained in the Adjusted Closing Working Capital Statement) and there are no outstanding agreements, understandings or commitments of SLG with respect to any compensation, commissions, bonuses or fees.
(b)None of the employees of SLG are represented by a labor union with respect to their employment with SLG. SLG is not, and has not been for the past ten (10) years, a party to, or bound by, any collective bargaining agreement or other Contract with a union, works council or labor organization (collectively, “Union”). No Union represents any employee or group of employees of SLG, nor has been recognized to do so. To SLG’s Knowledge, no Union or group of employees is engaged in or seeking to be engaged in collective bargaining or other union organizing activity with respect to the employees of SLG, and to SLG’s Knowledge no such activity has occurred in the past ten years. There is not pending nor has there been for the past ten (10) years, any labor strike, work slowdown, work stoppage, lockout, concerted refusal to work overtime, or other material labor dispute with respect to any group of SLG employees.
(c)Except as set forth in Section 3.21(c) of the Disclosure Schedules, SLG is not a defendant, respondent, or party to any pending Action alleging that SLG and/or any officer, director, member, employee, or agent has violated any Laws pertaining to employment and employment practices, including all Laws relating to labor relations, equal employment opportunities, fair employment practices, employment discrimination, harassment, retaliation, reasonable accommodation, disability rights or benefits, immigration, wages, hours, overtime compensation, child labor, hiring, promotion and termination of employees, working conditions, meal and break periods, privacy, health and safety, workers’ compensation, leaves of absence, and paid sick leave. SLG has no workers who are classified as independent contractors.
(d)All employees of SLG classified as exempt under the Fair Labor Standards Act and state and local wage and hour laws are properly classified. SLG has not received any claim, threatened claim, notice, or allegation in any form from any former employee or any Governmental Authority that any employee classified as exempt has been classified incorrectly as a matter of applicable Law.
(e)SLG has complied with the WARN Act;
(f)To SLG’s Knowledge, there are no Actions threatened to be brought or filed, by or with any Governmental Authority or arbitrator in connection with the
employment of any current or former applicant, employee, consultant or independent contractor of SLG, including any charge, investigation or claim relating to unfair labor practices, equal employment opportunities, fair employment practices, employment discrimination, harassment, retaliation, reasonable accommodation, disability rights or benefits, immigration, wages, hours, overtime compensation, employee classification, child labor, hiring, promotion and termination of employees, working conditions, meal and break periods, privacy, health and safety, workers’ compensation, leaves of absence, paid sick leave, or any other employment related matter arising under applicable Laws.
(g)Each employee of SLG hired after November 8, 1986, and employed in the United States, has completed and SLG has retained an Immigration and Naturalization Service Form I-9 in accordance with applicable rules and regulations. No current employee of SLG is (a) a non-immigrant employee whose status would terminate or otherwise be affected by the transaction consummated under this Agreement or (b) an alien who is authorized to work in the United States in non-immigrant status. SLG has not received notice or other communication from any Governmental Authority regarding any unresolved violation or alleged violation of any applicable Law relating to the hiring, recruiting, employing of (or continuing to employ) anyone who is not legally authorized to work in the United States.
(h)Throughout the past five (5) years, SLG has not engaged in any plant closing, mass layoff, workforce reduction or other action that has resulted or could result in liability under the WARN Act or any similar state or local Law addressing advance notice of any plant closing, mass layoff, or workforce reduction and has not issued any notice that any such action is to occur in the future. SLG does not have any current plans to engage in a plant closing, mass layoff, or other action requiring the issuance of any notice pursuant to any applicable federal or state WARN Act within ninety (90) days after the execution of this Agreement.
(i)With respect to each Government Contract, SLG is and has been in compliance in all material respects with all applicable Contract requirements relating to workers, including state and federal executive orders such as Executive Order No. 11246 of 1965 (“E.O. 11246”), Section 503 of the Rehabilitation Act of 1973 (“Section 503”) and the Vietnam Era Veterans’ Readjustment Assistance Act of 1974 (“VEVRAA”), including all implementing regulations. SLG maintains and complies with affirmative action plans in compliance with E.O. 11246, Section 503 and VEVRAA, including all implementing regulations. SLG is not, and has not been for the past five years, the subject of any audit, investigation or enforcement Action by any Governmental Authority in connection with any Government Contract or related compliance with any applicable Contract requirements relating to workers, including all state and federal executive orders, E.O. 11246, Section 503 or VEVRAA. SLG has not been debarred, suspended or otherwise made ineligible from doing business with the United States government or any government contractor. SLG is in compliance with and has complied with all immigration laws, including any applicable mandatory E-Verify obligations.
Section III.21Taxes.
(a)All Tax Returns required to be filed on or before the Effective Date by SLG have been, or will be, timely filed. Such Tax Returns are, or will be, true, complete and correct in all respects. All Taxes due and owing by SLG (whether or not shown on any Tax Return) have been, or will be, timely paid.
(b)SLG has withheld and paid each Tax required to have been withheld and paid in connection with amounts paid or owing to any employee, independent contractor, creditor, customer, shareholder or other party, and complied with all information reporting and backup withholding provisions of applicable Law.
(c)No claim has been made by any taxing authority in any jurisdiction where SLG does not file Tax Returns that it is, or may be, subject to Tax by that jurisdiction.
(d)No extensions or waivers of statutes of limitations have been given or requested with respect to any Taxes of SLG.
(e)The amount of SLG’s Liability for unpaid Taxes for all periods ending on or before the Interim Balance Sheet Date does not, in the aggregate, exceed the amount of accruals for Taxes (excluding reserves for deferred Taxes) reflected on the Financial Statements. The amount of SLG’s Liability for unpaid Taxes for all periods following the end of the recent period covered by the Financial Statements will not, in the aggregate, exceed the amount of accruals for Taxes (excluding reserves for deferred Taxes) as adjusted for the passage of time in accordance with the past custom and practice of SLG (and which accruals shall not exceed comparable amounts incurred in similar periods in prior years).
(f)Section 3.22(f) of the Disclosure Schedules sets forth:
(i)the taxable years of SLG as to which the applicable statutes of limitations on the assessment and collection of Taxes have not expired;
(ii)those years for which examinations by the taxing authorities have been completed; and
(iii)those taxable years for which examinations by taxing authorities are presently being conducted.
(g)All deficiencies asserted, or assessments made, against SLG as a result of any examinations by any taxing authority have been fully paid.
(h)SLG is not a party to any Action by any taxing authority. There are no pending or threatened Actions by any taxing authority.
(i)SLG has delivered to Buyer copies of all federal, state, local and foreign income, franchise and similar Tax Returns, examination reports, and statements of
deficiencies assessed against, or agreed to by, SLG for all Tax periods ending after December 31, 2019.
(j)There are no Encumbrances for Taxes (other than for current Taxes not yet due and payable) upon the assets of SLG.
(k)SLG is not a party to, or bound by, any Tax indemnity, Tax sharing or Tax allocation agreement.
(l)No private letter rulings, technical advice memoranda or similar agreement or rulings have been requested, entered into or issued by any taxing authority with respect to SLG.
(m)SLG has not been a member of an affiliated, combined, consolidated or unitary Tax group for Tax purposes. SLG has no Liability for Taxes of any Person (other than SLG) under Treasury Regulations Section 1.1502-6 (or any corresponding provision of state, local or foreign Law), as transferee or successor, by contract or otherwise.
(n)SLG is not, and has not been, a party to, or a promoter of, a “reportable transaction” within the meaning of Section 6707A(c)(1) of the Code and Treasury Regulations Section 1.6011-4(b).
(o)No property owned by SLG is (i) required to be treated as being owned by another person pursuant to the so-called “safe harbor lease” provisions of former Section 168(f)(8) of the Internal Revenue Code of 1954, as amended, (ii) subject to Section 168(g)(1)(A) of the Code, or (iii) subject to a disqualified leaseback or long-term agreement as defined in Section 467 of the Code.
(p)SLG is, and since the date of its formation has been, treated as a partnership for U.S. federal and other applicable income Tax purposes. SLG does not presently have any liability on account of an “imputed underpayment” of Taxes within the meaning of Section 6225 of the Code.
(q)ADM has delivered to SLG a duly completed and executed IRS Form W-9 certifying that ADM is not (i) a foreign person within the meaning of Code Section 1445 or 1446(f) or (ii) subject to U.S. backup withholding.
Section III.22CARES Act. (a) Except as set forth in Section 3.23(a) of the Disclosure Schedules, SLG has not (1) received any funds or granted or incurred any Indebtedness, (2) deferred any payroll Taxes or other obligations or (3) availed itself of any of the other Tax deferral or credits or other benefits, in each case, pursuant to the CARES Act and COVID Relief Programs and (b) no officer or executive of SLG is currently subject to the compensation restrictions set forth in Section 4004 of the CARES Act and COVID Relief Programs (or any similar provision of applicable Law).
Section III.23Books and Records. The minute books and ownership record books of SLG, all of which have been made available to Buyer, are complete and correct in all material respects and have been maintained in accordance with sound business practices. To SLG’s Knowledge, the minute books of SLG contain accurate and complete records of all material meetings, and actions taken by written consent of, the members, the board of directors and any committees of the board of directors of SLG, and no meeting, or action taken by written consent, of any such members, board of directors or committee has been held for which minutes have not been prepared and are not contained in such minute books. At the Closing, all of those books and records will be in the possession of SLG.
Section III.24Related Party Transactions. Except as set forth on Section 3.25 of the Disclosure Schedules, there are no Contracts or other arrangements involving SLG in which SLG, Co-op, their respective Affiliates, or any of its or their respective directors, or officers, or any immediate family members thereof is a party, has a financial interest, or otherwise owns or leases any material asset, property, or right which is used by SLG.
Section III.25Brokers. Except for SLG’s obligations to Ascendant Partners, Inc., no broker, finder or investment banker is entitled to any brokerage, finder’s or other fee or commission in connection with the transactions contemplated by this Agreement or any Ancillary Document based upon arrangements made by or on behalf of SLG or Co-op.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to SLG and Co-op that the statements contained in this ARTICLE IV are true and correct as of the Effective Date.
Section IV.1Organization and Authority of Buyer. Buyer is a corporation duly organized, validly existing and in good standing under the Laws of the state of Ohio. Buyer has full corporate power and authority to enter into this Agreement and the Ancillary Documents to which Buyer is or will be a party, to carry out its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby. The execution and delivery by Buyer of this Agreement and any Ancillary Document to which Buyer is or will be a party, the performance by Buyer of its obligations hereunder and thereunder and the consummation by Buyer of the transactions contemplated hereby and thereby have been duly authorized by all requisite corporate action on the part of Buyer. This Agreement has been duly executed and delivered by Buyer, and (assuming due authorization, execution and delivery by SLG and Co-op) this Agreement constitutes a legal, valid and binding obligation of Buyer enforceable against Buyer in accordance with its terms, except as such enforceability may be limited by the Equitable Exceptions. When each Ancillary Document to which Buyer is or will be a party has been duly executed and delivered by Buyer (assuming due authorization, execution and delivery by each other party thereto), such Ancillary Document will constitute a legal, valid and binding obligation of Buyer enforceable against it in accordance with its terms, except as such enforceability may be limited by the Equitable Exceptions.
Section IV.2No Conflicts; Consents. The execution, delivery and performance by Buyer of this Agreement and the Ancillary Documents to which it is or will be a party, and the consummation of the transactions contemplated hereby and thereby, do not and will not: (a) result in a
violation or breach of, or default under, any provision of the Organizational Documents of Buyer; (b) result in a violation or breach of any provision of any Law or Governmental Order applicable to Buyer; or (c) require the consent, notice or other action by any Person under, or result in a violation or breach of or constitute a default under, any Contract to which Buyer is a party the result of which would interfere with, preclude or have a material adverse effect upon the transactions contemplated by this Agreement. No consent, approval, Permit, Governmental Order, declaration or filing with, or notice to, any Governmental Authority is required by or with respect to Buyer in connection with the execution and delivery of this Agreement and the Ancillary Documents to which Buyer is or will be a party and the consummation of the transactions contemplated hereby and thereby.
Section IV.3Investment Purpose. Buyer is acquiring the Purchased Interest solely for its own account for investment purposes and not with a view to, or for offer or sale in connection with, any distribution thereof. Buyer acknowledges that the Purchased Interest is not registered under the Securities Act of 1933, as amended, or any state securities laws, and that the Purchased Interest may not be transferred or sold except pursuant to the registration provisions of the Securities Act of 1933, as amended or pursuant to an applicable exemption therefrom and subject to state securities laws and regulations, as applicable.
Section IV.4Brokers. No broker, finder or investment banker is entitled to any brokerage, finder’s or other fee or commission in connection with the transactions contemplated by this Agreement or any Ancillary Document based upon arrangements made by or on behalf of Buyer.
Section IV.5Sufficiency of Funds. Buyer has sufficient cash on hand or other sources of immediately available funds to enable it to make payment of the Purchase Price (including any adjustment amounts that may become payable by Buyer under Section 2.03) and consummate the transactions contemplated by this Agreement.
Section IV.6Legal Proceedings. There are no Actions pending or, to Buyer’s Knowledge, threatened against or by Buyer or any Affiliate of Buyer that challenge or seek to prevent, enjoin or otherwise delay the transactions contemplated by this Agreement. No event has occurred or circumstances exist that may give rise or serve as a basis for any such Action.
Section IV.7Non-Reliance. Buyer acknowledges that it and its Representatives have been permitted full and complete access to the books and records, facilities, equipment, Tax Returns, Contracts, and other properties and assets of SLG, that Buyer and its Representatives have desired or requested to see or review, and that Buyer and its Representatives have had a full opportunity to meet with the officers and directors of SLG to discuss SLG’s business. In entering into this Agreement, Buyer has relied solely upon its own investigation and analysis and SLG’s and Co-op’s representations and warranties set forth in this Agreement, and without limiting the foregoing, Buyer has not relied on any other representation or warranty (except for SLG’s and Co-op’s representations and warranties made in this Agreement). Buyer acknowledges that, except for the representations and warranties contained in this Agreement, it has not relied on any other express or implied representation or warranty or other statement made by or on behalf of SLG, Co-op or any of their respective Affiliates.
Section IV.8Accredited Investor Status. Buyer is an “accredited investor,” as defined in Rule 501 of Regulation D promulgated under the Securities Act. Buyer agrees to furnish any additional information requested by SLG to assure compliance with applicable U.S. federal and state securities laws in connection with the purchase and sale of the Purchased Interest.
ARTICLE V
COVENANTS
Section V.1Public Announcements. Unless otherwise required by applicable Law or stock exchange requirements (based upon the reasonable advice of counsel), no Party will make any public announcements in respect of this Agreement or the transactions contemplated hereby or otherwise communicate with any news media without the prior written consent of the other Party (which consent shall not be unreasonably withheld, conditioned or delayed), and the Parties shall cooperate as to the timing and contents of any such announcement.
Section V.2Further Assurances. Following the Closing, each of the Parties shall, and shall cause their respective Affiliates to, execute and deliver such additional documents, instruments, conveyances and assurances and take such further actions as may be reasonably required to carry out the provisions hereof and give effect to the transactions contemplated by this Agreement.
Section V.3Cron Lawsuit. Notwithstanding anything in Section 6.05 of the ADM Redemption Agreement, from and after the Closing Date, Co-op will reimburse SLG on a monthly basis for all third-party costs and expenses actually incurred by SLG in obtaining, collecting on and/or enforcing any judgement or settlement and negotiating, documenting, collecting or enforcing settlement of the Cron Lawsuit (as that term is defined in the ADM Redemption Agreement). SLG shall promptly pay to Co-op any amounts received by SLG from settlement, judgment, or otherwise related to or arising out of the Cron Lawsuit.
Section V.4Termination of Management and Personnel Services Agreement. The term “Management and Personnel Services Agreement” means and refers to the Management and Personnel Services Agreement, dated January 1, 2006, between SLG (as successor to United Prairie Ag, LLC) and Co-op (as successor to Cropland Co-op, Inc.). SLG and Co-op agree that as of the Effective Date the Management Agreement and Personnel Services Agreement will be terminated and be of no further force and effect and SLG and Co-op will have no further rights, duties, responsibilities or obligations under the Management and Personnel Services Agreement. SLG and Co-op hereby irrevocably and unconditionally release, cancel, and forever discharge the other Party, and each of the other Party’s current, former and future managers, members, shareholders, officers, directors, employees, subsidiaries, affiliates, agents, representatives, assigns and successors (collectively, the “Released Parties”), from all claims, complaints, causes of action, demands, damages, obligations, liabilities, losses, promises, agreements, controversies, penalties, expenses, and executions of any kind or nature whatsoever, whether known or unknown, actual or potential, whether arising in law or in equity in respect of the Management and Personnel Services Agreement (collectively, “Claims”), which such
releasing Party may have, may have had, or may in the future obtain, against the Released Parties. Co-op hereby represents and warrants to SLG that: (i) Co-op does not have any Claims under the Management and Personnel Services Agreement; and (ii) following the termination of the Management and Personnel Services Agreement, all fees and other consideration due and payable to Co-op thereunder will have been paid in full and Co-op has no right to receive, and SLG will have no obligation to pay, any further payments under the Management and Personnel Services Agreement.
Section V.5Hansen-Mueller Facilities. From and after the Closing, SLG and Co-op will use commercially reasonable efforts to enter into and close the sale by Co-op to SLG of the following locations owned by Co-op in Kansas: Sublette (North), 1182 Road Q, Hugoton, KS 67951; Hugoton (North), 19829 Road T, Kismet, KS 67895; and Kismet, 1320 Road 0, Sublette, KS 67877, which are currently leased by Co-op to SLG pursuant to a Lease Agreement dated June 7, 2021. The purchase price for such sale would be $14,710,000. The Parties contemplate that the form of the purchase agreement for the transaction contemplated by this Section 5.05 will be as set forth in Exhibit D.
ARTICLE VI
INDEMNIFICATION
Section VI.1Survival. Subject to the limitations and other provisions of this Agreement, the representations and warranties contained herein shall survive the Closing and shall remain in full force and effect until the date that is eighteen (18) months from the Effective Date; provided, that the Fundamental Representations shall survive for the applicable statute of limitations. All covenants and agreements of the Parties contained herein shall survive the Closing for the longer of the applicable statute of limitations or the period explicitly specified therein. Notwithstanding the foregoing, any claims asserted in good faith with reasonable specificity (to the extent known at such time) and in writing by notice from a Party to the other Party or Parties, as the case may be, prior to the expiration date of the applicable survival period shall not thereafter be barred by the expiration of the relevant representation or warranty and such claims shall survive until finally resolved by written agreement of the Parties, a final order of a court of competent jurisdiction or abandonment by the Party giving such notice. The Party giving such notice shall diligently pursue resolution of such claims.
Section VI.2Indemnification by SLG and Co-op. Subject to the other terms and conditions of this ARTICLE VI, including Section 6.05, from and after Closing, SLG and Co-op shall jointly and severally indemnify and defend each of Buyer and its Affiliates and their respective Representatives (collectively, the “Buyer Indemnitees”) against, and shall hold each of them harmless from and against, and shall pay and reimburse each of them for, any and all Losses incurred or sustained by, or imposed upon, the Buyer Indemnitees based upon, arising out of, with respect to or by reason of:
(a)any inaccuracy in or breach of any of the representations or warranties of SLG or Co-op contained in this Agreement;
(b)any breach or non-fulfillment of any covenant, agreement or obligation to be performed by SLG or Co-op pursuant to this Agreement, including the obligation of
Co-op to pay Transaction Expenses pursuant to Section 9.01;
(a)any failure by SLG to hold all SPCCs in compliance with Laws; and
(b)all matters relating to, arising out of, or in connection with (1) the Action (and any related or follow on Action) titled Belle Lopez vs. Skyland Grain, L.L.C., filed in the US. District Court for the District of Kansas, (2) any Action directly or indirectly relating to, arising out of, or in connection with, in whole or in part, the acts alleged in item (1) above or the data breach outlined in the Mandiant Investigation Summary dated June 3, 2024.
Section VI.3Indemnification by Buyer. Subject to the other terms and conditions of this ARTICLE VI, from and after Closing, Buyer shall indemnify and defend each of SLG and Co-op and their respective Affiliates and their respective Representatives (collectively, the “SLG Indemnitees”) against, and shall hold each of them harmless from and against, and shall pay and reimburse each of them for, any and all Losses incurred or sustained by, or imposed upon, SLG Indemnitees based upon, arising out of, with respect to or by reason of:
(a)any inaccuracy in or breach of any of the representations or warranties of Buyer contained in this Agreement; or
(b)any breach or non-fulfillment of any covenant, agreement or obligation to be performed by Buyer pursuant to this Agreement.
Section VI.4Tax Indemnification. Except to the extent treated as a liability in the calculation of Adjusted Closing Working Capital, from and after Closing, Co-op shall indemnify SLG, Buyer, and each Buyer Indemnitee and hold them harmless from and against: (a) any Loss attributable to any breach of or inaccuracy in any representation or warranty made in Section 3.23; (b) all Taxes of SLG or relating to the business of SLG for all Pre-Closing Tax Periods, including, for the avoidance of doubt, the portion of any Straddle Period ending on the Effective Date determined in accordance with Section 7.02 (including, for this purpose, any “imputed underpayment” within the meaning of Section 6225 of the Code (or any similar or corresponding provision of state, local or foreign Law) paid or payable by SLG relating or attributable to a Pre-Closing Tax Period); (c) all Taxes of any member of an affiliated, consolidated, combined or unitary group of which SLG (or any predecessor of SLG) is or was a member on or prior to the Effective Date by reason of a liability under Treasury Regulation Section 1.1502-6 or any comparable provisions of foreign, state or local Law; (d) any and all Taxes of any Person imposed on SLG arising under the principles of transferee or successor liability or by Contract, relating to an event or transaction occurring on or before the Effective Date; and (e) any out-of-pocket fees and expenses (including reasonable attorneys’ and accountants’ fees) incurred in connection therewith. In each of the above cases, Co-op shall reimburse Buyer for any Taxes of SLG that are the responsibility of Co-op pursuant to this Section 6.04 within ten (10) Business Days after the later of (a) a final determination that a Tax is payable by Buyer or SLG and the
actual payment thereof or (b) written demand for payment given by Buyer to Co-op. The aggregate amount of all Losses for which Co-op shall be liable under this Section 6.04 shall not exceed the Purchase Price.
Section VI.5Certain Limitations. The party making a claim under this ARTICLE VI is referred to as the “Indemnified Party”, and the party against whom such claims are asserted under this Article VI is referred to as the “Indemnifying Party”. The indemnification provided for in Section 6.02 and Section 6.03 shall be subject to the following limitations:
(a)The Indemnifying Party shall not be liable to the Indemnified Party for indemnification under Section 6.02(a) or Section 6.03(a), as the case may be, until the aggregate amount of all Losses in respect of indemnification under Section 6.02(a) or Section 6.03(a), as applicable, exceeds three hundred thousand dollars ($300,000) (the “Deductible”), in which event the Indemnifying Party shall only be required to pay or be liable for Losses in excess of the Deductible.
(b)The aggregate amount of all Losses for which an Indemnifying Party shall be liable pursuant to Section 6.02(a) or Section 6.03(a) as the case may be, shall not exceed ten million dollars ($10,000,000).
(c)Notwithstanding the foregoing, the limitations set forth in Section 6.05(a) and Section 6.05(b) shall not apply to Losses based upon, arising out of, with respect to or by reason of any inaccuracy in or breach by SLG of any of the SLG Fundamental Representations, by Co-op of any of the Co-op Fundamental Representations or by Buyer of any of the Buyer Fundamental Representation, as the case may be.
(d)For purposes of this ARTICLE VI (including for purposes of determining the existence of any inaccuracy in, or breach of, any representation or warranty and for calculating the amount of any Loss with respect thereto), any inaccuracy in or breach of any representation or warranty will be determined without regard to any materiality, Material Adverse Effect or other similar qualification contained in or otherwise applicable to such representation or warranty.
(e)Payments by an Indemnifying Party pursuant to Section 6.02, Section 6.03, 6.04 or ARTICLE VI in respect of any Loss shall be limited to the amount of any liability or damage that remains after deducting therefrom any insurance proceeds and any indemnity, contribution or other similar payment received by the Indemnified Party in respect of any such claim.
(f)Each Indemnified Party shall take all steps required by applicable Law to mitigate any Loss.
Section VI.6Indemnification Procedures.
(a)If any Indemnified Party receives notice of the assertion or commencement of any action, suit, claim or other legal proceeding made or brought by any Person who is not a party to this Agreement or an Affiliate of a party to this Agreement or a Representative of the foregoing (a “Third-Party Claim”) against such
Indemnified Party with respect to which the Indemnifying Party is obligated to provide indemnification under this Agreement, the Indemnified Party shall give the Indemnifying Party prompt written notice thereof. The failure to give such prompt written notice shall not, however, relieve the Indemnifying Party of its indemnification obligations, except and only to the extent that the Indemnifying Party forfeits rights or defenses by reason of such failure. Such notice by the Indemnified Party shall describe the Third-Party Claim in reasonable detail, shall include copies of all material written evidence thereof and shall indicate the estimated amount, if reasonably practicable, of the Loss that has been or may be sustained by the Indemnified Party. The Indemnifying Party shall have the right to participate in, or by giving written notice to the Indemnified Party, to assume the defense of any Third-Party Claim at the Indemnifying Party’s expense and by the Indemnifying Party’s own counsel, and the Indemnified Party shall cooperate in good faith in such defense. In the event that the Indemnifying Party assumes the defense of any Third-Party Claim, subject to Section 6.06(b), it shall have the right to take such action as it deems necessary to avoid, dispute, defend, appeal or make counterclaims pertaining to any such Third-Party Claim in the name and on behalf of the Indemnified Party. The Indemnified Party shall have the right, at its own cost and expense, to participate in the defense of any Third-Party Claim with counsel selected by it subject to the Indemnifying Party’s right to control the defense thereof. If the Indemnifying Party elects not to compromise or defend such Third-Party Claim or fails to promptly notify the Indemnified Party in writing of its election to defend as provided in this Agreement, the Indemnified Party may, subject to Section 6.05(b), pay, compromise, defend such Third-Party Claim and seek indemnification for any and all Losses based upon, arising from or relating to such Third-Party Claim. SLG and Buyer shall cooperate with each other in all reasonable respects in connection with the defense of any Third-Party Claim, including making available records relating to such Third-Party Claim and furnishing, without expense (other than reimbursement of actual out-of-pocket expenses) to the defending party, management employees of the non-defending party as may be reasonably necessary for the preparation of the defense of such Third-Party Claim.
(b)Notwithstanding any other provision of this Agreement, the Indemnifying Party shall not enter into settlement of any Third-Party Claim without the prior written consent of the Indemnified Party (which consent shall not be unreasonably withheld, conditioned or delayed), except as provided in this Section 6.05(b). If a firm offer is made to settle a Third-Party Claim without leading to liability or the creation of a financial or other obligation on the part of the Indemnified Party and provides, in customary form, for the unconditional release of each Indemnified Party from all liabilities and obligations in connection with such Third-Party Claim and the Indemnifying Party desires to accept and agree to such offer, the Indemnifying Party shall give written notice to that effect to the Indemnified Party. If the Indemnified Party fails to consent to such firm offer within ten (10) days after its receipt of such notice, the Indemnified Party may continue to contest or defend such Third-Party Claim and in such event, the maximum liability of the Indemnifying Party as to such Third-Party Claim shall not exceed the amount of such settlement offer. If the Indemnified Party fails to consent to such firm offer and also fails to assume defense of such Third-Party Claim, the Indemnifying Party may settle the
Third-Party Claim upon the terms set forth in such firm offer to settle such Third-Party Claim. If the Indemnified Party has assumed the defense pursuant to Section 6.06(a), it shall not agree to any settlement without the written consent of the Indemnifying Party (which consent shall not be unreasonably withheld, conditioned or delayed).
(c)Any claim by an Indemnified Party on account of a Loss which does not result from a Third-Party Claim (a “Direct Claim”) shall be asserted by the Indemnified Party giving the Indemnifying Party prompt written notice thereof. The failure to give such prompt written notice shall not, however, relieve the Indemnifying Party of its indemnification obligations, except and only to the extent that the Indemnifying Party forfeits rights or defenses by reason of such failure. Such notice by the Indemnified Party shall describe the Direct Claim in reasonable detail, shall include copies of all material written evidence thereof and shall indicate the estimated amount, if reasonably practicable, of the Loss that has been or may be sustained by the Indemnified Party. The Indemnifying Party shall have thirty (30) days after its receipt of such notice to respond in writing to such Direct Claim. During such 30-day period, the Indemnified Party shall allow the Indemnifying Party and its professional advisors to investigate the matter or circumstance alleged to give rise to the Direct Claim, and whether and to what extent any amount is payable in respect of the Direct Claim and the Indemnified Party shall assist the Indemnifying Party’s investigation by giving such information and assistance as the Indemnifying Party or any of its professional advisors may reasonably request. If the Indemnifying Party does not so respond within such 30-day period, the Indemnifying Party shall be deemed to have rejected such claim, in which case the Indemnified Party shall be free to pursue such remedies as may be available to the Indemnified Party on the terms and subject to the provisions of this Agreement.
Section VI.7Tax Treatment of Indemnification Payments. All indemnification payments made under this Agreement shall be treated by the Parties as an adjustment to the Purchase Price for Tax purposes, unless otherwise required by Law.
Section VI.8Effect of Investigation. The representations, warranties and covenants of the Indemnifying Party, and the Indemnified Party's right to indemnification with respect thereto, will not be affected or deemed waived by reason of any investigation made by or on behalf of the Indemnified Party (including by any of its Representatives) or by reason of the fact that the Indemnified Party or any of its Representatives knew or should have known that any such representation or warranty is, was or might be inaccurate or by reason of the Indemnified Party's waiver of any condition set forth in Section 6.02 or Section 6.03, as the case may be.
Section VI.9Setoff. In addition to any rights and remedies Buyer has hereunder, at law or in equity, if Co-op fails to pay when due any amount owed under this Agreement to Buyer, Buyer may in its sole and complete discretion (and without regard to the terms or restrictions in the Amended and Restated Operating Agreement, which terms and restrictions the Parties hereby waive) satisfy all or any portion of the amount owed by setoff against
Co-op’s membership interest in SLG (including the withholding and payment of any distributions otherwise payable by SLG to Co-op). For purposes of this Section 6.09, the
valuation of Co-op’s membership interest will be equal to the Fair Market Value of the membership interest. The exercise of any setoff right in good faith, whether or not ultimately determined to be proper, will not constitute a breach or an event of default of this Agreement or any other agreement.
Section VI.10Exclusive Remedies. Subject to and except for Section 9.12, the Parties acknowledge and agree that from and after Closing their sole and exclusive remedy with respect to any and all claims (other than claims of Fraud against a Party hereto committing Fraud) for any breach of any representation, warranty, covenant, agreement or obligation set forth herein or otherwise relating to the subject matter of this Agreement, shall be pursuant to the indemnification provisions set forth in this ARTICLE VI. In furtherance of the foregoing, each Party hereby waives, from and after Closing, to the fullest extent permitted under Law, any and all rights, claims and causes of action for any breach of any representation, warranty, covenant, agreement or obligation set forth herein or otherwise relating to the subject matter of this Agreement it may have against the other Parties arising under or based upon any Law, except pursuant to Section 9.12 or the indemnification provisions set forth in this Article VI. Nothing in this Agreement shall limit any Person’s right to (i) seek and obtain any equitable relief to which any Person shall be entitled pursuant to Section 9.12 or (ii) pursue a claim of Fraud.
ARTICLE VII
ENVIRONMENTAL INDEMNITY
Section VII.1Environmental Indemnification.
(a)Co-op covenants and agrees, at its sole cost and expense, to unconditionally indemnify, defend, protect, save and defend and hold harmless the Buyer Indemnitees against and from any and all Environmental Damages that may at any time be imposed upon, threatened against, incurred by or asserted or awarded against SLG or any Buyer Indemnitee arising directly or indirectly from or out of:
(i)SLG’s or Co-op’s failure to comply with any of the obligations and provisions of this ARTICLE VII or for any breach of the representations and warranties in Section 3.19 to the extent related to the Fuels Business;
(ii)the presence, exacerbation, Release or threatened Release of Hazardous Materials in violation of Environmental Law at, on, in, under, affecting or migrating or threatening to migrate to or from all or any portion of the Fuels Business;
(iii)the failure to conduct the investigation, remediation, monitoring and reporting that is required by a Governmental Authority to comply with Environmental Law and corresponding Environmental Permits and orders relating to the Fuels Business;
(iv)any violation of, or noncompliance with, or alleged violation of, or noncompliance with, Environmental Law, including any Environmental Permits,
orders or requirements in connection with conditions associated with the Fuels Business;
(v)the willful misconduct, error or omission or negligent act or omission of SLG or Co-op, or their agents, employees or contractors in connection with the operation of the Fuels Business;
(vi)any cost, fee, deposit or premium associated with applying for, enrolling in, and completing any available environmental fund or insurance program for the environmental equipment and tanks at or Hazardous Materials impacting the Fuels Business;
(vii)any judgment, Encumbrance, order, complaint, claim, penalty, fee, fine, deposit, premium, notice, citation, action, proceeding or investigation pending or threatened by or before any Governmental Authority or any private party litigant, including any environmental regulatory body, or before any court of law (including any private civil litigation) with respect to the Fuels Business, in connection with any Hazardous Materials, or any Environmental Law, including any Encumbrance existing or arising pursuant to any Environmental Law;
(viii)the enforcement of this Agreement or the assertion by SLG or Co-op of any defense to their obligations hereunder.
(b)Buyer may demand SLG and Co-op pay and the right to require SLG and Co-op to comply with and satisfy their obligations and liabilities under this Agreement, and may proceed against SLG or Co-op with respect thereto, without being required to attempt recovery first from any other Person, or resort to any other means of obtaining payment of the Environmental Damages. Any such demand may be made at any time coincident with or after the time for payment of any of the Environmental Damages. No liability or obligation of SLG or Co-op hereunder will be reduced, discharged or released because or by reason of any existing or future offset, claim or defense of any other Person, against Buyer or against payment of the Environmental Damages, except as otherwise stated within this Agreement.
(c)Promptly after the receipt by Buyer of written notice of any demand or claim or the commencement of any Action concerning Buyer, SLG or Co-op in connection with the Fuels Business, Buyer will notify SLG and Co-op in writing thereof. The failure by Buyer promptly to give such notice will not relieve SLG or Co-op of any liability to Buyer hereunder.
(d)Upon prior written notice to SLG and Co-op, Buyer may, at the expense of SLG and Co-op (which expense will be included in Environmental Damages), employ separate counsel in any such action and participate in the defense thereof. If SLG or Co-op fail to discharge or undertake to defend Buyer against any Environmental Damages, Buyer may, at its reasonable option and election, defend or settle such Environmental Damages. The liability of SLG or Co-op to Buyer hereunder will be conclusively
established by such settlement, provided such settlement is made in good faith, and the amount of such liability includes both the settlement consideration and the actual and reasonable costs and expenses, including attorneys’ fees and disbursements, incurred by Buyer or any Buyer Indemnitee in effecting such settlement. In such event, such settlement consideration, costs and expenses will be included in Environmental Damages and SLG or Co-op will pay the same as provided herein. Buyer’s good faith in any such settlement will be conclusively established if the settlement is made on the advice of independent legal counsel for Buyer.
(e)SLG and Co-op will not, without the prior written consent of Buyer, which consent will not be unreasonably withheld, conditioned or delayed: (i) settle or compromise any Action or consent to the entry of any judgment that does not include as an unconditional term thereof the delivery by the claimant or plaintiff to Buyer and SLG of a full and complete written release of all applicable Buyer Indemnitees and SLG (in form, scope and substance satisfactory to Buyer in its reasonable discretion) from all liability in respect of such Action and a dismissal with prejudice of such Action; or (ii) settle or compromise any Action in any manner that may adversely affect Buyer or SLG or obligate Buyer or SLG to pay any sum or perform any obligation as determined by Buyer in its reasonable discretion.
Section VII.2Section 7.02 Indemnification Procedures. The indemnification procedures for Third-Party Claims and Direct Claims as set forth in Section 7.06 apply to this ARTICLE VII. The term “Environmental Damages” is to be interpreted as interchangeable with “Loss” in this Agreement solely for establishing indemnification procedures.
Section VII.3Survival. The obligations and liabilities of SLG and Co-op under this ARTICLE VII will survive five (5) years after the Effective Date; provided, however, if the Fuels Business is still owned or operated by SLG on such five (5) year anniversary, then the obligations and liabilities of SLG and Co-op under this ARTICLE VII will survive until ten (10) years after the Effective Date. The aggregate amount of all Losses for which SLG and Co-op shall be liable under this ARTICLE VII shall not exceed the Purchase Price.
ARTICLE VIII
TAX MATTERS
Section VIII.1Transfer Taxes. All real property transfer, sales, use, documentary stamp, registration and other similar Taxes, if any, arising from the transactions contemplated hereby (collectively, “Transfer Taxes”) will be borne by Co-op. Each of the Parties required to file any Tax Returns and other filings relating to any such Transfer Taxes will prepare and file such Tax Returns and other filings, and the other Party will reasonably cooperate, as and to the extent requested by such Party, with respect to the preparation and filing of such Tax Returns and other filings. Buyer, Co-op and their Affiliates will cooperate in good faith to minimize, to the extent permissible under applicable Law, the amount of any such Transfer Taxes.
Section VIII.2Certain Tax Elections.
(a)Buyer, Co-op and each of their respective Affiliates will cause (A) SLG (and any partnership or other pass-through entity in which SLG holds a beneficial interest) to make (or otherwise have in place) a Section 754 election on its U.S. federal income Tax Return (and any similar election on any applicable state or local income Tax Return) that would be in effect for the Tax period that includes the Effective Date and (B) the income, gains, losses, deductions, credits and other Tax items of SLG (and any partnership or other pass-through entity in which SLG holds a beneficial interest) to be allocated among Buyer (or its Affiliates, as applicable), ADM and Co-op using the “interim closing of the books” method within the meaning of Section 706(d)(1) of the Code and the Treasury Regulations promulgated thereunder (and any similar provision of applicable state or local Tax Law) as of the end of the Effective Date (using the calendar day convention), and for such purpose, the taxable period of any partnership or other pass-through entity in which SLG holds a beneficial interest will be deemed to terminate at such time.
(b)If any audit, litigation or other proceeding with respect to Taxes of SLG for any Pre-Closing Tax Period results in an “imputed underpayment” under Section 6225 of the Code (or any similar or corresponding liability or provision of state or local Tax Law), Buyer, Co-op and each of their respective Affiliates shall cause SLG to make a “push out” election under Section 6226(a) of the Code (and any similar election under state or local Tax Law, if applicable) with respect to such underpayment; provided, however, that the failure to make any such election will not eliminate or reduce the obligations of Co-op pursuant to this Agreement (including ARTICLE VI).
Section VIII.3Straddle Periods. For all purposes of this Agreement, in the case of any Tax period that includes, but does not end on, the Effective Date (a “Straddle Period”), the amount of any Taxes of SLG (and any partnership or other pass-through entity in which SLG holds a beneficial interest) attributable to the portion of such Tax period ending on and including the Effective Date will be determined as follows:
(a)In respect of Taxes not based upon or measured by income, gains, sales, transactions, activities, or events, the amount of any Taxes that are attributable to the portion of such Straddle Period ending on and including the Effective Date will be deemed to be the amount of such Taxes for the entire Straddle Period, multiplied by a fraction, (A) the numerator of which is the number of days in the portion of the Straddle Period ending on and including the Effective Date and (B) the denominator of which is the number of days in the entire Straddle Period.
(b)In respect of any other Taxes, the amount of Taxes that are attributable to the portion of such Straddle Period ending on and including the Effective Date will be determined based on an interim closing of the books as of the close of business on the Effective Date (and for such purpose and otherwise for the purposes of determining Liabilities for Taxes hereunder, the taxable period of any partnership will be deemed to end as of the close of business on the Effective Date); provided, however, that any item determined on an annual or periodic basis (such as deductions for depreciation) will be apportioned on a daily basis.
Section VIII.4Tax Treatment. For U.S. federal and applicable state and local income Tax purposes, the purchase of the Purchased Interest hereby and the redemption of the interests in the ADM Redemption Transaction is intended to be treated (i) in part as a “disguised sale” of SLG interests under the principles of Section 707 of the Code (i.e., as if Buyer had purchased Interests
directly from ADM in exchange for the portion of the Purchase Price that is paid to ADM pursuant to Section 2.07 as consideration in the ADM Redemption Transaction pursuant to Sections 741, 751, and 1001 of the Code) and (ii) in part as if SLG newly issued Interests to Buyer in exchange for a portion of the Purchase Price pursuant to Section 721(a) of the Code. In connection with the acquisition of the Interests described in clause (i), SLG will prepare and deliver to Buyer a schedule showing an allocation of the Purchase Price (and any other amounts properly treated as consideration for applicable Tax purposes) among the assets of SLG in accordance with Sections 743(b), 755, and 1060 of the Code, which allocation will be subject to the written consent of Buyer (not to be unreasonably withheld, conditioned, or delayed). In connection with the acquisition of the Interests described in clause (ii), SLG will increase or decrease the capital accounts of the members to reflect a revaluation of partnership property in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f). SLG and Buyer will jointly agree with respect to any such adjustments and the adoption of any “allocation method” within the meaning of Treasury Regulations Section 1.704-3 with respect any “reverse Section 704(c) allocations” within the meaning of Treasury Regulations Section 1.704-3(a)(6)(i) resulting from such revaluation event.
ARTICLE I
MISCELLANEOUS
Section VI.1Expenses. Except as otherwise expressly provided herein all costs and expenses, including fees and disbursements of counsel, financial advisors and accountants, incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the Party incurring such costs and expenses, whether or not the Closing shall have occurred; provided, however, that Co-op will be responsible for all Transaction Expenses of SLG.
Section VI.2Notices. All notices, requests, consents, claims, demands, waivers and other communications hereunder shall be in writing and shall be deemed to have been given: (a) when delivered by hand (with written confirmation of receipt); (b) when received by the addressee if sent by a nationally recognized overnight courier (receipt requested); (c) on the date sent by email (with confirmation of transmission) if sent during normal business hours of the recipient, and on the next Business Day if sent after normal business hours of the recipient; or (d) on the third day after the date mailed, by certified or registered mail, return receipt requested, postage prepaid. Such communications must be sent to the respective Parties at the following addresses (or at such other address for a Party as shall be specified in a notice given in accordance with this Section 9.02):
| | | | | |
| If to SLG: | Skyland Grain, L.L.C. 1125 W. Oklahoma Avenue, P.O. Box 947 Ulysses, Kansas 67880 Attention: Pete Goetzmann, Chief Executive Officer
|
| with copies (which shall not constitute notice) to: | Marc Kliewer, General Counsel 1125 W. Oklahoma Avenue, P.O. Box 947 Ulysses, Kansas 67880 and Nyemaster Goode, P.C. 700 Walnut, Suite 1300 Des Moines, Iowa 50309 Attention: Rod Kubat |
| | | | | |
If to Co-op:
with a copy (which shall not constitute notice) to: | Skyland Co-op, Inc. P.O. Box 280 Johnson City, Kansas 67855
Attention: Wade Tucker, Chairman of the Board
and
Skyland Co-op, Inc. 1125 W. Oklahoma Avenue Ulysses, Kansas 67880
Attention: Wade Tucker, Chairman of the Board
Merritt Law Attn: Johnny Merritt 1201 Rio Grande Street, Suite 200 Austin, Texas 78701
The Andersons, Inc. 11350 Switzer Road, Suite 350 Overland Park, Kansas 66210
Attention: Bill Krueger, CEO |
If to Buyer:
with copies (which shall not constitute notice) to: | The Andersons, Inc. 11350 Switzer Road, Suite 350 Overland Park, Kansas 66210
Attention: Jason Phelps
and
Stinson LLP 1201 Walnut Street, Suite 2900 Kansas City, Missouri 64106 Attention: Scot Hill |
Section VI.3Interpretation. For purposes of this Agreement: (a) the words “include,” “includes” and “including” shall be deemed to be followed by the words “without limitation”; (b) the word “or” is not exclusive; and (c) the words “herein,” “hereof,” “hereby,” “hereto” and “hereunder” refer to this Agreement as a whole. Unless the context otherwise requires, references herein: (x) to Articles, Sections, Disclosure Schedules and Exhibits mean the Articles and Sections of, and Disclosure Schedules and Exhibits attached to, this Agreement; (y) to an agreement, instrument or other document means such agreement, instrument or other document as amended, supplemented and modified from time to time to the extent permitted by the provisions thereof; and (z) to a statute means such statute as amended from time to time and includes any successor legislation thereto and any regulations promulgated thereunder. This Agreement shall be construed without regard to any presumption or rule requiring construction or interpretation against the Party
drafting an instrument or causing any instrument to be drafted. The Disclosure Schedules and Exhibits referred to herein shall be construed with, and as an integral part of, this Agreement to the same extent as if they were set forth verbatim herein.
Section VI.4Disclosure Schedules. All section headings in the Disclosure Schedules correspond to the sections of this Agreement, but information provided in any section of the Disclosure Schedules shall constitute disclosure for purposes of each section of this Agreement where such information is relevant. Unless the context otherwise requires, all capitalized terms used in the Disclosure Schedules shall have the respective meanings assigned to such terms in this Agreement. Certain information set forth in the Disclosure Schedules is included solely for informational purposes, and may not be required to be disclosed pursuant to this Agreement. No disclosure in the Disclosure Schedules relating to any possible breach or violation of any agreement or Law shall be construed as an admission or indication that any such breach or violation exists or has actually occurred. The inclusion of any information in the Disclosure Schedules shall not be deemed to be an admission or acknowledgment by SLG that in and of itself, such information is material to or outside the ordinary course of the business. No disclosure in the Disclosure Schedules shall be deemed to create any rights in any third party.
Section VI.5Headings. The headings in this Agreement are for reference only and shall not affect the interpretation of this Agreement.
Section VI.6Severability. If any term or provision of this Agreement is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable such term or provision in any other jurisdiction. Upon such determination that any term or other provision is invalid, illegal or unenforceable, the Parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated hereby be consummated as originally contemplated to the greatest extent possible.
Section VI.7Entire Agreement. This Agreement and the Ancillary Documents constitute the sole and entire agreement of the Parties with respect to the subject matter contained herein and therein, and supersede all prior and contemporaneous representations, warranties, understandings and agreements, both written and oral, with respect to such subject matter. In the event of any inconsistency between the statements in the body of this Agreement, and those in the Ancillary Documents, the Exhibits and Disclosure Schedules (other than an exception expressly set forth as such in the Disclosure Schedules), the statements in the body of this Agreement will control. Upon consummation of the Closing, the Confidentiality Agreement will automatically terminate.
Section VI.8Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the Parties and their respective successors and permitted assigns. No Party may assign its rights or obligations hereunder without the prior written consent of the other Party, which consent shall not be unreasonably withheld, conditioned or delayed. No assignment shall relieve the assigning Party of any of its obligations hereunder.
Section VI.9No Third-Party Beneficiaries. Except as provided in ARTICLE VI, this Agreement is for the sole benefit of the Parties and their respective successors and permitted assigns and nothing herein, express or implied, is intended to or shall confer upon any other Person or entity any legal or equitable right, benefit or remedy of any nature whatsoever under or by reason of this Agreement.
Section VI.10Amendment and Modification; Waiver. This Agreement may only be amended, modified or supplemented by an agreement in writing signed by each Party hereto. No waiver by any Party of any of the provisions hereof shall be effective unless explicitly set forth in writing and signed by the Party so waiving. No waiver by any Party shall operate or be construed as a waiver in respect of any failure, breach or default not expressly identified by such written waiver, whether of a similar or different character, and whether occurring before or after that waiver. No failure to exercise, or delay in exercising, any right, remedy, power or privilege arising from this Agreement shall operate or be construed as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.
Section VI.11Governing Law; Submission to Jurisdiction; Waiver of Jury Trial.
(a)This Agreement shall be governed by and construed in accordance with the internal laws of the State of Kansas without giving effect to any choice or conflict of law provision or rule (whether of the State of Kansas or any other jurisdiction).
(b)ANY LEGAL SUIT, ACTION OR PROCEEDING ARISING OUT OF OR BASED UPON THIS AGREEMENT, THE ANCILLARY DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY MAY BE INSTITUTED IN THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA LOCATED IN THE CITY OF WICHITA OR THE COURTS OF THE STATE OF KANSAS LOCATED IN THE COUNTY OF GRANT, AND EACH PARTY IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF SUCH COURTS IN ANY SUCH SUIT, ACTION OR PROCEEDING. SERVICE OF PROCESS, SUMMONS, NOTICE OR OTHER DOCUMENT BY MAIL TO SUCH PARTY’S ADDRESS SET FORTH HEREIN SHALL BE EFFECTIVE SERVICE OF PROCESS FOR ANY SUIT, ACTION OR OTHER PROCEEDING BROUGHT IN ANY SUCH COURT. THE PARTIES IRREVOCABLY AND UNCONDITIONALLY WAIVE ANY OBJECTION TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR ANY PROCEEDING IN SUCH COURTS AND IRREVOCABLY WAIVE AND AGREE NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
(c)EACH PARTY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LEGAL ACTION ARISING OUT OF OR RELATING TO THIS AGREEMENT,
THE ANCILLARY DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
Section VI.12Specific Performance. The Parties agree that irreparable damage would occur if any provision of this Agreement were not performed in accordance with the terms hereof (including if the Parties fail to take such actions as are required to consummate the transactions contemplated hereby) or were otherwise breached. Each Party hereto shall be entitled to an injunction or injunctions to prevent breaches or threatened breaches of this Agreement or to enforce specifically the performance of the terms and provisions hereof in the courts described in Section 9.11(b) without proof of actual damages, in addition to any other remedy to which it is entitled at law or in equity. No Party will oppose the granting of an injunction, specific performance, or other equitable relief when expressly available pursuant to the terms of this Agreement on the basis that the other party has an adequate remedy at law or that an award of specific performance is not an appropriate remedy for any reason at law or equity. No other Party or any other Person shall be required to obtain, furnish, or post any bond or similar instrument in connection with or as a condition to obtaining any remedy referred to in this Section 9.12, and each Party hereto irrevocably waives any right it may have to require the obtaining, furnishing, or posting of any such bond or similar instrument. The right of specific enforcement is an integral part of the transactions contemplated hereby and without that right, neither Party would have entered into this Agreement.
Section VI.13Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall be deemed to be one and the same agreement. A signed copy of this Agreement delivered by e-mail or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed as of the Effective Date.
| | | | | |
| SKYLAND GRAIN, L.L.C. |
|
By_____________________
Name: Peter Goetzmann
Title: CEO |
| |
| THE ANDERSONS, INC. |
|
By_____________________
Name: Bill Krueger
Title: CEO |
| | |
SKYLAND CO-OP, INC. |
By_____________________
Name: Wade Tucker
Title: Chairman of the Board |
[Signature Page to Interest Purchase Agreement]
Exhibit A
Sample Working Capital Calculation
"[***]"
Exhibit A to the agreement has been redacted as it is both not material and confidential.
Exhibit B
Sample Calculation of Closing Indebtedness
"[***]"
Exhibit B to the agreement has been redacted as it is both not material and confidential.
Exhibit C
Producer Notes
"[***]"
Exhibit C to the agreement has been redacted as it is both not material and confidential.
Exhibit D
Form of Real Estate Purchase Agreement for Hansen-Mueller Facilities
"[***]"
Exhibit C to the agreement has been redacted as it is both not material and confidential.
Appendix I
Defined Terms
The following terms have the meanings specified or referred to below:
“Action” means any claim, cause of action, demand, counterclaim, action, suit, audit, investigation, arbitration, citation, summons, subpoena or proceeding of any kind.
“Adjusted Closing Working Capital” means (a) the Current Assets of SLG plus (b) $927,435 (representing an inventory shrink credit agreed to by the Parties) minus (c) the Current Liabilities of SLG plus (c) $302,036 (representing an adjustment based on seasonal expenses already incurred), in each case determined as of the beginning of business on the Effective Date.
“Adjusted Closing Working Capital Statement” has the meaning set forth in Section 2.03(b)(i).
“ADM” has the meaning set forth in the recitals.
“ADM Contribution Agreement” means that certain Asset Contribution Agreement by and among SLG, the Co-op and ADM dated June 2, 2023.
“ADM Interest” has the meaning set forth in the recitals.
“ADM Redemption Agreement” has the meaning set forth in the recitals.
“ADM Redemption Transaction” has the meaning set forth in the recitals.
“Affiliate” of a Person means any other Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such Person. The term “control” (including the terms “controlled by” and “under common control with”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise. For purposes of this Agreement, Co-op is an Affiliate of SLG.
“Affordable Care Act” means, collectively, the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010.
“Agreement” has the meaning set forth in the preamble.
“Amended and Restated Operating Agreement” means the Sixth Amended and Restated Operating Agreement of SLG in the form previously agreed to by Buyer and Co-op.
“Ancillary Documents” means the Amended and Restated Operating Agreement, the Services Agreement, the Facilities Management Agreement, and all other agreements, documents, instruments, or certificates delivered or required to be delivered by any party at the Closing pursuant to this Agreement.
“APC Merger” means the merger of Ag Producers Co-op with and into the Co-op with the Co-op as the surviving entity.
“Audited Financial Statements” has the meaning set forth in Section 3.06.
“Balance Sheet” has the meaning set forth in Section 3.06.
“Balance Sheet Date” has the meaning set forth in Section 3.06.
“Benefit Plan” has the meaning set forth in Section 3.20(a).
“Business Day” means any day except Saturday, Sunday or any other day on which commercial banks located in Kansas City, Kansas are authorized or required by Law to be closed for business.
“Buyer” has the meaning set forth in the preamble.
“Buyer Fundamental Representations” means the representations and warranties made by the Buyer in Section 4.01, Section 4.02, and Section 4.04.
“Buyer Indemnitees” has the meaning set forth in Section 6.02.
“CARES Act and COVID Relief Programs” means, collectively, the Coronavirus Aid, Relief, and Economic Security Act, the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act and all FAQs and Interim Final Rules issued by any Governmental Authority related thereto, including any programs or facilities established by the Board of Governors of the Federal Reserve System to which the U.S. Treasury Department has provided financing as contemplated by Title IV of the Coronavirus Aid, Relief and Economic Security Act, and any similar law that addresses the impact of COVID-19 on any Person.
“CERCLA” means the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended by the Superfund Amendments and Reauthorization Act of 1986, 42 U.S.C. §§ 9601 et seq.
“Closing” has the meaning set forth in Section 2.05.
“Closing Transaction Expenses Certificate” means a certificate executed by the Chief Financial Officer of SLG, certifying on behalf of SLG the amount of Unpaid Transaction Expenses remaining as of the Effective Date (including an itemized list of each such Unpaid Transaction Expense with a description of the nature of such expense and the Person to whom such expense is owed).
“CoBank” means CoBank, ACB.
“CoBank Documents” means the (a) written consent of CoBank to this Agreement, the ADM Redemption Agreement and the transactions contemplated hereby and thereby, (b) an amended and restated credit facility to SLG, and (c) a nondisturbance agreement.
“Code” means the Internal Revenue Code of 1986, as amended.
“Confidentiality Agreement” means the Confidentiality Agreement, dated as of May 14, 2024, between Buyer and SLG.
“Constructive Knowledge” means the knowledge which any individual should have been aware after reasonable inquiry.
“Contract” means all contracts, leases, deeds, mortgages, licenses, instruments, notes, commitments, undertakings, indentures, joint ventures and all other agreements, commitments and legally binding arrangements, whether written or oral.
“Co-op” has the meaning set forth in the preamble.
“Co-op Fundamental Representations” means the representations and warranties made by the Co-op in Section 3.02, Section 3.05 and Section 3.26 of this Agreement.
“Co-op Retirement Plan” means The Co-op Retirement Plant, established in 1946 and sponsored by United Benefits Group, a Missouri nonprofit corporation, in which SLG is a Participating Employer (as defined therein).
“Copyrights” has the meaning set forth in the definition of “Intellectual Property.”
“Corrective Work” means cleanup, remediation, removal, response, abatement, containment, closure, restoration, treatment, investigation or monitoring required to address any violation of Environmental Law, Release or threatened Release, or Environmental Damages, including any actions required by SLG or Co-op under this Agreement.
“Current Assets” means cash and cash equivalents, accounts receivable, inventory, chemical and seed rebates, and prepaid expenses, but excluding (a) the portion of any prepaid expense of SLG will not receive the benefit following the Closing, (b) deferred Tax assets, and (c) receivables from any of SLG’s Affiliates, directors, employees, officers or members and any of their respective Affiliates, determined in accordance with GAAP applied using the same accounting methods, practices, principles, policies and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were used in the preparation of the Audited Financial Statements for the most recent fiscal year end.
“Current Liabilities” means accounts payable, accrued Taxes and accrued expenses, but excluding payables to any of SLG’s Affiliates, directors, employees, officers or members and any of their respective Affiliates, deferred Tax liabilities, Transaction Expenses and the current portion of any Indebtedness of SLG, determined in accordance with GAAP applied using the same accounting methods, practices, principles, policies and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were used in the preparation of the Audited Financial Statements for the most recent fiscal year end.
“Current Operating Agreement” has the meaning set forth in the recitals.
“Deductible” has the meaning set forth in Section 6.05(a).
“Direct Claim” has the meaning set forth in Section 6.06(c).
“Disclosure Schedules” means the Disclosure Schedules delivered by SLG and Buyer concurrently with the execution and delivery of this Agreement.
“Dollars or $” means the lawful currency of the United States.
“Effective Date” has the meaning set forth in the preamble.
“Encumbrance” means any charge, claim, community property interest, pledge, condition, equitable interest, lien (statutory or other), option, security interest, mortgage, easement, encroachment, right of way, right of first refusal, or restriction of any kind, including any restriction on use, voting, transfer, receipt of income or exercise of any other attribute of ownership.
“Environmental Attributes” means any emissions and renewable energy credits, energy conservation credits, benefits, offsets and allowances, environmental impact mitigation credits, emission reduction credits or words of similar import or regulatory effect (including emissions reduction credits or allowances under all applicable emission trading, compliance or budget programs, or any other federal, state or regional emission, renewable energy or energy conservation trading or budget program) that have been held, allocated to or acquired by SLG for the development, construction, ownership, lease, operation, use or maintenance of the business, assets or associated real property as of (i) the date of this Agreement and (ii) future years for which allocations have been established and are in effect as of the date of this Agreement.
“Environmental Claim” means any Action, Governmental Order, lien, fine, penalty, or, as to each, any settlement or judgment arising therefrom, by or from any Person alleging liability of whatever kind or nature (including liability or responsibility for the costs of enforcement proceedings, investigations, cleanup, governmental response, removal or remediation, natural resources damages, property damages, personal injuries, medical monitoring, penalties, contribution, indemnification and injunctive relief) arising out of, based on or resulting from: (a) the presence of, Release of, or exposure to, any Hazardous Materials; or (b) any actual or alleged non-compliance with any Environmental Law or term or condition of any Environmental Permit.
“Environmental Damages” means all claims, judgments, damages (including consequential damages, special damages, and punitive damages to the extent recovered in a Third-Party Claim), losses, penalties, fines, fees, premiums, deposits, liabilities (including strict liability), obligations, Encumbrances, costs and expenses (including costs and expenses of investigation and defense of any claim, whether or not such claim is ultimately defeated, and of any good faith settlement), of whatever kind or nature, contingent or otherwise, matured or unmatured, foreseeable or unforeseeable, including reasonable attorneys’ fees and disbursements and consultants’ fees, any of which are related to Environmental Laws, Environmental Permits, Hazardous Materials or environmental conditions and are incurred at any time, and including:
i.damages, losses or costs for personal injury, or injury to property or natural resources (including costs of assessment), occurring upon or off of the Real Property associated with the Fuels Business, including the cost of demolition and rebuilding of any improvements on real property, interest and penalties;
ii.actual and reasonable fees incurred for the services of attorneys, consultants, contractors, experts, laboratories and all other actual and reasonable costs and expenses incurred in connection with investigation, removal, remediation or post-remediation monitoring, operation and maintenance, of any Hazardous Materials or Release or in connection with the actual or alleged violation of any Environmental Law, including the preparation of any feasibility studies or reports or the performance of any cleanup, remediation, removal, response, abatement, containment, closure, restoration, treatment, investigation work or monitoring work, in each case as required by any Environmental Law, or required to settle or otherwise respond to any Third-Party Claim, or reasonably necessary to make and secure the full economic use and value of the Fuels Business or any other property, or otherwise expended in connection with such conditions, including any and all Corrective Work, and further including any attorneys’ fees, costs and expenses incurred in enforcing this Agreement or collecting any sums due hereunder;
iii.any additional costs required to take necessary precautions to protect against a Release of Hazardous Materials at, on, in, under migrating from, migrating to, or affecting the Fuels Business, whether into the subsurface, air, any body of water, any building or structure on or near the Fuels Business, any other public domain or any surrounding or adjoining areas;
iv.any costs incurred to comply, in connection with the Real Property, the Fuels Business or any area surrounding or adjoining the Fuels Business, with Environmental Law;
v.any costs, including deposits, premiums and fees, associated with application and enrolment in environmental funds or insurance programs, and any costs necessary to participate in and complete the obligations of the respective environmental fund or insurance program;
vi.liability to any third Persons or Governmental Authority for costs expended in connection with the items referenced above; and
vii.diminution in the value of the Fuels Business, and damages for the loss of business and restriction on the use of the Fuels Business.
“Environmental Law” means any applicable Law, and any Governmental Order or binding agreement with any Governmental Authority: (a) relating to pollution (or the cleanup thereof) or the protection of natural resources, endangered or threatened species or habitat, or the environment (including ambient or indoor air, soil, surface water or groundwater, wetlands or subsurface strata); or (b) concerning the presence of, exposure to, or the management, manufacture, use, containment, storage, recycling, reclamation, reuse, treatment, generation, discharge, transportation, processing, production, abandonment, disposal or remediation of any Hazardous Materials. The term “Environmental Law” includes the following (including their implementing regulations and any state analogs): the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended by the Superfund Amendments and Reauthorization Act of 1986, 42 U.S.C. §§ 9601 et seq.; the Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act of 1976, as amended by the Hazardous and Solid Waste Amendments of 1984, 42 U.S.C. §§ 6901 et seq.; the Federal Water Pollution Control Act of 1972, as amended by the Clean Water Act of 1977, 33 U.S.C. §§ 1251 et seq.; the Toxic Substances Control Act of 1976, as amended, 15 U.S.C. §§ 2601 et seq.; the Emergency Planning and Community Right-to-Know Act of 1986, 42 U.S.C. §§ 11001 et seq.; the Clean Air Act of 1966, as amended by the Clean Air Act Amendments of 1990, 42 U.S.C. §§ 7401 et seq.; the Federal Insecticide, Fungicide and Rodenticide Act of 1910, as amended, 7 U.S.C. §§ 136 et seq.; the Oil Pollution Act of 1990, as amended, 33 U.S.C. §§ 2701 et seq.; and the Occupational Safety and Health Act of 1970, as amended, 29 U.S.C. §§ 651 et seq.
“Environmental Notice” means any written directive, letter of warning, notice of violation or infraction, or notice respecting any Environmental Claim or relating to actual or alleged non-compliance with any Environmental Law or any term or condition of any Environmental Permit.
“Environmental Permit” means any Permit, letter, clearance, consent, waiver, closure, exemption, decision or other action required under or issued, granted, given, authorized or made by a Governmental Authority pursuant to Environmental Law.
“E.O. 11246” has the meaning set forth in Section 3.21(i).
“Equitable Exceptions” means bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting creditors’ rights generally and by general principles of equity regardless of whether enforcement is sought in a proceeding at law or in equity.
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended, and the regulations promulgated thereunder.
“ERISA Affiliates” means all employers, trades, or businesses (whether or not incorporated) that would be treated together with SLG or any of its Affiliates as a “single employer” within the meaning of Section 414 of the Code.
“Facilities Management Agreement” means the Second Amended and Restated Facilities Agreement, dated the Effective Date, between SLG and Co-op.
“Fair Market Value” means the fair market value as agreed between Co-op and Buyer; provided, that if Co-op and Buyer are unable to agree on the fair market value within 30 days, such fair market value shall be determined by an independent, nationally recognized investment banking, accounting, or valuation firm (the “Valuation Firm”) selected by Co-op and Buyer. Buyer and Co-op shall provide the Valuation Firm with all reasonably necessary financial and other records as the Valuation Firm may request. The Valuation Firm shall deliver its written determination of the fair market value within sixty (60) days of its engagement and such determination of the fair market value shall be final, conclusive, and binding. The fees and expenses of the Valuation Firm shall be borne equally by Co-op and Buyer. In determining the Fair Market Value, an orderly sale transaction between a willing buyer and a willing seller shall be assumed, using valuation techniques then prevailing in the securities industry without regard to the lack of liquidity due to any restrictions (contractual or otherwise) applicable thereto or any discount for minority interests and assuming full disclosure of all relevant information.
“Financial Statements” has the meaning set forth in Section 3.06.
“Fraud” means, with respect to any Person, intentional fraud under Delaware common law.
“Fuels Business” means any business or location (including real and Personal Property, and tangible and intangible property) previously or currently owned or operated by SLG or the Co-op in which fuels are sold or dispensed, whether internally or for sale to the general public.
“Fundamental Representations” means the SLG Fundamental Representations, Co-op Fundamental Representations, and the Buyer Fundamental Representations.
“GAAP” means United States generally accepted accounting principles in effect from time to time.
“Governmental Authority” means any federal, state, local or foreign government or political subdivision thereof, or any agency or instrumentality of such government or political subdivision, or any self-regulated organization or other non-governmental regulatory authority or quasi-governmental authority (to the extent that the rules, regulations or orders of such organization or authority have the force of Law), or any arbitrator, court or tribunal of competent jurisdiction.
“Government Contracts” has the meaning set forth in Section 3.09(a)(viii).
“Governmental Order” means any order, agreement, writ, judgment, injunction, decree, stipulation, determination or award entered by or with any Governmental Authority.
“Hazardous Materials” means: (a) any material, substance, chemical, waste, product, derivative, compound, mixture, solid, liquid, mineral or gas, in each case, whether naturally occurring or man-made, that is hazardous, acutely hazardous, toxic, or words of similar import or regulatory effect under Environmental Laws; and (b) any petroleum or petroleum-derived products, radon, radioactive materials or wastes, asbestos in any form, lead or lead-containing materials, urea formaldehyde foam insulation and polychlorinated biphenyls, carbon tetrachloride or other fumigants, and per- and poly-fluoroalkyl substances (PFAS) and other emerging contaminants.
“Indebtedness” means, without duplication and with respect to SLG (other than Current Liabilities to the extent taken into account in the calculation of Adjusted Closing Working Capital), all: (a) indebtedness for borrowed money; (b) obligations for the deferred purchase price of property or services: (c) long or short-term obligations evidenced by notes, bonds, debentures or other similar instruments; (d) obligations under any interest rate, currency swap or other hedging agreement or arrangement; (e) capital or financing lease obligations; (f) reimbursement obligations under any letter of credit, banker’s acceptance or similar credit transactions; (g) guarantees made by SLG on behalf of any third party in respect of obligations of the kind referred to in the foregoing clauses (a) through (f); and (h) any unpaid interest, prepayment penalties, premiums, costs and fees that arise or become due as a result of the prepayment at the Closing of any of the obligations referred to in the foregoing clauses (a) through (g).
“Indemnified Party” has the meaning set forth in Section 6.05.
“Indemnifying Party” has the meaning set forth in Section 6.05.
“Independent Accountant” has the meaning set forth in Section 2.03(c)(iii).
“Insurance Policies” has the meaning set forth in Section 3.16.
“Intellectual Property” means any and all rights in, arising out of, or associated with any of the following in any jurisdiction throughout the world: (a) issued patents and patent applications (whether provisional or non-provisional), including divisionals, continuations, continuations-in-part, substitutions, reissues, reexaminations, extensions, or restorations of any of the foregoing, and other Governmental Authority-issued indicia of invention ownership (including certificates of invention, petty patents, and patent utility models) (“Patents”); (b) trademarks, service marks, brands, certification marks, logos, trade dress, trade names, and other similar indicia of source or origin, together with the goodwill connected with the use of and symbolized by, and all registrations, applications for registration, and renewals of, any of the foregoing (“Trademarks”); (c) copyrights and works of authorship, whether or not copyrightable, and all registrations, applications for registration, and renewals of any of the foregoing (“Copyrights”); (d) internet domain names and social media account or user names (including “handles”), whether or not Trademarks, all associated web addresses, URLs, websites and web pages, social media sites and pages, and all content and data thereon or relating thereto, whether or not Copyrights; (e) mask works, and all registrations, applications for registration,
and renewals thereof; (f) industrial designs, and all Patents, registrations, applications for registration, and renewals thereof; (g) trade secrets, know-how, inventions (whether or not patentable), discoveries, improvements, technology, business and technical information, databases, data compilations and collections, tools, methods, processes, techniques, and other confidential and proprietary information and all rights therein (“Trade Secrets”); (h) computer programs, operating systems, applications, firmware, and other code, including all source code, object code, application programming interfaces, data files, databases, protocols, specifications, and other documentation thereof (“Software”); and (i) all other intellectual or industrial property and related proprietary rights.
“Interest” has the meaning set forth in the recitals.
“Interim Balance Sheet” has the meaning set forth in Section 3.06.
“Interim Balance Sheet Date” has the meaning set forth in Section 3.06.
“Interim Financial Statements” has the meaning set forth in Section 3.06.
“Knowledge of Buyer or Buyer’s Knowledge” or any other similar knowledge qualification, means the actual knowledge or Constructive Knowledge of Mark Hobrock, Chris Reed, Brian Walz, or Scott Wernimont.
“Knowledge of SLG or SLG’s Knowledge” or any other similar knowledge qualification, means the actual knowledge or Constructive Knowledge of Wade Tucker, Pete Goetzmann, Scott Deweese, or David Gaddis.
“Law” means any statute, law, ordinance, regulation, rule, code, order, constitution, treaty, common law, judgment, decree, executive order, other requirement or rule of law of any Governmental Authority.
“Liabilities” has the meaning set forth in Section 3.07.
“Licensed Intellectual Property” means all Intellectual Property in which SLG holds any rights or interests granted by other Persons, including Co-op or any of its Affiliates.
“Losses” means losses, damages, Liabilities, deficiencies, Actions, judgments, interest, awards, penalties, fines, costs or expenses of whatever kind, including reasonable attorneys' fees and the cost of enforcing any right to indemnification hereunder and the cost of pursuing any insurance providers; provided, however, that “Losses” shall not include punitive damages, except to the extent actually awarded to a Governmental Authority or other third party or on account of a Party’s Fraud.
“Material Adverse Effect” means any event, occurrence, fact, condition or change that is, or could reasonably be expected to become, individually or in the aggregate, materially adverse to (a) the business, results of operations, condition (financial or otherwise) or assets of SLG or (b) the ability of SLG or Co-op to consummate the transactions contemplated hereby on a timely basis; provided, however, that “Material Adverse Effect” shall not include any event, occurrence, fact, condition or change, directly or indirectly, arising out of or attributable to: (i) general economic or political conditions; (ii) conditions generally affecting the industries in which SLG operates; (iii) any changes in financial or securities markets in general; (iv) acts of war (whether or not declared), armed hostilities or terrorism, or the escalation or worsening
thereof; (v) any action required or permitted by this Agreement or any action taken (or omitted to be taken) with the written consent of or at the written request of Buyer; (vi) any changes in applicable Laws or accounting rules, including GAAP; (vii) the public announcement, pendency or completion of the transactions contemplated by this Agreement; (viii) any natural or man-made disasters or acts of God; or (ix) any failure by SLG to meet any internal or published projections, forecasts or revenue or earnings predictions (provided that the underlying causes of such failures (subject to the other provisions of this definition) shall not be excluded); provided further, however, that any event, occurrence, fact, condition or change referred to in clauses (i) through (iv) immediately above shall be taken into account in determining whether a Material Adverse Effect has occurred or could reasonably be expected to occur to the extent that such event, occurrence, fact, condition or change has a disproportionate effect on SLG compared to other participants in the industries in which SLG conducts its businesses.
“Material Contracts” has the meaning set forth in Section 3.09(a).
“Material Customers” has the meaning set forth in Section 3.15(a).
“Material Suppliers” has the meaning set forth in Section 3.15(b).
“Organizational Documents” means (a) in the case of a Person that is a corporation, its articles or certificate of incorporation and its by-laws, regulations or similar governing instruments required by the laws of its jurisdiction of formation or organization; (b) in the case of a Person that is a partnership, its articles or certificate of partnership, formation or association, and its partnership agreement (in each case, limited, limited liability, general or otherwise); (c) in the case of a Person that is a limited liability company, its articles or certificate of formation or organization, and its limited liability company agreement or operating agreement; and (d) in the case of a Person that is none of a corporation, partnership (limited, limited liability, general or otherwise), limited liability company or natural person, its governing instruments as required or contemplated by the laws of its jurisdiction of organization.
“Party” or “Parties” has the meaning set forth in the preamble.
“Patents” has the meaning set forth in the definition of Intellectual Property.
“Permits” means all permits, licenses, franchises, approvals, authorizations and consents required to be obtained from Governmental Authorities.
“Permitted Encumbrances” has the meaning set forth in Section 3.10(a).
“Person” means an individual, corporation, partnership, joint venture, limited liability company, Governmental Authority, unincorporated organization, trust, association or other entity.
“Personal Property” means all tangible and intangible personal property owned by, or leased or subleased to SLG.
“Platform Agreements” has the meaning set forth in Section 3.12(h).
“Post-Closing Adjustment” has the meaning set forth in Section 2.03(b)(ii).
“Post-Closing Tax Period” means any taxable period beginning on or after the Effective Date and, with respect to any taxable period beginning before and ending after the Effective Date, the portion of such taxable period beginning on or after the Effective Date.
“Pre-Closing Tax Period” means any taxable period ending on or before the Effective Date and, with respect to any taxable period beginning before and ending after the Effective Date, the portion of such taxable period ending on or before the Effective Date.
“Property” means the Real Property and Personal Property.
“Purchased Interest” has the meaning set forth in the recitals.
“Purchase Price” has the meaning set forth in Section 2.02.
“Qualified Benefit Plan” has the meaning set forth in Section 3.20(c).
“Real Property” means the real property owned by, or leased or subleased to, SLG, together with all buildings, structures and facilities located thereon.
“Release” means any actual or threatened release, spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, abandonment, disposing or allowing to escape or migrate into or through the environment (including ambient or indoor air, surface water, groundwater, land surface or subsurface strata or within any building, structure, facility or fixture).
“Representative” means, with respect to any Person, any and all directors, managers, officers, employees, consultants, financial advisors, counsel, accountants and other agents of such Person.
“Resigning SLG Directors” means all directors of SLG other than Wade Tucker, Clay Scott, Kody Carson, Bart Thoreson, Kent Dunn, and Bart Parks.
“Resolution Period” has the meaning set forth in Section 2.03(c)(ii).
“Review Period” has the meaning set forth in Section 2.03(c)(i).
“Services Agreement” means the Services Agreement, dated the Effective Date, by and between SLG and Buyer.
“SLG” has the meaning set forth in the preamble.
“SLG Fundamental Representations” means the representations and warranties made by SLG in Section 3.01, Section 3.03, Section 3.04, Section 3.05 and Section 3.26 of this Agreement.
“SLG Indemnitees” has the meaning set forth in Section 6.03.
“SLG Intellectual Property” means all Intellectual Property that is owned by SLG.
“SLG IP Agreements” means all licenses, sublicenses, consent to use agreements, settlements, coexistence agreements, covenants not to sue, waivers, releases, permissions and
other Contracts, whether written or oral, relating to Intellectual Property to which SLG is a party, beneficiary or otherwise bound.
“SLG IP Registrations” means all SLG Intellectual Property that is subject to any issuance, registration or application by or with any Governmental Authority or authorized private registrar in any jurisdiction, including issued Patents, registered Trademarks, domain names and Copyrights, and pending applications for any of the foregoing.
“SLG IT Systems” means all Software, computer hardware, servers, networks, platforms, peripherals, and similar or related items of automated, computerized, or other information technology (IT) networks and systems (including telecommunications networks and systems for voice, data and video) owned, leased, licensed, or used (including through cloud-based or other third-party service providers) by SLG.
“Software” has the meaning set forth in the definition of Intellectual Property.
“Statement of Objections” has the meaning set forth in Section 2.03(c)(ii).
“Straddle Period” has the meaning set forth in Section 8.03.
“Target Working Capital” means $[-8,882,000].
“Taxes” means all federal, state, local, foreign and other income, gross receipts, sales, use, production, ad valorem, transfer, franchise, registration, profits, license, lease, service, service use, withholding, payroll, employment, unemployment, estimated, excise, severance, environmental, stamp, occupation, premium, property (real or personal), real property gains, windfall profits, customs, duties or other taxes, fees, assessments or charges of any kind whatsoever, together with any interest, additions or penalties with respect thereto and any interest in respect of such additions or penalties.
“Tax Return” means any return, declaration, report, claim for refund, information return or statement or other document required to be filed with respect to Taxes, including any schedule or attachment thereto, and including any amendment thereof.
“Third-Party Claim” has the meaning set forth in Section 6.06(a).
“Trademarks” has the meaning set forth in the definition of Intellectual Property.
“Trade Secrets” has the meaning set forth in the definition of Intellectual Property.
“Transaction Expenses” means all fees and expenses incurred by SLG at, prior to or after the Closing in connection with the preparation, negotiation and execution of this Agreement and the other transaction documents, and the performance and consummation of the transactions contemplated hereby and thereby, including any brokerage fees and commissions (including Ascendant Partners and FTI), debt financing fees, and any bonus or severance obligation to any officer, director, employee or other Person in connection with the transaction contemplated by this Agreement minus $650,000 (representing ADM’s portion of the Transaction Expenses).
“Union” has the meaning set forth in Section 3.21(b).
“Unpaid Transaction Expenses” has the meaning set forth in Section 2.03(a).
“VEVRAA” has the meaning set forth in Section 3.21(i).
“WARN Act” means the federal Worker Adjustment and Retraining Notification Act of 1988, and similar state, local and foreign laws related to plant closings, relocations, mass layoffs and employment losses.
AMENDED AND RESTATED CREDIT AGREEMENT
by and among
SKYLAND GRAIN, L.L.C.,
THE GUARANTORS PARTY HERETO,
THE LENDERS PARTY HERETO
and
COBANK, ACB, as Administrative Agent, Issuing Lender and Swing Line Lender
COBANK, ACB
and
FARM CREDIT MID-AMERICA, PCA,
as Joint Lead Arrangers and Joint Bookrunners
$300,000,000.00 REVOLVING CREDIT FACILITY
$15,000,000.00 REVOLVING TERM CREDIT FACILITY
$67,000,000.00 VARIABLE RATE TERM LOAN FACILITY
$11,192,740.00 FIXED RATE TERM LOAN FACILITY
Dated as of November 1, 2024
Exhibits to the agreement below have been redacted as they are both not material and confidential.
TABLE OF CONTENTS
Page
Page
LIST OF SCHEDULES AND EXHIBITS
SCHEDULES
SCHEDULE 1.1(B) - COMMITMENTS OF LENDERS AND ADDRESSES FOR NOTICES
SCHEDULE 1.1(P) - EXISTING LIENS
SCHEDULE 2.5 - VARIABLE RATE TERM LOAN AMORTIZATION
SCHEDULE 2.6 - FIXED RATE TERM LOANS
SCHEDULE 5.1 - QUALIFICATIONS TO DO BUSINESS AND JURISDICTION OF ORGANIZATION
SCHEDULE 5.6 - SUBSIDIARIES
SCHEDULE 5.18 - ENVIRONMENTAL DISCLOSURES
SCHEDULE 5.21 - TRANSACTIONS WITH AFFILIATES
SCHEDULE 5.24 - MATERIAL OWNED PROPERTY AND MATERIAL LEASED PROPERTY
SCHEDULE 6.16 - POST-CLOSING DELIVERABLES
SCHEDULE 7.1 - EXISTING INDEBTEDNESS
SCHEDULE 7.5 - EXISTING INVESTMENTS
SCHEDULE 11.7 - VOTING PARTICIPANTS
EXHIBITS
EXHIBIT A - ASSIGNMENT AND ASSUMPTION
EXHIBIT B - COMPLIANCE CERTIFICATE
EXHIBIT C - GUARANTOR JOINDER
EXHIBIT D - LOAN REQUEST
EXHIBIT E - PERFECTION AND DILIGENCE CERTIFICATE
EXHIBIT F-1 - REVOLVING/REVOLVING TERM NOTE
EXHIBIT F-2 - SWING LINE NOTE
EXHIBIT F-3 - FIXED RATE TERM/SEASONAL TERM/VARIABLE RATE TERM LOAN NOTE
EXHIBIT G - SOLVENCY CERTIFICATE
EXHIBIT H - TAX COMPLIANCE CERTIFICATES
EXHIBIT I - CONVERSION OR CONTINUATION NOTICE
EXHIBIT J-1 - NOTICE OF SEASONAL TERM LOAN BORROWING
EXHIBIT J-2 - NOTICE OF REVOLVING FACILITY INCREASE
EXHIBIT J-3 - REVOLVING LENDER JOINDER
EXHIBIT K - ENVIRONMENTAL INDEMNITY
EXHIBIT L - BORROWING BASE CERTIFICATE
"[***]"
Schedules and Exhibits to the agreement have been redacted as they are both not material and confidential.
AMENDED AND RESTATED CREDIT AGREEMENT
THIS AMENDED AND RESTATED CREDIT AGREEMENT (this "Agreement"), dated as of November 1, 2024, is entered into by and among SKYLAND GRAIN, L.L.C., a Kansas limited liability company, as Borrower (as hereinafter defined), each of the Guarantors (as hereinafter defined), the Lenders (as hereinafter defined), and COBANK, ACB, in its capacity as Administrative Agent for the Secured Parties and as the Issuing Lender and Swing Line Lender (each as hereinafter defined).
RECITALS
WHEREAS, the Borrower, the guarantors from time to time party thereto, the lenders from time to time party thereto, and CoBank, as Administrative Agent, previously entered into that certain Credit Agreement dated as of September 29, 2022 (as amended by that certain Forbearance Agreement and First Amendment to Credit Agreement dated as of September 1, 2023, that certain Second Forbearance Agreement and Second Amendment to Credit Agreement dated as of November 15, 2023, that certain Third Forbearance and Third Amendment to Credit Agreement dated as of March 19, 2024, that certain Fourth Forbearance Agreement and Fourth Amendment to Credit Agreement dated as of June 17, 2024, that certain Fifth Forbearance Agreement and Fifth Amendment to Credit Agreement dated as of September 16, 2024 and that certain Sixth Forbearance Agreement and Sixth Amendment to Credit Agreement dated as of October 11, 2024, and as may be further, modified, supplemented, increased and extended in writing from time to time prior to the Closing Date, the “Existing Credit Agreement”).
WHEREAS, the parties hereto hereby agree to amend and restate the Existing Credit Agreement to make certain amendments and modifications, all as more fully set forth herein.
WHEREAS, the Borrower has requested that the Lenders provide to the Borrower (a) commitments to fund a revolving credit facility in an aggregate principal amount at any time outstanding not to exceed $300,000,000.00 (as such aggregate commitment amount may be increased or reduced from time to time in accordance herewith), (b) an uncommitted seasonal term credit facility in an aggregate principal amount at any time outstanding not to exceed $100,000,000.00, (c) commitments to fund a revolving term credit facility in an aggregate principal amount at any time outstanding not to exceed $15,000,000.00, (d) a term loan facility in an aggregate principal amount not to exceed $67,000,000.00, and (e) a term loan facility in an aggregate principal amount not to exceed $11,192,740.00, all as more particularly set forth in, and subject to the terms and conditions of, this Agreement. In consideration of their mutual covenants and agreements hereinafter set forth and intending to be legally bound hereby, the parties hereto covenant and agree as follows:
I.CERTAIN DEFINITIONS
I.1Certain Definitions. In addition to words and terms defined elsewhere in this Agreement, the following words and terms shall have the following meanings, respectively, unless the context hereof clearly requires otherwise:
"Actual Knowledge" means, with respect to any Person and any fact or matter, the earlier of actually becoming aware of the fact or matter, or receipt of written notice by, such Person, if an individual, or a responsible officer of such Person, if an entity, of such fact or matter.
"ADM" means Archer-Daniels-Midland Company, a Delaware corporation.
"ADM Interest Redemption Agreement" means that certain Interest Redemption Agreement dated as of November 1, 2024 by and among ADM, Skyland Co-op and the Borrower, as may be amended prior to the Closing Date with the prior written consent of the Administrative Agent.
"Administrative Agent" means CoBank, in its capacity as administrative agent and collateral agent under the Loan Documents.
"Administrative Questionnaire" means an administrative questionnaire in a form supplied by the Administrative Agent.
"Affected Financial Institution" means (a) any EEA Financial Institution or (b) any UK Financial Institution.
"Affiliate" means, with respect to any specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls, is Controlled by or is under common Control with the Person specified.
"Agent Parties" has the meaning set forth in Section 11.4(d)(ii).
"Alternate Base Rate" means a rate per annum determined by the Administrative Agent on the first Business Day of each week, which shall be the Prime Rate; provided that, in no event shall the Alternate Base Rate be less than the Floor. Any change in the Alternate Base Rate due to a change in the calculation thereof shall be effective at the opening of business on the first Business Day of each week or, if determined more frequently, at the opening of business on the first Business Day immediately following the date of such determination and without necessity of notice being provided to the Borrower or any other Person.
"Alternate Base Rate Loans" means any Loan converted to and bearing interest at the Alternate Base Rate.
"Andersons Buyer" means The Andersons Inc., an Ohio corporation.
"Andersons Interest Purchase Agreement" means that certain Interest Purchase Agreement dated as of November 1, 2024 by and among the Andersons Buyer, Skyland Co-op and the Borrower, as may be amended prior to the Closing Date with the prior written consent of the Administrative Agent.
"Andersons Transaction" means the Borrower’s purchase of 25.59% of the Equity Interests of the Borrower from ADM pursuant to the ADM Interest Redemption Agreement and the Andersons Buyer’s purchase of Equity Interests of the Borrower pursuant to the Andersons Interest Purchase Agreement, immediately after which (a) the Andersons Buyer shall own 65.00% of the Equity Interests of the Borrower and (b) Skyland Co-op shall own 35.00% of the Equity Interests of the Borrower.
"Anti-Corruption Laws" means any Laws of any Governmental Authority concerning or relating to bribery or corruption.
"Anti-Terrorism Laws" means any Laws of any Governmental Authority concerning or relating to financing terrorism, "know your customer" or money laundering.
"Applicable Letter of Credit Fee Rate" means the percentage rate per annum based on the Gross Cash Flow then in effect according to the Pricing Grid below the heading "Applicable Margin for Loans under Revolving Credit Facility and Letter of Credit Fee".
"Applicable Margin" means, as applicable:
(a)the percentage spread to be added to the Daily Simple SOFR Rate applicable to Daily Simple SOFR Rate Loans based on the Gross Cash Flow then in effect according to the Pricing Grid below the heading (i) with respect to Daily Simple SOFR Rate Loans that are Revolving Facility Loans, "Applicable Margin for Loans under Revolving Credit Facility and Letter of Credit Fee", (ii) with respect to Daily Simple SOFR Rate Loans that are Revolving Term Loans, "Applicable Margin for Revolving Term Loans" and (iii) with respect to Daily Simple SOFR Rate Loans that are Variable Rate Term Loans, "Applicable Margin for Variable Rate Term Loans", or
(b)the percentage spread to be added to the Term SOFR Rate applicable to Term SOFR Rate Loans based on the Gross Cash Flow then in effect according to the Pricing Grid below the heading (i) with respect to Term SOFR Rate Loans that are Revolving Facility Loans, "Applicable Margin for Loans under Revolving Credit Facility and Letter of Credit Fee", (ii) with respect to Term SOFR Rate Loans that are Revolving Term Loans, "Applicable Margin for Revolving Term Loans" and (iii) with respect to Term SOFR Rate Loans that are Variable Rate Term Loans, "Applicable Margin for Variable Rate Term Loans".
Notwithstanding the foregoing, the Applicable Margin for any Seasonal Term Loan shall be the interest rate margin per annum governing such Tranche of Seasonal Term Loan as set forth in the related Seasonal Term Loan Funding Agreement, subject to Section 2.2.
"Applicable Unused Commitment Fee Rate" means the percentage rate per annum set forth in the Pricing Grid (a) with respect to Revolving Facility Unused Commitment Fees, below the heading "Unused Commitment Fee ", and (b) with respect to Revolving Term Facility Unused Commitment Fees, below the heading "Unused Commitment Fee ".
"Approved Fund" means any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.
"Arranger" means each of CoBank and FCMA, in their capacities as joint lead arrangers and joint bookrunners.
"Assignment and Assumption" means an assignment and assumption agreement entered into by a Lender and an assignee permitted under Section 11.7, in substantially the form of Exhibit A or any other form approved by the Administrative Agent.
"Authorized Officer" means, with respect to any Loan Party, the Chief Executive Officer, President, or Chief Financial Officer (or in the case of a Loan Party that is a limited liability company, a manager or member authorized under such Loan Party's Organizational Documents) of such Loan Party or such other individuals, designated by written notice to the Administrative Agent from the Borrower, authorized to execute notices, reports and other documents on behalf of the Loan Parties required hereunder. The Borrower may amend such list of individuals from time to time by giving written notice of such amendment to the Administrative Agent.
"Available Revolving Facility Commitment" means, with respect to any Revolving Facility Lender, an amount equal to such Lender's Revolving Facility Commitment minus the outstanding principal amount of its Revolving Facility Loans, minus such Lender's Pro Rata Share of the aggregate outstanding amount of Swing Line Loans, if any, minus such Lender's Pro Rata Share of Letter of Credit Obligations, if any.
"Available Revolving Term Facility Commitment" means, with respect to any Revolving Term Facility Lender, an amount equal to such Lender's Revolving Term Facility Commitment minus the outstanding principal amount of its Revolving Term Loans.
"Available Tenor" means, as of any date of determination and with respect to the applicable then-current Benchmark, as applicable, (a) if the applicable then-current Benchmark is a term rate, any tenor for such Benchmark that is or may be used for determining the length of an Interest Period or (b) otherwise, any payment period for interest calculated with reference to such Benchmark, as applicable, pursuant to this Agreement as of such date.
"Avoidance Provisions" has the meaning specified in Section 12.4(a)(i)(C).
"Bail-In Action" means the exercise of any Write-Down and Conversion Powers by the applicable Resolution Authority in respect of any liability of an Affected Financial Institution.
"Bail-In Legislation" means (a) with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law, regulation, rule or requirement for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule and (b) with respect to the United Kingdom, Part I of the United Kingdom Banking Act 2009 (as amended from time to time) and any other law, regulation or rule applicable in the United Kingdom relating to the resolution of unsound or failing banks, investment firms or other financial institutions or their affiliates (other than through liquidation, administration or other insolvency proceedings).
"Bankruptcy Code" means title 11 of the United States Code.
"Benchmark" means, initially, the Daily Simple SOFR Rate and the Term SOFR Rate, as applicable; provided that if a Benchmark Transition Event has occurred with respect to any initial Benchmark or any then-current Benchmark, then "Benchmark" means the applicable Benchmark Replacement for such initial or then-current Benchmark to the extent that such Benchmark Replacement has replaced such prior benchmark rate pursuant to Section 3.7(a). Any reference to a "Benchmark" shall include, as applicable, the published component used in the calculation thereof.
"Benchmark Replacement" means, for any Available Tenor:
(a)for the Term SOFR Rate, the first alternative set forth below that can be determined by the Administrative Agent:
i.the sum of (a) Daily Simple SOFR Rate and (b) an adjustment (which may be a positive or negative value or zero), in each case, that has been selected by the Administrative Agent and the Borrower as the replacement for such Available Tenor of such Benchmark giving due consideration to any evolving or then-prevailing market convention, including any applicable recommendations made by the
Relevant Governmental Body, for U.S. dollar-denominated syndicated credit facilities at such time, or
ii.the sum of (a) the alternate benchmark rate and (b) an adjustment (which may be a positive or negative value or zero), in each case, that has been selected by the Administrative Agent and the Borrower as the replacement for such Available Tenor of such Benchmark giving due consideration to any evolving or then-prevailing market convention, including any applicable recommendations made by the Relevant Governmental Body, for U.S. dollar-denominated syndicated credit facilities at such time; and
(c)for all other Benchmarks, the sum of (i) the alternate benchmark rate and (ii) an adjustment (which may be a positive or negative value or zero), in each case, that has been selected by the Administrative Agent and the Borrower as the replacement for such Available Tenor of such Benchmark giving due consideration to any evolving or then-prevailing market convention, including any applicable recommendations made by the Relevant Governmental Body, for U.S. dollar-denominated syndicated credit facilities at such time;
provided that, if the Benchmark Replacement as determined pursuant to clause (a) or (b) above would be less than the Floor, the Benchmark Replacement will be deemed to be the Floor for the purposes of this Agreement and the other Loan Documents.
"Benchmark Replacement Conforming Changes" means, with respect to either the use or administration of any initial Benchmark or the use, administration, adoption or implementation of any Benchmark Replacement, any technical, administrative or operational changes (including changes to the definition of "Business Day," the definition of "U.S. Government Securities Business Day," the definition of "Interest Period" or any similar or analogous definition (or the addition of a concept of "interest period"), timing and frequency of determining rates and making payments of interest, timing of borrowing requests or prepayment, conversion or continuation notices, the applicability and length of lookback periods, the applicability of Section 3.5 and other technical, administrative or operational matters) that the Administrative Agent decides may be appropriate to reflect the adoption and implementation of any such rate or to permit the use and administration thereof by the Administrative Agent in a manner substantially consistent with market practice (or, if the Administrative Agent decides that adoption of any portion of such market practice is not administratively feasible or if the Administrative Agent determines that no market practice for the administration of any such rate exists, in such other manner of administration as the Administrative Agent decides is reasonably necessary in connection with the administration of this Agreement and the other Loan Documents).
"Benchmark Transition Event" means, with respect to any then-current Benchmark, the occurrence of a public statement or publication of information by or on behalf of the administrator of the then-current Benchmark, the regulatory supervisor for the administrator of such Benchmark, the Board of Governors of the Federal Reserve System, the Federal Reserve Bank of New York, an insolvency official with jurisdiction over the administrator for such Benchmark, a resolution authority with jurisdiction over the administrator for such Benchmark or a court or an entity with similar insolvency or resolution authority over the administrator for such Benchmark, announcing or stating that (a) such administrator has ceased or will cease on a specified date to provide all Available Tenors of such Benchmark, permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark or (b) all
Available Tenors of such Benchmark are or will no longer be representative of the underlying market and economic reality that such Benchmark is intended to measure and that representativeness will not be restored.
"Beneficial Ownership Certification" means a certification regarding beneficial ownership as required by the Beneficial Ownership Regulations.
"Beneficial Ownership Regulation" means 31 C.F.R. § 1010.230.
"Benefit Plan" means any of (a) an "employee benefit plan" (as defined in ERISA) that is subject to Title I of ERISA, (b) a "plan" as defined in Section 4975 of the Code or (c) any Person whose assets include (for purposes of ERISA Section 3(42) or otherwise for purposes of Title I of ERISA or Section 4975 of the Code) the assets of any such "employee benefit plan" or "plan".
"Board" means the Board of Governors of the Federal Reserve System of the United States of America.
"Board of Directors" means, collectively, the Directors of the Borrower.
"Borrower" means Skyland Grain, L.L.C., a limited liability company organized and existing under the laws of the State of Kansas.
"Borrower Equity Interests" has the meaning specified in Section 5.6.
"Borrowing" means as of any date of determination (a) with respect to Term SOFR Rate Loans outstanding as of such date, a borrowing consisting of Loans of the same Class and having the same Interest Period, and (b) with respect to Daily Simple SOFR Rate Loans, all Daily Simple SOFR Rate Loans outstanding as of such date regardless of Class.
"Borrowing Base" means the "Borrowing Base" set forth in the applicable Borrowing Base Certificate.
"Borrowing Base Certificate" shall have the meaning specified in Section 6.1(d).
"Borrowing Base Deficit" means a "Deficit" as indicated in the applicable Borrowing Base Certificate.
"Borrowing Date" means, with respect to any Loan, the date for the making thereof or the renewal or conversion thereof at or to the same or a different Interest Rate Option, which shall be a Business Day.
"Budget" means, for the Borrower and its Subsidiaries on a Consolidated basis, forecasted: (a) balance sheets, (b) cash flow statements, (c) operating budget, and (d) capital budget, all prepared on a consistent basis with the Borrower's and the Subsidiaries' historical financial statements. The Budget represents and will represent as of the date thereof the good faith estimate of the Borrower and its senior management concerning the probable course of its and its Subsidiaries' business.
"Business" has the meaning set forth in Section 5.18(d).
"Business Day" means any day that is not a Saturday, Sunday or other day that is a legal holiday under the laws of the State of New York or Colorado or is a day on which banking institutions in such state are authorized or required by Law to close.
"Capital Expenditures" means, with respect to any Person, the aggregate costs incurred by such Person during any measuring period for the acquisition of any fixed assets or improvements or replacements of, substitutions for or additions to any existing fixed asset resulting in a future economic benefit to such Person, and that are required to be capitalized in accordance with GAAP.
"Capital Lease" means any lease of real or personal property that is required to be capitalized under GAAP or that is treated as an operating lease under regulations applicable to the Borrower and its Subsidiaries but that otherwise would be required to be capitalized under GAAP.
"Cash Collateralize" means (a) with respect to the Obligations, to deposit in a Controlled Account or to pledge and deposit with or deliver to the Administrative Agent, for the benefit of the Issuing Lender or Lenders, as collateral for Letter of Credit Obligations or obligations of Lenders to fund participations in respect of Letter of Credit Obligations, cash or deposit account balances or, if the Administrative Agent and the Issuing Lender shall agree in their sole discretion, other credit support, in each case pursuant to documentation in form and substance satisfactory to the Administrative Agent and the Issuing Lender, and (b) with respect to Other Liabilities, to pledge and deposit with or deliver to the Administrative Agent, for the benefit of each Lender (or its Affiliate) that is the provider of a Secured Bank Product or Secured Hedge, as the case may be, as collateral for the Other Liabilities, cash or deposit account balances, or, if the Administrative Agent and such Lender (or its Affiliate) shall agree in their respective sole discretion, other credit support, in each case pursuant to documentation in form and substance satisfactory to the Administrative Agent and each applicable Lender (or its Affiliate). "Cash Collateral" shall have meanings correlative to the foregoing and shall include the proceeds of such cash collateral and other credit support.
"Cash Equivalents" means:
(a)direct obligations of the United States of America or any agency or instrumentality thereof or obligations backed by the full faith and credit of the United States of America maturing in twelve (12) months or less from the date of acquisition;
(d)commercial paper maturing in 180 days or less rated not lower than A-1, by Standard & Poor's or P-1 by Moody's on the date of acquisition;
(e)demand deposits, time deposits or certificates of deposit maturing within one year in commercial banks that are organized under the laws of the United States or any state thereof or that is a foreign bank or branch or agency thereof acceptable to the Administrative Agent and, in any case, having combined capital, surplus and undivided profits in an amount equal to at least $1,000,000,000.00; and
(f)money market or mutual funds whose investments are limited to those types of investments described in clauses (a) through (c) above.
"Casualty Event" means, with respect to any property of any Person, any loss of or damage to, or any condemnation or other taking of, such property for which such Person or any of its Subsidiaries receives insurance proceeds, or proceeds of a condemnation award or other compensation.
"Change in Law" means the occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect of any Law, (b) any change in any Law or in the administration, interpretation, implementation or application thereof by any Official Body or (c) the making or issuance of any request, rule, guideline or directive (whether or not having the force of Law) by any Official Body; provided that notwithstanding anything herein to the contrary, (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, regulations, guidelines, interpretations or directives thereunder or issued in connection therewith (whether or not having the force of Law) and (ii) all requests, rules, regulations, guidelines, interpretations or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities (whether or not having the force of Law), in each case pursuant to Basel III, shall in each case be deemed to be a Change in Law regardless of the date enacted, adopted, issued, promulgated or implemented.
"Change of Control" means (a) the Andersons Buyer shall cease to own and control legally and beneficially a majority of the Equity Interests of the Borrower; (b) Skyland Co-op shall cease to own and control legally and beneficially 20% or more of the Equity Interests of the Borrower; (c) Skyland Co-op and the Andersons Buyer, individually or collectively, shall cease to own and control legally and beneficially 100% of the Equity Interests of the Borrower; (d) no Director shall be an individual appointed or elected by Skyland Co-op; or (e) within a period of twelve (12) consecutive calendar months, individuals who were Directors of the Borrower on the first day of such period (or Directors who have replaced such individuals as provided in the Borrower’s Organizational Documents) shall cease to constitute a majority of the Board of Directors of the Borrower; provided, however, for the avoidance of doubt, nothing in this definition shall relieve Borrower of its obligations under Section 6.11(a); and provided, further, that the appointment of new Directors of Borrower occurring simultaneously or immediately following the closing of the Andersons Transaction shall not be deemed to be a “Change of Control” under this Agreement.
"Class" means, when used in reference to any Loan, whether such Loan is a Revolving Facility Loan, Seasonal Term Loan, Swing Line Loan, Revolving Term Loan, Variable Rate Term Loan or Fixed Rate Term Loan and, when used in reference to any Commitment, whether such Commitment is a Revolving Facility Commitment, Seasonal Term Loan Commitment, Revolving Term Facility Commitment, Variable Rate Term Loan Commitment or Fixed Rate Term Loan Commitment.
"Closing Date" means November 1, 2024.
"CoBank" means CoBank, ACB, a federally-chartered instrumentality of the United States.
"CoBank Cash Management Agreement" means any mutually acceptable Master Agreement for Cash Management and Transaction Services between CoBank and the Borrower, including all exhibits, schedules and annexes thereto and including all related forms delivered by the Borrower to CoBank in connection therewith; provided that, the Borrower shall have elected pursuant to its rule set instructions or similar document to have its accounts that are subject to the CoBank Cash Management Agreement settle against the Swing Line Loan and such election shall not have been modified.
"Code" means the Internal Revenue Code of 1986.
"Collateral" means the collateral subject to any of the Collateral Documents or any other real or personal property of the Loan Parties, in each case pledged to the Administrative Agent for the benefit of the Secured Parties as security for the Secured Obligations.
"Collateral Assignment" means any collateral assignment of a Material Agreement, in form and substance approved by the Administrative Agent, executed by the applicable Loan Party or Loan Parties and the counterparty to such Material Agreement in favor of the Administrative Agent, for the benefit of itself and the other Secured Parties.
"Collateral Documents" means the Security Agreement, the Pledge Agreement, the Collateral Assignment (if any), the Mortgages, the account control agreements and any other document pursuant to which the Borrower or any other Loan Party has granted a Lien to the Administrative Agent for the benefit of the Secured Parties to secure all or a portion of the Secured Obligations.
"Commitment" means as to any Lender the aggregate of its Revolving Facility Commitment (including any Swing Line Commitment of the Swing Line Lender), Seasonal Term Loan Commitment, Revolving Term Facility Commitment, Variable Rate Term Loan Commitment or Fixed Rate Term Loan Commitment, as applicable, and "Commitments" means the aggregate of the Revolving Facility Commitments (including any Swing Line Commitment of the Swing Line Lender), Seasonal Term Loan Commitments, Revolving Term Facility Commitments, Variable Rate Term Loan Commitments and Fixed Rate Term Loan Commitments of all of the Lenders.
"Commodity Exchange Act" means the Commodity Exchange Act (7 U.S.C. § 1 et seq.).
"Communications" means this Agreement, any Loan Document and any document, any amendment, approval, consent, information, notice, certificate, request, statement, disclosure or authorization related to any Loan Document.
"Compliance Certificate" means a certificate of the Borrower, signed by a Compliance Officer of the Borrower, substantially in the form of Exhibit B hereto.
"Compliance Officer" means the Chief Executive Officer, President or Chief Financial Officer (or in the case of a Loan Party that is a limited liability company, a manager or member authorized under such Loan Party's Organizational Documents) of the Borrower or any other Loan Party, as the case may be.
"Connection Income Taxes" means Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profits Taxes.
"Consolidated" means, when used with reference to financial statements or financial statement items of any Person, such statements or items on a consolidated basis in accordance with applicable principles of consolidation under GAAP.
"Consolidated Net Worth" means, as of any date of determination, in accordance with GAAP, (a) total stockholders' equity as of such date determined on a Consolidated basis plus (b) the amount, if any, of any negative purchase price accounting adjustments made in connection with the Andersons Transaction or minus (c) the amount of any positive purchase price accounting adjustments made in connection with the Andersons Transaction).
"Contingent Obligations" means, as applied to any Person, any direct or indirect liability of that Person: (a) with respect to any indebtedness, lease, dividend or other obligation of another Person if the primary effect thereof, is to provide assurance to the obligee of such liability that such liability will be paid, performed or discharged, or that any agreements relating thereto will be complied with, or that the holders of such liability will be protected (in whole or in part) against loss with respect thereto; (b) with
respect to any letter of credit issued for the account of that Person or as to which that Person is otherwise liable for reimbursement of drawings; or (c) under any foreign exchange contract, currency swap agreement, interest rate swap agreement or other similar agreement or arrangement designed to alter the risks of that Person arising from fluctuations in currency values or interest rates. Contingent Obligations should also include (i) the direct or indirect guaranty, endorsement (other than for collection or deposit in the ordinary course of business), co-making, discounting with recourse or sale with recourse by such Person of the obligations of another (ii) obligations to make take-or-pay or similar payments if required regardless of the nonperformance by any other party or parties to any agreement to purchase, repurchase or otherwise acquire such obligation or any property constituting security therefor, to provide funds for the payment or discharge of such obligation or to maintain the solvency, financial condition or any balance sheet item or level of income of another and (iii) obligations under any revenue sharing agreement with vendors. The amount of any Contingent Obligation shall be equal at all times to the amount of the obligations so guaranteed or otherwise supported or, if not a fixed and determined amount, the maximum amount so guaranteed.
"Control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. Without limiting the generality of the foregoing, a Person shall be deemed to be "controlled by" a Person if such Person holds, directly or indirectly, power to vote 10% or more of the securities having ordinary voting power for the election of directors of such other Person. "Controlling" and "Controlled" have meanings correlative thereto.
"Controlled Account" means each deposit account and securities account that is subject to an account control agreement in form and substance satisfactory to the Administrative Agent and the Issuing Lender.
"Conversion or Continuation Notice" has the meaning specified in Section 2.8.
"Credit Extension" means the making, conversion or continuation of any Borrowing, Loan or Swing Line Loan or the issuing, extending, amending, renewing or increasing of any Letter of Credit.
"Credit Party" has the meaning specified in Section 11.9(b).
"Current Portion of Consolidated Long-Term Debt" means the sum, without duplication, of the current portion of all long-term Indebtedness, whether issued, assumed or guaranteed, and whether the Borrower, or any of its Subsidiaries that are included in the Borrower’s consolidated financial statements, is otherwise obligated to, or customarily pays, the principal or interest thereof or thereon; provided, that, for the avoidance of doubt, the Current Portion of Consolidated Long-Term Debt shall in no event include any Indebtedness permitted pursuant to Section 7.1(i).
"Daily Simple SOFR Rate" means, for any day (a "Daily Simple SOFR Rate Day"), a rate per annum equal to the greater of (a) SOFR for the day (such day "Daily Simple SOFR Determination Date") that is five U.S. Government Securities Business Days prior to (i) if such Daily Simple SOFR Rate Day is a U.S. Government Securities Business Day, such Daily Simple SOFR Rate Day or (ii) if such Daily Simple SOFR Rate Day is not a U.S. Government Securities Business Day, the U.S. Government Securities Business Day immediately preceding such Daily Simple SOFR Rate Day, in each case, as such SOFR is published by the SOFR Administrator on the SOFR Administrator's Website, and (b) the Floor. If by 3:00 pm on the second U.S. Government Securities Business Day immediately following any Daily Simple SOFR Determination Date SOFR in respect of such Daily Simple SOFR Rate Day has not been
published on the SOFR Administrator's Website and a Benchmark Transition Event with respect to the Daily Simple SOFR Rate has not occurred, then the SOFR for such Daily Simple SOFR Determination Date will be the SOFR as published in respect of the first preceding U.S. Government Securities Business Day for which such SOFR was published on the SOFR Administrator's Website; provided that any SOFR determined pursuant to this sentence shall be utilized for purposes of calculation of Daily Simple SOFR Rate for no more than three consecutive Daily Simple SOFR Rate Days. Any change in the Daily Simple SOFR Rate due to a change in SOFR shall be effective from and including the effective date of such change in SOFR without notice to the Borrower.
"Daily Simple SOFR Rate Loan" means a Loan bearing interest at the Daily Simple SOFR Rate Option. A Daily Simple SOFR Rate Loan is a Loan not subject to an Interest Period.
"Daily Simple SOFR Rate Option" means the option of the Borrower to have Loans bear interest at the rate and under the terms set forth in Section 2.7(a)(i).
"Debt Incurrence" means the incurrence by the Borrower or any of its Subsidiaries on or after the Closing Date of any Indebtedness other than the Obligations.
"Debt Service Coverage Ratio" means, for the period of twelve consecutive (12) months most recently ended as of the date of determination, the quotient derived by dividing (a) the sum of (in each case for such period and without duplication), (i) Gross Cash Flow, minus (ii) to the extent not included in Gross Cash Flow, the amount of Restricted Payments permitted and actually made during such period under Section 7.6(d) and the amount of payments of Indebtedness permitted and actually made during such period under Section 7.16(b)(ii) by (b) the Current Portion of Consolidated Long-Term Debt of the Borrower and its Subsidiaries that are included in the Borrower’s Consolidated financial statements for such period.
"Debtor Relief Laws" means the Bankruptcy Code, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the United States of America or other applicable jurisdictions from time to time in effect.
"Default" means any event or condition that with notice or passage of time, or both, would constitute an Event of Default.
"Default Rate" means, as of any date of determination, the following: (a) for Daily Simple SOFR Rate Loans, the rate determined in accordance with the Daily Simple SOFR Rate Option as of such date plus an additional margin of 2.00% per annum, (b) for Term SOFR Rate Loans, the rate determined in accordance with the Term SOFR Rate Option as of such date plus an additional margin of 2.00% per annum, (c) for Fixed Rate Term Loans, the rate applicable to each such Loan plus an additional margin of 2.00% per annum, (d) for Letter of Credit Fees, the Applicable Letter of Credit Fee Rate as of such date plus an additional margin of 2.00% per annum and (e) for all other Obligations, the rate for loans under Revolving Credit Facility bearing interest based upon the Daily Simple SOFR Rate (inclusive of the Applicable Margin) plus an additional margin of 2.00% per annum.
"Defaulting Lender" means, subject to Section 2.18(b), any Lender that (a) has failed to (i) fund all or any portion of its Loans within two Business Days of the date such Loans were required to be funded hereunder unless such Lender notifies the Administrative Agent and the Borrower in writing that such failure is the result of such Lender's determination that one or more conditions precedent to funding (each of which conditions precedent, together with any applicable default, shall be specifically identified
in such writing) has not been satisfied, or (ii) pay to the Administrative Agent, the Issuing Lender, the Swing Line Lender or any other Lender any other amount required to be paid by it hereunder (including in respect of its participation in Letters of Credit or Swing Line Loans) within two (2) Business Days of the date when due, (b) has notified the Borrower, the Administrative Agent or the Issuing Lender or Swing Line Lender in writing that it does not intend to comply with its funding obligations hereunder, or has made a public statement to that effect (unless such writing or public statement relates to such Lender's obligation to fund a Loan hereunder and states that such position is based on such Lender's determination that a condition precedent to funding (which condition precedent, together with any applicable default, shall be specifically identified in such writing or public statement) cannot be satisfied), (c) has failed, within three (3) Business Days after written request by the Administrative Agent or the Borrower, to confirm in writing to the Administrative Agent and the Borrower that it will comply with its prospective funding obligations hereunder (provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by the Administrative Agent and the Borrower), or (d) has, or has a direct or indirect parent company that has, (x) become the subject of a proceeding under any Debtor Relief Law, (y) had appointed for it a receiver, custodian, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any other state or federal regulatory authority or other Governmental Authority acting in such a capacity or (z) becomes the subject of a Bail-In Action; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender. Any determination by the Administrative Agent that a Lender is a Defaulting Lender under any one or more of clauses (a) through (d) above shall be conclusive and binding absent manifest error, and, subject to any cure rights expressly provided above, such Lender shall be deemed to be a Defaulting Lender (subject to Section 2.18) upon delivery of written notice of such determination to the Borrower, the Issuing Lender, the Swing Line Lender and each Lender.
"Directors" means the individuals designated by the Members pursuant to the Borrower’s Organizational Documents to serve on the board of Directors. Each Director is a “manager” as defined in the Kansas Revised Limited Liability Company Act, K.S.A. 17-7662, et seq.
"Disposition" or "Dispose" means the sale, transfer, license, lease or other disposition (including any sale and leaseback transaction) of any property or asset by any Person.
"Division" means, in reference to any Person which is an entity, the division of such Person into two (2) or more separate Persons with the dividing Person either continuing or terminating its existence as part of the division including as contemplated under Section 18-217 of the Delaware Limited Liability Act for limited liability companies formed under Delaware Law or any analogous action taken pursuant to any applicable Law with respect to any corporation, limited liability company, partnership or other entity. The word "Divide", when capitalized shall have correlative meaning.
"Dollar," "Dollars," "U.S. Dollars" and the symbol "$" means lawful money of the United States of America.
"Domestic Subsidiary" means any Subsidiary that is organized and existing under the Laws of the United States of America or any state, commonwealth or territory thereof or under the Laws of the District of Columbia.
"Drawing Date" has the meaning specified in Section 2.12(c)(i).
"EEA Financial Institution" means (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.
"EEA Member Country" means any of the member states of the European Union, United Kingdom, Iceland, Liechtenstein, and Norway.
"EEA Resolution Authority" means any public administrative authority or any Person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.
"Electronic Copy" has the meaning specified in Section 11.9(c).
"Eligible Assignee" means any Person that meets the requirements to be an assignee under Sections 11.7(b)(iii), 11.7(b)(v) and 11.7(b)(vi) (subject to such consents, if any, as may be required under Section 11.7(b)(iii)).
"Environmental Indemnity" means the Environmental Indemnity Agreement substantially in the form of Exhibit K hereto and as supplemented pursuant to Section 6.10(c).
"Environmental Laws" means any and all applicable current and future federal, state, local and foreign Laws and any consent decrees, concessions, permits, grants, franchises, licenses, agreements or other restrictions of a Governmental Authority or common Law causes of action relating to: (a) protection of the environment or natural resources from, or emissions, discharges, releases or threatened releases of, any materials, including Hazardous Materials, in the environment including ambient air, surface and subsurface soils and materials, surface water, ground water, wetlands or land, (b) the generation, storage, handling, use, labeling, disposal, transportation, reclamation and remediation of Hazardous Materials; (c) human health or safety; (d) the protection of endangered or threatened species; and (e) the protection of environmentally sensitive areas.
"Environmental Liability" means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines, penalties or indemnities), of any Loan Party or any Subsidiary of any Loan Party resulting from or based upon (a) violation of any Environmental Law; (b) the generation, use, handling, transportation, storage, treatment, disposal or permitting or arranging for the disposal of any Hazardous Materials; (c) exposure to any Hazardous Materials; (d) the release or threatened release of any Hazardous Materials; or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.
"Equity Interests" means, with respect to any Person, all of the shares of capital stock of, or other ownership interests, in such Person (including partnership, member or trust interests therein),
whether voting or nonvoting and all of the warrants, options or other rights for the purchase or acquisition from such Person of shares of capital stock of, or other ownership interests in, such Person.
"Equity Issuance" means (a) any issuance or sale by the Borrower or any of its Subsidiaries of any Equity Interests, or (b) any equity contribution or capital contribution in respect of any Equity Interests of the Borrower or any of its Subsidiaries, in each case at any time after the Closing Date.
"ERISA" means the Employee Retirement Income Security Act of 1974.
"ERISA Affiliate" means, at any time, any trade or business (whether or not incorporated) under common control with any Loan Party such that such trade or business, together with such Loan Party and all other ERISA Affiliates, are treated as a single employer under Section 414 of the Code or Section 4001(b)(1) of ERISA.
"ERISA Event" means (a) a "reportable event" (under Section 4043 of ERISA and regulations thereunder) with respect to a Pension Plan; (b) a withdrawal by a Loan Party or any ERISA Affiliate from a Pension Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of ERISA; (c) a complete or partial withdrawal by a Loan Party or any ERISA Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is in reorganization; (d) the filing of a notice of intent to terminate, the treatment of an amendment to a Pension Plan or a Multiemployer Plan as a termination under Section 4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e) an event or condition that constitutes grounds or that could reasonably be expected to constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan or Multiemployer Plan; (f) an event or condition that results or could reasonably expected to result in any liability under Title IV of ERISA, other than for PBGC premiums due but not delinquent under Section 4007 of ERISA, to a Loan Party or any ERISA Affiliate; (g) with respect to any Pension Plan, the failure to satisfy the minimum funding standards under the Plan Funding Rules (whether or not waived); (h) with respect to any Pension Plan, the occurrence of any event that would result in the imposition of any limitation under Section 436 of the Code or Section 206(g) of ERISA, determined without regard to any contribution made or the provision of security under Section 436 of the Code or Section 206(g) of ERISA to avoid the imposition of the limitation; (i) the determination that any Pension Plan is considered an at-risk plan or a plan in endangered or critical status within the meaning of the Plan Funding Rules; (j) the occurrence of an aggregate Unfunded Liability for all Plans exceeding $2,000,000.00; (k) any transaction that could subject any Loan Party or any ERISA Affiliate to liability under Section 4069 or 4212 of ERISA; (l) a prohibited transaction with respect to a Plan within the meaning of Section 4975 of the Code or Section 406 of ERISA or a violation of the fiduciary responsibility rules of Section 404 of ERISA; and (m) an event or condition that results, or could reasonably be expected to result, in any liability under Section 4980H(a) of the Code, without qualifying for the reduced assessment under Section 49980H(b) of the Code, to any Loan Party or any ERISA Affiliate.
"EU Bail-In Legislation Schedule" means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor Person), as in effect from time to time.
"Event of Default" means any of the events described in Section 9.1 and referred to therein as an "Event of Default."
"Excluded Swap Obligation" means, with respect to any Loan Party providing a Guaranty of or granting a security interest to secure any Swap Obligation of another Loan Party, if, and to the extent that, all or a portion of the Guaranty of such Loan Party of, or the grant by such Loan Party of a security interest to secure, such Swap Obligation (or any Guaranty thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Loan Party's failure for any reason not to constitute an "eligible contract participant" as defined in the Commodity Exchange Act (determined after giving effect to Section 11.16 and any other "keepwell, support or other agreements" for the benefit of such Guarantor) at the time the Guaranty of, or the grant of such security interest by, such Loan Party becomes effective with respect to such related Swap Obligation. If a Swap Obligation arises under a master agreement governing more than one swap, such exclusion shall apply only to the portion of such Swap Obligation that is attributable to swaps for which such Guaranty or grant of security interest is or becomes illegal.
"Excluded Taxes" means any of the following Taxes imposed on or with respect to a Recipient or required to be withheld or deducted from a payment to a Recipient, (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result of such Recipient being organized under the laws of, or having its principal office or, in the case of any Lender, its applicable lending office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Loan or Commitment pursuant to a law in effect on the date on which (x) such Lender acquires such interest in such Loan or Commitment (other than pursuant to an assignment request by the Borrower under Section 3.6) or (y) such Lender changes its lending office, except in each case to the extent that, pursuant to Section 3.2, amounts with respect to such Taxes were payable either to such Lender's assignor immediately before such Lender became a party hereto or to such Lender immediately before it changed its lending office, (c) Taxes attributable to such Recipient's failure to comply with Section 3.2 and (d) any U.S. federal withholding Taxes imposed under FATCA.
"Existing Credit Agreement" has the meaning set forth in the recitals hereto.
"Existing Fixed Rate Term Loan Facility" has the meaning set forth in Section 2.6(a).
"Facilities Management Agreements" means (a) the Second Amended and Restated Facilities Management Agreement by and between the Borrower and Skyland Co-op dated as of November 1, 2024, and (b) the Facilities Management Agreement(s) delivered pursuant to Section 6.16 or any other provision of this Agreement, in each case including all exhibits, schedules and annexes thereto and each as altered, amended, changed, modified, restated or amended and restated from time to time.
"Facility" means, collectively, the Revolving Credit Facility, any Seasonal Term Loan Facility, the Swing Line Facility, the Revolving Term Credit Facility, the Variable Rate Term Loan Facility, the Fixed Rate Term Loan Facility and the Letter of Credit Facility.
"Farm Credit Equities" means any of the Borrower’s stock, patronage refunds issued in the form of stock or otherwise constituting allocated units, patronage surplus (including any such surplus accrued by a Farm Credit Lender for the account of the Borrower) and other equities in each Farm Credit Lender acquired in connection with, or because of the existence of, the Borrower’s patronage loan from such Farm Credit Lender (or its affiliate), and the proceeds of any of the foregoing.
"Farm Credit Lender" means a federally-chartered Farm Credit System lending institution organized under the Farm Credit Act of 1971.
"FATCA" means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with) and any current or future regulations or official interpretations thereof and any agreements entered into pursuant to Section 1471(b)(1) of the Code and any fiscal or regulatory legislation, rules or practices adopted pursuant to any intergovernmental agreement, treaty or convention among Governmental Authorities entered into in connection with the implementation of the foregoing.
"Federal Funds Effective Rate" means, for any day, the greater of (a) the rate of interest per annum (rounded upward, if necessary, to the nearest whole multiple of 1/100th of 1%) equal to the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System, as published by the Federal Reserve Bank of New York on such date, or if no such rate is so published on such day, on the most recent day preceding such day on which such rate is so published and (b) 0%.
"Fee Letter" means that certain fee letter dated as of September 19, 2024 between the Borrower and the Administrative Agent, together with any other fee letters entered into between the Borrower and the Administrative Agent from time to time in connection with any Revolving Facility Increase or any Tranche of Seasonal Term Loans.
"FCMA" means Farm Credit Mid-America, PCA.
"Fiscal Quarter" means (a) for any period ending on or before January 31, 2024, the three-month periods beginning each February 1, May 1, August 1 and November 1, (b) the stub period from February 1, 2024 to March 31, 2024, and (c) for any period beginning April 1, 2024 or thereafter, the three-month periods beginning each January 1, April 1, July 1 and October 1.
"Fixed Rate Term Lender" means each Lender having a Fixed Rate Term Loan Commitment or who has funded or purchased all or a portion of a Fixed Rate Term Loan in accordance with the terms hereof.
"Fixed Rate Term Loan" has the meaning specified in Section 2.6(a) and "Fixed Rate Term Loans" means collectively all of the Fixed Rate Term Loans.
"Fixed Rate Term Loan Commitment" means, as to any Lender at any time, the amount initially set forth opposite its name on Schedule 1.1(b), as such Commitment is thereafter assigned or modified, and "Fixed Rate Term Loan Commitments" means the aggregate Fixed Rate Term Loan Commitments of all of the Lenders. As of the Closing Date, the aggregate amount of the Fixed Rate Term Loan Commitments of the Lenders is $11,192,740.00.
"Fixed Rate Term Loan Facility" means the term loan facility established pursuant to Section 2.6.
"Fixed Rate Term Loan Notes" means the promissory notes of the Borrower substantially in the form of Exhibit F-3 hereto evidencing the Fixed Rate Term Loans.
"Fixed Rate Term Loan Overadvance" has the meaning specified in Section 2.16(a)(v).
"Flood Laws" means, collectively, (a) the National Flood Insurance Act of 1968, (b) the Flood Disaster Protection Act of 1973, (c) the National Flood Insurance Reform Act of 1994 and (d) the Flood Insurance Reform Act of 2004, and all other applicable Laws related thereto.
"Floor" means a rate of interest equal to 0.00%.
"Foreign Lender" means (a) if the Borrower is a U.S. Person, a Lender that is not a U.S. Person, and (b) if the Borrower is not a U.S. Person, a Lender that is resident or organized under the Laws of a jurisdiction other than that in which the Borrower is resident for tax purposes. For purposes of this definition, the United States of America, each State thereof and the District of Columbia shall be deemed to constitute a single jurisdiction.
"Fronting Exposure" means, at any time there is a Defaulting Lender, (a) with respect to the Issuing Lender, such Defaulting Lender's Pro Rata Share of the outstanding Letter of Credit Obligations with respect to Letters of Credit issued by the Issuing Lender other than Letter of Credit Obligations as to which such Defaulting Lender's participation obligation has been reallocated to other Lenders or Cash Collateralized in accordance with the terms hereof, and (b) with respect to the Swing Line Lender, such Defaulting Lender's Pro Rata Share of outstanding Swing Line Loans made by the Swing Line Lender other than Swing Line Loans as to which such Defaulting Lender's participation obligation has been reallocated to other Lenders.
"Fund" means any Person (other than a natural Person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its activities.
"GAAP" means generally accepted accounting principles as are in effect from time to time, subject to the provisions of Section 1.3, and applied on a consistent basis both as to classification of items and amounts.
"Governmental Authority" means the government of the United States of America or any other nation, or of any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank).
"Gross Cash Flow" means, for the period of twelve consecutive (12) months most recently ended as of the date of determination, the sum of (a) the net income (or loss) before taxes of the Borrower, determined on a Consolidated basis, in accordance with GAAP minus (b) non-cash income from subsidiaries and joint ventures minus (c) non-cash patronage income minus (d) gain (plus loss) on asset sales minus (e) extraordinary income (plus loss) minus (f) non-cash mark-to-market inventory adjustments, if positive (or plus such adjustments, if negative) plus (g) depreciation plus (h) amortization, in each case without duplication.
"Guaranteed Liabilities" means (a) the prompt Payment In Full, when due or declared due and at all such times, of all Secured Obligations and all other amounts pursuant to the terms of this Agreement, the Notes, and all other Loan Documents heretofore, now or at any time or times hereafter owing, arising, due or payable from the Borrower or any other Loan Party to any one or more of the Secured Parties, including principal, interest, premiums and fees (including all reasonable fees and expenses of counsel); (b) the prompt, full and faithful performance, observance and discharge of each and every agreement, undertaking, covenant and provision to be performed, observed or discharged by the
Borrower and each other Loan Party under this Agreement, the Notes and all other Loan Documents to which it is a party; and (c) the prompt Payment In Full by the Borrower and each other Loan Party, when due or declared due and at all such times, of obligations and liabilities now or hereafter arising with respect to any Secured Bank Product or Secured Hedge. Notwithstanding the foregoing, the "Guaranteed Liabilities", with respect to any Loan Party providing a Guaranty, shall not include the Excluded Swap Obligations.
"Guarantor" means each of the parties to this Agreement that is designated as a "Guarantor" on the signature page hereof and each other Person that joins this Agreement as a Guarantor after the date hereof pursuant to a Guarantor Joinder.
"Guarantor Joinder" means a joinder agreement joining a Person as a Guarantor under the Loan Documents in the form of Exhibit C.
"Guarantors' Obligations" means the obligations of the Guarantors to the Secured Parties under Article XII.
"Guaranty" or "Guarantee" means, with respect to any Person, without duplication, any obligation, contingent or otherwise, of such Person pursuant to which such Person has directly or indirectly guaranteed or had the economic effect of guaranteeing any Indebtedness or other obligation or liability of any other Person and, without limiting the generality of the foregoing, any obligation, direct or indirect, contingent or otherwise, of any such Person (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation or liability (whether arising by virtue of partnership arrangements, by agreement to keep well, to purchase assets, goods, securities or services, to take-or-pay, or to maintain financial statement condition or otherwise), (b) to purchase or lease property or services for the purpose of assuring another Person's payment or performance of any Indebtedness or other obligations or liabilities, (c) to maintain the working capital of such Person to permit such Person to pay such Indebtedness or other obligations or liabilities or (d) entered into for the purpose of assuring in any other manner the obligee of such Indebtedness or other obligation or liability of the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part); provided, that the term Guaranty/Guarantee shall not include endorsements for collection or deposit in the ordinary course of business. Unless otherwise specified, the amount of any Guaranty shall be deemed to be the lesser of the principal amount of the Indebtedness or other obligations or liabilities guaranteed and still outstanding and the maximum amount for which the guaranteeing Person may be liable pursuant to the terms of the instrument embodying such Guaranty.
"Hazardous Materials" means (a) any explosive or radioactive substances, materials or wastes, (b) any hazardous or toxic substances, materials or wastes, defined or regulated as such in or under, or that could reasonably be expected to give rise to liability under, any applicable Environmental Law, including, asbestos or asbestos containing materials, infectious or medical waste, polychlorinated biphenyls, radon gas, urea-formaldehyde insulation, per- and poly-fluoroalkyl substances, carbon tetrachloride, gasoline or petroleum (including crude oil or any fraction thereof) or petroleum products and (c) all other substances, materials or wastes of any nature regulated under or with respect to which liability or standards of conduct are imposed pursuant to any Environmental Law.
"Hedge Agreement" means (a) any and all rate swap transactions, basis swaps, credit derivative transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions, interest rate options, forward
foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of any of the foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement, and (b) any and all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement.
"Hedge Bank" means any Person that, at the time it enters into a Hedge Agreement with a Loan Party for an Interest Rate Hedge with respect to interest on the Obligations, is a Lender, an Affiliate of a Lender, the Administrative Agent or an Affiliate of the Administrative Agent.
"Hedge Termination Value" means, in respect of any one or more Hedge Agreements, after taking into account the effect of any legally enforceable netting agreement relating to such Hedge Agreements, (a) for any date on or after the date such Hedge Agreements have been closed out and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for such Hedge Agreements, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Hedge Agreements (which may include a Lender or any Affiliate of a Lender).
"Indebtedness" means, as to any Person at a particular time, without duplication, all of the following, whether or not included as indebtedness or liabilities in accordance with GAAP:
(a)all obligations of such Person for borrowed money and all obligations of such Person evidenced by bonds, debentures, notes, loan agreements or other similar instruments;
(g)all direct or contingent obligations of such Person arising under letters of credit (including standby and commercial), bankers' acceptances, bank guaranties, surety bonds and similar instruments;
(h)all net obligations of such Person under each Hedge Agreement to which it is a party (provided, that the amount of any net obligation under any Hedge Agreement on any date shall be deemed to be the Hedge Termination Value thereof as of such date);
(i)all obligations of such Person to pay the deferred purchase price of property or services (other than trade accounts payable in the ordinary course of business and, in each case, not past due for more than 30 days after the date on which such trade account payable was created);
(j)obligations (excluding prepaid interest thereon) secured by a Lien on property owned or being purchased by such Person (including indebtedness arising under conditional sales or other title retention agreements), whether or not such obligations shall have been assumed by such Person or is limited in recourse;
(k)all obligations of such Person under Capital Leases and all its Synthetic Lease Obligations;
(l)all obligations of such Person to purchase, redeem, retire, defease or otherwise make any payment in respect of any Equity Interest in such Person or any other Person, valued, in the
case of a redeemable preferred interest, at the greater of its voluntary or involuntary liquidation preference plus accrued and unpaid dividends; and
(m)all fixed payment obligations of any Person under any Guarantee of such Person in respect of any of the foregoing.
"Indemnified Taxes" means (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of the Borrower or any other Loan Party under any Loan Document and (b) to the extent not otherwise described in the preceding clause (a), Other Taxes.
"Indemnitee" has the meaning specified in Section 11.3.
"Information" has the meaning specified in Section 11.8.
"Insolvency Proceeding" means, with respect to any Person, (a) a case, action or proceeding with respect to such Person (i) before any court or any other Governmental Authority under any Debtor Relief Law or other similar law now or hereafter in effect, or (ii) for the appointment of a receiver, liquidator, assignee, custodian, trustee, sequestrator, conservator (or similar official) of any Loan Party or otherwise relating to the liquidation, dissolution, winding-up or relief of such Person, or (b) any general assignment for the benefit of creditors, composition, marshaling of assets for creditors, or other, similar arrangement in respect of such Person's creditors generally or any substantial portion of its creditors; undertaken under any Law.
"Intellectual Property" shall mean any and all worldwide industrial, proprietary, and intellectual property rights (including all common law and statutory rights, registrations and applications therefor, and renewals, extensions, and restorations thereof, as applicable), of every kind and nature, whether existing now or in the future, including but not limited to all of the following: (i) all Copyrights, Domain Names, Patents, Trademarks and IP Licenses (in each case as defined in the Security Agreement), (ii) all confidential or proprietary information trade secrets, designs, and social media accounts and content thereon; (iii) any and all royalties, fees, income, payments and other proceeds now or hereafter due or payable with respect to any and all of the foregoing; and (iv) any and all claims and causes of action with respect to any of the foregoing, including all rights to and claims for damages, restitution and injunctive and other legal and equitable relief for past, present, and future infringement, dilution, misappropriation, violation, misuse, breach or default, with the right to sue for such legal and equitable relief and to collect, or otherwise recover, any such damages.
"Interest Payment Date" means, with respect to (a) Daily Simple SOFR Rate Loans, December 1, 2024, the first day of each calendar month thereafter and the applicable Maturity Date and (b) Alternate Base Rate Loans, January 1, 2025, the first day of each Fiscal Quarter thereafter and the applicable Maturity Date.
"Interest Period" means the period of time selected by the Borrower in connection with (and to apply to) any election permitted hereunder by the Borrower to have Loans bear interest under the Term SOFR Rate Option. Subject to the last sentence of this definition, such period shall be one, three, six and twelve months. Such Interest Period shall commence on the effective date of such Term SOFR Rate Loan, which shall be (a) the Borrowing Date if the Borrower is requesting new Loans, or (b) the date of renewal of or conversion to a Term SOFR Rate Loan if the Borrower is renewing or converting an existing Loan. Notwithstanding the second sentence hereof: (i) any Interest Period that would otherwise end on a date that is not a Business Day shall be extended to the next succeeding Business Day unless such Business Day falls in the next calendar month, in which case such Interest Period shall end on the
next preceding Business Day, (ii) the Borrower shall not select, convert to or renew an Interest Period for any portion of the Loans that would end after the applicable Maturity Date and (iii) if any Interest Period begins on the last Business Day of a month or on a day of a month for which there is no numerically corresponding day in the month in which such Interest Period is to end, such Interest Period shall be deemed to end on the last Business Day of the final month of such Interest Period.
"Interest Rate Hedge" means a Hedge Agreement entered into by the Loan Parties or their Subsidiaries in order to provide protection to, or minimize the impact upon, the Borrower, the Guarantor and/or their Subsidiaries of increasing floating rates of interest applicable to Indebtedness.
"Interest Rate Option" means any (a) Daily Simple SOFR Rate Option or (b) Term SOFR Rate Option.
"Investment" means, with respect to any Person, any direct or indirect acquisition or investment by such Person, whether by means of (a) the purchase or other acquisition of capital stock or other securities of another Person, (b) a loan, advance or capital contribution to, Guarantee or assumption of debt of, or purchase or other acquisition of any other debt or equity participation or interest in, another Person, including any partnership or joint venture interest in such other Person and any arrangement pursuant to which the investor Guarantees Indebtedness of such other Person, or (c) the purchase or other acquisition (in one transaction or a series of transactions) of assets of another Person that constitute a business unit. For purposes of covenant compliance, the amount of any Investment shall be the amount actually invested, without adjustment for subsequent increases or decreases in the value of such Investment.
"IRS" means the United States Internal Revenue Service.
"ISP" has the meaning specified in Section 2.12(k).
"Issuing Lender" means CoBank, in its individual capacity as issuer of Letters of Credit hereunder.
"Joint Venture" means a corporation, partnership, limited liability company or other entity in which any Person other than the Loan Parties and their Subsidiaries holds, directly or indirectly, an equity interest.
"Knowledge of the Authorized Officer" means the Actual Knowledge of any Authorized Officer after reasonable inquiry of the senior management level Person(s) with oversight responsibility for the matter that is the subject of the inquiry. “Knowledge of an Authorized Officer”, “Knowledge of any Authorized Officer”, and “Known by any Authorized Officer” shall have corollary meanings.
"Landlord Agreement" means any landlord's waiver or other lien waiver or subordination agreement executed and delivered by a lessor, warehouse operator or other applicable Person with respect to a leased location of any Loan Party to the Administrative Agent for the benefit of the Lenders.
"Law" means any law (including common law), constitution, statute, codes, treaty, regulation, rule, ordinance, opinion, release, ruling, order, injunction, writ, decree, bond, judgment, authorization or approval, or award by or settlement agreement with any Governmental Authority applicable to any Person or the properties of any Person, including all Environmental Laws.
"Lenders" means each of the financial institutions from time to time party hereto as a lender (including the Swing Line Lender, any New Seasonal Term Lender, any New Variable Rate Term Lender and any New Revolving Facility Lender) and their respective successors and assigns as permitted hereunder, each of which is referred to herein as a Lender. For the purpose of any Loan Document that provides for the granting of a security interest or other Lien to the Lenders or to the Administrative Agent for the benefit of the Lenders as security for the Obligations, "Lenders" shall include any Affiliate of a Lender to the extent such Affiliate is a Secured Party.
"Letter of Credit" has the meaning specified in Section 2.12(a).
"Letter of Credit Borrowing" has the meaning specified in Section 2.12(c)(iii).
"Letter of Credit Expiration Date" means the day that occurs thirty (30) days prior to the Maturity Date for the Revolving Credit Facility.
"Letter of Credit Facility" means the Letter of Credit facility established pursuant to Section 2.12.
"Letter of Credit Fee" has the meaning specified in Section 2.12(b).
"Letter of Credit Obligations" means, as of any date of determination, (a) the aggregate amount available to be drawn under all outstanding Letters of Credit on such date (if any Letter of Credit shall increase in amount automatically in the future, such aggregate amount available to be drawn shall currently give effect to any such future increase) plus (b) the aggregate Reimbursement Obligations and Letter of Credit Borrowings on such date.
"Letter of Credit Request" has the meaning specified in Section 2.12(a).
"Letter of Credit Sublimit" means $5,000,000.00.
"Lien" means any mortgage, deed of trust, pledge, hypothecation, collateral assignment, lien (statutory or otherwise), security interest, charge or other encumbrance or security arrangement of any nature whatsoever, whether voluntarily or involuntarily given, including any conditional sale or title retention arrangement, and any assignment, deposit arrangement or lease intended as, or having the effect of, security and any filed financing statement or other notice of any of the foregoing (whether or not a lien or other encumbrance is created or exists at the time of the filing).
"Loan Documents" means this Agreement, the Fee Letter, the Environmental Indemnity, the Collateral Documents, the Solvency Certificates, the Perfection and Diligence Certificate, the Landlord Agreements (if any), the Notices of Seasonal Term Loan Borrowing (if any), the Seasonal Term Loan Funding Agreements (if any), the Notices of Revolving Facility Increase (if any), the Notes, Secured Bank Products, Hedge Agreements and any other instruments, certificates or documents delivered in connection herewith or therewith, all as amended, restated, reaffirmed, reconfirmed, replaced, substituted or otherwise modified from time to time.
"Loan Parties" means the Borrower and the Guarantors.
"Loan Request" means a request for any of a Revolving Facility Loan, a Seasonal Term Loan, a Swing Line Loan, a Revolving Term Loan, a Variable Rate Term Loan or a Fixed Rate Term Loan, in each case substantially in the form of Exhibit D hereto.
"Loans" means collectively all Revolving Facility Loans, Seasonal Term Loans, Swing Line Loans, Revolving Term Loans, Variable Rate Term Loans and Fixed Rate Term Loans or any Revolving Facility Loan, Seasonal Term Loan, Swing Line Loan, Revolving Term Loan, Variable Rate Term Loan or Fixed Rate Term Loan, and "Loan" means the reference to any of the foregoing.
"Material Account" means all deposit, securities or other investment accounts in the name of any Loan Party to the extent the average daily balance of any such account determined after giving effect to any daily sweeps thereof (or market value of such account), for the most recently completed six calendar months, individually, exceeds $2,000,000.00 or, in the aggregate, exceeds $4,000,000.00.
"Material Adverse Change" means any circumstance or event, or series of circumstances or events, that has or could reasonably be expected to have any material adverse effect whatsoever upon (a) the business, properties, assets, condition (financial or otherwise), operations, liabilities (actual or contingent) or prospects of the Borrower individually or the Loan Parties, taken as a whole, (b) the legality, binding effect, validity or enforceability of this Agreement or any other Loan Document, (c) the ability of the Borrower individually or the Loan Parties, taken as a whole, to duly and punctually pay or perform any of the Secured Obligations, or (d) the ability of the Administrative Agent or any other Secured Party to enforce their legal remedies pursuant to this Agreement or any other Loan Document.
"Material Agreement" means any (a) agreement, contract, note, bond, debenture or other instrument evidencing Material Indebtedness or (b) any agreement, contract or other instrument to which any Loan Party or any Subsidiary of any Loan Party is a party or that is binding upon any Loan Party or any Subsidiary of any Loan Party or its respective property the revocation, suspension or termination (prior to the stated termination date therefor) of which could reasonably be expected to result in a Material Adverse Change. For the avoidance of doubt, the Facilities Management Agreements shall constitute Material Agreements.
"Material Indebtedness" means Indebtedness (other than the Obligations) in an aggregate principal amount exceeding $5,000,000.00.
"Material Leased Property" means any real property leased or licensed by any Loan Party that (a) is the headquarters or principal place of business of any Loan Party or (b) is a headend site, switch site or such other location, in each case, the loss of which would reasonably be expected to have a Material Adverse Change.
"Material Owned Property" means any real property owned by any Loan Party in fee simple (a) that has a book value in excess of $2,000,000.00, (b) that is the headquarters or principal place of business of any Loan Party, or (c) as to which the loss thereof would have a Material Adverse Change.
"Material Subsidiary" means a Subsidiary of the Borrower which, as of the last day of any period of four consecutive Fiscal Quarters for which financial statements were required to be delivered pursuant to Section 6.1(a) or (b), either (i) owns assets at least equal to five percent (5%) of the total assets (as calculated in accordance with GAAP) of the Borrower and its Subsidiaries on a consolidated basis, or (ii) has earnings before interest expense, tax, depreciation and amortization (as calculated in accordance with GAAP) at least equal to five percent (5%) of earnings before interest expense, tax, depreciation and amortization (as calculated in accordance with GAAP) of the Borrower and its Subsidiaries on a consolidated basis. For the avoidance of doubt, once a Subsidiary becomes a Material Subsidiary, it shall thereafter be treated as a Material Subsidiary for all purposes under this Agreement, unless the Administrative Agent otherwise agrees.
"Maturity Date" means: (a) with respect to the Revolving Credit Facility and the Swing Line Facility, the earlier of (i) the date of acceleration of the Obligations in accordance with Section 9.2 and (ii) November 1, 2027; (b) with respect to the Revolving Term Credit Facility, the earlier of (i) the date of acceleration of the Obligations in accordance with Section 9.2 and (ii) November 1, 2029; (c) with respect to the Variable Rate Term Loan Facility, the earlier of (i) the date of acceleration of the Obligations in accordance with Section 9.2 and (ii) November 1, 2029; (d) with respect to each Fixed Rate Term Loan, the earlier of (i) the date of acceleration of the Obligations in accordance with Section 9.2 and (ii) June 20, 2029; and (e) with respect to any Seasonal Term Loan, the earlier of (i) the date of acceleration of the Obligations in accordance with Section 9.2 and (ii) the date set forth in the applicable Seasonal Term Loan Funding Agreement.
"Maximum Aggregate Seasonal Term Loan Amount" means $100,000,000.00.
"Maximum Guarantor Liability" has the meaning specified in Section 12.4.
"Maximum Rate" has the meaning specified in Section 11.14.
"Maximum Revolving Facility Aggregate Increase Amount" means with respect to the Revolving Credit Facility, an aggregate principal amount of all increases to the Revolving Facility Commitments made pursuant to Section 2.1(e)(i) not to exceed $150,000,000.00.
"Minimum Collateral Amount" means, at any time, (a) with respect to Cash Collateral consisting of cash or deposit account balances, an amount equal to 105% of the Fronting Exposure of the Issuing Lender with respect to Letters of Credit issued and outstanding at such time and (b) otherwise, such lesser amount determined by the Administrative Agent and the Issuing Lender in their sole discretion.
"Moody's" means Moody's Investors Service, Inc., or any successor or assignee thereof in the business of rating securities and debt.
"Mortgage" means each mortgage or deed of trust (as applicable) in a form acceptable to the Administrative Agent in its reasonable discretion executed and delivered by a Loan Party to the Administrative Agent for the benefit of the Lenders with respect to certain of the real estate owned or leased by such Loan Party.
"Multiemployer Plan" means any employee benefit plan that is a "multiemployer plan" within the meaning of Section 3(37) of the Code or Section 4001(a)(3) of ERISA and to which any Loan Party or any ERISA Affiliate is then making or accruing an obligation to make contributions or, within the preceding five (5) plan years of such Multiemployer Plan, has made or had an obligation to make such contributions or with respect to which otherwise has any obligation or liability (including a contingent liability).
"Net Cash Proceeds" means:
(a)in the case of any Debt Incurrence, an amount equal to (i) the aggregate amount of all cash and Cash Equivalents received by any Loan Party or any of its Subsidiaries in respect of such Debt Incurrence, minus (ii) customary, bona fide, out-of-pocket direct costs incurred by such Loan Party and its Subsidiaries in connection with such issuance;
(n)in the case of any Equity Issuance, an amount equal to (i) the aggregate amount of all cash and Cash Equivalents received by any Loan Party or any of its Subsidiaries in respect of such Equity Issuance, minus (ii) customary, bona fide, out-of-pocket direct costs incurred by such Loan Party and its Subsidiaries in connection with such issuance;
(o)in the case of any Casualty Event, an amount equal to (i) the aggregate amount of all cash and Cash Equivalents received by any Loan Party or any of its Subsidiaries from such Casualty Event, minus (ii) the sum of all customary, bona fide, out-of-pocket direct costs incurred by such Loan Party and its Subsidiaries in connection with collecting such cash and Cash Equivalents; and
(p)in the case of any Disposition, an amount equal to (i) the aggregate amount of all cash and Cash Equivalents received by any Loan Party or any of its Subsidiaries from such Disposition (including any such proceeds received by way of deferred payment of principal pursuant to a note or installment receivable or purchase price adjustment receivable or return of funds held in escrow or otherwise, but only as and when received), minus (ii) the sum of (x) all income taxes and other taxes assessed by a Governmental Authority as a result of such transaction, (y) all customary, bona fide, out-of-pocket direct transaction costs incurred by such Loan Party and its Subsidiaries in connection with such Disposition, and (z) amounts applied to repayment of permitted Indebtedness (other than the Obligations) secured by a Permitted Lien on the asset or property disposed of having priority over the Lien of the Administrative Agent on the Collateral;
provided that, so long as no Default or Event of Default shall have occurred and be continuing or would result therefrom, Net Cash Proceeds shall not include any amounts (1) with respect to clause (c) above to the extent that such amounts are applied to reimburse the Borrower for repairs to or replacements of the property subject to such Casualty Event, used for repairs to or replacements of the property subject to such Casualty Event; or reinvested in productive assets (other than inventory unless such Net Cash Proceeds result from a Casualty Event with respect to inventory) of a kind then used or usable in the business of such Loan Party, within 180 days after the receipt thereof or (2) with respect to clause (d) above to the extent that such amounts are reinvested in productive assets (other than inventory) of a kind then used or usable in the business of such Loan Party, within 180 days after the receipt thereof. To the extent reinvestment is permitted, such Net Cash Proceeds must be deposited and held in a deposit account of which the Administrative Agent has "control" (as defined in Article 9 of the UCC) until reinvested and must be reinvested in assets subject to the Lien of the Administrative Agent under the Collateral Documents, subject only to Permitted Liens.
"New Revolving Facility Lender" has the meaning specified in Section 2.1(e)(iv).
"New Seasonal Term Lender" has the meaning set forth in Section 2.2(d).
"Non-Consenting Lender" has the meaning specified in Section 11.1.
"Non-Defaulting Lender" means, at any time, each Lender that is not a Defaulting Lender at such time.
"Notes" means, collectively, the Revolving Facility Notes, any Seasonal Term Loan Notes, the Swing Line Note, the Revolving Term Facility Notes, the Variable Rate Term Loan Notes and the Fixed Rate Term Loan Notes.
"Notice of Revolving Facility Increase" means a facility increase notice meeting the requirements of Section 2.1(e)(i) and substantially in the form of Exhibit J-2 hereto.
"Notice of Seasonal Term Loan Borrowing" means a notice of a Tranche of Seasonal Term Loans meeting the requirements of Section 2.2(a) and substantially in the form of Exhibit J-1 hereto.
"Obligation" means any obligation or liability of any of the Loan Parties (other than Excluded Swap Obligations), howsoever created, arising or evidenced, whether direct or indirect, joint or several, absolute or contingent, for payment or performance, now or hereafter existing (and including obligations or liabilities arising or accruing after the commencement of any Insolvency Proceeding with respect to any Loan Party or which would have arisen or accrued but for the commencement of such Insolvency Proceeding, even if the claim for such obligation or liability is not enforceable or allowable in such proceeding), or due or to become due, under or in connection with this Agreement, the Notes, the Letters of Credit, the Fee Letter or any other Loan Document (regardless of whether any Credit Extension is in excess of the amount committed under or contemplated by the Loan Documents or are made in circumstances in which any condition to any Credit Extension is not satisfied) whether to the Administrative Agent, any of the Lenders or their Affiliates or other persons provided for under such Loan Documents.
"Official Body" means (a) any Governmental Authority and (b) any group or body charged with setting financial accounting or regulatory capital rules or standards (including the Financial Accounting Standards Board, the Bank for International Settlements or the Basel Committee on Banking Supervision or any successor or similar authority to any of the foregoing).
"Order" has the meaning specified in Section 2.12.
"Organizational Documents" means the certificate or articles of incorporation, bylaws, certificate of limited partnership, partnership agreement, certificate of formation, limited liability company agreement or other organizational documents of any Person.
"Other Connection Taxes" means, with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).
"Other Information" has the meaning specified in Section 12.13.
"Other Liabilities" means any obligation of any Loan Party arising under any document or agreement relating to or on account of (a) any Secured Bank Product and/or (b) any Secured Hedge (other than any Excluded Swap Obligations).
"Other Taxes" means all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment (other than an assignment made pursuant to Section 3.6).
"Overadvance" means any Revolving Facility Overadvance, any Revolving Term Facility Overadvance, any Seasonal Term Loan Overadvance, any Variable Rate Term Loan Overadvance and any Fixed Rate Term Loan Overadvance.
"Participant" has the meaning specified in Section 11.7(d).
"Participant Register" has the meaning specified in Section 11.7(d).
"Participation Advance" has the meaning specified in Section 2.12(c)(ii).
"Payment In Full" means (a) with respect to the Obligations, the payment in full in cash of the Loans and other Obligations (other than contingent indemnification obligations as to which no claim has been made) hereunder, the termination of the Commitments and the expiration, termination or Cash Collateralization of all Letters of Credit and (b) with respect to the Other Liabilities, the payment in full in cash or Cash Collateralization of such Other Liabilities.
"PBGC" means the Pension Benefit Guaranty Corporation established pursuant to Subtitle A of Title IV of ERISA.
"Pension Plan" means any "employee pension benefit plan" (as defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is subject to Title IV of ERISA or is subject to the minimum funding standards under Section 412 of the Code, and that any Loan Party or any ERISA Affiliate sponsors, maintains, or contributes to or is required to contribute to or with respect to which any Loan Party or any ERISA Affiliate otherwise has any obligation or liability (including any contingent liability).
"Perfection and Diligence Certificate" means a certificate in substantially the form of Exhibit E hereto, executed and delivered by an Authorized Officer of each Loan Party to the Administrative Agent.
"Permitted Liens" means:
(a)Liens for taxes, assessments, or similar charges and levies of any Governmental Authority not yet due or which are being diligently contested in good faith by appropriate and lawful proceedings that suspend enforcement of such Liens and for which adequate reserves or other appropriate provisions in accordance with GAAP have been set aside on such Loan Party's books;
(b)pledges or deposits made in the ordinary course of business to secure payment of worker's compensation, or to participate in any fund in connection with worker's compensation, unemployment insurance, old-age pensions or other social security programs, other than any Lien imposed by ERISA, provided that the aggregate amount of such pledges and deposits is less than $2,000,000.00;
(c)Liens of mechanics, repairmen , materialmen, warehousemen, carriers, suppliers, landlords or other like Liens that are incurred in the ordinary course of business and either (i) secure obligations that are not overdue by more than thirty (30) days or (ii) are being diligently contested in good faith by appropriate and lawful proceedings that suspend enforcement of such Liens and for which adequate reserves or other appropriate provisions in accordance with GAAP have been set aside on such Loan Party's books, provided that the aggregate amount of such liabilities secured by such Liens is less than $2,000,000.00;
(d)good-faith pledges or deposits made in the ordinary course of business to secure performance of bids, tenders, trade contracts (other than Indebtedness but including margin deposits for futures trading accounts) or leases, not in excess of the aggregate amount due thereunder, or to secure
statutory obligations, or surety, appeal, performance or other similar bonds required in the ordinary course of business;
(e)encumbrances consisting of zoning restrictions, easements, right-of-way or other encumbrances, title defects and restrictions on the use of real property that (i) are set forth in any ALTA title insurance policy or policies insuring the Administrative Agent, for the benefit of the Secured Parties, provided to, and accepted by, the Administrative Agent pursuant to Section 4.1(a)(xix)(B) of this Agreement and any updates to such ALTA title insurance policy or policies provided to, and accepted by, the Administrative Agent from time to time or (ii) in the aggregate are not substantial in amount and none of which materially impairs the use of such property or the value thereof, none of which is violated in any material respect by existing or proposed structures or land use and which do not interfere with the ordinary conduct of the business of the applicable Loan Party;
(f)Liens, security interests and mortgages in favor of the Administrative Agent for the benefit of the Secured Parties;
(g)any Lien existing on the date of this Agreement and described on Schedule 1.1(P), provided that (i) the principal amount secured thereby is not hereafter increased, (ii) no additional assets become subject to such Lien, (iii) the direct or contingent obligor with respect thereto is not changed and (iv) any renewal or extension of the Indebtedness secured or benefitted thereby is permitted by Section 7.1(b);
(h)each Farm Credit Lender’s Lien (including the right of setoff) in the Farm Credit Equities and in any cash patronage;
(i)Liens resulting from judgments or orders not constituting an Event of Default under Section 9.1(f);
(j)Liens securing Indebtedness permitted under Section 7.1(c), provided, that (i) such Liens do not at any time encumber any property other than the property purchased, leased or otherwise acquired with the proceeds of such Indebtedness and (ii) the Indebtedness secured thereby does not exceed the cost or fair market value, whichever is lower, of the property being so purchased, leased or otherwise acquired on the date of its purchase, lease or other acquisition; and
(k)Liens in the form of cash collateral securing Hedge Agreements permitted under Section 7.1(j) in an aggregate amount not to exceed $5,000,000.00 at any time.
"Person" means any natural person, corporation, company, partnership, limited liability company, association, joint-stock company, trust, unincorporated organization, joint venture, Official Body, or any other entity.
"Plan" means any employee benefit plan within the meaning of Section 3(3) of ERISA (including any Pension Plan) that any Loan Party or any ERISA Affiliate sponsors, maintains, or contributes to or is required to contribute to or with respect to which any Loan Party or any ERISA Affiliate otherwise has any obligation or liability.
"Plan Funding Rules" means the rules of the Code and ERISA regarding minimum required contributions (including any installment payment thereof) to Pension Plans and Multiemployer Plans and set forth in, Sections 412, 430, 431, 432 and 436 of the Code and Sections 206, 302, 303, 304 and 305 of ERISA.
"Plan Qualification Event" means with respect to any Plan that is intended to be a qualified plan under Section 401(a) of the Code, or exempt from tax under Section 501(a) or 501(c)(9) of the Code, any occurrence or event that results or could reasonably be expected to result in the loss of the Plan's qualified or tax-exempt status or for which the cost of correction under or related to the IRS employee plans compliance resolution system or any successor program (including the cost of computing the correction, making a submission to the IRS, making any payment to the IRS, the Plan or participants and any other related cost of correction) could reasonably be expected to exceed $2,000,000.00.
"Platform" has the meaning specified in Section 11.4.
"Platform Communications" has the meaning specified in Section 11.4.
"Pledge Agreement" means the Amended and Restated Pledge Agreement, dated as of the date hereof, by each of the Loan Parties in favor of the Administrative Agent.
"Pricing Grid" means the table and text set forth below:
| | | | | | | | | | | | | | | | | |
Level | Gross Cash Flow | Applicable Margin for Loans under Revolving Credit Facility and Letter of Credit Fee | Applicable Margin for Revolving Term Loans | Applicable Margin for Variable Rate Term Loan | Unused Commitment Fee |
Level I | > $30,000,000 | 2.25% | 2.75% | 2.50% | 0.20% |
Level II | > $25,000,000 but
< $30,000,000 | 2.50% | 3.00% | 2.75% | 0.25% |
Level III | > $20,000,000 but
< $25,000,000 | 2.75% | 3.25% | 3.00% | 0.30% |
Level IV | < $20,000,000 | 3.00% | 3.50% | 3.25% | 0.35% |
For purposes of determining the Applicable Margin, the Applicable Unused Commitment Fee Rate and the Applicable Letter of Credit Fee Rate:
(a)The Applicable Margin, the Applicable Unused Commitment Fee Rate and the Applicable Letter of Credit Fee Rate shall be set at Level IV until receipt of the Compliance Certificate for the fiscal year ending December 31, 2024.
(b)The Applicable Margin, the Applicable Unused Commitment Fee Rate and the Applicable Letter of Credit Fee Rate shall be recomputed as of the end of each Fiscal Quarter ending on and after the fiscal year ending December 31, 2024 based on the Gross Cash Flow for the four consecutive Fiscal Quarters most recently ended. Any increase or decrease in the Applicable Margin, the Applicable Unused Commitment Fee Rate or the Applicable Letter of Credit Fee Rate computed as of a Fiscal Quarter end shall be effective no later than five (5) Business Days following the date on which the Compliance Certificate evidencing such computation is delivered under Section 6.1(c). If a Compliance Certificate is not delivered when due in accordance with such Section 6.1(c), then the rates in Level IV shall apply as of the first Business Day after the date on which such Compliance Certificate was required to have been delivered and shall remain in effect until the date on which such Compliance Certificate is delivered.
(c)If, as a result of any restatement of or other adjustment to the financial statements of the Borrower or for any other reason, the Borrower or the Lenders determine that (i) Gross Cash Flow as calculated by the Borrower as of any applicable date was inaccurate and (ii) a proper calculation of Gross Cash Flow would have resulted in higher pricing for such period, then the Borrower shall immediately and retroactively be obligated to pay to the Administrative Agent for the account of the applicable Lenders, promptly on demand by the Administrative Agent (or, after the occurrence of an actual or deemed entry of an order for relief with respect to the Borrower under the Bankruptcy Code, automatically and without further action by the Administrative Agent, any Lender or the Issuing Lender), an amount equal to the excess of the amount of interest and fees that should have been paid for such period over the amount of interest and fees actually paid for such period. This clause (c) shall not limit the rights of the Administrative Agent, any Lender or the Issuing Lender, as the case may be, under Section 2.12, Section 3.5, or Article IX.
"Prime Rate" means the rate of interest per annum last quoted by The Wall Street Journal as the "Prime Rate" in the U.S. or, if The Wall Street Journal ceases to quote such rate, the highest per annum interest rate published by the Federal Reserve Board in Federal Reserve Statistical Release H.15 (519) (Selected Interest Rates) as the "bank prime loan" rate or, if such rate is no longer quoted therein, any similar rate quoted therein (as determined by the Administrative Agent) or any similar release by the Federal Reserve Board (as determined by the Administrative Agent). Any change in the Prime Rate shall take effect at the opening of business on the day such change is publicly announced or quoted as being effective without the necessity of notice provided to the Borrower or any other Loan Party.
"Principal Office" means the main banking office of the Administrative Agent in Greenwood Village, Colorado, or such other banking office as may be designated by the Administrative Agent from time to time.
"Prior Security Interest" means a valid and enforceable perfected first-priority security interest in and to the Collateral that is subject only to Permitted Liens which have first-priority by operation of applicable Law.
"Pro Rata Share" means (a) with respect to the Revolving Credit Facility as of any date of determination, the proportion that a Revolving Facility Lender's Revolving Facility Commitment as of such date bears to the aggregate amount of Revolving Facility Commitments of all of the Revolving
Facility Lenders as of such date, provided, that if the Revolving Facility Commitments have been terminated or have expired, Pro Rata Share under the Revolving Credit Facility shall be determined based upon the Revolving Facility Commitments most recently in effect, giving effect to any assignment, (b) with respect to each Tranche of any Seasonal Term Loan Facility as of any date of determination, (i) if any Seasonal Term Loan Commitments remain in effect with respect to such Tranche, the proportion that a Seasonal Term Lender's unused Seasonal Term Loan Commitments with respect to such Tranche bears to the aggregate amount of the Seasonal Term Loan Commitments of all of the Seasonal Term Lenders for such Tranche as of such date, or (ii) if the Seasonal Term Loan Commitments have been terminated or have expired with respect to such Tranche, the proportion that the outstanding principal amount of a Seasonal Term Lender's Seasonal Term Loans with respect to such Tranche as of such date bears to the aggregate principal amount of all outstanding Seasonal Term Loans for such Tranche as of such date, (c) with respect to the Revolving Term Credit Facility as of any date of determination, the proportion that a Revolving Term Facility Lender's Revolving Term Facility Commitment as of such date bears to the aggregate amount of Revolving Term Facility Commitments of all of the Revolving Term Facility Lenders as of such date, provided, that if the Revolving Term Facility Commitments have been terminated or have expired, Pro Rata Share under the Revolving Term Credit Facility shall be determined based upon the Revolving Term Facility Commitments most recently in effect, giving effect to any assignment, (d) with respect to the Variable Rate Term Loan Facility as of any date of determination, (i) if any Variable Rate Term Loan Commitments remain in effect, the proportion that a Variable Rate Term Lender's unused Variable Rate Term Loan Commitments bears to the aggregate amount of Variable Term Loan Commitments of all of the Variable Rate Term Lenders as of such date, or (ii) if the Variable Rate Term Loan Commitments have been terminated or have expired, the proportion that the outstanding principal amount of a Variable Rate Term Lender's Variable Rate Term Loans as of such date bears to the aggregate principal amount of all outstanding Variable Rate Term Loans as of such date and (e) with respect to the Fixed Rate Term Loan Facility as of any date of determination, (i) if any Fixed Rate Term Loan Commitments remain in effect, the proportion that a Fixed Rate Term Lender's unused Fixed Rate Term Loan Commitments bears to the aggregate amount of Fixed Rate Term Loan Commitments of all of the Fixed Rate Term Lenders as of such date, or (ii) if the Fixed Rate Term Loan Commitments have been terminated or have expired, the proportion that the outstanding principal amount of a Fixed Rate Term Lender's Fixed Rate Term Loans as of such date bears to the aggregate principal amount of all outstanding Fixed Rate Term Loans as of such date.
"Properties" has the meaning set forth in Section 5.18(a).
“Protective Advance” has the meaning specified in Section 2.3(h)(i) and “Protective Advances” means collectively all of the Protective Advances.
“Protective Advance Commitment Increase” has the meaning specified in Section 2.3(h)(ii).
“Protective Advance Overage” has the meaning specified in Section 2.3(h)(iv).
"PTE" means a prohibited transaction class exemption issued by the U.S. Department of Labor, as any such exemption may be amended from time to time.
"Purchase Money Security Interest" means Liens upon tangible personal property securing loans to any Loan Party or Subsidiary of a Loan Party or deferred payments by such Loan Party or Subsidiary for the purchase of such tangible personal property.
"Qualified ECP Guarantor" means, in respect of any Swap Obligation, each Loan Party that has total assets exceeding $10,000,000.00 at the time the relevant Guaranty or grant of security interest becomes effective with respect to such Swap Obligation or such other Person as constitutes an "eligible contract participant" under the Commodity Exchange Act or any regulations promulgated thereunder and can cause another Person to qualify as an "eligible contract participant" at such time by entering into a keepwell under Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.
"Recipient" means (a) the Administrative Agent, (b) any Lender or (c) the Issuing Lender, as applicable.
"Register" has the meaning specified in Section 11.7(c).
"Regulation D" means Regulation D of the Federal Reserve Board, as in effect from time to time and all official rulings and interpretations thereunder or thereof.
"Reimbursement Obligation" has the meaning specified in Section 2.12(c)(i).
"Related Agreements" has the meaning specified in Section 12.3(a).
"Related Parties" means, with respect to any Person, such Person's Affiliates and the partners, directors, officers, employees, agents, trustees, administrators, managers, advisors and representatives of such Person and of such Person's Affiliates.
"Relevant Governmental Body" means the Federal Reserve Board and/or the Federal Reserve Bank of New York, or a committee officially endorsed or convened by the Federal Reserve Board and/or the Federal Reserve Bank of New York or any successor thereto.
"Required Lenders" means, at any time, two or more Lenders (other than Defaulting Lenders and including Voting Participants) having Total Credit Exposures representing more than 50% of the Total Credit Exposures of all Lenders. With respect to economic changes applicable only to one of the Facilities, "Required Lenders" shall be calculated with respect to only the Lenders (other than any Defaulting Lender and including Voting Participants) holding Loans or Commitments of the applicable Facility. The Total Credit Exposure of any Defaulting Lender shall be disregarded in determining Required Lenders at any time.
"Resolution Authority" means an EEA Resolution Authority or, with respect to any UK Financial Institution, a UK Resolution Authority.
"Restricted Payment" means any dividend or other distribution (whether in cash, securities or other property) with respect to any capital stock or other Equity Interest of the Borrower or any Subsidiary, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such capital stock or other Equity Interest, or on account of any return of capital to the Borrower's stockholders, partners or members (or the equivalent Person thereof).
"Revolving Credit Facility" means the revolving credit facility established pursuant to Section 2.1.
"Revolving Facility Commitment" means, as to any Revolving Facility Lender at any time, the amount initially set forth opposite its name on Schedule 1.1(B), as such Commitment is thereafter
assigned or modified or increased pursuant to any Revolving Facility Increase, and "Revolving Facility Commitments" means the aggregate Revolving Facility Commitments of all of the Revolving Facility Lenders. As of the Closing Date, the aggregate amount of the Revolving Facility Commitments of all Revolving Facility Lenders is $300,000,000.00.
"Revolving Facility Credit Exposure" means, as to any Revolving Facility Lender at any time, the aggregate principal amount at such time of its outstanding Revolving Facility Loans and such Revolving Facility Lender's participation in Letter of Credit Obligations and Swing Line Loans at such time.
"Revolving Facility Increase" has the meaning specified in Section 2.1(e)(i).
"Revolving Facility Lender" means each Lender (including any New Revolving Facility Lenders) having a Revolving Facility Commitment or who has funded or purchased all or a portion of a Revolving Facility Loan in accordance with the terms hereof.
"Revolving Facility Loans" means collectively and "Revolving Facility Loan" means separately all Revolving Facility Loans or any Revolving Facility Loan made by the Lenders or one of the Lenders to the Borrower pursuant to Section 2.1.
"Revolving Facility Note" means the promissory notes of the Borrower substantially in the form of Exhibit F-1 hereto evidencing the Revolving Facility Loans.
"Revolving Facility Overadvance" has the meaning specified in Section 2.16(a)(i).
"Revolving Facility Unused Commitment Fee" has the meaning specified in Section 2.10(a)(i).
"Revolving Facility Usage" means at any time the sum of the outstanding principal amount of Revolving Facility Loans, the outstanding principal amount of Swing Line Loans and the Letter of Credit Obligations.
"Revolving Term Credit Facility" means the revolving term credit facilities established pursuant to Section 2.4.
"Revolving Term Facility Commitment" means, as to any Revolving Term Facility Lender at any time, the amount initially set forth opposite its name on Schedule 1.1(B), as such Commitment is thereafter assigned or modified, and "Revolving Term Facility Commitments" means the aggregate Revolving Term Facility Commitments of all of the Revolving Term Facility Lenders. As of the Closing Date, the aggregate amount of the Revolving Term Facility Commitments of all Revolving Term Facility Lenders is $15,000,000.00.
"Revolving Term Facility Credit Exposure" means, as to any Revolving Term Facility Lender at any time, the aggregate principal amount at such time of its outstanding Revolving Term Loans.
"Revolving Term Facility Lender" means each Lender having a Revolving Term Facility Commitment or who has funded or purchased all or a portion of a Revolving Term Loan in accordance with the terms hereof.
"Revolving Term Facility Note" means the promissory notes of the Borrower substantially in the form of Exhibit F-1 hereto evidencing the Revolving Term Loans.
"Revolving Term Facility Overadvance" has the meaning specified in Section 2.16(a)(ii).
"Revolving Term Facility Unused Commitment Fee" has the meaning specified in Section 2.10(a)(ii).
"Revolving Term Facility Usage" means at any time the sum of the outstanding Revolving Term Loans.
"Revolving Term Loans" means collectively and "Revolving Term Loan" means separately all Revolving Term Loans or any Revolving Term Loan made by the Lenders or one of the Lenders to the Borrower pursuant to Section 2.4.
"Sanctioned Country" means, at any time, a country, territory or sector that is the subject or target of any Sanctions or that is, or whose government is, the subject of any list-based or territorial or sectorial Sanctions.
"Sanctioned Person" means, at any time, (a) any Person listed in any Sanctions-related list of designated Persons maintained by any Governmental Authority, (b) any Person operating, organized or resident in a Sanctioned Country, (c) any Person that is otherwise subject to any Sanctions, or (d) any Person, directly or indirectly, 50% or more in the aggregate owned by, otherwise controlled by, or acting for the benefit or on behalf of, any Person or Persons described in clause (a), (b) or (c) of this definition.
"Sanctions" means any economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by any Governmental Authority.
"Seasonal Term Lender" means each Lender (including any New Seasonal Term Lender) having a Seasonal Term Loan Commitment with respect to any Tranche of the Seasonal Term Loan Facility or who has funded or purchased all or a portion of any Seasonal Term Loan with respect to any Tranche of the Seasonal Term Loan Facility in accordance with the terms hereof.
"Seasonal Term Loan" has the meaning specified in Section 2.2; and "Seasonal Term Loans" means collectively all of the Seasonal Term Loans.
"Seasonal Term Loan Commitment" means, as to any Lender at any time, the amount initially set forth opposite its name in any Seasonal Term Loan Funding Agreement with respect to any Tranche of the Seasonal Term Loan Facility, as such Commitment is thereafter assigned or modified and "Seasonal Term Loan Commitments" means the aggregate Seasonal Term Loan Commitments of all of the Lenders with respect to all Tranches of the Seasonal Term Loan Facility.
"Seasonal Term Loan Facility" means the term loan facility established pursuant to Section 2.2.
"Seasonal Term Loan Funding Agreement" has the meaning assigned to such term in Section 2.2(e).
"Seasonal Term Loan Notes" means the promissory notes of the Borrower substantially in the form of Exhibit F-3 hereto evidencing any Tranche of Seasonal Term Loans.
"Seasonal Term Loan Overadvance" has the meaning specified in Section 2.16(a)(iv).
"Secured Bank Product" means agreements or other arrangements entered into by a Lender or its Affiliate, on the one hand, and any Loan Party, on the other hand at the time such Lender is a party to this Agreement, under which any Lender or Affiliate of a Lender provides any of the following products or services to any of the Loan Parties: (a) credit cards, (b) credit card processing services, (c) debit cards, (d) purchase cards, (e) ACH transactions, (f) cash management, including controlled disbursement, accounts or services, or (g) foreign currency exchange, and shall include the CoBank Cash Management Agreement; provided that the foregoing shall not constitute a Secured Bank Product if at any time the applicable provider of such bank products or services is not a Lender or an Affiliate of a Lender.
"Secured Hedge" means an Interest Rate Hedge permitted under this Agreement (a) that is entered into by a Hedge Bank at the time that such Hedge Bank or its Affiliate is a Lender hereunder and (b) with respect to which such Hedge Bank has provided evidence satisfactory to the Administrative Agent that (i) such Interest Rate Hedge is documented in a standard International Swaps and Derivatives Association, Inc. Master Agreement, and (ii) such Interest Rate Hedge provides for the method of calculating the reimbursable amount of the provider's credit exposure in a reasonable and customary manner; provided that the foregoing shall not constitute a Secured Hedge if at any time the applicable provider of such Interest Rate Hedge is not a Lender or an Affiliate of a Lender.
"Secured Obligations" means all Obligations, all Guaranteed Liabilities and all Other Liabilities, but excluding all Excluded Swap Obligations.
"Secured Parties" means, collectively, the Administrative Agent, the Lenders, the Issuing Lender, each Lender (or its Affiliate) that provides any Secured Hedge for so long as such Lender remains a Lender hereunder, each Lender (or its Affiliate) that provides any Secured Bank Product for so long as such Lender remains a Lender hereunder, each Related Party or co-agent or sub-agent appointed by the Administrative Agent from time to time pursuant to Section 10.6, and, in each case, their respective successors and permitted assigns.
"Security Agreement" means the Amended and Restated Security Agreement, dated as of the date hereof, by each of the Loan Parties in favor of the Administrative Agent.
"Services Agreement" means the Services Agreement, dated as of November 1, 2024, between the Borrower and the Andersons Buyer, in form and substance reasonably satisfactory to the Administrative Agent.
"Skyland Aerial " means Skyland Aerial, LLC, a Kansas limited liability company.
"Skyland Co-op" means Skyland Co-op Inc., a Kansas corporation, organized pursuant to the Kansas Cooperative Marketing Act.
"SOFR" means a rate equal to the secured overnight financing rate as administered by the SOFR Administrator.
"SOFR Administrator" means the Federal Reserve Bank of New York (or a successor administrator of the secured overnight financing rate).
"SOFR Administrator's Website" means the website of the Federal Reserve Bank of New York, currently at http://www.newyorkfed.org, or any successor source for the secured overnight financing rate identified as such by the SOFR Administrator from time to time.
"Solvency Certificate" means the certificate of the Loan Parties in the form of Exhibit G hereto.
"Solvent" means, with respect to any Person on any date of determination, taking into account any and all rights of reimbursement, contribution or similar right available to such Person from other Persons, that on such date (a) the fair value of the assets of such Person is greater than the total amount of liabilities, including contingent liabilities, of such Person, (b) the present fair saleable value of the assets of such Person is not less than the amount that will be required to pay the probable liability of such Person on its debts as they become absolute and matured, (c) such Person is able to realize upon its assets and pay its debts and other liabilities, contingent obligations and other commitments as they mature in the normal course of business, (d) such Person does not intend to, and does not believe that it will, incur debts or liabilities beyond such Person's ability to pay as such debts and liabilities mature, and (e) such Person is not engaged in business or a transaction, and is not about to engage in business or a transaction, for which such Person's assets would constitute unreasonably small capital after giving due consideration to the prevailing practice in the industry in which such Person is engaged. In computing the amount of contingent liabilities at any time, it is intended that such liabilities will be computed at the amount that, in light of all the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability.
"Standard & Poor's" means Standard & Poor's Ratings Services LLC, a subsidiary of The McGraw-Hill Companies, Inc., or any successor or assignee of the business of such division in the business of rating securities and debt.
"Subsidiary" of any Person at any time means any corporation, trust, partnership, any limited liability company or other business entity (a) of which more than 50% of the outstanding voting securities or other interests normally entitled to vote for the election of one or more directors or trustees (regardless of any contingency that does or may suspend or dilute the voting rights) is at such time owned, or the management of which is controlled, directly or indirectly through one or more intermediaries, or both, by such Person or one or more of such Person's Subsidiaries, or (b) that is directly or indirectly controlled by such Person or one or more of such Person's Subsidiaries.
"Subsidiary Equity Interests" has the meaning specified in Section 5.6.
"Swap Obligation" means, with respect to any Loan Party, any obligation to pay or perform under any agreement, contract or transaction that constitutes a "swap" within the meaning of section 1a(47) of the Commodity Exchange Act.
"Swing Line Commitment" means, as to the Swing Line Lender at any time, the amount initially set forth opposite its name on Schedule 1.1(B), as such Commitment is thereafter assigned or modified. As of the Closing Date, the Swing Line Commitment of the Swing Line Lender is $60,000,000.00.
"Swing Line Facility" means the swing line facility established pursuant to Section 2.3.
"Swing Line Lender" means CoBank, in its individual capacity as the provider of the Swing Line Commitment.
"Swing Line Loans" means collectively, and “Swing Line Loan” means separately, all Swing Line Loans (including Protective Advances) or any Swing Line Loan (or Protective Advance) made by the Swing Line Lender to the Borrower pursuant to Section 2.3.
"Swing Line Note" means the promissory note of the Borrower substantially in the form of Exhibit F-2 hereto evidencing the Swing Line Loans.
"Synthetic Lease Obligation" means the monetary obligation of a Person under (a) a so-called synthetic, off-balance sheet or tax retention lease, or (b) an agreement for the use or possession of property creating obligations that do not appear on the balance sheet of such Person but which, for tax purposes or otherwise upon the insolvency or bankruptcy of such Person, would be characterized as the indebtedness of such Person (without regard to accounting treatment).
"Tax Compliance Certificate" means a tax certificate substantially in the form of Exhibit H hereto, prepared and delivered in accordance with Section 3.2(g).
"Taxes" means all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.
"Term SOFR Administrator" means CME Group Benchmark Administration Limited (CBA) (or a successor administrator of the Term SOFR Reference Rate selected by the Administrative Agent in its reasonable discretion).
"Term SOFR Rate" means, for any calculation with respect to a Term SOFR Rate Loan, the Term SOFR Reference Rate for a tenor comparable to the applicable Interest Period on the day (such day, the "Periodic Term SOFR Determination Day") that is two U.S. Government Securities Business Days prior to the first day of such Interest Period, as such rate is published by the Term SOFR Administrator; provided, however, that if as of 3:00 p.m. on any Periodic Term SOFR Determination Day the Term SOFR Reference Rate for the applicable tenor has not been published by the Term SOFR Administrator and a Benchmark Transition Event with respect to the Term SOFR Reference Rate has not occurred, then Term SOFR Rate will be the Term SOFR Reference Rate for such tenor as published by the Term SOFR Administrator on the first preceding U.S. Government Securities Business Day for which such Term SOFR Reference Rate for such tenor was published by the Term SOFR Administrator so long as such first preceding U.S. Government Securities Business Day is not more than three U.S. Government Securities Business Days prior to such Periodic Term SOFR Determination Day; provided, further, that if the Term SOFR Rate determined as provided above shall ever be less than the Floor, then Term SOFR Rate shall be deemed to be the Floor.
"Term SOFR Rate Loan" means a Loan bearing interest at the Term SOFR Rate Option. A Term SOFR Rate Loan is a Loan subject to an Interest Period.
"Term SOFR Rate Option" means the option of the Borrower to have Loans bear interest at the rate and under the terms set forth in Section 2.7(a)(ii).
"Term SOFR Reference Rate" means the forward-looking term rate based on SOFR.
"Termination Date" means the date as of which all of the following shall have occurred: (a) all Commitments under this Agreement have terminated, (b) all Obligations have been paid in full (other than (i) contingent indemnification obligations as to which no claim has been made and (ii) obligations and liabilities with respect to any Secured Bank Product or Secured Hedge as to which arrangements reasonably satisfactory to the applicable Lender (or its Affiliate) or Hedge Bank have been made), and (c) all Letters of Credit have terminated or expired (other than Letters of Credit which have been Cash
Collateralized or as to which other arrangements with respect thereto satisfactory to the Administrative Agent and the Issuing Lender shall have been made).
"Threshold Amount" means $5,000,000.00.
"Total Credit Exposure" means, as to any Lender at any time, the unused Commitments, Revolving Facility Credit Exposure, Revolving Term Facility Credit Exposure, outstanding Seasonal Term Loans, outstanding Variable Rate Term Loans and outstanding Fixed Rate Term Loans of such Lender at such time.
"Tranche" means, with respect to any Seasonal Term Loans, all Seasonal Term Loans made on the same date pursuant to the terms of the same Notice of Seasonal Term Loan Borrowing and Seasonal Term Loan Funding Agreement.
"UCC" has the meaning set forth in the Security Agreement, subject to the rules of construction set forth in Section 1.2 of the Security Agreement.
"UK Financial Institution" means any BRRD Undertaking (as such term is defined under the PRA Rulebook (as amended from time to time) promulgated by the United Kingdom Prudential Regulations Authority) or any Person falling within IFPRU 11.6 of the FCA Handbook (as amended from time to time) promulgated by the United Kingdom Financial Conduct Authority, which includes certain credit institutions and investment firms and certain affiliates of such certain credit institutions or investment firms.
"UK Resolution Authority" means the Bank of England or any other public administrative authority having responsibility for the resolution of any UK Financial Institution.
"Unfunded Liability" means, (a) for a Pension Plan other than a Multiemployer Plan, any excess of the Pension Plan's funding target under Section 430(d) of the Code or Section 303(d) of ERISA over the value of the Pension Plan's assets, determined in accordance with Section 430(d)(2)(A) of the Code or Section 303(d)(2)(A) of ERISA for the applicable plan year, (b) for a Multiemployer Plan, any excess of the Multiemployer Plan's current liability under Section 431(c)(6) of the Code or Section 304(c)(6) of ERISA over the value of the Multiemployer Plan's assets determined in accordance with Section 431(c)(2) of the Code or Section 304(c)(2) of ERISA, and (c) for a Welfare Benefit Plan, the present value (determined using actuarial and other assumptions that are reasonable with respect to the benefits provided and the employees participating) of the liability of each Loan Party and each ERISA Affiliate for post-retirement benefits other than pensions, net of all assets under all such Welfare Benefit Plans allocable to such benefits, determined in accordance with Financial Accounting Standard 106 (as amended).
"Unused Commitment Fee" means the Revolving Facility Unused Commitment Fee or the Revolving Term Facility Unused Commitment Fee, and "Unused Commitment Fees" means, collectively, Revolving Facility Unused Commitment Fees and Revolving Term Facility Unused Commitment Fees.
"USA Patriot Act" means the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Public Law 107-56.
"U.S. Borrower" means any Borrower that is a U.S. Person.
"U.S. Government Securities Business Day" means any day except for (a) a Saturday, (b) a Sunday or (c) a day on which the Securities Industry and Financial Markets Association recommends that the fixed income departments of its members be closed for the entire day for purposes of trading in United States government securities.
"U.S. Person" means any Person that is a "United States Person" as defined in Section 7701(a)(30) of the Code.
"Variable Rate Term Lender" means each Lender having a Variable Rate Term Loan Commitment or who has funded or purchased all or a portion of a Variable Rate Term Loan in accordance with the terms hereof.
"Variable Rate Term Loan" has the meaning specified in Section 2.5(a) and "Variable Rate Term Loans" means collectively all of the Variable Rate Term Loans.
"Variable Rate Term Loan Commitment" means, as to any Lender at any time, the amount initially set forth opposite its name on Schedule 1.1(B), as such Commitment is thereafter assigned or modified or increased pursuant to any Variable Rate Term Loan Increase, and "Variable Rate Term Loan Commitments" means the aggregate Variable Rate Term Loan Commitments of all of the Lenders. As of the Closing Date, the aggregate amount of the Variable Rate Term Loan Commitments of the Lenders is $67,000,000.00.
"Variable Rate Term Loan Facility" means the term loan facility established pursuant to Section 2.5.
"Variable Rate Term Loan Notes" means the promissory notes of the Borrower substantially in the form of Exhibit F-3 hereto evidencing the Variable Rate Term Loans.
"Variable Rate Term Loan Overadvance" has the meaning specified in Section 2.16(a)(iii).
"Voting Participant" has the meaning specified in Section 11.7(d).
"Voting Participant Notice" has the meaning specified in Section 11.7(d).
"Welfare Benefit Plan" means a Plan which is an "employee welfare benefit plan" within the meaning of Section 3(1) of ERISA.
"Withholding Agent" means (a) the Borrower or any other Loan Party and (b) the Administrative Agent.
"Working Capital" means the sum of, in accordance with GAAP, (i) current assets minus (ii) current liabilities plus (iii) the amount of any negative purchase price accounting adjustments made in connection with the Andersons Transaction (or minus the amount of any positive purchase price accounting adjustments made in connection with the Andersons Transaction). For purposes of calculating "current assets," any available commitment under the Revolving Term Credit Facilities (less the amount that would be considered a current liability if fully advanced) may be included. For purposes of calculating "current liabilities," the aggregate principal amount of all outstanding Revolving Facility Loans, Swing Line Loans and Seasonal Term Loans shall be included.
"Write-Down and Conversion Powers" means, (a) with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule, and (b) with respect to the United Kingdom, any powers of the applicable Resolution Authority under the Bail-In Legislation to cancel, reduce, modify or change the form of a liability of any UK Financial Institution or any contract or instrument under which that liability arise, to convert all or part of that liability into shares, securities or obligations of that Person or any other Person, to provide that any such contract or instrument is to have effect as if a right had been exercised under it or to suspend any obligations in respect of that liability or any of the powers under that Bail-In Legislation that are related to or ancillary to any of those powers.
I.1Construction. Unless the context of this Agreement otherwise clearly requires, the following rules of construction shall apply to this Agreement and each of the other Loan Documents: (a) references to the plural include the singular, the plural, the part and the whole; (b) the words "include," "includes" and "including" shall be deemed to be followed by the phrase "without limitation"; (c) the words "hereof," "herein," "hereunder," "hereto" and similar terms in this Agreement or any other Loan Document refer to this Agreement or such other Loan Document as a whole; (d) article, section, subsection, clause, schedule and exhibit references are to this Agreement or other Loan Document, as the case may be, unless otherwise specified; (e) reference to any Person includes such Person's successors and assigns; (f) reference to any agreement, including this Agreement and any other Loan Document together with the schedules and exhibits hereto or thereto, document or instrument means such agreement, document or instrument as amended, extended, modified, supplemented, replaced, substituted for, superseded, renewed, refinanced, refunded, reaffirmed or restated at any time and from time to time; (g) relative to the determination of any period of time, "from" means "from and including," "to" means "to but excluding," and "through" means "through and including"; (h) the words "asset" and "property" shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights; (i) section headings herein and in each other Loan Document are included for convenience and shall not affect the interpretation of this Agreement or such Loan Document; (j) any pronoun shall include the corresponding masculine, feminine and neuter terms; (k) reference to any Law shall refer to such Law as amended, modified, supplemented, renewed, or extended from time to time and to any successor or replacement Law promulgated thereunder or substantially related thereto and to any rules and regulations related thereto; (l) reference to any Governmental Authority includes any similar or successor Governmental Authority; (m) the word "will" shall be construed to have the same meaning and effect as the word "shall"; and (n) unless otherwise specified, all references herein to times of day shall be references to Denver, Colorado time.
I.2Accounting Principles. Except as otherwise provided in this Agreement, all computations and determinations as to accounting or financial matters (including financial ratios and other financial covenants) and all financial statements to be delivered pursuant to this Agreement shall be made and prepared in accordance with GAAP (including principles of consolidation where appropriate), applied on a consistent basis and, except as expressly provided herein, in a manner consistent with that used in preparing audited financial statements in accordance with Section 6.1(b) and all accounting or financial terms have the meanings ascribed to such terms by GAAP; provided, however, that all accounting terms used in Article VIII (and all defined terms used in the definition of any accounting term used in Article VIII) has the meaning given to such terms (and defined terms) under GAAP as in effect on the date hereof applied on a basis consistent with those used in preparing the financial statements referred to in Section 5.10. In the event of any change after the date hereof in GAAP, and if such change would affect the computation of any of the financial covenants set forth in Article VIII, then the parties hereto agree to endeavor, in good faith, to agree upon an amendment to this Agreement that would adjust such
financial covenants in a manner that would preserve the original intent thereof, but would allow compliance therewith to be determined in accordance with the Borrower's financial statements at that time, provided that until so amended such financial covenants shall continue to be computed in accordance with GAAP prior to such change therein.
I.3Rounding. Any financial ratios required to be maintained pursuant to this Agreement shall be calculated by dividing the appropriate component by the other component, carrying the result to one place more than the number of places by which such ratio or percentage is expressed herein and rounding the result up or down to the nearest number (with a rounding-up if there is no nearest number).
I.4Letter of Credit Amounts. Unless otherwise specified, all references herein to the amount of a Letter of Credit at any time shall be deemed to mean the maximum face amount of such Letter of Credit after giving effect to all increases thereof contemplated by such Letter of Credit or the Letter of Credit Request therefor (at the time specified therefor in such applicable Letter of Credit or Letter of Credit Request) and as such amount may be reduced by (a) any permanent reduction of such Letter of Credit or (b) any amount which is drawn, reimbursed and no longer available under such Letter of Credit.
I.5Covenant Compliance Generally. For purposes of determining compliance under Article VIII, any amount in a currency other than Dollars will be converted to Dollars in a manner consistent with that used in calculating Consolidated Net Income in the most recent annual financial statements of any Loan Party and its Subsidiaries delivered pursuant to Section 6.1(b). Notwithstanding the foregoing, for purposes of determining compliance with Article VII, with respect to any covenant with respect to the amount of Indebtedness or investment in a currency other than Dollars, no breach of any basket contained therein shall be deemed to have occurred solely as a result of changes in rates of exchange occurring after the time such Indebtedness or investment is incurred; provided, that for the avoidance of doubt, the result of any changes in rates of exchange occurring after the time such Indebtedness or investment is incurred shall otherwise apply in all other cases, including determining whether any additional Indebtedness or investment may be incurred at any time in accordance with Article VII and for purposes of calculating financial ratios in accordance with Article VIII.
I.6Holidays. Whenever payment of a Loan to be made or taken hereunder shall be due on a day that is not a Business Day such payment shall be due on the next Business Day (except as provided in Section 2.8) and such extension of time shall be included in computing interest and fees, except that the Loans shall be due on the Business Day preceding the Maturity Date if the Maturity Date is not a Business Day. Whenever any payment or action to be made or taken hereunder (other than payment of the Loans) shall be stated to be due on a day that is not a Business Day, such payment or action shall be made or taken on the next following Business Day, and such extension of time shall not be included in computing interest or fees, if any, in connection with such payment or action.
I.7Divisions. For all purposes under the Loan Documents, in connection with any Division or plan of Division: (a) if any asset, right, obligation or liability of any Person becomes the asset, right, obligation or liability of a different Person, then it shall be deemed to have been transferred from the original Person to the subsequent Person, and (b) if any new Person comes into existence, such new Person shall be deemed to have been organized on the first date of its existence by the holders of its Equity Interests at such time. Any reference in Section 7.7 or in Section 7.8 to a combination, merger, consolidation, Disposition, dissolution, liquidation, transfer or similar term shall be deemed to apply to a Division, or an allocation of assets to a series of limited liability companies (or the unwinding of such a
Division or allocation) as if it were a combination, merger, consolidation, Disposition, dissolution, transfer or similar term, as applicable, to, of or with a separate Person.
I.CREDIT FACILITIES
I.1Revolving Credit Facility.
(a)Revolving Facility Commitments. Subject to the terms and conditions hereof and relying upon the representations and warranties of the Loan Parties set forth herein and in the other Loan Documents, each Revolving Facility Lender severally agrees to make Revolving Facility Loans to the Borrower at any time or from time to time on or after the Closing Date to, but not including, the Maturity Date with respect to the Revolving Credit Facility; provided, that after giving effect to each such Revolving Facility Loan (i) the aggregate principal amount of such Revolving Facility Lender's Revolving Facility Loans shall not exceed its Available Revolving Facility Commitment, (ii) the Revolving Facility Usage shall not exceed the Revolving Facility Commitments, and (iii) the Revolving Facility Usage shall not exceed the Borrowing Base set forth in the most recent Borrowing Base Certificate delivered to the Administrative Agent. Each request by the Borrower for a Revolving Facility Loan shall be deemed to be a representation by the Borrower that it shall be in compliance with the proviso at the end of the preceding sentence and with Article IV both before and after giving effect to the requested Revolving Facility Loan. Within such limits of time and amount and subject to the other provisions of this Agreement, the Borrower may borrow, repay and reborrow pursuant to this Section 2.1.
(b)Revolving Credit Facility Loan Requests. Except as otherwise provided herein or in the CoBank Cash Management Agreement, the Borrower may from time to time prior to the Maturity Date with respect to the Revolving Credit Facility request the Revolving Facility Lenders to make Revolving Facility Loans by delivering to the Administrative Agent, not later than 11:00 a.m., (i) three (3) U.S. Government Securities Business Days prior to the proposed Borrowing Date with respect to Term SOFR Rate Loans; and (ii) one (1) U.S. Government Securities Business Day prior to the proposed Borrowing Date with respect to Daily Simple SOFR Rate Loans, a duly completed Loan Request. Each such Loan Request shall be irrevocable and shall specify the aggregate amount of the proposed Revolving Facility Loans comprising each Borrowing, and, if applicable, the Interest Period, which amounts shall be in (x) integral multiples of $1,000,000.00 and not less than $5,000,000.00 for each Borrowing under the Term SOFR Rate Option, and (y) integral multiples of $1,000,000.00 and not less than $5,000,000.00 for each Borrowing under the Daily Simple SOFR Rate Option.
(c)Nature of Lenders' Obligations with Respect to Revolving Facility Loans. Each Revolving Facility Lender shall be obligated to participate in each request for Revolving Facility Loans pursuant to this Section 2.1 in accordance with its Pro Rata Share. The obligations of each Revolving Facility Lender hereunder are several. The failure of any Revolving Facility Lender to perform its obligations hereunder shall not affect the Obligations of the Borrower to any other party nor shall any other party be liable for the failure of such Revolving Facility Lender to perform its obligations hereunder. Other than Revolving Facility Loans in repayment of Swing Line Loans in accordance with Section 2.3(e) and/or Reimbursement Obligations in accordance with Section 2.12(c), the Revolving Facility Lenders shall have no obligation to make Revolving Facility Loans hereunder on or after the Maturity Date with respect to the Revolving Credit Facility.
(d)Repayment of Revolving Facility Loans. Notwithstanding anything herein or in any other Loan Document to the contrary, the Borrower shall repay the entire outstanding principal
amount of Revolving Facility Loans, together with all outstanding interest thereon and unpaid fees with respect thereto, on the Maturity Date with respect to the Revolving Credit Facility.
(e)Increase in Revolving Facility Commitments.
(i)Following the Closing Date, the Borrower may from time to time prior to the Maturity Date with respect to the Revolving Credit Facility, request an increase in the aggregate amount of the Revolving Facility Commitment be made in accordance with this Section 2.1(e) (each, a "Revolving Facility Increase") by delivering a Notice of Revolving Facility Increase to the Administrative Agent, specifying (subject to the restrictions set forth in this Section 2.1(e)(i)) therein (x) the amount of the requested Revolving Facility Increase (which shall be in a minimum principal amount of $50,000,000.00 and integral multiples of $50,000,000.00 in excess thereof) and (y) the requested effective date of the proposed Revolving Facility Increase (which shall be not less than thirty (30) days from the date of delivery of the Notice of Revolving Facility Increase (or such shorter period of time as to which the Administrative Agent may agree in its sole discretion)). Subject to the last sentence in Section 2.1(e)(iv), each Notice of Revolving Facility Increase delivered by the Borrower shall be irrevocable and shall be binding upon all Loan Parties. At the time of delivery of each Notice of Revolving Facility Increase, the Borrower shall also deliver to the Administrative Agent a certificate of an Authorized Officer of the Borrower certifying (1) that, both before and after giving effect to such Revolving Facility Increase, the Borrower shall be in pro forma compliance with the covenants set forth in Article VIII as of the most recent period for which financial statements have been delivered (and showing the calculations thereof), (2) that, both before and after giving effect to such Revolving Facility Increase, there shall not exist a Borrowing Base Deficit, and (3) that no Default or Event of Default then exists or would be caused thereby.
(ii)The aggregate principal amount of all Revolving Facility Increases made pursuant to this Section 2.1(e) shall not exceed the Maximum Revolving Facility Aggregate Increase Amount. The Borrower shall make no more than eight (8) requests for a Revolving Facility Increase. For the avoidance of doubt, each commitment increase and/or new commitment in connection with any Revolving Facility Increase shall constitute a Revolving Facility Commitment hereunder, each loan made in connection with any Revolving Facility Increase shall constitute a Revolving Facility Loan and each such commitment and loan shall be subject to the same terms and conditions as all other Revolving Facility Commitment and Revolving Facility Loans, including with respect to the Maturity Date therefor and interest and fees thereon.
(iii)Upon receipt of a request for a Revolving Facility Increase from the Borrower, the Administrative Agent may, in its sole discretion, offer one or more Lenders with Revolving Facility Commitments, other Lenders or new lenders the opportunity, in such amounts as the Administrative Agent shall determine, to participate in the Revolving Facility Increase by increasing such Lender's Revolving Facility Commitment or, in the case of another Lender or a new lender, by issuing a Revolving Facility Commitment. The Administrative Agent shall have no obligation to offer any Revolving Facility Lender, other Lender or new lender the opportunity to participate in any such Revolving Facility Increase and nothing herein shall prohibit the Administrative Agent from retaining for its own account, as a Revolving Facility Lender, all or substantially all of such Revolving Facility Increase. Each Revolving Facility Lender, other Lender or new lender that fails to respond to such notice in writing in a form acceptable to the Administrative Agent within the period of time provided therein shall be deemed to have elected not to participate in such Revolving Facility Increase. No Lender or new lender shall have any obligation to participate in any Revolving Facility Increase, and any decision by a
Lender or new lender to participate in any Revolving Facility Increase shall be made in its sole discretion independently from any other Lender or new lender.
(iv)If in response to the offer to participate in such Revolving Facility Increase made by the Administrative Agent pursuant to Section 2.1(e)(iii), the Administrative Agent obtains one or more subscriptions to participate in a requested Revolving Facility Increase from Lenders and/or from any other Person (provided that each such Lender shall be approved by the Administrative Agent, the Issuing Lender and the Swing Line Lender) that has agreed to become a Lender in respect of all or a portion of the Revolving Facility Increase (a "New Revolving Facility Lender"), in excess of the requested Revolving Facility Increase, the Administrative Agent shall have the right, in its sole discretion but with the consent of the Borrower, to reduce and reallocate (within the minimum and maximum amounts specified by each such Lender or New Revolving Facility Lender in its notice to the Administrative Agent) the shares of the Revolving Facility Increase of the Lenders or New Revolving Facility Lenders willing to commit to such Revolving Facility Increase so that the total committed Revolving Facility Increase equals the requested Revolving Facility Increase. If the Administrative Agent does not receive commitments from Lenders or New Revolving Facility Lenders in an amount sufficient to fund the requested Revolving Facility Increase, the Administrative Agent shall so notify Borrower and the request for such Revolving Facility Increase shall be deemed automatically either (1) if the amount of the commitments received is equal to or more than the minimum amount specified in Section 2.1(e)(i), reduced to equal the amount of the commitments received, or (2) if the amount of the commitments received is less than the minimum amount specified in Section 2.1(e)(i), rescinded.
(v)Provided that the Notice of Revolving Facility Increase is not rescinded as provided in the last sentence of Section 2.1(e)(iv), the Administrative Agent shall provide to the Borrower, each Revolving Facility Lender, each Revolving Facility Lender increasing its Revolving Facility Commitment in connection with such Revolving Facility Increase, each other Person that has agreed to become a Lender in respect of all or a portion of the Revolving Facility Increase, and each New Revolving Facility Lender, a notice setting forth (w) the amount of the approved Revolving Facility Increase and, after giving effect thereto, the aggregate Revolving Facility Commitments, (x) the effective date of the approved Revolving Facility Increase, (y) any fees payable to the Lenders (including New Revolving Facility Lenders) subscribing to a portion of such Revolving Facility Increase, and (z) for each Revolving Facility Lender, its respective Revolving Facility Commitment and Pro Rata Share of the aggregate Revolving Facility Commitments after giving effect to the Revolving Facility Increase. In addition, a fee letter shall be entered into between the Administrative Agent and Borrower in connection with any such Revolving Facility Increase setting forth all fees payable to the Administrative Agent in connection with obtaining subscriptions for, and implementation of, the Revolving Facility Increase (which fee letter shall be a Fee Letter).
(vi)On the effective date of a Revolving Facility Increase:
(A)Each New Revolving Facility Lender shall execute and deliver a lender joinder substantially in the form of Exhibit J-3 hereto;
(B)the Borrower shall pay to the Administrative Agent such fees as may be described in any Fee Letter related to such Revolving Facility Increase;
(C)the Borrower shall execute and deliver a replacement Revolving Facility Note for any Revolving Facility Lender that may require one;
(D)the Borrower shall deliver to the Administrative Agent officer's certificates and ratification agreements executed by each Loan Party and such evidence of satisfaction of all conditions set forth in Section 4.2, appropriate corporate authorization on the part of each Loan Party with respect to the requested Revolving Facility Increase, amendments to any other Loan Documents reasonably requested by the Administrative Agent in relation to the requested Revolving Facility Increase (which amendments to the Loan Documents (other than this Agreement) the Administrative Agent is hereby authorized to execute on behalf of the Lenders), updates or endorsements to policies of title insurance, flood hazard determination certificates (and, if applicable, evidence of flood insurance) with respect to each parcel of property subject to a Mortgage, such amendments to the existing Mortgages as the Administrative Agent shall deem necessary to increase the amount of indebtedness secured thereby due to the increase in the Secured Obligations as a result of the Revolving Facility Increase, the results of lien searches from applicable jurisdictions, and such opinions of counsel for the Loan Parties with respect to the requested Revolving Facility Increase and other assurances as the Administrative Agent may reasonably request;
(E)the Borrower shall in coordination with the Administrative Agent repay outstanding Revolving Facility Loans of certain Revolving Facility Lenders and obtain additional Revolving Facility Loans from other Revolving Facility Lenders (both existing and new), in each case, to the extent necessary so that all Revolving Facility Lenders participate in outstanding Revolving Facility Loans ratably, on the basis of their respective Revolving Facility Commitments, after giving effect to the increase in the aggregate Revolving Facility Commitments effected by implementation of the Revolving Facility Increase;
(F)each Revolving Facility Lender (both existing and new) participating in the Revolving Facility Increase (1) will be deemed to have purchased a participation in each then-outstanding Letter of Credit equal to its Pro Rata Share of such Letter of Credit in accordance with Section 2.12 and the participation of each other Revolving Facility Lender in such Letter of Credit shall be adjusted accordingly, (2) will acquire (and will pay to the Administrative Agent, for the account of each other Revolving Facility Lender, in immediately available funds, an amount equal to) its Pro Rata Share of all outstanding Participation Advances, and (3) will be deemed to have purchased a participation in each then-outstanding Swing Line Loan equal to its Pro Rata Share of such Swing Line Loan in accordance with Section 2.3 and the participation of each other Revolving Facility Lender in such Swing Line Loan shall be adjusted accordingly;
(G)the Administrative Agent shall confirm, in writing, that the approved Revolving Facility Increase has become effective and that the aggregate Revolving Facility Commitments have been increased by the amount thereof.
(vii)The parties hereby agree that the borrowing notice, minimum borrowing, pro rata borrowing, and pro rata payment requirements contained elsewhere in this Agreement shall not apply to the transactions effected pursuant to Sections 2.1(e)(vi)(E) and 2.1(e)(vi)(F). Any repayments made pursuant to Sections 2.1(e)(vi)(E) or 2.1(e)(vi)(F) shall be accompanied by payment of all accrued interest on the amount prepaid and all amounts owed pursuant to Sections 3.5 and 11.3.
(viii)The Administrative Agent shall record relevant information regarding each Revolving Facility Increase (including information with respect to New Revolving Facility Lenders) in the Register in accordance with Section 11.7(c); provided, however, that failure to make any such recordation, or any error in such recordation, shall not affect the Borrower's obligations in respect of any Revolving Facility Commitments or Revolving Loans.
I.2Seasonal Term Loans.
(a)From the Closing Date until the Maturity Date with respect to the Revolving Credit Facility, the Borrower may, during the period beginning on each December 1 and ending on (but not including) the immediately subsequent May 31, from time to time request that term loans be made to it in accordance with this Section 2.2 (each, a "Seasonal Term Loan") by delivering a Notice of Seasonal Term Loan Borrowing to the Administrative Agent, specifying therein (subject to the restrictions set forth in Section 2.2(b)) (i) the amount of the Tranche of Seasonal Term Loans requested (which Tranche shall be in a minimum principal amount of $50,000,000.00 and integral multiples of $50,000,000.00 in excess thereof) and (ii) the requested advance date of the proposed Seasonal Term Loans comprising such Tranche (which shall be not less than twenty (20) days from the date of delivery of the Notice of Seasonal Term Loan Borrowing (or such shorter period of time as to which the Administrative Agent may agree in its sole discretion). Subject to the last sentence in Section 2.2(d), each Notice of Seasonal Term Loan Borrowing delivered by the Borrower shall be irrevocable and shall be binding upon all Loan Parties. At the time of delivery of each Notice of Seasonal Term Loan Borrowing, the Borrower shall also deliver to the Administrative Agent a certificate of an Authorized Officer of the Borrower certifying (1) that, both before and after giving effect to a Borrowing of such Tranche of Seasonal Term Loans, the Borrower shall be in pro forma compliance with the covenants set forth in Article VIII as of the most recent period for which financial statements have been delivered (and showing the calculations thereof), (2) that, both before and after giving effect to a Borrowing of such Tranche of Seasonal Term Loans, there shall not exist a Borrowing Base Deficit, and (3) that no Default or Event of Default then exists or would be caused thereby. There shall be no more than two Tranches of Seasonal Term Loans outstanding at any one time.
(b)The aggregate principal amount of all Seasonal Term Loan Commitments of all Tranches of Seasonal Term Loans made pursuant to this Section 2.2 shall not exceed the Maximum Aggregate Seasonal Term Loan Amount. Repayments of the principal of any Seasonal Term Loans may not be reborrowed. Each Tranche of Seasonal Term Loans shall bear interest at the Benchmarks plus such Applicable Margin as is set forth in the Seasonal Term Loan Funding Agreement (as defined below) related to such Tranche, and shall be subject to the amortization set forth in the applicable Seasonal Term Loan Funding Agreement relating to such Tranche. All Seasonal Term Loans shall for all purposes be Obligations hereunder and under the Loan Documents.
(c)Upon receipt of a request for a Tranche of Seasonal Term Loans from the Borrower, the Administrative Agent may, in its sole discretion, offer one or more Lenders or new lenders the opportunity, in such amounts as the Administrative Agent shall determine, to participate in the requested Tranche of Seasonal Term Loans. The Administrative Agent shall have no obligation to offer any Lender or new lender the opportunity to participate in any such Tranche of Seasonal Term Loans and nothing herein shall prohibit the Administrative Agent from retaining for its own account, as a Seasonal Term Lender, all or substantially all of such Tranche of Seasonal Term Loans. The Administrative Agent shall deliver a copy of each Notice of Seasonal Term Loan Borrowing to such Lenders or other Persons that qualify as an Eligible Assignee as may be determined by the Administrative Agent in its reasonable discretion with the approval of the Borrower or as may be specified by the Borrower with the consent of the Administrative Agent. Each Lender or new lender that fails to respond to such a notice in writing in a form acceptable to the Administrative Agent within the period of time provided therein shall be deemed to have elected not to participate in such Tranche of Seasonal Term Loans. No Lender or new lender shall have any obligation to fund any Seasonal Term Loan, and any decision by a Lender or new lender to fund any Seasonal Term Loan shall be made in its sole discretion independently from any other Lender or new lender.
(d)If in response to the offer to participate in such Tranche made by the Administrative Agent pursuant to Section 2.2(c), the Administrative Agent receives commitments from Lenders and/or from any other Person that has agreed to become a Lender (provided that each such Lender shall be approved by the Administrative Agent) in respect of all or a portion of the Seasonal Term Loan (a "New Seasonal Term Lender"), in excess of the requested Seasonal Term Loan, the Administrative Agent shall have the right, in its sole discretion but with the consent of the Borrower, to reduce and reallocate (within the minimum and maximum amounts specified by each such Lender or New Seasonal Term Lender in its notice to the Administrative Agent) the shares of the Seasonal Term Loan of the Lenders or New Seasonal Term Lenders willing to fund (or commit to fund) such Seasonal Term Loan so that the total committed Seasonal Term Loan equals the requested Seasonal Term Loan. If the Administrative Agent does not receive commitments from Lenders or New Seasonal Term Lenders in an amount sufficient to fund the requested Seasonal Term Loan, the Administrative Agent shall so notify Borrower and the request for such Seasonal Term Loan shall be deemed automatically rescinded; provided, the Borrower may submit a replacement Notice of Seasonal Term Loan Borrowing setting forth different terms for the requested Seasonal Term Loan.
(e)An agreement to fund Seasonal Term Loans (a "Seasonal Term Loan Funding Agreement"), pursuant to this Section 2.2 shall become effective upon the receipt by the Administrative Agent of an agreement in form and substance reasonably satisfactory to the Administrative Agent and the Borrower signed by each Loan Party, by each New Seasonal Term Lender and by each existing Lender who has agreed to fund such Seasonal Term Loans, setting forth (i) the Interest Rate Option(s) and the Applicable Margin(s) to be applicable to all Seasonal Term Loans, (ii) the amortization for all Seasonal Term Loans, (iii) the amount of any upfront or closing fees to be paid by the Borrower to the Lenders funding the Seasonal Term Loans requested, and (iv) the agreement of each New Seasonal Term Lender to become a party to this Agreement as a Lender and to be bound by all the terms and provisions hereof, together with officer's certificates and ratification agreements executed by each Loan Party and such evidence of satisfaction of all conditions set forth in Section 4.2, appropriate corporate authorization on the part of each Loan Party with respect to the requested Seasonal Term Loan, amendments to any other Loan Documents reasonably requested by the Administrative Agent in relation to the requested Seasonal Term Loan (which amendments to the Loan Documents (other than this Agreement) the Administrative Agent is hereby authorized to execute on behalf of the Lenders), updates or endorsements to policies of title insurance, flood hazard determination certificates (and, if applicable, evidence of flood insurance) with respect to each parcel of property subject to a Mortgage, the results of lien searches from applicable jurisdictions, and such opinions of counsel for the Loan Parties with respect to the requested Seasonal Term Loan and other assurances as the Administrative Agent may reasonably request.
(f)In addition to any prepayments or repayments made pursuant to Sections 2.15 and 2.16, the principal of the Seasonal Term Loans of each Tranche shall be repaid on such dates and in such amounts as may be set forth in the Notice of Seasonal Term Loan Borrowing for such Tranche, to be applied to the unpaid principal amount of the Seasonal Term Loans for such Tranche for which such payment relates. Notwithstanding anything herein to the contrary, the entire outstanding principal balance of the Seasonal Term Loans shall be due and payable in full in cash on the applicable Maturity Date.
(g)The Administrative Agent shall record relevant information regarding each Tranche of Seasonal Term Loans (including information with respect to New Seasonal Term Lenders) in the Register in accordance with Section 11.7(c); provided, however, that failure to make any such recordation, or any error in such recordation, shall not affect the Borrower's obligations in respect of any Seasonal Term Loan Commitment or Seasonal Term Loan.
I.3Swing Line Loans.
(a)Swing Line Commitments. Subject to the terms and conditions hereof and relying upon the agreements of the Revolving Facility Lenders set forth in this Section 2.3, the Swing Line Lender shall make Swing Line Loans to the Borrower at any time or from time to time after the Closing Date to, but not including, the Maturity Date with respect to the Revolving Credit Facility; provided, that after giving effect to any such Swing Line Loan, (i) the aggregate amount of Swing Line Loans shall not exceed the Swing Line Commitment, (ii) the Revolving Facility Usage shall not exceed the Revolving Facility Commitments and (iii) both before and after giving effect to such Swing Line Loan, there shall not exist a Borrowing Base Deficit. Each request by the Borrower for a Swing Line Loan shall be deemed to be a representation by the Borrower that it is in compliance with the proviso at the end of the preceding sentence and with Article IV after giving effect to the requested Swing Line Loan. Within such limits of time and amount and subject to the other provisions of this Agreement, the Borrower may borrow, repay and reborrow Swing Line Loans in accordance with this Section 2.3. The Borrower shall not use the proceeds of any Swing Line Loan to refinance any outstanding Swing Line Loan. If at any time the aggregate principal balance of the Swing Line Loans then outstanding exceeds the Swing Line Commitment, the Borrower shall be deemed to have requested the Revolving Facility Lenders to make Revolving Facility Loans in the amount of the difference in the manner and pursuant to the terms of Section 2.1(b).
(b)Cash Management Arrangements. The Borrower and the Swing Line Lender may enter into a cash management agreement (including the CoBank Cash Management Agreement) providing for the automatic advance by the Swing Line Lender of Swing Line Loans under the conditions set forth in such agreement, which conditions shall be in addition to the conditions set forth herein and which shall be in form and substance reasonably acceptable to the Administrative Agent.
(c)Swing Line Loan Requests. Except as otherwise provided herein or in the CoBank Cash Management Agreement, the Borrower may from time to time prior to the Maturity Date with respect to the Revolving Credit Facility request that the Swing Line Lender make Swing Line Loans by delivery to the Swing Line Lender (with a copy to the Administrative Agent) not later than 12:00 noon (or such later time as the applicable cash management agreement, if any, may permit or otherwise as the Swing Line Lender in its sole discretion may agree) on the proposed Borrowing Date of a duly completed and executed Loan Request, by telephonic request promptly followed by a duly completed and executed Loan Request, or by such other method of request as may be provided for in any applicable cash management agreement. Each such request shall be irrevocable and shall specify the proposed Borrowing Date and the principal amount of such Swing Line Loan. Minimum borrowing amounts shall not apply to Swing Line Loans, except as provided for in any applicable cash management agreement. Promptly after receipt of any such request for a Swing Line Loan, the Swing Line Lender will confirm with the Administrative Agent that the Administrative Agent received a copy of the same and, if not, provide the Administrative Agent with information regarding the requested Swing Line Loan.
(d)Making Swing Line Loans. So long as the Swing Line Lender has not received timely telephonic or written notice from the Administrative Agent that one or more conditions precedent to the making of a Credit Extension under Section 4.2 have not been satisfied, the Swing Line Lender, after receipt by it of a Loan Request in accordance with Section 2.3(c), shall fund such Swing Line Loan to the Borrower in Dollars and immediately available funds at the Principal Office prior to 2:00 p.m. or as otherwise agreed in any applicable cash management agreement on the Borrowing Date; provided, that at any time that the CoBank Cash Management Agreement is in effect, the Swing Line Lender may waive,
in its sole discretion, any one or more of the conditions precedent in Section 4.2 with respect to the making of any Swing Line Loan.
(e)Borrowings to Repay Swing Line Loans. The Swing Line Lender may, at its option, exercisable at any time for any reason whatsoever, request that the Administrative Agent demand repayment of the Swing Line Loans. Upon such request, the Administrative Agent shall demand repayment of the Swing Line Loans, and each Revolving Facility Lender shall make a Revolving Facility Loan in an amount equal to such Lender's Pro Rata Share of the aggregate principal amount of the outstanding Swing Line Loans, plus, if the Swing Line Lender has so requested, accrued interest thereon, provided, that no Revolving Facility Lender shall be obligated in any event to make Revolving Facility Loans in excess of its Available Revolving Facility Commitment. Revolving Facility Loans made pursuant to the preceding sentence shall bear interest at the Daily Simple SOFR Rate Option and shall be deemed to have been properly requested in accordance with Section 2.1(b) without regard to any of the requirements of such provision. Each Revolving Facility Lender acknowledges and agrees that its obligations to fund Swing Line Loans pursuant to this Section 2.3(e) and/or to acquire participations pursuant to Section 2.3(f) in respect of Swing Line Loans are absolute and unconditional and shall not be affected by any circumstance whatsoever, including the occurrence and continuance of a Default or an Event of Default or any failure by the Borrower to satisfy any of the conditions set forth in Section 4.2. The Administrative Agent shall provide notice to the Revolving Facility Lenders that such Revolving Facility Loans are to be made under this Section 2.3 and of the apportionment among the Revolving Facility Lenders, and the Revolving Facility Lenders shall be unconditionally obligated to fund such Revolving Facility Loans (whether or not the conditions specified in Section 2.1(b) are then satisfied) by the time requested by the Swing Line Lender and designated in such notice from the Administrative Agent, which shall not be earlier than 2:00 p.m. on the Business Day next after the date the Revolving Facility Lenders receive such notice from the Administrative Agent.
(f)Risk Participations in Swing Line Loans. Immediately upon the making of each Swing Line Loan, each Revolving Facility Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the Swing Line Lender, without recourse or warranty, an undivided interest and participation in such Swing Line Loan in an amount equal to such Revolving Facility Lender's Pro Rata Share (determined in accordance with clause (a) of the definition thereof) of the principal amount of such Swing Line Loan, and such interest and participation may be recovered from such Revolving Facility Lender together with interest thereon at the Daily Simple SOFR Rate for each day during the period commencing on the date of demand and ending on the date such amount is received (subject to the limitation in clause (e) above that no Revolving Facility Lender shall be obligated in any event to make Revolving Facility Loans in excess of its Available Revolving Facility Commitment).
(g)Repayment of Swing Line Loans. On the Maturity Date with respect to the Revolving Credit Facility, if not sooner demanded, the Borrower shall repay in full the outstanding principal amount of the Swing Line Loans, together will all accrued and unpaid interest and any applicable fees.
(h)Protective Advances.
(i) Subject to the limitations set forth below, the Administrative Agent, in its capacity as Swing Line Lender, is authorized by the Borrower and the Lenders, from time to time in the Administrative Agent’s sole discretion (but with absolutely no obligation), to make Swing Line Loans to or for the account
of the Borrower that the Administrative Agent, in its reasonable discretion, deems necessary or desirable (A) to preserve or protect the Collateral, or any portion thereof, (B) to enhance the likelihood of, or maximize the amount of, repayment of Loans and other Secured Obligations, or (C) to pay any other amount chargeable to or required to be paid by any Loan Party under the Loan Documents (any of such Swing Line Loans herein referred to as a “Protective Advance”), notwithstanding that, after giving effect to any such Swing Line Loans, the Revolving Facility Usage would exceed the Revolving Facility Commitments, the outstanding principal balance of all Swing Line Loans would exceed the Swing Line Commitment, or the conditions precedent set forth in Section 4.2 have not been satisfied.
(ii) If funding a Protective Advance would cause the Revolving Facility Usage (including all Protective Advances) to exceed the Revolving Facility Commitments or the Swing Line Loans to exceed the Swing Line Commitment, then the Administrative Agent in its capacity as a Revolving Facility Lender and the Swing Line Lender, in its sole discretion, may increase its Revolving Facility Commitment (and, concurrently, its Swing Line Commitment, if necessary) in an amount determined by the Administrative Agent to be sufficient to accommodate such Protective Advance and such future Protective Advances as the Administrative Agent may reasonably anticipate making (each, a “Protective Advance Commitment Increase”); provided, that the aggregate amount of Protective Advance Commitment Increases shall not exceed $50,000,000.00 at any time. In no event shall any such Protective Advance Commitment Increase modify or increase the Revolving Facility Commitment of any Lender other than the Revolving Facility Commitment (and Swing Line Commitment) of the Administrative Agent, in its capacities as a Revolving Facility Lender and the Swing Line Lender. In connection with any Protective Advance, the Borrower shall pay any and all fees imposed by the Administrative Agent in any Fee Letter or otherwise.
(iii) All Protective Advances shall constitute Swing Line Loans hereunder and, as such, shall be Secured Obligations secured by all Collateral, shall bear interest and be payable as are all other Swing Line Loans and shall be subject to all terms and conditions applicable to Swing Line Loans set forth and described in this Section 2.3 and otherwise in this Agreement; provided, however, that each Protective Advance shall be repaid by the Borrower on demand or, if no demand is made, within thirty (30) days after the funding thereof.
(iv) Except as set forth in the next sentence, all Revolving Facility Lenders shall be obligated to make Revolving Facility Loans under Section 2.3(e) or to purchase participations under Section 2.3(f) in connection with Protective Advances in the same manner as so required with respect to all Swing Line Loans, so long as the making of any such Revolving Facility Loan or purchase of a participation does not cause the aggregate amount of Revolving Facility Loans or participations made or purchased by a Revolving Facility Lender to exceed the amount of its respective Revolving Facility Commitment. Notwithstanding anything to the contrary set forth in this Agreement, to the
extent that the funding of any Protective Advance would cause the Revolving Facility Usage (including all Protective Advances) to exceed the Revolving Facility Commitments (such amount, the “Protective Advance Overage”), such Protective Advance Overage shall be for the sole account of the Administrative Agent, in its capacities as a Revolving Facility Lender and the Swing Line Lender, and no other Revolving Facility Lender shall be obligated to make Revolving Facility Loans under Section 2.3(e) or to purchase participations under Section 2.3(f) in connection with Protective Advances in connection with such Protective Advance Overage at any time, regardless of whether the Revolving Facility Usage (including all Protective Advances) is as of such date of determination less than the Revolving Facility Commitments.
(v) The Administrative Agent shall not be required to obtain the consent of any Secured Party as a condition to making a Protective Advance or implementing a Protective Advance Commitment Increase, but the Administrative Agent’s discretion to make Protective Advances and implement Protective Advance Commitment Increases may be revoked at any time in writing by the Required Lenders. No such revocation shall affect any Lender’s obligations under Section 2.3 with respect to Protective Advances made prior to the effective date of the revocation. A Protective Advance Commitment Increase may be terminated at any time in the Administrative Agent’s sole discretion, whereupon the Revolving Facility Commitment and Swing Line Commitment of the Administrative Agent shall be reduced by the amount of such terminated Protective Advance Commitment Increase.
(vi) On the Maturity Date with respect to the Revolving Credit Facility, if not sooner repaid, the Borrower shall repay in full the outstanding principal amount of all Protective Advances, together with all accrued and unpaid interest and any applicable fees.
(vii) In no event shall the Borrower or any other Loan Party be deemed a beneficiary of this Section 2.3(h) nor authorized to enforce any of its terms.
I.4Revolving Term Credit Facility.
(a)Revolving Term Facility Commitments. Subject to the terms and conditions hereof and relying upon the representations and warranties of the Loan Parties set forth herein and in the other Loan Documents, each Revolving Term Facility Lender severally agrees to make Revolving Term Loans to the Borrower at any time or from time to time on or after the Closing Date to, but not including, the Maturity Date with respect to the Revolving Term Credit Facility; provided, that after giving effect to each such Revolving Term Loan (i) the aggregate principal amount of such Revolving Term Facility Lender's Revolving Term Loans shall not exceed its Available Revolving Term Facility Commitment, and (ii) the Revolving Term Facility Usage shall not exceed the Revolving Term Facility Commitments. Each request by the Borrower for a Revolving Term Loan shall be deemed to be a representation by the Borrower that it shall be in compliance with the proviso at the end of the preceding sentence and with Article IV both before and after giving effect to the requested Revolving Term Loan. Within such limits of time and amount and subject to the other provisions of this Agreement, the Borrower may borrow, repay and reborrow pursuant to this Section 2.4.
(b)Revolving Term Loan Requests. Except as otherwise provided herein or in the CoBank Cash Management Agreement, the Borrower may from time to time prior to the Maturity Date with respect to the Revolving Term Credit Facility request the Revolving Term Facility Lenders to make Revolving Term Loans by delivering to the Administrative Agent, not later than 11:00 a.m., (i) three (3) U.S. Government Securities Business Days prior to the proposed Borrowing Date with respect to Term SOFR Rate Loans; and (ii) one (1) U.S. Government Securities Business Day prior to the proposed Borrowing Date with respect to Daily Simple SOFR Rate Loans, a duly completed Loan Request. Each such Loan Request shall be irrevocable and shall specify the aggregate amount of the proposed Revolving Term Loans comprising each Borrowing, and, if applicable, the Interest Period, which amounts shall be in (x) integral multiples of $5,000,000.00 and not less than $5,000,000.00 for each Borrowing under the Term SOFR Rate Option, and (y) integral multiples of $5,000,000.00 and not less than $5,000,000.00 for each Borrowing under the Daily Simple SOFR Rate Option.
(c)Nature of Lenders' Obligations with Respect to Revolving Term Loans. Each Revolving Term Facility Lender shall be obligated to participate in each request for Revolving Term Loans pursuant to this Section 2.4 in accordance with its Pro Rata Share. The obligations of each Revolving Term Facility Lender hereunder are several. The failure of any Revolving Term Facility Lender to perform its obligations hereunder shall not affect the Obligations of the Borrower to any other party nor shall any other party be liable for the failure of such Revolving Term Facility Lender to perform its obligations hereunder. The Revolving Term Facility Lenders shall have no obligation to make Revolving Term Loans hereunder on or after the Maturity Date with respect to the Revolving Term Credit Facility.
(d)Repayment of Revolving Term Loans. Notwithstanding anything herein or in any other Loan Document to the contrary, the Borrower shall repay the entire outstanding principal amount of Revolving Term Loans, together with all outstanding interest thereon and unpaid fees with respect thereto, on the Maturity Date with respect to the Revolving Term Credit Facility.
I.5Variable Rate Term Loan.
(a)Variable Rate Term Loan Commitments. Subject to the terms and conditions hereof, and relying upon the representations and warranties of the Loan Parties set forth herein and in the other Loan Documents, each Variable Rate Term Lender severally agrees to make a term loan (the "Variable Rate Term Loan") to the Borrower on the Closing Date in such principal amount as the Borrower shall request up to, but not exceeding the lesser of (i) such Variable Rate Term Lender's Variable Rate Term Loan Commitment or (ii) such Variable Rate Term Lender's Pro Rata Share of the aggregate principal amount of Variable Rate Term Loans to be funded on the Closing Date. The request by the Borrower for the Variable Rate Term Loan shall be deemed to be a representation by the Borrower that it shall be in compliance with Article IV both before and after giving effect to the requested Variable Rate Term Loan.
(b)Variable Rate Term Loan Request. The Borrower shall request the Variable Rate Term Lenders to make the Variable Term Loans by delivering to the Administrative Agent, not later than 11:00 a.m., (i) three (3) U.S. Government Securities Business Days prior to the expected Closing Date with respect to Term SOFR Rate Loans, and (ii) one (1) U.S. Government Securities Business Day prior to the expected Closing Date with respect to Daily Simple SOFR Rate Loans, a duly completed Loan Request. The Loan Request with respect to the Variable Rate Term Loan shall be subject to the occurrence of the Closing Date but otherwise shall be irrevocable and shall specify the aggregate amount
of the proposed Variable Rate Term Loans comprising each Borrowing, and, if applicable, the Interest Period.
(c)Nature of Lenders' Obligations with Respect to Variable Rate Term Loans. The failure of any Variable Rate Term Lender to make a Variable Rate Term Loan shall not relieve any other Variable Rate Term Lender of its obligations to make a Variable Rate Term Loan nor shall it impose any additional liability on any other Lender hereunder. The Variable Rate Term Lenders shall have no obligation to make the Variable Rate Term Loans after the Closing Date. The Variable Rate Term Loan Commitments are not revolving commitments, and the Borrower shall not have the right to repay and reborrow under this Section 2.5.
(d)Repayment of Variable Rate Term Loans. In addition to any prepayments or repayments made pursuant to Sections 2.15 and 2.16, the Borrower shall repay the aggregate outstanding principal balance of the Variable Rate Term Loan in quarterly principal payments on the dates and in the amounts set forth in Schedule 2.5. Notwithstanding anything herein to the contrary, the entire outstanding principal balance of the Variable Rate Term Loans shall be due and payable in full in cash on the Maturity Date with respect to the Variable Rate Term Loan Facility.
I.6Fixed Rate Term Loan.
(a)Fixed Rate Term Loan Commitments. An existing fixed rate term loan in the original aggregate principal amount of $22,476,180.00 (the “Existing Fixed Rate Term Loan”) was advanced to the Borrower on September 29, 2022 and remains outstanding in the aggregate principal amount of $11,192,740.00 immediately prior to the Closing Date. Subject to the terms and conditions of this Agreement, on the Closing Date each Lender with a Fixed Rate Term Loan Commitment agrees (severally, not jointly or jointly and severally) to convert, exchange and “cashless roll” its Pro Rata Share of the Existing Fixed Rate Term Loan for an equivalent amount of new term loans (collectively, the “Fixed Rate Term Loan”) to the Borrower, such that as of the Closing Date (a) each Lender with a Fixed Rate Term Loan Commitment shall hold an amount equal to such Lender’s Pro Rata Share of the Fixed Rate Term Loan Facility in accordance with this Agreement and (b) the entire amount of the Existing Fixed Rate Term Loan shall be deemed repaid simultaneously with the borrowing of the Fixed Rate Term Loan, with each Lender with a Fixed Rate Term Loan Commitment hereby irrevocably agreeing to accept, in lieu of cash for the outstanding principal amount of its Existing Fixed Rate Term Loan so prepaid, an equal principal amount of the Fixed Rate Term Loan in accordance with this Agreement; provided, that, (x) each such Lender with a Fixed Rate Term Loan Commitment hereby waives its right to any compensation for any loss, cost or expense required pursuant to Section 3.5 (and Section 3.5 of the Existing Credit Agreement) with respect to the conversion, exchange and “cashless roll” of its portion of the Existing Fixed Rate Term Loan; and (y) the Borrower agrees to pay to the Administrative Agent, on the first interest payment date for the Fixed Rate Term Loan pursuant to Schedule 2.6 following the Closing Date and for the ratable benefit of the Lenders holding a portion of the Existing Fixed Rate Term Loan, all accrued and unpaid interest on the Existing Fixed Rate Term Loan to the Closing Date.
(b)Fixed Rate Term Loan Principal. Schedule 2.6 sets forth the principal amount of each Fixed Rate Term Loan as of the Closing Date.
(c)Nature of Lenders' Obligations with Respect to Fixed Rate Term Loans. The Fixed Rate Term Loan Commitments are not revolving commitments, and the Borrower shall not have the right to repay and reborrow under this Section 2.6.
(d)Repayment of Fixed Rate Term Loans. In addition to any prepayments or repayments made pursuant to Sections 2.15 and 2.16, the Borrower shall repay the aggregate outstanding principal balance of the Fixed Rate Term Loans on the dates and in the amounts set forth in Schedule 2.6. Notwithstanding anything herein to the contrary, the entire outstanding principal balance of each Fixed Rate Term Loan shall be due and payable in full in cash on the Maturity Date with respect to such Fixed Rate Term Loan.
I.7Interest Rate Provisions. The Borrower shall pay interest in respect of the outstanding unpaid principal amount of the Loans, it being understood that, subject to the provisions of this Agreement, the Borrower may select different Interest Rate Options and different Interest Periods to apply to different Borrowings at any time outstanding and may convert to or renew one or more Interest Rate Options with respect to all or any portion of any Borrowing (subject to minimum amounts set forth in Sections 2.1(b), 2.2, and 2.4(b); provided that there shall not be at any one time outstanding more than ten (10) Borrowings of Term SOFR Rate Loans; provided, further, that each Fixed Rate Term Loan shall bear interest until the applicable Maturity Date at the rate set forth for such Loan on Schedule 2.6; and provided, further, that if a Default or an Event of Default has occurred and is continuing, (x) the Borrower may not request, convert to, or renew any Term SOFR Rate Loans, (y) the Borrower may not request or convert to any Daily Simple SOFR Rate Loans, and (z) immediately upon the occurrence and during the continuation of an Event of Default under clause (a) or (l) of Section 9.1 or immediately after written demand by the Administrative Agent (or by the Required Lenders to the Administrative Agent) after the occurrence and during the continuation of any other Event of Default, any Daily Simple SOFR Rate Loans will convert to Alternate Base Rate Loans. If at any time the designated rate applicable to any Loan made by any Lender exceeds the Maximum Rate, the rate of interest on such Lender's Loan shall be limited to such Lender's Maximum Rate.
(a)Interest Rate Options. Swing Line Loans and all other Obligations not constituting Revolving Facility Loans, Revolving Term Loans, Variable Rate Term Loans, Seasonal Term Loans or Fixed Rate Term Loans shall bear interest calculated based upon the Daily Simple SOFR Rate Option. Subject to the limitations set forth in Section 3.3, the Borrower shall have the right to select from the following Interest Rate Options applicable to the Revolving Facility Loans, Revolving Term Loans, Variable Rate Term Loans and any Seasonal Term Loans:
(i)Daily Simple SOFR Rate Option: An option to pay interest at a fluctuating rate per annum equal to the Daily Simple SOFR Rate in effect as of any date of determination plus the Applicable Margin as of such date; or
(ii)Term SOFR Rate Option: An option to pay interest at a fluctuating rate per annum equal to the Term SOFR Rate with respect to the applicable Interest Period and as in effect as of any date of determination plus the Applicable Margin as of such date.
(b)Day Count Basis. Interest and fees shall be calculated on the basis of a 360-day year for the actual number of days elapsed (which results in more interest or fees, as the case may be, being paid than if calculated on the basis of a 365-day year). The date of funding or conversion of a Term SOFR Rate Loan to a Daily Simple SOFR Rate Loan and the first day of an Interest Period shall be included in the calculation of interest. The date of payment of any Loan and the last day of an Interest Period shall be excluded from the calculation of interest; provided, if a Loan is repaid on the same day that it is made, one (1) day's interest shall be charged.
(c)SOFR. In connection with the use or administration of the Term SOFR Rate and the Daily Simple SOFR Rate, the Administrative Agent will have the right to make Benchmark Replacement Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Loan Document, any amendments implementing such Benchmark Replacement Conforming Changes will become effective without any further action or consent of any other party to this Agreement or any other Loan Document. The Administrative Agent will promptly notify the Borrower and the Lenders of the effectiveness of any Benchmark Replacement Conforming Changes in connection with the use or administration of the Term SOFR Rate or the Daily Simple SOFR Rate.
I.8Interest Periods. In order to convert a Daily Simple SOFR Rate Loan or Term SOFR Rate Loan or to continue a Term SOFR Rate Loan, the Borrower shall deliver to the Administrative Agent a duly completed, written request therefor substantially in the form of Exhibit I (each, a "Conversion or Continuation Notice") not later than 11:00 a.m. (i) with respect to a conversion to or continuation of a Term SOFR Rate Loan, at least three (3) U.S. Government Securities Business Days prior to the proposed effective date of such conversion or continuation and (ii) with respect to a conversion to a Daily Simple SOFR Rate Loan, at least one (1) U.S. Government Securities Business Day prior to the proposed effective date of such conversion. The Conversion or Continuation Notice shall specify (i) which Borrowings (including the principal amount thereof) are subject to such request, and, in the case of any Term SOFR Rate Loan to be converted or continued, the last day of the current Interest Period therefor, (ii) the proposed effective date of such conversion or continuation (which shall be a Business Day), (iii) whether the Borrower is requesting a continuation of Term SOFR Rate Loans or a conversion of Borrowings from one interest rate option to another interest rate option, and (iv) if a continuation of or conversion to Term SOFR Rate Loans is requested, the requested Interest Period with respect thereto. In addition, the following provisions shall apply to any continuation of or conversion of any Borrowings:
(a)Amount of Loans. After giving effect to such conversion or continuation, each Borrowing of Revolving Facility Loans, Seasonal Term Loans and Revolving Term Loans shall be in an amount no less than the applicable minimum amount set forth in Sections 2.1(b), 2.2, and 2.4(b), respectively.
(b)Commencement of Interest Period. In the case of any borrowing of, conversion to or continuation of any Term SOFR Rate Loan, the Interest Period shall commence on the date of advance or continuation of, or conversion to, any Term SOFR Rate Loan and, in the case of immediately successive Interest Periods, each successive Interest Period shall commence on the date on which the immediately preceding Interest Period expires. Upon a conversion from a Term SOFR Rate Loan to a Daily Simple SOFR Rate Loan, interest at the Daily Simple SOFR Rate Option shall commence on the last day of the existing Interest Period.
(c)Selection of Interest Rate Options. If the Borrower elects to continue a Term SOFR Rate Loan but fails to select a new Interest Period to apply thereto, then a one month Interest Period automatically shall apply. If the Borrower fails to duly request the continuation of any Borrowing consisting of Term SOFR Rate Loans on or before the date specified and otherwise in accordance with the provisions of this Section 2.8, then such Term SOFR Rate Loan automatically shall be converted to a Daily Simple SOFR Rate Loan, and interest at the Daily Simple SOFR Rate Option shall commence on the last day of the existing Interest Period.
I.9Making of Loans.
(a)Notifications and Payments. The Administrative Agent shall, promptly after receipt by it of a Loan Request pursuant to Sections 2.1(b), 2.4(b), 2.5(b) or 2.6(b), notify the applicable Lenders of such Class of Loan of its receipt of such Loan Request specifying the information provided by the Borrower and the apportionment among the Lenders of the requested Loan as determined by the Administrative Agent in accordance with Section 2.1, 2.4, 2.5, or 2.6, as applicable. Each applicable Lender shall remit the principal amount of their Pro Rata Share of the Loan to the Administrative Agent such that the Administrative Agent is able to, and the Administrative Agent shall, to the extent the Lenders have made funds available to it for such purpose and subject to the terms and conditions of Section 2.1, 2.4, 2.5, or 2.6, as applicable, fund such Loan to the Borrower in Dollars and immediately available funds to the Borrower's account specified in the Loan Request prior to 2:00 p.m. on the proposed Borrowing Date.
(b)Pro Rata Treatment of Lenders. The borrowing of any Class of Loan shall be allocated to each Lender of such Class of Loan according to its Pro Rata Share thereof, and each selection of, conversion to or renewal of any Interest Rate Option and each payment or prepayment by the Borrower with respect to principal and interest due from the Borrower hereunder to the Lenders with respect to the applicable Class of Commitments and Loan, shall (except as otherwise may be provided with respect to a Defaulting Lender and except as provided in Section 2.1(e), Section 3.1 or Section 3.6) be payable ratably among the Lenders of such Class of Loan entitled to such payment in accordance with the amount of principal and interest then due or payable such Lenders as set forth in this Agreement.
(c)Presumptions by the Administrative Agent. Unless the Administrative Agent shall have received notice from a Lender prior to the proposed Borrowing Date that such Lender will not make available to the Administrative Agent such Lender's share of any Loan, the Administrative Agent may assume that such Lender has made such share available on such date in accordance with Section 2.1, 2.2, 2.4, 2.5 or 2.6, as the case may be, and may, in reliance upon such assumption, make available to the Borrower a corresponding amount. In such event, if a Lender has not in fact made its share of such Loan available to the Administrative Agent, then the applicable Lender and the Borrower severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount with interest thereon, for each day from and including the date such amount is made available to the Borrower to but excluding the date of payment to the Administrative Agent, at (i) in the case of a payment to be made by such Lender, the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation and (ii) in the case of a payment to be made by the Borrower, the interest rate then applicable to Daily Simple SOFR Rate Loans. If such Lender pays its share of the applicable Loan to the Administrative Agent, then the amount so paid shall constitute such Lender's Loan. Any payment by the Borrower shall be without prejudice to any claim the Borrower may have against a Lender that shall have failed to make such payment to the Administrative Agent. If the Borrower and such Lender pay such interest for the same period, the Administrative Agent promptly shall remit to the Borrower the amount of interest paid by Borrower for such overlapping period. Nothing in this Section 2.9(c) or elsewhere in this Agreement or the other Loan Documents, including the provisions of Section 2.17, shall be deemed to require the Administrative Agent (or any other Lender) to advance funds on behalf of any Lender or to relieve any Lender from its obligation to fulfill its commitments hereunder or to prejudice any rights that the Administrative Agent or the Borrower may have against any Lender as a result of any default by such Lender hereunder.
I.10Fees.
(a)Unused Commitment Fees.
(i)Revolving Credit Facility. Accruing from the Closing Date until the Maturity Date with respect to the Revolving Credit Facility, the Borrower agrees to pay to the Administrative Agent for the account of each Revolving Facility Lender according to its Pro Rata Share, a nonrefundable unused commitment fee (each a "Revolving Facility Unused Commitment Fee") equal to the Applicable Unused Commitment Fee Rate (computed on the basis of a year of 360 days, as the case may be, and actual days elapsed) multiplied by the average daily result of (i) the Revolving Facility Commitments minus (ii) Revolving Facility Usage; provided, further, that any Unused Commitment Fee accrued with respect to the Revolving Facility Commitment of a Defaulting Lender during the period prior to the time such Lender became a Defaulting Lender and unpaid at such time shall not be payable by the Borrower so long as such Lender shall be a Defaulting Lender except to the extent that such Unused Commitment Fee shall otherwise have been due and payable by the Borrower prior to such time; and provided further that no Unused Commitment Fee shall accrue with respect to the Revolving Facility Commitment of a Defaulting Lender so long as such Lender shall be a Defaulting Lender. Subject to the provisos in the directly preceding sentence, all Revolving Facility Unused Commitment Fees shall be payable in arrears on the first day of each Fiscal Quarter of the Borrower.
(ii)Revolving Term Credit Facility. Accruing from the Closing Date until the Maturity Date with respect to the Revolving Term Credit Facility, the Borrower agrees to pay to the Administrative Agent for the account of each Revolving Term Facility Lender according to its Pro Rata Share, a nonrefundable unused commitment fee (each a "Revolving Term Facility Unused Commitment Fee") equal to the Applicable Unused Commitment Fee Rate (computed on the basis of a year of 360 days, as the case may be, and actual days elapsed) multiplied by the average daily result of (i) the Revolving Term Facility Commitments minus (ii) Revolving Term Facility Usage; provided, further, that any Unused Commitment Fee accrued with respect to the Revolving Term Facility Commitment of a Defaulting Lender during the period prior to the time such Lender became a Defaulting Lender and unpaid at such time shall not be payable by the Borrower so long as such Lender shall be a Defaulting Lender except to the extent that such Unused Commitment Fee shall otherwise have been due and payable by the Borrower prior to such time; and provided further that no Unused Commitment Fee shall accrue with respect to the Revolving Term Facility Commitment of a Defaulting Lender so long as such Lender shall be a Defaulting Lender. Subject to the provisos in the directly preceding sentence, all Revolving Term Facility Unused Commitment Fees shall be payable in arrears on the first day of each Fiscal Quarter of the Borrower.
(b)Other Fees. The Borrower agrees to pay to the Administrative Agent such other fees (for the applicable recipient thereof) as agreed to in the Fee Letter, and the Borrower shall pay to the Administrative Agent, the Arrangers and the Lenders such fees as shall have been separately agreed to in writing in the amounts and at the times so specified. Such fees shall be fully earned when paid and shall not be refundable for any reason whatsoever.
I.11Notes. The obligation of the Borrower to repay the aggregate unpaid principal amount of the Revolving Facility Loans, any Seasonal Term Loans, Swing Line Loans, Revolving Term Loans, Variable Rate Term Loans and Fixed Rate Term Loans made to it by each Lender, together with interest thereon, shall, at the request of the applicable Lender, be evidenced by a Revolving Facility Note, a Seasonal Term Loan Note, a Swing Line Note, a Revolving Term Facility Note, a Variable Rate Term Loan Note and a Fixed Rate Term Loan Note, as the case may be, dated the Closing Date, the effective date, or the date of such request, as applicable, payable to the order of such Lender in a face amount equal to the Revolving Facility Commitment, Seasonal Term Loan Commitment, Swing Line Commitment, Revolving Term Facility Commitment, Variable Rate Term Loan Commitment and Fixed Rate Term Loan Commitment, as applicable, of such Lender. The Borrower hereby unconditionally promises to pay,
to the order of each of the Lenders, the Administrative Agent, the Issuing Lender and the Swing Line Lender, as applicable, the Loans and other Obligations as provided in this Agreement and the other Loan Documents.
I.12Letter of Credit Subfacility.
(a)Issuance of Letters of Credit. Subject to the terms and conditions of this Agreement and the other Loan Documents, including Section 4.2, and in reliance upon the representations and warranties set forth in this Agreement and the other Loan Documents and in reliance on the agreements of the Revolving Facility Lenders set forth in this Section 2.12, the Issuing Lender agrees to issue standby letters of credit (the "Letters of Credit") for the account of the Borrower on any Business Day from the Closing Date through but not including the Letter of Credit Expiration Date. The Borrower may at any time prior to the Letter of Credit Expiration Date request the issuance of a Letter of Credit, or an amendment or extension of a Letter of Credit, by delivering to the Issuing Lender (with a copy to the Administrative Agent) a completed application and agreement for letters of credit, or request for such amendment or extension, as applicable, in such form as the Issuing Lender may specify from time to time (each a "Letter of Credit Request") by no later than 11:00 a.m. at least five (5) Business Days, or such shorter period as may be agreed to by the Issuing Lender, in advance of the proposed date of issuance, amendment or extension. Promptly after receipt of any Letter of Credit Request, the Issuing Lender shall confirm with the Administrative Agent (in writing) that the Administrative Agent has received a copy of such Letter of Credit Request and if not, the Issuing Lender will provide the Administrative Agent with a copy thereof. Unless the Issuing Lender has received notice from any Lender, the Administrative Agent or any Loan Party, at least one day prior to the requested date of issuance, amendment or extension of the applicable Letter of Credit, that one or more applicable conditions in Article IV is not satisfied, then the Issuing Lender will issue a Letter of Credit or agree to such amendment or extension, provided that each Letter of Credit shall (A) have a maximum maturity of twelve (12) months from the date of issuance, provided, that a Letter of Credit may contain renewal terms satisfactory to the Issuing Lender (except that the foregoing shall not prohibit a Letter of Credit from providing for automatic renewals for additional periods not exceeding one (1) year each so long as the Issuing Lender may prevent such renewal by notice and no such additional period extends beyond the date set forth in the following clause (B)), and (B) in no event expire later than the Letter of Credit Expiration Date (except that a Letter of Credit may provide for automatic renewals for additional twelve (12-month periods without an amendment to such Letter of Credit unless at least ninety (90) days prior to any such date the Issuing Lender notifies the beneficiary of such Letter of Credit in writing of the Issuing Lender’s election not to extend such Letter of Credit, so long as no such additional period extends beyond the first anniversary of the Maturity Date for the Revolving Credit Facility), and provided, further that at no time shall (i) the Letter of Credit Obligations exceed the Letter of Credit Sublimit, (ii) the Revolving Facility Usage exceed the Borrowing Base or (iii) the Revolving Facility Usage exceed the Revolving Facility Commitments. Each request by the Borrower for the issuance, amendment or extension of a Letter of Credit shall be deemed to be a representation by the Borrower that it shall be in compliance with the 2nd proviso to the preceding sentence and with Article IV after giving effect to the requested issuance, amendment or extension of such Letter of Credit. Promptly after its delivery of any Letter of Credit or any amendment to a Letter of Credit to the beneficiary thereof, the Issuing Lender will also deliver to the Borrower and the Administrative Agent a true and complete copy of such Letter of Credit or amendment. The Borrower unconditionally guarantees all obligations of any other Loan Party with respect to Letters of Credit issued by the Issuing Lender for the account of such Loan Party.
(b)Letter of Credit Fees. The Borrower shall pay to the Administrative Agent for the ratable account of the Revolving Facility Lenders a fee (the "Letter of Credit Fee") equal to the
Applicable Letter of Credit Fee Rate (computed on the basis of a year of 360 days and actual days elapsed), which fee shall be computed on the daily average Letter of Credit Obligations and shall be payable annually and on the Maturity Date. The Borrower shall also pay to the Issuing Lender for the Issuing Lender's sole account a fronting fee in an amount equal to the greater of (i) 0.125% of the face amount of each Letter of Credit and (ii) $1,000.00, as well as the Issuing Lender's then in effect customary fees and administrative expenses payable with respect to the Letters of Credit as the Issuing Lender may generally charge or incur from time to time in connection with the issuance, maintenance, amendment (if any), assignment or transfer (if any), negotiation, and administration of Letters of Credit.
(c)Disbursements, Reimbursement. Immediately upon the issuance of each Letter of Credit, each Revolving Facility Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the Issuing Lender a participation in such Letter of Credit and each drawing thereunder, without recourse or warranty, in an amount equal to such Revolving Facility Lender's Pro Rata Share of the maximum amount available to be drawn under such Letter of Credit and the amount of such drawing, respectively.
(i)In the event of any request for a drawing under a Letter of Credit by the beneficiary or transferee thereof, the Issuing Lender will promptly notify the Borrower and the Administrative Agent thereof. Provided that it shall have received such notice, the Borrower shall reimburse (such obligation to reimburse the Issuing Lender shall sometimes be referred to as a "Reimbursement Obligation") the Issuing Lender prior to 12:00 noon on each date that an amount is paid by the Issuing Lender under any Letter of Credit (each such date, a "Drawing Date") by paying to the Administrative Agent for the account of the Issuing Lender an amount equal to the amount so paid by the Issuing Lender. In the event the Borrower fails to reimburse the Issuing Lender (through the Administrative Agent) for the full amount of any drawing under any Letter of Credit in accordance with the foregoing sentence, then the Administrative Agent will promptly notify each Revolving Facility Lender thereof, and the Borrower shall be deemed to have requested that Revolving Facility Loans be made by the Revolving Facility Lenders under the Daily Simple SOFR Rate Option to be disbursed on the Business Day immediately following the Drawing Date, subject to the amount of the unutilized portion of the Revolving Facility Commitment and subject to the conditions set forth in Section 4.2 other than any notice requirements. Any notice given by the Administrative Agent or the Issuing Lender pursuant to this Section 2.12(c)(i) may be by telephone if immediately confirmed in writing; provided that the lack of such an immediate confirmation shall not affect the conclusiveness or binding effect of such notice.
(ii)Each Revolving Facility Lender shall upon the Business Day immediately following a Drawing Date with respect to which notice was delivered by the Administrative Agent in accordance with Section 2.12(c)(i) make funds available to the Administrative Agent for the account of the Issuing Lender in an amount equal to its Pro Rata Share of the amount of the drawing. So long as the conditions set forth in Section 4.2 have been satisfied or waived in accordance with this Agreement, each Revolving Facility Lender that makes such funds available shall be deemed to have made a Revolving Facility Loan at the Daily Simple SOFR Rate Option; provided, that if any conditions set forth in Section 4.2 have not been satisfied or waived in accordance with this Agreement, each Revolving Facility Lender shall remain obligated to fund its Pro Rata Share of such unreimbursed amount and such amount (each a "Participation Advance") shall be deemed to be a payment in respect of its participation in the applicable Letter of Credit Borrowing resulting from such drawing in accordance with Section 2.12(c)(iii). If any Revolving Facility Lender so notified fails to make available to the Administrative Agent for the account of the Issuing Lender the amount of such Revolving Facility Lender's Pro Rata Share of such amount by no later than Noon on such date, then interest shall accrue on such Revolving Facility Lender's obligation to make such payment, from such Business Day to the date
on which such Lender makes such payment (i) at a rate per annum equal to the Federal Funds Effective Rate during the first three (3) days following the date such amount was due and (ii) at a rate per annum equal to the rate applicable to the Revolving Facility Loans under the Daily Simple SOFR Rate Option.
(iii)With respect to any unreimbursed drawing that is not fully reimbursed by Borrower and is not refinanced by Revolving Facility Loans in accordance with Section 2.12(c)(i) because of the Borrower's failure to satisfy the conditions set forth in Section 4.2, the Borrower shall be deemed to have incurred from the Issuing Lender a borrowing (each, a "Letter of Credit Borrowing") in an amount equal to the unreimbursed portion of such drawing. Such Letter of Credit Borrowing shall be due and payable on demand (together with interest) and shall bear interest at the rate per annum applicable to the Revolving Facility Loans under the Daily Simple SOFR Rate Option.
(d)Repayment of Participation Advances.
(i)Upon (and only upon) receipt by the Administrative Agent for the account of the Issuing Lender of immediately available funds from the Borrower (A) in reimbursement of any payment made by the Issuing Lender under the Letter of Credit with respect to which any Lender has made a Participation Advance to the Administrative Agent, or (B) in payment of interest on such a payment made by the Issuing Lender under such a Letter of Credit, the Administrative Agent on behalf of the Issuing Lender will pay to each Revolving Facility Lender, in the same funds as those received by the Administrative Agent, the amount of such Revolving Facility Lender's Pro Rata Share of such funds, except the Administrative Agent shall retain for the account of the Issuing Lender the amount of the Pro Rata Share of such funds of any Revolving Facility Lender that did not make a Participation Advance in respect of such payment by the Issuing Lender.
(ii)If the Administrative Agent is required at any time to return to any Loan Party, or to a trustee, receiver, liquidator, custodian, or any official in any Insolvency Proceeding, any portion of any payment made by any Loan Party to the Administrative Agent for the account of the Issuing Lender pursuant to this Section 2.12 in reimbursement of a payment made under the Letter of Credit or interest or fee thereon, each Revolving Facility Lender shall, on demand of the Administrative Agent, forthwith return to the Administrative Agent for the account of the Issuing Lender the amount of its Pro Rata Share of any amounts so returned by the Administrative Agent plus interest thereon from the date such demand is made to the date such amounts are returned by such Revolving Facility Lender to the Administrative Agent, at a rate per annum equal to the Federal Funds Effective Rate in effect from time to time.
(e)Documentation. Each Loan Party agrees to be bound by the terms of the Issuing Lender's application and agreement for letters of credit and the Issuing Lender's written regulations and customary practices relating to letters of credit, though such interpretation may be different from such Loan Party's own. In the event of a conflict between such application or agreement and this Agreement, this Agreement shall govern. It is understood and agreed that, except in the case of its or its Affiliate's gross negligence, willful misconduct, bad faith or fraud as determined by a final decision by a court of competent jurisdiction, the Issuing Lender shall not be liable for any error, negligence and/or mistakes, whether of omission or commission, in following any Loan Party's instructions or those contained in the Letters of Credit or any modifications, amendments or supplements thereto.
(f)Determinations to Honor Drawing Requests. In determining whether to honor any request for drawing under any Letter of Credit by the beneficiary thereof, the Issuing Lender shall be responsible only to determine that the documents and certificates required to be delivered under such
Letter of Credit have been delivered and that they comply on their face with the requirements of such Letter of Credit.
(g)Nature of Participation and Reimbursement Obligations. Each Revolving Facility Lender's obligation in accordance with this Agreement to make the Revolving Facility Loans or Participation Advances, as contemplated by this Section 2.12, as a result of a drawing under a Letter of Credit, and the Obligations of the Borrower to reimburse the Issuing Lender upon a draw under a Letter of Credit, shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Section 2.12 under all circumstances, including the following circumstances:
(i)any set-off, counterclaim, recoupment, defense or other right that such Revolving Facility Lender may have against the Issuing Lender or any of its Affiliates, the Borrower or any other Person for any reason whatsoever, or that any Loan Party may have against the Issuing Lender or any of its Affiliates, any Lender or any other Person for any reason whatsoever;
(ii)the failure of any Loan Party or any other Person to comply, in connection with a Letter of Credit Borrowing, with the conditions set forth in Sections 2.1 or 4.2 or as otherwise set forth in this Agreement for the making of a Revolving Facility Loan, it being acknowledged that such conditions are not required for the making of a Letter of Credit Borrowing and the obligation of the Revolving Facility Lenders to make Participation Advances under this Section 2.12;
(iii)any lack of validity or enforceability of any Letter of Credit;
(iv)any claim of breach of warranty that might be made by any Loan Party or any Lender against any beneficiary of a Letter of Credit, or the existence of any claim, set-off, recoupment, counterclaim, crossclaim, defense or other right that any Loan Party or any Lender may have at any time against a beneficiary, successor beneficiary, any transferee or assignee of any Letter of Credit or the proceeds thereof (or any Persons for whom any such transferee may be acting), the Issuing Lender or its Affiliates or any Lender or any other Person, whether in connection with this Agreement, the transactions contemplated herein or any unrelated transaction (including any underlying transaction between any Loan Party or Subsidiaries of a Loan Party and the beneficiary for which any Letter of Credit was procured);
(v)the lack of power or authority of any signer of (or any defect in or forgery of any signature or endorsement on) or the form of or lack of validity, sufficiency, accuracy, enforceability or genuineness of any draft, demand, instrument, certificate or other document presented under or in connection with any Letter of Credit, or any fraud or alleged fraud in connection with any Letter of Credit by any Person other than the Issuing Lender or its Affiliates, or the transport of any property or provision of services relating to a Letter of Credit, in each case even if the Issuing Lender or any of its Affiliates has been notified thereof;
(vi)payment by the Issuing Lender or any of its Affiliates under any Letter of Credit against presentation of a demand, draft or certificate or other document that does not comply with the terms of such Letter of Credit;
(vii)the solvency of, or any acts or omissions by, any beneficiary of any Letter of Credit, or any other Person having a role in any transaction or obligation relating to a Letter of Credit, or the existence, nature, quality, quantity, condition, value or other characteristic of any property or services relating to a Letter of Credit;
(viii)any failure by the Issuing Lender or any of its Affiliates to issue any Letter of Credit in the form requested by any Loan Party, unless the Issuing Lender has received written notice from such Loan Party of such failure within three Business Days after the Issuing Lender shall have furnished such Loan Party and the Administrative Agent a copy of such Letter of Credit and such error is material and no drawing has been made thereon prior to receipt of such notice;
(ix)any adverse change in the business, operations, properties, assets, condition (financial or otherwise) or prospects of any Loan Party or Subsidiaries of a Loan Party;
(x)any breach of this Agreement or any other Loan Document by any party thereto;
(xi)the occurrence or continuance of an Insolvency Proceeding with respect to any Loan Party;
(xii)the fact that an Event of Default or a Default shall have occurred and be continuing;
(xiii)the fact that the Maturity Date shall have passed or this Agreement or the Commitments hereunder shall have been terminated; and
(xiv)any other circumstance or happening whatsoever, whether or not similar to any of the foregoing.
Notwithstanding the foregoing, the Borrower hereby reserves any rights it may have under applicable Law with respect to any actual losses it may suffer to the extent arising out of the fraud, gross negligence, willful misconduct or breach in bad faith by the Issuing Lender of its obligations under this Section 2.12 (as determined by a court of competent jurisdiction in a final, non-appealable judgment) as a direct result of actions or omissions by the Issuing Lender described in the preceding clause (i) through (xiv); provided that in no event shall the Issuing Lender be liable to any Loan Party or any other Person for any indirect, consequential, incidental, punitive, exemplary or special damages or expenses, or for any damages resulting from any change in the value of any property relating to a Letter of Credit.
(h)Indemnity. The Borrower hereby agrees to protect, indemnify, pay and save harmless the Issuing Lender from and against any and all claims, demands, liabilities, damages, taxes, penalties, interest, judgments, losses, costs, charges and expenses (including reasonable fees, expenses and disbursements of counsel and allocated costs of internal counsel) that the Issuing Lender may incur or be subject to as a consequence, direct or indirect, of the issuance of any Letter of Credit, other than as a result of the fraud, gross negligence, willful misconduct or bad faith of the Issuing Lender or any of its Affiliates as determined by a final, non-appealable judgment of a court of competent jurisdiction.
(i)Liability for Acts and Omissions. As between any Loan Party and the Issuing Lender, such Loan Party assumes all risks of the acts and omissions of, or misuse of the Letters of Credit by, the respective beneficiaries of such Letters of Credit. In furtherance and not in limitation of the foregoing, the Issuing Lender shall not be responsible for any of the following, including any losses or damages to any Loan Party or other Person or property relating therefrom: (i) the form, validity, sufficiency, accuracy, genuineness or legal effect of any document submitted by any party in connection with the application for an issuance of any such Letter of Credit, even if it should in fact prove to be in any or all respects invalid, insufficient, inaccurate, fraudulent or forged (even if the Issuing Lender or its Affiliates shall have been notified thereof); (ii) the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign any such Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, that may prove to be invalid or ineffective for any reason; (iii) the failure of the beneficiary of any such Letter of Credit, or any other party to which such Letter of Credit may be transferred, to comply fully with any conditions required in order to draw upon such Letter of Credit or any other claim of any Loan Party against any beneficiary of such Letter of Credit, or any such transferee, or any dispute between or among any Loan Party and any beneficiary of any Letter of Credit or any such transferee; (iv) errors, omissions, interruptions or delays in transmission or delivery of any messages, by mail, cable, telegraph, telex or otherwise, whether or not they be in cipher; (v) errors in interpretation of technical terms; (vi) any loss or delay in the transmission or otherwise of any document required in order to make a drawing under any such Letter of Credit or of the proceeds thereof; (vii) the misapplication by the beneficiary of any such Letter of Credit of the proceeds of any drawing under such Letter of Credit; or (viii) any consequences arising from causes beyond the control of the Issuing Lender or its Affiliates, as applicable, including any act or omission of any Governmental Authority, and none of the above shall affect or impair, or prevent the vesting of, any of the Issuing Lender's or its Affiliates rights or powers hereunder. Nothing in the preceding sentence shall relieve the Issuing Lender from liability for the Issuing Lender's gross negligence, willful misconduct, fraud or breach in bad faith by the Issuing Lender of its obligations under this Agreement (as determined by a court of competent jurisdiction in a final, non-appealable judgment) in connection with actions or omissions described in such clauses (i) through (viii) of such sentence. In no event shall the Issuing Lender or its Affiliates be liable to any Loan Party for any indirect, consequential, incidental, punitive, exemplary or special damages or expenses (including attorneys' fees), or for any damages resulting from any change in the value of any property relating to a Letter of Credit.
Without limiting the generality of the foregoing, the Issuing Lender and each of its Affiliates (i) may rely on any oral or other communication believed in good faith by the Issuing Lender or such Affiliate to have been authorized or given by or on behalf of the applicant for a Letter of Credit, (ii) may honor any presentation if the documents presented appear on their face substantially to comply with the terms and conditions of the relevant Letter of Credit; (iii) may honor a previously dishonored presentation under a Letter of Credit if the Issuing Lender or such Affiliate shall have reasonably determined that the reason for such dishonor has been eliminated, whether such dishonor was pursuant to a court order, to settle or compromise any claim of wrongful dishonor, or otherwise, and shall be entitled to reimbursement to the same extent as if such presentation had initially been honored, together with any interest paid by the Issuing Lender or its Affiliate; (iv) may honor any drawing that is payable upon presentation of a statement advising negotiation or payment, upon receipt of such statement (even if such statement indicates that a draft or other document is being delivered separately), and shall not be liable for any failure of any such draft or other document to arrive, or to conform in any way with the relevant Letter of Credit; (v) may pay any paying or negotiating bank claiming that it rightfully honored under the laws or practices of the place where such bank is located; and (vi) may settle or adjust any claim or demand made on the Issuing Lender or its Affiliate in any way related to any order issued at the applicant's request to an air carrier, a letter of guarantee or of indemnity issued to a carrier or any similar document (each an "Order") and honor any drawing in connection with any Letter of Credit that is the subject of such Order, notwithstanding that any drafts or other documents presented in connection with such Letter of Credit fail to conform in any way with such Letter of Credit.
In furtherance and extension and not in limitation of the specific provisions set forth above, any action taken or omitted by the Issuing Lender or its Affiliates under or in connection with the Letters of Credit issued by it or any documents and certificates delivered thereunder, if taken or omitted in good faith, shall not put the Issuing Lender or its Affiliates under any resulting liability to the Borrower or any Lender.
(j)Issuing Lender Reporting Requirements. The Issuing Lender shall, on the first Business Day of each month, provide to the Administrative Agent and the Borrower a schedule of the Letters of Credit issued by it, in form and substance satisfactory to the Administrative Agent, showing the date of issuance of each Letter of Credit, the account party, the original face amount (if any), and the Maturity Date of any Letter of Credit outstanding at any time during the preceding month, and any other information relating to such Letter of Credit that the Administrative Agent may request.
(k)ISP. Unless otherwise expressly agreed by the Issuing Lender, the Borrower and the beneficiary of a Letter of Credit, the rules of the International Standby Practices as most recently published from time to time by the International Chamber of Commerce (the "ISP") shall apply to each Letter of Credit.
(l)Illegality. If, at any time, it becomes unlawful for an Issuing Lender to comply with any of its obligations under any Letter of Credit (including, but not limited to, as a result of any Sanctions), the obligations of such Issuing Lender with respect to such Letter of Credit shall be suspended (and all corresponding rights shall cease to accrue) until such time as it may again become lawful for such Issuing Lender to comply with its obligations under such Letter of Credit, and such Issuing Lender shall not be liable for any losses that the Borrower or its Subsidiaries may incur as a result.
I.13Payments.
(a)Payments Generally. All payments and prepayments to be made in respect of principal, interest, Unused Commitment Fees, Letter of Credit Fees, other fees referred to in Section 2.10 or other fees or amounts due from the Borrower hereunder shall be payable prior to 11:00 a.m. on the date when due without presentment, demand, protest or notice of any kind, all of which are hereby expressly waived by the Borrower, and without set-off, counterclaim or other deduction of any nature, and an action therefor shall immediately accrue. Such payments shall be made to the Administrative Agent at the Principal Office for the account of the Lenders or the Issuing Lender to which they are owed, in each case in Dollars and in immediately available funds. The Administrative Agent shall promptly distribute such amounts to the Issuing Lender, Swing Line Lender and/or applicable Lenders in immediately available funds. The Administrative Agent's and each Lender's statement of account, ledger or other relevant record shall, in the absence of manifest error, be conclusive as the statement of the amount of principal of and interest on the Loans and other amounts owing under this Agreement."
(b)Payments by the Borrower; Presumptions by the Administrative Agent. Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Administrative Agent for the account of the Lenders or the Issuing Lender hereunder that the Borrower will not make such payment, the Administrative Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders or the Issuing Lender, as the case may be, the amount due. In such event, if the Borrower has not in fact made such payment, then each of the Lenders or the Issuing Lender, as the case may be, severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender or the Issuing Lender, with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation.
I.14Interest Payment Dates. Interest on Daily Simple SOFR Rate Loans shall be due and payable in arrears on each applicable Interest Payment Date. Interest on Term SOFR Rate Loans shall be
due and payable on the last day of each Interest Period for those Loans and, if such Interest Period is longer than three (3) months, also on the date that is the three-month anniversary of the first day of such Interest Period. Interest on each Fixed Rate Term Loan shall be due and payable in arrears on the dates specified therefor on Schedule 2.6. Interest on mandatory prepayments of principal under Section 2.16 shall be due on the date such mandatory prepayment is due. Interest on the principal amount of each Loan not constituting a Daily Simple SOFR Rate Loan, Term SOFR Rate Loan, Fixed Rate Term Loan or on any other monetary Obligations shall be due and payable on demand after such principal amount or other monetary Obligation becomes due and payable (whether on the stated Maturity Date, upon an accelerated Maturity Date or otherwise).
I.15Voluntary Prepayments and Reduction of Commitments.
(a)Right to Prepay. The Borrower shall have the right at its option from time to time to prepay the Loans (other than Seasonal Term Loans) in whole or part without premium or penalty (except those amounts, if any, owed by Borrower at the time of such prepayment pursuant to Sections 11.3, 3.1 and 3.5). Whenever the Borrower desires to prepay any part of the Variable Rate Term Loans, it shall provide a prepayment notice to the Administrative Agent by 11:00 a.m. at least (A) three (3) U.S. Government Securities Business Days prior to the date of prepayment of Term SOFR Rate Loans, or (B) one (1) U.S. Government Securities Business Day prior to the date of prepayment of Daily Simple SOFR Rate Loans, in each case setting forth the following information:
(i)the date, which shall be a Business Day, on which the proposed prepayment is to be made;
(ii)a statement indicating the application of the prepayment among Class of Loan and Borrowings; and
(iii)the total principal amount of such prepayment, which shall not be less than the lesser of the following with respect to any Class of Loan: (A) the then outstanding principal amount of such Class of Loan, or (B) $2,000,000.00 (provided, that the amount of any prepayment to which this Section 2.15(a)(iii)(b) applies shall be in integral multiples of $2,000,000.00).
All prepayment notices shall be irrevocable. The principal amount of the Loans for which a prepayment notice is given, together with interest on such principal amount except with respect to Loans to which the Daily Simple SOFR Rate Option applies, shall be due and payable on the date specified in such prepayment notice as the date on which the proposed prepayment is to be made. So long as no Event of Default has occurred and is continuing, all Variable Rate Term Loan prepayments permitted pursuant to this Section 2.15 shall be applied pro rata to the unpaid installments of principal of such Variable Rate Term Loan (as applicable) in the inverse order of scheduled maturities (for the avoidance of doubt, to be first applied to any balloon payment due and payable on the Maturity Date of such Variable Rate Term Loan (as applicable)). If the Borrower prepays a Loan but fails to specify the applicable Class and/or Borrowing that the Borrower intends to prepay or if an Event of Default has occurred and is continuing, then such prepayment shall be applied first, ratably to all outstanding Revolving Facility Loans and Revolving Term Loans that are Daily Simple SOFR Rate Loans, second, ratably to all outstanding Revolving Facility Loans and Revolving Term Loans that are Term SOFR Rate Loans, third, ratably to all outstanding Variable Rate Term Loans that are Daily Simple SOFR Rate Loans, fourth, ratably to all outstanding Variable Rate Term Loans that are Term SOFR Rate Loans and fifth ratably to all outstanding Fixed Rate Term Loans. Any prepayment hereunder shall include all interest and fees due
and payable at the time of such prepayment with respect to the Loan being prepaid and shall be subject to the Borrower’s Obligation to indemnify the Lenders under Section 3.5.
Voluntary prepayments of Revolving Facility Loans and Revolving Term Loans shall be governed by, and applied in accordance with, the CoBank Cash Management Agreement. Voluntary prepayments of Fixed Rate Term Loans shall be governed by, and applied in accordance with, instructions issued by the Administrative Agent at the time of such prepayment. Seasonal Term Loans may not be voluntarily prepaid.
(b)Reduction of Revolving Facility Commitments.
(i)In addition to the commitment reductions pursuant to Sections 2.15(b)(ii) and 2.16(g), (A) the Revolving Facility Commitments shall be permanently reduced and terminated in full on the Maturity Date with respect to the Revolving Credit Facility, and (B) the Revolving Term Facility Commitments shall be permanently reduced and terminated in full on the Maturity Date with respect to the Revolving Term Credit Facility. Any outstanding principal balance of the Revolving Facility Loans or Revolving Term Loans not sooner due and payable will become due and payable on such Maturity Date and shall be accompanied by accrued interest on the amount repaid, any applicable fees pursuant to Section 3.5 and any other fees required hereunder.
(ii)The Borrower shall have the right at any time after the Closing Date upon five (5) days' prior written notice to the Administrative Agent to permanently reduce (ratably among the Revolving Facility Lenders in proportion to their Pro Rata Shares) the Revolving Facility Commitments in a minimum amount of $50,000,000.00 and whole multiples of $50,000,000.00 or the Revolving Term Facility Commitments in a minimum amount of $5,000,000.00 and whole multiples of $5,000,000.00, or to terminate completely the Revolving Facility Commitments or Revolving Term Facility Commitments, without penalty or premium except as hereinafter set forth; provided that any such reduction or termination shall be accompanied by prepayment of the Revolving Facility Loans or Revolving Term Loans, as applicable, together with outstanding Unused Commitment Fees, and the full amount of interest accrued on the principal sum to be prepaid (and all amounts referred to in Section 3.5 hereof) to the extent necessary to cause the (A) Revolving Facility Usage after giving effect to such prepayments to be equal to or less than the Revolving Facility Commitments as so reduced or terminated, and (B) aggregate Revolving Term Facility Usage after giving effect to such prepayments to be equal to or less than the Revolving Term Facility Commitments as so reduced or terminated. Any notice to reduce the Revolving Facility Commitments or Revolving Term Facility Commitment under this Section 2.15(b)(ii) shall be irrevocable.
I.16Mandatory Prepayments.
(a)Overadvance.
(i)If the Revolving Facility Usage at any time exceeds the Revolving Facility Commitments (each, a "Revolving Facility Overadvance"), the Borrower shall prepay the Revolving Facility Loans and Swing Line Loans in such amounts as shall be necessary so that Revolving Facility Usage does not exceed the Revolving Facility Commitments and, if prepayment in full of the Revolving Facility Loans and Swing Line Loans is not sufficient to eliminate such excess, the Borrower shall Cash Collateralize the Letter of Credit Obligations.
(ii)If the Revolving Term Facility Usage at any time exceeds the Revolving Term Facility Commitments (each, a "Revolving Term Facility Overadvance"), the Borrower shall
prepay the Revolving Term Loans in such amounts as shall be necessary so that Revolving Term Facility Usage does not exceed the Revolving Term Facility Commitments.
(iii)If the aggregate amount of the Variable Rate Term Loans at any time exceeds the Variable Rate Term Loan Commitments (each, a "Variable Rate Term Loan Overadvance"), the Borrower shall prepay the Variable Rate Term Loans in such amounts as shall be necessary so that the Variable Rate Term Loans do not exceed the Variable Rate Term Loan Commitments.
(iv)If the aggregate amount of any Seasonal Term Loans at any time exceeds the Seasonal Term Loan Commitments (each, a "Seasonal Term Loan Overadvance"), the Borrower shall prepay the Seasonal Term Loans in such amounts as shall be necessary so that the Seasonal Term Loans do not exceed the Seasonal Term Loan Commitments.
(v)If the aggregate amount of the Fixed Rate Term Loans at any time exceeds the Fixed Rate Term Loan Commitments (each, a "Fixed Rate Term Loan Overadvance"), the Borrower shall prepay the Fixed Rate Term Loans in such amounts as shall be necessary so that the Fixed Rate Term Loans do not exceed the Fixed Rate Term Loan Commitments.
(b)Disposition of Assets. Immediately upon the receipt by any Loan Party or Subsidiary thereof of the Net Cash Proceeds from any Disposition not expressly permitted by Section 7.8, or as required pursuant to Section 7.8(h)(iii) or Section 7.8(j), the Borrower shall prepay, or cause such other Loan Party or Subsidiary to prepay, Obligations in an aggregate amount equal to 100% of the Net Cash Proceeds of such Disposition (or such other amount as may be required pursuant to Section 7.8(h)(iii)), unless otherwise agreed to by the Administrative Agent in writing; provided, however, that, so long as no Default shall have occurred and be continuing, such Net Cash Proceeds shall not be required to be so applied at the election of the Borrower (as notified by the Borrower to the Administrative Agent on or prior to the date of such Disposition) to the extent such Loan Party or such Subsidiary reinvests all or any portion of such Net Cash Proceeds in Capital Expenditures of the Loan Parties within three hundred sixty-five (365) days after the receipt of such Net Cash Proceeds; provided, that, if such Net Cash Proceeds shall have not been so reinvested, such Net Cash Proceeds shall be immediately prepaid. All such proceeds shall be paid and applied in accordance with Sections 2.16(g)(ii) and 2.16(h). Notwithstanding anything herein to the contrary, no such mandatory prepayment shall constitute or be deemed to constitute a cure of any Default or Event of Default arising as a result of the Disposition giving rise to such prepayment obligation.
(c)Casualty Events. Immediately upon the receipt by any Loan Party or Subsidiary thereof of the Net Cash Proceeds of any Casualty Event or series of related Casualty Events affecting any property of any Loan Party, the Borrower shall prepay, or cause such other Loan Party or Subsidiary thereof to prepay, Obligations in an aggregate amount equal to 100% of the Net Cash Proceeds of such Casualty Event(s), unless otherwise agreed to by the Administrative Agent in writing; provided, however, that, so long as no Default shall have occurred and be continuing, such Net Cash Proceeds shall not be required to be so applied at the election of the Borrower (as notified by the Borrower to the Administrative Agent) to the extent such Loan Party or such Subsidiary reinvests all or any portion of such Net Cash Proceeds in Capital Expenditures of the Loan Parties within three hundred sixty-five (365) days after the receipt of such Net Cash Proceeds; provided, that, if such Net Cash Proceeds shall have not been so reinvested, such Net Cash Proceeds shall be immediately prepaid. All such proceeds shall be paid and applied in accordance with Sections 2.16(g) and 2.16(h). Notwithstanding anything herein to the contrary, no such mandatory prepayment shall constitute or be deemed to constitute a cure of any Default
or Event of Default arising as a result of such Casualty Event(s) giving rise to such prepayment obligation.
(d)Equity Issuances. Immediately upon receipt by any Loan Party or Subsidiary thereof of the Net Cash Proceeds from any Equity Issuance, other than Equity Issuances expressly permitted under Section 7.13(a), the Borrower shall prepay, or cause such other Loan Party or Subsidiary to prepay, Obligations in an aggregate amount equal to 100% of the Net Cash Proceeds of such Equity Issuance. All such proceeds shall be paid and applied in accordance with Sections 2.16(g) and 2.16(h). Notwithstanding anything herein to the contrary, no such mandatory prepayment shall constitute or be deemed to constitute a cure of any Default or Event of Default arising as a result of such Equity Issuance giving rise to such prepayment obligation.
(e)Debt Incurrence. Immediately upon the receipt by any Loan Party or Subsidiary thereof of the Net Cash Proceeds of any Debt Incurrence, other than a Debt Incurrence permitted under Section 7.1, the Borrower shall prepay, or cause such other Loan Party or Subsidiary thereof to prepay, Obligations in an amount equal to 100% of the amount of such Net Cash Proceeds. All such proceeds shall be paid and applied in accordance with Sections 2.16(g) and 2.16(h). Notwithstanding anything herein to the contrary, any such prepayment shall not constitute or be deemed to be a cure of any Default or Event of Default arising as a result of such Debt Incurrence.
(f)Borrowing Base Deficit. If any Borrowing Base Certificate shall reflect a Borrowing Base Deficit, the Borrower shall, immediately and without the necessity of a demand by the Administrative Agent or any Lender, prepay the Revolving Facility Loans and any Seasonal Term Loans in such amount as may be necessary to eliminate such Borrowing Base Deficit. Notwithstanding anything herein to the contrary, no such mandatory prepayment shall constitute or be deemed to constitute a cure of any Default or Event of Default arising as a result of such Borrowing Base Deficit giving rise to such prepayment obligation.
(g)Application Among Obligations.
(i)Except to the extent provided in Section 2.16(g)(ii), all prepayments pursuant to this Section 2.16 shall be applied, first to prepay any Overadvances that may be outstanding, pro rata, second to prepay the Variable Rate Term Loans (to be applied to installments of the Variable Rate Term Loans in inverse order of scheduled maturities ratably in accordance with the then outstanding amounts thereof), third to prepay the Revolving Facility Loans (including Swing Line Loans) and Revolving Term Loans, pro rata, with a corresponding reduction in the Revolving Facility Commitments and Revolving Term Facility Commitments, and to Cash Collateralize outstanding Letter of Credit Obligations, and fourth to prepay the Fixed Rate Term Loans (to be applied to installments of the Fixed Rate Term Loans in inverse order of scheduled maturities ratably in accordance with the then outstanding amounts thereof).
(ii)All prepayments required pursuant to Section 2.16(b) shall be applied as follows: (i) the first $20,000,000.00 of prepayments made after the Closing Date shall be applied to prepay the Revolving Facility Loans (including Swing Line Loans) and Revolving Term Loans, pro rata, without a corresponding reduction in the Revolving Facility Commitments and Revolving Term Facility Commitments; and (ii) any remaining prepayments shall be applied, first to prepay the Revolving Term Loans, without a corresponding reduction in the Revolving Term Facility Commitments, second to prepay the Variable Rate Term Loans (to be applied to installments of the Variable Rate Term Loans in inverse order of scheduled maturities ratably in accordance with the then outstanding amounts thereof), and third
to prepay the Fixed Rate Term Loans (to be applied to installments of the Fixed Rate Term Loans in inverse order of scheduled maturities ratably in accordance with the then outstanding amounts thereof).
(h)Interest Payments; Application Among Interest Rate Options. All prepayments pursuant to this Section 2.16 shall be accompanied by accrued and unpaid interest upon the principal amount of each such prepayment. Subject to Section 2.16(g), all prepayments required pursuant to this Section 2.16 (other than prepayments in respect of Fixed Rate Term Loans) shall first be applied to Daily Simple SOFR Rate Loans and then to Term SOFR Rate Loans. In accordance with Section 3.5, the Borrower shall indemnify the Lenders for any loss or expense, including loss of margin, incurred with respect to any such prepayments applied against Term SOFR Rate Loans on any day other than the last day of the applicable Interest Period or against Fixed Rate Term Loans.
I.17Sharing of Payments by Lenders. If any Lender shall, by exercising any right of setoff, counterclaim or banker's lien, by receipt of voluntary payment, by realization upon security, or by any other non-pro rata source or otherwise, obtain payment in respect of any principal of or interest on any of its Loans or other obligations hereunder resulting in such Lender receiving payment of a proportion of the aggregate amount of its Loans and accrued interest thereon or other such obligations greater than its pro-rata share of the amount such Lender is entitled hereunder, then the Lender receiving such greater proportion shall (a) notify the Administrative Agent of such fact, and (b) purchase (for cash at face value) participations in the Loans and such other obligations of the other Lenders, or make such other adjustments as shall be equitable, so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Loans and other Obligations owing them, provided that:
(a)if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest; and
(b)the provisions of this Section 2.17 shall not be construed to apply to (x) any payment (including the application of funds arising from the existence of a Defaulting Lender) made by the Loan Parties pursuant to and in accordance with the express terms of the Loan Documents, (y) the application of Cash Collateral provided for in Section 2.19 or (z) any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans or Participation Advances to any assignee or participant, other than to the Borrower or any Subsidiary thereof (as to which the provisions of this Section 2.17 shall apply).
Each Loan Party consents to the foregoing and agrees, to the extent it may effectively do so under applicable Law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against each Loan Party rights of setoff and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of each Loan Party in the amount of such participation. This Section 2.17 shall not apply to any action taken by any Farm Credit Lender with respect to any Farm Credit Equities held by the Borrower or any cash patronage, whether on account of foreclosure of any Lien thereon, retirement and cancellation of the same, exercise of setoff rights or otherwise.
I.18Defaulting Lenders.
(a)Defaulting Lender Adjustments. Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as such Lender is no longer a Defaulting Lender, to the extent permitted by applicable Law:
(i)Waivers and Amendments. Such Defaulting Lender's right to approve or disapprove any amendment, waiver or consent with respect to this Agreement shall be restricted as set forth in the definition of Required Lenders.
(ii)Defaulting Lender Waterfall. Any payment of principal, interest, fees or other amounts received by the Administrative Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article IX or otherwise) or received by the Administrative Agent from a Defaulting Lender pursuant to Section 9.2(c) shall be applied at such time or times as may be determined by the Administrative Agent as follows: first, to the payment of any amounts owing by such Defaulting Lender to the Administrative Agent hereunder; second, to the payment on a pro rata basis of any amounts owing by such Defaulting Lender to the Issuing Lender or Swing Line Lender hereunder; third, to Cash Collateralize the Issuing Lender's Fronting Exposure with respect to such Defaulting Lender in accordance with Section 2.19; fourth, as the Borrower may request (so long as no Default or Event of Default exists), to the funding of any Loan in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Administrative Agent; fifth, if so determined by the Administrative Agent and the Borrower, to be held in a deposit account and released pro rata in order to (x) satisfy such Defaulting Lender's potential future funding obligations with respect to Loans under this Agreement and (y) Cash Collateralize the Issuing Lender's future Fronting Exposure with respect to such Defaulting Lender with respect to future Letters of Credit issued under this Agreement, in accordance with Section 2.19; sixth, to the payment of any amounts owing to the Lenders, the Issuing Lender or the Swing Line Lender as a result of any judgment of a court of competent jurisdiction obtained by any Lender, the Issuing Lender or the Swing Line Lender against such Defaulting Lender as a result of such Defaulting Lender's breach of its obligations under this Agreement; seventh, so long as no Default or Event of Default exists, to the payment of any amounts owing to the Borrower as a result of any judgment of a court of competent jurisdiction obtained by the Borrower against such Defaulting Lender as a result of such Defaulting Lender's breach of its obligations under this Agreement; and eighth, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if (x) such payment is a payment of the principal amount of any Loans or Letter of Credit Obligations in respect of which such Defaulting Lender has not fully funded its appropriate share, and (y) such Loans were made or the related Letters of Credit were issued at a time when the conditions set forth in Section 4.2 were satisfied or waived, such payment shall be applied solely to pay the Loans of, and Letter of Credit Obligations owed to, all Non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of, or Letter of Credit Obligations owed to, such Defaulting Lender until such time as all Loans and funded and unfunded participations in Letter of Credit Obligations and Swing Line Loans are held by the Lenders pro rata in accordance with the Commitments under the applicable Facility without giving effect to Section 2.18(a)(iv) below. Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender or to post Cash Collateral pursuant to this Section 2.18(a) shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.
(iii)Certain Fees.
(A)No Defaulting Lender shall be entitled to receive any Unused Commitment Fee for any period during which that Lender is a Defaulting Lender (and the Borrower shall not be required to pay any such fee that otherwise would have been required to have been paid to that Defaulting Lender).
(B)Each Defaulting Lender shall be entitled to receive Letter of Credit Fees for any period during which that Lender is a Defaulting Lender only to the extent allocable to its Pro Rata Share of the stated amount of Letters of Credit for which it has provided Cash Collateral pursuant to Section 2.19.
(C)With respect to any Unused Commitment Fee or Letter of Credit Fee not required to be paid to any Defaulting Lender pursuant to clause (A) or (B) above, the Borrower shall (x) pay to each Non-Defaulting Lender that portion of any such fee otherwise payable to such Defaulting Lender with respect to such Defaulting Lender's participation in Letter of Credit Obligations or Swing Line Loans that has been reallocated to such Non-Defaulting Lender pursuant to clause (iv) below, (y) pay to the Issuing Lender and Swing Line Lender, as applicable, the amount of any such fee otherwise payable to such Defaulting Lender to the extent allocable to the Issuing Lender's or Swing Line Lender's Fronting Exposure to such Defaulting Lender, and (z) not be required to pay the remaining amount of any such fee.
(iv)Reallocation of Participations to Reduce Fronting Exposure. All or any part of such Defaulting Lender's participation in Letter of Credit Obligations and Swing Line Loans shall be reallocated among the Non-Defaulting Lenders in accordance with their respective Pro Rata Shares (calculated without regard to such Defaulting Lender's Commitment) but only to the extent that (x) the conditions set forth in Section 4.2 are satisfied at the time of such reallocation (and, unless the Borrower shall have otherwise notified the Administrative Agent within ten (10) Business Days of receiving notice of the reallocation, the Borrower shall be deemed to have represented and warranted that such conditions are satisfied at such time), and (y) such reallocation does not cause any Non-Defaulting Lender's Pro Rata Share of the Revolving Facility Usage to exceed such Non-Defaulting Lender's Revolving Facility Commitment. No reallocation hereunder shall constitute a waiver or release of any claim of any party hereunder against a Defaulting Lender arising from that Lender having become a Defaulting Lender, including any claim of a Non-Defaulting Lender as a result of such Non-Defaulting Lender's increased exposure following such reallocation.
(v)Cash Collateral; Repayment of Swing Line Loans. If the reallocation described in clause (iv) above cannot, or can only partially, be effected, the Borrower shall, without prejudice to any right or remedy available to it hereunder or under Law, (x) first, prepay Swing Line Loans in an amount equal to the Swing Line Lender's Fronting Exposure and (y) second, Cash Collateralize the Issuing Lender's Fronting Exposure in accordance with the procedures set forth in Section 2.19.
(b)Defaulting Lender Cure. If the Borrower, the Administrative Agent and the Swing Line Lender and Issuing Lender agree in writing that a Lender is no longer a Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any Cash Collateral), that Lender will, to the extent applicable, purchase at par that portion of outstanding Loans of the other Lenders or take such other actions as the Administrative Agent may determine to be necessary to cause the Loans and funded and unfunded participations in Letters of Credit and Swing Line Loans to be held pro rata by the Lenders in accordance with the Commitments under the applicable Facility (without giving effect to Section 2.18(a)(iv), whereupon such Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrower while that Lender was a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed by the affected parties, no change
hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender's having been a Defaulting Lender.
(c)New Swing Line Loans/Letters of Credit. So long as any Lender is a Defaulting Lender, (i) the Swing Line Lender shall not be required to fund any Swing Line Loans unless it is satisfied that it will have no Fronting Exposure after giving effect to such Swing Line Loan and (ii) the Issuing Lender shall not be required to issue, extend, renew or increase any Letter of Credit unless it is satisfied that it will have no Fronting Exposure after giving effect thereto.
I.19Cash Collateral. At any time that there shall exist a Defaulting Lender, within one (1) Business Day following the written request of the Administrative Agent or the Issuing Lender (with a copy to the Administrative Agent) the Borrower shall Cash Collateralize the Issuing Lender's Fronting Exposure with respect to such Defaulting Lender (determined after giving effect to Section 2.18(a)(iv) and any Cash Collateral provided by such Defaulting Lender) in an amount not less than the Minimum Collateral Amount.
(a)Grant of Security Interest. The Borrower, and to the extent provided by any Defaulting Lender, such Defaulting Lender, hereby grants to the Administrative Agent, for the benefit of the Issuing Lender, and agrees to maintain, a first priority security interest in all such Cash Collateral as security for the Defaulting Lenders' obligation to fund participations in respect of Letter of Credit Obligations, to be applied pursuant to clause (b) below. If at any time the Administrative Agent determines that Cash Collateral is subject to any right or claim of any Person other than the Administrative Agent and the Issuing Lender as herein provided, or that the total amount of such Cash Collateral is less than the Minimum Collateral Amount, the Borrower will, promptly upon demand by the Administrative Agent, pay or provide to the Administrative Agent additional Cash Collateral in an amount sufficient to eliminate such deficiency (after giving effect to any Cash Collateral provided by the Defaulting Lender).
(b)Application. Notwithstanding anything to the contrary contained in this Agreement, Cash Collateral provided under this Section 2.19 or Section 2.18 in respect of Letters of Credit shall be applied to the satisfaction of the Defaulting Lender's obligation to fund participations in respect of Letter of Credit Obligations (including, as to Cash Collateral provided by a Defaulting Lender, any interest accrued on such obligation) for which the Cash Collateral was so provided, prior to any other application of such property as may otherwise be provided for herein.
(c)Termination of Requirement. Cash Collateral (or the appropriate portion thereof) provided to reduce the Issuing Lender's Fronting Exposure shall no longer be required to be held as Cash Collateral pursuant to this Section 2.19 following (i) the elimination of the applicable Fronting Exposure (including by the termination of Defaulting Lender status of the applicable Lender), or (ii) the determination by the Administrative Agent and the Issuing Lender that there exists excess Cash Collateral; provided that, subject to Section 2.18, the Person providing Cash Collateral and the Issuing Lender may agree that Cash Collateral shall be held to support future anticipated Fronting Exposure or other obligations and provided further that to the extent that such Cash Collateral was provided by the Borrower or any other Loan Party, such Cash Collateral shall remain subject to the Prior Security Interest granted pursuant to the Loan Documents.
II.INCREASED COSTS; TAXES; ILLEGALITY; INDEMNITY
II.1Increased Costs.
(a)Increased Costs Generally. If any Change in Law shall:
(i)impose, modify or deem applicable any reserve (including pursuant to regulations issued from time to time by the Federal Reserve Board for determining the maximum reserve requirement (including any emergency, special, supplemental or other marginal reserve requirement) with respect to eurocurrency funding (currently referred to as "Eurocurrency liabilities" in Regulation D)), special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or participated in by, any Lender or the Issuing Lender;
(ii)subject any Recipient to any Taxes (other than (A) Indemnified Taxes, (B) Taxes described in clauses (b) through (d) of the definition of Excluded Taxes and (C) Connection Income Taxes) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto; or
(iii)impose on any Lender or the Issuing Lender any other condition, cost or expense (other than Taxes) affecting this Agreement or Loans made by such Lender or any Letter of Credit or participation therein;
and the result of any of the foregoing shall be to increase the cost to such Lender or such other Recipient of making, converting to, continuing or maintaining any Loan or of maintaining its obligation to make any such Loan, or to increase the cost to such Lender, the Issuing Lender or such other Recipient of participating in, issuing or maintaining any Letter of Credit (or of maintaining its obligation to participate in or to issue any Letter of Credit), or to reduce the amount of any sum received or receivable by such Lender, Issuing Lender or other Recipient hereunder (whether of principal, interest or any other amount) then, upon request of such Lender, Issuing Lender or other Recipient, the Borrower will pay to such Lender, Issuing Lender or other Recipient, as the case may be, such additional amount or amounts as will compensate such Lender, Issuing Lender or other Recipient, as the case may be, for such additional costs incurred or reduction suffered.
(b)Capital Requirements. If any Lender or the Issuing Lender determines that any Change in Law affecting such Lender or the Issuing Lender or any lending office of such Lender or such Lender's or the Issuing Lender's holding company, if any, regarding capital or liquidity requirements, has or would have the effect of reducing the rate of return on such Lender's or the Issuing Lender's capital or on the capital of such Lender's or the Issuing Lender's holding company, if any, as a consequence of this Agreement, the Commitments of such Lender or the Loans made by, or participations in Letters of Credit or Swing Line Loans held by, such Lender, or the Letters of Credit issued by the Issuing Lender, to a level below that which such Lender or the Issuing Lender or such Lender's or the Issuing Lender's holding company could have achieved but for such Change in Law (taking into consideration such Lender's or the Issuing Lender's policies and the policies of such Lender's or the Issuing Lender's holding company with respect to capital adequacy), then from time to time the Borrower will pay to such Lender or the Issuing Lender, as the case may be, such additional amount or amounts as will compensate such Lender or the Issuing Lender or such Lender's or the Issuing Lender's holding company for any such reduction suffered.
(c)Certificates for Reimbursement. A certificate of a Lender or the Issuing Lender setting forth the amount or amounts necessary to compensate such Lender or the Issuing Lender or its holding company, as the case may be, as specified in this Section 3.1 which shall include supporting information, and delivered to the Borrower shall be conclusive absent manifest error. The Borrower shall
pay such Lender or the Issuing Lender, as the case may be, the amount shown as due on any such certificate within ten (10) days after receipt thereof.
(d)Delay in Requests. Failure or delay on the part of any Lender or the Issuing Lender to demand compensation pursuant to this Section 3.1 shall not constitute a waiver of such Lender's or the Issuing Lender's right to demand such compensation, provided that the Borrower shall not be required to compensate a Lender or the Issuing Lender pursuant to this Section 3.1 for any increased costs incurred or reductions suffered more than nine (9) months prior to the date that such Lender or the Issuing Lender, as the case may be, notifies the Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender's or the Issuing Lender's intention to claim compensation therefor (except that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the nine (9) month period referred to above shall be extended to include the period of retroactive effect thereof).
II.2Taxes.
(a)Issuing Lender. For purposes of this Section 3.2, the term "Lender" includes the Issuing Lender and the term "applicable Law" includes FATCA.
(b)Payments Free of Taxes. Any and all payments by or on account of any obligation of any Loan Party hereunder or under any other Loan Document shall be made free and clear of and without deduction or withholding for any Taxes, except as required by applicable Law. If any applicable Law (as determined in the good faith discretion of an applicable Withholding Agent) requires the deduction or withholding of any Tax from any such payment by a Withholding Agent, then the applicable Withholding Agent shall be entitled to make such deduction or withholding and shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable Law and, if such Tax is an Indemnified Tax, then the sum payable by the applicable Loan Party shall be increased as necessary so that after such deduction or withholding has been made (including such deductions and withholdings applicable to additional sums payable under this Section 3.2) the applicable Recipient receives an amount equal to the sum it would have received had no such deduction or withholding been made.
(c)Payment of Other Taxes by the Borrower. The Loan Parties shall timely pay to the relevant Governmental Authority in accordance with applicable Law, or at the option of the Administrative Agent timely reimburse it for the payment of, any Other Taxes.
(d)Indemnification by the Borrower. The Loan Parties shall jointly and severally indemnify each Recipient, within ten (10) days after demand therefor, for the full amount of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section 3.2) payable or paid by such Recipient or required to be withheld or deducted from a payment to such Recipient and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate with supporting information as to the amount of such payment or liability delivered to the Borrower by a Lender (with a copy to the Administrative Agent), or by the Administrative Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error. Each of the Loan Parties shall, and does hereby agree to, jointly and severally indemnify the Administrative Agent, and shall make payment in respect thereof within thirty (30) days after demand therefor, for any amount which a Lender for any reason fails to pay indefeasibly to the Administrative Agent as required pursuant to Section 3.2(e) below.
(e)Indemnification by the Lenders. Each Lender shall severally indemnify the Administrative Agent, within ten (10) days after demand therefor, for (i) any Indemnified Taxes attributable to such Lender (but only to the extent that the applicable Loan Party has not already indemnified the Administrative Agent for such Indemnified Taxes and without limiting the obligation of the Loan Parties to do so), (ii) any Taxes attributable to such Lender's failure to comply with the provisions of Section 11.7 relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each case, that are payable or paid by the Administrative Agent in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error. Each Lender hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by the Administrative Agent to the Lender from any other source against any amount due to the Administrative Agent under this clause (e).
(f)Evidence of Payments. As soon as practicable after any payment of Taxes by any Loan Party to a Governmental Authority pursuant to this Section 3.2, the Borrower shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.
(g)Status of Lenders.
(i)Any Lender that is entitled to an exemption from or reduction of withholding Tax with respect to payments made under any Loan Document shall deliver to the Borrower and the Administrative Agent, at the time or times reasonably requested by the Borrower or the Administrative Agent, such properly completed and executed documentation reasonably requested by the Borrower or the Administrative Agent as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition, any Lender, if reasonably requested by the Borrower or the Administrative Agent, shall deliver such other documentation prescribed by applicable Law or reasonably requested by the Borrower or the Administrative Agent as will enable the Borrower or the Administrative Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements. Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in Section 3.2(g)(ii)(A), 3.2(g)(ii)(B) and 3.2(g)(ii)(D) below) shall not be required if in the Lender's reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender.
(ii)Without limiting the generality of the foregoing, in the event that the Borrower is a U.S. Borrower:
(A)any Lender that is a U.S. Person shall deliver to the Borrower and the Administrative Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed originals of IRS Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding Tax;
(B)any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), whichever of the following is applicable:
(1)in the case of a Foreign Lender claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under any Loan Document, executed originals of IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable, establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the "interest" article of such tax treaty and (y) with respect to any other applicable payments under any Loan Document, IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable, establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the "business profits" or "other income" article of such tax treaty;
(2)executed originals of IRS Form W-8ECI;
(3)in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a Tax Compliance Certificate to the effect that such Foreign Lender is not (A) a "bank" within the meaning of Section 881(c)(3)(A) of the Code, (B) a "10 percent shareholder" of the Borrower within the meaning of Section 871(h)(3)(B) of the Code, or (C) a "controlled foreign corporation" related to the Borrower as described in Section 881(c)(3)(C) of the Code and (y) executed originals of IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable; or
(4)to the extent a Foreign Lender is not the beneficial owner, executed originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable, a Tax Compliance Certificate, IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that if the Foreign Lender is a partnership and one or more direct or indirect partners of such Foreign Lender are claiming the portfolio interest exemption, such Foreign Lender may provide a Tax Compliance Certificate on behalf of each such direct and indirect partner;
(C)any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed originals of any other form prescribed by applicable Law as a basis for claiming exemption from or a reduction in U.S. federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by applicable Law to permit the Borrower or the Administrative Agent to determine the withholding or deduction required to be made; and
(D)if a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to the Borrower and the Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by the Borrower or the Administrative Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably
requested by the Borrower or the Administrative Agent as may be necessary for the Borrower and the Administrative Agent to comply with their obligations under FATCA and to determine that such Lender has complied with such Lender's obligations under FATCA or to determine the amount, if any, to deduct and withhold from such payment. Solely for purposes of this clause (D), "FATCA" shall include any amendments made to FATCA after the date of this Agreement.
Each Lender agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify the Borrower and the Administrative Agent in writing of its legal inability to do so.
(h)Treatment of Certain Refunds. If any party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section 3.2 (including by the payment of additional amounts pursuant to this Section 3.2), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under this Section 3.2 with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including Taxes) of such indemnified party and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund). Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party the amount paid over pursuant to this clause (h) (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event that such indemnified party is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this clause (h), in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this clause (h) the payment of which would place the indemnified party in a less favorable net after-Tax position than the indemnified party would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such Tax had never been paid. This clause (h) shall not be construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the indemnifying party or any other Person.
II.3Illegality. If any Lender determines that any Law has made it unlawful, or that any Governmental Authority has asserted that it is unlawful, for any Lender or its applicable lending office to make, maintain or fund any Loans or to determine or charge interest rates based upon any Benchmark, then, upon notice thereof by such Lender to the Borrower (through the Administrative Agent), any obligation of the Lenders to make such Loans, and any right of the Borrower to continue such Loans shall be suspended until such Lender notifies the Administrative Agent and the Borrower that the circumstances giving rise to such determination no longer exist. Upon receipt of such notice, the Borrower shall, if necessary to avoid such illegality, upon demand from any Lender with supporting information (with a copy to the Administrative Agent), prepay or, if applicable, convert all such Loans to Alternate Base Rate Loans,
(A)if such Loans are not subject to an Interest Period, immediately, or
(B)if such Loans are subject to an Interest Period, on the last day of the Interest Period therefor, if all affected Lenders may lawfully continue to maintain such Loans to such day, or immediately, if any Lender may not lawfully continue to maintain such Loans to such day,
in each case until the Administrative Agent is advised in writing by each affected Lender that it is no longer illegal for such Lender to determine or charge interest rates based upon such Benchmark. Upon
any such prepayment or conversion, the Borrower shall also pay accrued and unpaid interest on the amount so prepaid or converted, together with any additional amounts required pursuant to Section 3.5.
II.4Inability to Determine Rate; Cost; Interest After Default.
(a)Inability to Determine Rate; Cost. Subject to Section 3.7, if, on or prior to the commencement of any Interest Period (or, in the case of any Benchmark that is not subject to an Interest Period, on any Business Day):
(i)the Administrative Agent determines (which determination shall be conclusive and binding absent manifest error) that for any reason (other than a Benchmark Transition Event) any Benchmark cannot be determined pursuant to the definition thereof;
(ii)the Required Lenders determine that for any reason in connection with any request for a Loan that is subject to an Interest Period or a conversion thereto or a continuation thereof that the Benchmark for any requested Interest Period with respect to a proposed Loan does not adequately and fairly reflect the cost to such Lenders of funding such Loans, and the Required Lenders have provided notice of such determination to the Administrative Agent; or
(iii)the Required Lenders determine that for any reason in connection with any request for a Loan that is not subject to an Interest Period or a conversion thereto or a continuation thereof or the maintaining thereof that the Benchmark with respect to a proposed Loan or outstanding Loan does not adequately and fairly reflect the cost to such Lenders of funding or maintaining such Loans, and the Required Lenders have provided notice of such determination to the Administrative Agent,
then the Administrative Agent shall give notice thereof to the Borrower and the Lenders.
Upon notice thereof by the Administrative Agent to the Borrower,
(1)any obligation of the Lenders to make such Loans that are subject to an Interest Period, and any right of the Borrower to continue such Loans or to convert to such Loans, shall be suspended (to the extent of the affected Loans or affected Interest Periods) until the Administrative Agent (with respect to clause (ii), at the instruction of the Required Lenders) revokes such notice;
(2)any obligation of the Lenders to make or maintain such Loans that are not subject to an Interest Period and any right of the Borrower to continue such Loans or to convert to such Loans shall be suspended (to the extent of the affected Loans) until the Administrative Agent (with respect to clause (iii), at the instruction of the Required Lenders) revokes such notice;
(3)the Borrower may revoke any pending request for a borrowing of, conversion to or continuation of such Loans (to the extent of the affected Loans or affected Interest Periods) or, failing that, the Borrower will be deemed to have converted any such request into a request for a Borrowing of or conversion to Alternate Base Rate Loans in the amount specified therein; and
(4)any outstanding affected Loans will be deemed to have been converted into Alternate Base Rate Loans at the end of the applicable Interest Period (or if such Loans are not subject to an Interest Period, immediately) and, upon any such conversion, the Borrower shall also pay accrued interest on the amount so converted, together with any additional amounts required pursuant to Section 3.5.
(b)Default Rate. To the extent permitted by Law, immediately upon the occurrence and during the continuation of an Event of Default under clause (a) or (l) of Section 9.1, or immediately after written demand by the Required Lenders to the Administrative Agent after the occurrence and during the continuation of any other Event of Default, then the principal amount of all Obligations shall bear interest at the Default Rate and the rates applicable to Letter of Credit Fees shall be increased to the Default Rate. The Borrower acknowledges that the increase in rates referred to in this Section 3.4(b) reflects, among other things, the fact that such Loans or other amounts have become a substantially greater risk given their default status and that the Lenders are entitled to additional compensation for such risk; and all such interest shall be payable by the Borrower upon demand by the Administrative Agent.
II.5Indemnity. Upon demand of any Lender (with a copy to the Administrative Agent) from time to time, the Borrower shall promptly compensate such Lender for and hold such Lender harmless from any loss, cost or expense attributable to or incurred by it as a result of:
(a)any continuation, conversion, payment or prepayment of any Loan that is subject to an Interest Period on a day other than the last day of the Interest Period for such Loan (whether voluntary, mandatory, automatic, by reason of acceleration, or otherwise);
(b)any failure by the Borrower (for a reason other than the failure of such Lender to make a Loan) to prepay, borrow, continue or convert any Loan that is subject to an Interest Period on the date or in the amount notified by the Borrower; or
(c)any assignment of a Loan that is subject to an Interest Period on a day other than the last day of the Interest Period therefor as a result of a request by the Borrower pursuant to Section 3.6;
including any loss, cost or expenses arising from the liquidation or reemployment of funds. The Borrower shall also pay reasonable customary administrative fees charged by such Lender in connection with the foregoing.
II.6Mitigation Obligations; Replacement of Lenders.
(a)Designation of a Different Lending Office. If any Lender requests compensation under Section 3.1, or requires any Loan Party to pay any Indemnified Taxes or additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.2, then such Lender shall (at the request of the Borrower) use reasonable efforts to designate a different lending office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 3.1 or Section 3.2, as the case may be, in the future, and (ii) would not subject such Lender to any unreimbursed cost or expense. The Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.
(b)Replacement of Lenders. If any Lender requests compensation under Section 3.1, or if the Borrower is required to pay any Indemnified Taxes or additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.2 and, in each case, such Lender has declined or is unable to designate a different lending office in accordance with Section 3.6(a) above or if any Lender is a Defaulting Lender or a Non-Consenting Lender, then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign and delegate, without recourse except to the extent provided in clause (vi) below (in accordance with and subject to the restrictions contained in, and consents required by,
Section 11.8), all of its interests, rights (other than its existing rights to payments pursuant to Section 3.1 or 3.2) and obligations under this Agreement and the related Loan Documents to an Eligible Assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that:
(i)the Borrower shall have paid to the Administrative Agent the assignment fee (if any) specified in Section 11.7;
(ii)such Lender shall have received payment of an amount equal to the outstanding principal of its Loans and participations in Letter of Credit drawings, accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan Documents (including any amounts under Section 3.5) from the assignee (to the extent of such outstanding principal and accrued interest and fees) or the Borrower (in the case of all other amounts);
(iii)in the case of any such assignment resulting from a claim for compensation under Section 3.1 or payments required to be made pursuant to Section 3.2, such assignment will result in a reduction in such compensation or payments thereafter;
(iv)such assignment does not conflict with applicable Law;
(v)in the case of any assignment resulting from a Lender becoming a Non-Consenting Lender, the applicable assignee shall have consented to the applicable amendment, waiver or consent; and
(vi)notwithstanding anything to the contrary in this Section 3.6(b) but subject to the other provisions of this Agreement (including Section 11.3(b)), if such Lender is a Defaulting Lender, the Borrower shall retain any rights and remedies it may have against such Lender for any claim arising hereunder on account of that Lender having been a Defaulting Lender.
A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.
II.7Benchmark Replacement Setting.
Notwithstanding anything to the contrary herein or in any other Loan Document (and any Secured Bank Product or Hedge Agreement shall be deemed not to be a "Loan Document" for purposes of this Section 3.7:
(a)Replacing Benchmarks. Upon the occurrence of a Benchmark Transition Event as to any Benchmark, the applicable Benchmark Replacement will replace the applicable then-current Benchmark for all purposes hereunder and under any Loan Document in respect of any setting of such Benchmark at or after 3:00 p.m. on the fifth Business Day after the date notice of such Benchmark Replacement is provided to the Lenders and the Borrower without any amendment to, or further action or consent of any other party to, this Agreement or any other Loan Document so long as the Administrative Agent has not received, by such time, written notice of objection to such Benchmark Replacement from the Required Lenders. At any time that the administrator of the applicable then-current Benchmark has permanently or indefinitely ceased to provide such Benchmark or such Benchmark has been announced by the regulatory supervisor for the administrator of such Benchmark pursuant to public statement or publication of information to be no longer representative of the underlying market and economic reality
that such Benchmark is intended to measure and that representativeness will not be restored, the Borrower may revoke any request for a borrowing of, conversion to or continuation of Loans to be made, converted or continued that would bear interest by reference to such Benchmark until the Borrower's receipt of notice from the Administrative Agent that a Benchmark Replacement has replaced such Benchmark, and, failing that, the Borrower will be deemed to have converted any such request into a request for a borrowing of or conversion to Alternate Base Rate Loans.
(b)Benchmark Replacement Conforming Changes. In connection with the implementation and administration of a Benchmark Replacement, the Administrative Agent will have the right to make Benchmark Replacement Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Loan Document, any amendments implementing such Benchmark Replacement Conforming Changes will become effective without any further action or consent of any other party to this Agreement.
(c)Notices; Standards for Decisions and Determinations. The Administrative Agent will promptly notify the Borrower and the Lenders of (i) the implementation of any Benchmark Replacement, and (ii) the effectiveness of any Benchmark Replacement Conforming Changes in connection with the use, administration, adoption or implementation of a Benchmark Replacement. The Administrative Agent will promptly notify the Borrower of the removal or reinstatement of any tenor of a Benchmark pursuant to Section 3.7(d). Any determination, decision or election that may be made by the Administrative Agent or, if applicable, any Lender (or group of Lenders) pursuant to this Section 3.7, including any determination with respect to a tenor, rate or adjustment or of the occurrence or non-occurrence of an event, circumstance or date and any decision to take or refrain from taking any action, will be conclusive and binding absent manifest error and may be made in its or their sole discretion and without consent from any other party hereto or any other Loan Document, except, in each case, as expressly required pursuant to this Section 3.7.
(d)Unavailability of Tenor of Benchmark. At any time (including in connection with the implementation of a Benchmark Replacement), (i) if the applicable then-current Benchmark is a term rate (including Term SOFR), then the Administrative Agent may remove any tenor of such Benchmark that is unavailable or non-representative for Benchmark (including Benchmark Replacement) settings and (ii) the Administrative Agent may reinstate any such previously removed tenor for such Benchmark (including any applicable Benchmark Replacement) settings.
II.8Survival. Each party's obligations under this Article III shall survive the resignation of the Administrative Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all obligations under any Loan Document.
III.CONDITIONS OF LENDING AND ISSUANCE OF LETTERS OF CREDIT
The obligation of each Lender to make Loans and of the Issuing Lender to issue Letters of Credit hereunder is subject to the performance by each of the Loan Parties of its Obligations to be performed hereunder at or prior to the making of any such Loans or issuance of such Letters of Credit and to the satisfaction of the following further conditions:
III.1First Loans and Letters of Credit. The obligation of each Lender to make the Variable Rate Term Loan, the Fixed Rate Term Loan and any other Loans requested by the Borrower on the Closing Date, and the obligation of the Issuing Lender to issue any Letters of Credit requested by the
Borrower on the Closing Date, are subject to the satisfaction of the following conditions on or before the Closing Date:
(a)Deliveries. The Administrative Agent shall have received each of the following in form and substance satisfactory to the Administrative Agent and, if applicable, its counsel:
(i)a certificate of the Borrower signed by a Compliance Officer of the Borrower, dated as of the Closing Date stating that (a) all representations and warranties of the Loan Parties set forth in this Agreement are true and correct in all material respects, except that such representations and warranties that are qualified in this Agreement by reference to materiality or a Material Adverse Change shall be true and correct in all respects, as of the Closing Date (or, if such representation or warranty makes reference to an earlier date, as of such earlier date), (b) the Loan Parties are in compliance with each of the covenants and conditions hereunder, (c) no Event of Default or Default exists, (d) there has occurred no Material Adverse Change either (y) in the business, properties, assets, condition (financial or otherwise) or prospects of the Loan Parties and their respective Subsidiaries, taken as a whole or (z) in the facts and information regarding the Loan Parties and their respective Subsidiaries as represented to the Administrative Agent and the Lenders up to the Closing Date, taken as a whole and (e) each of the Loan Parties has satisfied each of the closing conditions required to be satisfied by it hereunder;
(ii)a certificate dated as of the Closing Date and signed by the Secretary or an Assistant Secretary of each of the Loan Parties, certifying as appropriate as to: (a) all action taken by each Loan Party in connection with this Agreement and the other Loan Documents; (b) the names of the Authorized Officers authorized to sign the Loan Documents and their true signatures; and (c) copies of its Organizational Documents as in effect on the Closing Date certified by the appropriate state official where such documents are filed in a state office (if so filed or required to be so filed) together with certificates from the appropriate state officials as to the continued existence and good standing or existence (as applicable) of each Loan Party in each state where organized or qualified to do business;
(iii)evidence that there is no action, suit, proceeding or investigation pending against, or threatened in writing against, any Loan Party or any Subsidiary of any Loan Party or any of their respective properties in any court or before any arbitrator of any kind or before or by any other Governmental Authority that would reasonably be expected to result in a Material Adverse Change;
(iv)this Agreement and each of the other Loan Documents signed by an Authorized Officer and all appropriate financing statements and appropriate stock powers and certificates evidencing the pledged Collateral and all other original items required to be delivered pursuant to any of the Collateral Documents;
(v)customary written opinions of counsel for the Loan Parties, duly executed (including any local counsel, if required by the Administrative Agent), dated as of the Closing Date;
(vi)evidence that adequate insurance required to be maintained under this Agreement is in full force and effect, with additional insured, mortgagee and lender loss payable special endorsements attached thereto naming the Administrative Agent as additional insured, mortgagee and lender loss payee, as applicable;
(vii)a duly completed Borrowing Base Certificate setting forth the calculation of the Borrowing Base on a pro forma basis as of September 30, 2024, signed by a Compliance Officer of the Borrower;
(viii)evidence satisfactory to the Administrative Agent that the Andersons Transaction has been consummated;
(ix)a duly completed, executed Loan Request for Credit Extension for each Loan or Letter of Credit requested to be made on the Closing Date, including notice of election as to Interest Periods (if applicable);
(x)a duly completed, executed Perfection and Diligence Certificate signed by an Authorized Officer of each of the Loan Parties;
(xi)a duly completed, executed Solvency Certificate signed by an Authorized Officer of the Borrower;
(xii)evidence that all material governmental and third-party consents, subordinations or waivers, as applicable, required to effectuate the transactions contemplated hereby have been obtained and are in full force and effect, including any required material permits and authorizations of all applicable Governmental Authorities;
(xiii)a Lien search with respect to the Borrower and each other Loan Party, in scope satisfactory to the Administrative Agent and with results showing no Liens other than Permitted Liens and otherwise satisfactory to the Administrative Agent;
(xiv)true, correct and complete copies of all Material Agreements not already delivered pursuant to another clause of this Section 4.1;
(xv)an executed Landlord Agreement from the lessor, warehouse operator or other applicable Person for each leased Collateral location;
(xvi)evidence satisfactory to the Administrative Agent and FCMA that the Borrower (A) has made a minimum equity investment of $1,000.00 in each of CoBank’s and FCMA’s Farm Credit Equities and (B) has executed a Loan Term Options, Insurance and Stock Disclosure Statement with FCMA in form and substance satisfactory to FCMA and the Administrative Agent;
(xvii)the Loan Parties shall have (A) paid all accrued and unpaid interest on the loans (other than the Fixed Rate Term Loans) outstanding under the Existing Credit Agreement, (B) fully prepaid any loans (other than the Fixed Rate Term Loans) outstanding under the Existing Credit Agreement, and (C) paid all accrued fees owing to the lenders under the Existing Credit Agreement;
(xviii)subject to Section 6.16:
(A)evidence that the Loan Parties have effectively and validly pledged and perfected the Collateral contemplated by the Collateral Documents;
(B)evidence that all filings and recordings (including all Mortgages and fixture filings) that are necessary to perfect the Prior Security Interest of the Administrative Agent,
for the benefit of the Secured Parties, in the Collateral described in the Collateral Documents have been filed or recorded in all appropriate locations;
(C)a duly completed, executed account control agreement with respect to all Material Accounts signed by an Authorized Officer of the Borrower and the appropriate depository institutions or other entities holding such Material Accounts;
(xix)subject to Section 6.16:
(A)a legal description of each parcel of real property constituting Collateral, compatible with the survey described below (if such survey is required) and sufficient for recording;
(B)to the extent requested by the Administrative Agent in its sole discretion, an ALTA title insurance policy or policies insuring the Administrative Agent, for the benefit of the Secured Parties (including such endorsements as the Administrative Agent may reasonably require), insuring each Mortgage as a valid first priority Lien upon the property subject to such Mortgage subject only to Permitted Liens which have first priority by operation of law, and such other exceptions as are reasonably acceptable to the Administrative Agent;
(C)to the extent requested by the Administrative Agent in its sole discretion, an "as-built" survey or surveys adequate to delete the standard survey exception from any title policy delivered to the Administrative Agent, such survey or surveys to be certified in favor of the Administrative Agent for the benefit of the Secured Parties as to each of the real properties constituting Collateral;
(D)to the extent requested by the Administrative Agent in its sole discretion, acceptable appraisals, field exams and other third party inspections, as applicable of the Loan Parties' and their Subsidiaries' assets, including the real property and improvements thereto constituting Collateral;
(E)to the extent requested by the Administrative Agent in its sole discretion, acceptable Phase I environmental audits with respect to each of the real properties constituting Collateral, together with such other environmental information as the Administrative Agent may request, including, but not limited to, completed environmental questionnaires in the form provided by the Administrative Agent;
(F)written opinions of counsel for the Loan Parties, duly executed, dated as of the Closing Date, and covering such matters with respect to the Mortgages as may be requested by the Administrative Agent;
(G)evidence that the Loan Parties have taken all actions required under the Flood Laws and/or requested by the Administrative Agent to assist in ensuring that each Lender is in compliance with the Flood Laws applicable to the Collateral, including, but not limited to:
(1)providing the Administrative Agent with the address and/or GPS coordinates of each structure on any improved real property that will be subject to the Mortgage;
(2)obtaining or providing the following documents: (a) a completed standard "life-of-loan" flood hazard determination form, (b) if the improvement(s) to the improved real property is located in a special flood hazard area, a notification to the Borrower ("Borrower Notice") and (if applicable) notification to the Borrower that flood insurance coverage under the National Flood Insurance Program ("NFIP") is not available because the community does not participate in the NFIP, and (c) documentation evidencing the Borrower's receipt of the Borrower Notice (e.g., countersigned Borrower Notice, return receipt of certified U.S. Mail, or overnight delivery); and
(3)to the extent required under Section 6.5(b), obtaining flood insurance for such property, structures and contents prior to such property, structures and contents becoming Collateral, together with such endorsements in favor of the Administrative Agent as the Administrative Agent may reasonably request;
(xx)an executed letter from the Borrower with respect to any proceeds of the Loans being disbursed to third parties authorizing the Administrative Agent to distribute such proceeds on behalf of the Loan Parties in accordance with the instructions set forth in such letter;
(xxi)the audited, consolidated and consolidating financial statements of the Borrower and its Subsidiaries for the fiscal year ending January 31, 2024, and such other financial statements, budgets, forecasts and other financial information as to the Loan Parties as the Administrative Agent or any other Lender may have reasonably required prior to the Closing Date;
(xxii)at least five (5) Business Days prior to the Closing Date, (A) all documentation and other information requested by (or on behalf of) any Lender in order to comply with requirements of Anti-Corruption Laws, Anti-Terrorism Laws and Sanctions and (B) if the Borrower qualifies as a "legal entity customer" under the Beneficial Ownership Regulation, a Beneficial Ownership Certification; and
(xxiii)such other documents in connection with such transactions as the Administrative Agent or its counsel may reasonably request.
(b)Payment of Fees. The Borrower shall have paid all fees and expenses related to the Facilities and this Agreement and the other Loan Documents payable on or before the Closing Date as required by this Agreement, the Fee Letter or any other Loan Document.
III.2Each Loan or Letter of Credit. At the time of any Credit Extension and after giving effect to the proposed Credit Extension: (i) the representations and warranties of the Loan Parties set forth in Article V of this Agreement and in the other Loan Documents shall then be true and correct, except such representations and warranties that are not qualified by reference to materiality or a Material Adverse Change shall then be true and correct in all material respects as of such date (except for any such representation and warranty that by its terms is made only as of an earlier date, which representation and warranty shall remain true and correct in all material respects as of such earlier date), (ii) no Event of Default or Default shall have occurred and be continuing, and (iii) the Borrower shall have delivered a duly executed and completed Loan Request to the Administrative Agent for each Loan requested to be made pursuant to Sections 2.1(b), 2.2, 2.4(b), 2.5(b), or 2.6(b), or Letter of Credit Request to the Issuing Lender for each Letter of Credit to be issued pursuant to Section 2.12(a), as the case may be.
IV.REPRESENTATIONS AND WARRANTIES
The Loan Parties, jointly and severally, represent and warrant to the Administrative Agent and each of the Lenders as follows:
IV.1Organization and Qualification. Each Loan Party and each Subsidiary of each Loan Party (a) is a corporation, partnership or limited liability company or other entity as identified on Schedule 5.1, in each case duly organized, validly existing and in good standing under the laws of its jurisdiction of organization specified on Schedule 5.1, (b) has the lawful power to own or lease its properties and to engage in the business it presently conducts or proposes to conduct, and (c) is duly licensed or qualified and in good standing in each jurisdiction listed on Schedule 5.1 and in all other jurisdictions where the property owned or leased by it or the nature of the business transacted by it or both makes such licensing or qualification necessary except where the failure to be so duly licensed or qualified could not reasonably be expected to result in a Material Adverse Change.
IV.2Compliance With Laws.
(a)Each Loan Party and each Subsidiary of each Loan Party is in compliance with all applicable Laws in all jurisdictions in which any Loan Party or Subsidiary of any Loan Party is presently or currently foresees that it will be doing business except where the failure to do so could not reasonably be expected to result in a Material Adverse Change.
(b)No Credit Extension, or use of any proceeds thereof, or entry into or performance by any Loan Party of the Loan Documents to which it is a party contravenes any Law applicable to such Loan Party or any Subsidiary of any Loan Party or any of the Lenders.
IV.3Title to Properties. Each Loan Party and each Subsidiary of each Loan Party (a) has good and marketable title to or valid leasehold interest in all properties, assets and other rights that it purports to own or lease or that are reflected as owned or leased on its books and records, and (b) owns or leases all of its properties free and clear of all Liens except Permitted Liens.
IV.4Investment Company Act. None of the Loan Parties or Subsidiaries of any Loan Party is an "investment company" registered or required to be registered under the Investment Company Act of 1940 or under the "control" of an "investment company" as such terms are defined in the Investment Company Act of 1940 and shall not become such an "investment company" or under such "control."
IV.5Event of Default. No Event of Default or Default exists or is continuing.
IV.6Subsidiaries and Owners. Schedule 5.6 states (a) the name of each of the Borrower's Subsidiaries, its jurisdiction of organization and the amount, percentage and type of Equity Interests in such Subsidiary (the "Subsidiary Equity Interests"), (b) the name of each holder of an Equity Interest in the Borrower, the amount, percentage and type of such Equity Interest (the "Borrower Equity Interests"), and (c) any options, warrants or other rights outstanding to purchase any such Equity Interests referred to in clause (a) or (b). The Borrower and each Subsidiary of the Borrower has good and marketable title to all of the Subsidiary Equity Interests it purports to own, free and clear in each case of any Lien and all such Subsidiary Equity Interests have been validly issued, fully paid and nonassessable (or, in the case of a partnership, limited liability company or similar Equity Interest, not subject to any capital call or other additional capital requirement).
IV.7Power and Authority; Validity and Binding Effect.
(a)Each Loan Party and each Subsidiary of each Loan Party has the full power to enter into, execute, deliver and carry out this Agreement and the other Loan Documents to which it is a party, to incur the Indebtedness contemplated by the Loan Documents and to perform its Obligations under the Loan Documents to which it is a party, and all such actions have been duly authorized by all necessary proceedings on its part.
(b)This Agreement and each of the other Loan Documents (i) has been duly and validly executed and delivered by each Loan Party, and (ii) constitutes, or will constitute, legal, valid and binding obligations of each Loan Party that is or will be a party thereto, enforceable against such Loan Party in accordance with its terms, subject only to limitations on enforceability imposed by (y) applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors' rights generally, and (z) general equitable principles.
IV.8No Conflict; Material Agreements; Consents.
(a)Neither the execution and delivery of this Agreement or the other Loan Documents by any Loan Party nor the consummation of the transactions herein or therein contemplated or compliance with the terms and provisions hereof or thereof by any of them will conflict with, constitute a default under or result in any breach of (i) the terms and conditions of the Organizational Documents of any Loan Party, (ii) any Material Agreement to which any Loan Party or any of its Subsidiaries is a party or by which it or any of its Subsidiaries is bound or to which it is subject, or (iii) any applicable Law or any order, writ, judgment, injunction or decree to which any Loan Party or any of its Subsidiaries is a party or by which it or any of its Subsidiaries or any of its respective property is bound or to which it is subject, or result in the creation or enforcement of any Lien, charge or encumbrance whatsoever upon any property (now or hereafter acquired) of any Loan Party or any of its Subsidiaries (other than Liens granted under the Loan Documents). Neither any Loan Party nor, to the Knowledge of the Authorized Officer, any other party thereto is in default under any Material Agreement. Neither any Loan Party nor any Subsidiary of any Loan Party is in default under any order, writ, judgment, injunction or decree under which it is bound or to which it is subject. None of the Loan Parties or their Subsidiaries or their respective property is bound by any contractual obligation (including pursuant to any Material Agreement), or subject to any restriction in any of its Organizational Documents, or any requirement of Law that could reasonably be expected to result in a Material Adverse Change.
(b)No consent, approval, exemption, order or authorization of, or a registration or filing with, any Governmental Authority or any other Person is required by any Law or any agreement (including any Material Agreement) in connection with (i) the execution, delivery and carrying out of this Agreement or the other Loan Documents, (ii) the grant by any Loan Party of the Liens granted by it pursuant to the Collateral Documents, (iii) the perfection of the Prior Security Interest of the Administrative Agent and the Secured Parties created under the Collateral Documents (other than the filing of UCC financing statements, recording of the Mortgages, and filings with the United States Patent and Trademark Office or the United States Copyright Office) or (iv) the exercise by the Administrative Agent or any Lender of its rights under the Loan Documents or the remedies of any Secured Party in respect of the Collateral pursuant to the Collateral Documents, in each case except those which have been duly obtained on or before the Closing Date, taken, given or made and are in full force and effect. Each of the Loan Parties' Material Agreements is in full force and effect, and no Loan Party has received any notice of termination, revocation or other cancellation (before any scheduled date of termination) in respect thereof.
IV.9Litigation. There are no actions, suits, proceedings or investigations pending or threatened in writing against any Loan Party or any Subsidiary of any Loan Party or any of their respective properties, at law or in equity before any Governmental Authority that individually or in the aggregate (i) could reasonably be expected to result in a Material Adverse Change or (ii) purports to affect the legality, validity or enforceability of any Loan Document. None of the Loan Parties or any Subsidiaries of any Loan Party is in violation of any order, writ, injunction or any decree of any Governmental Authority that could reasonably be expected to result in a Material Adverse Change.
IV.10Financial Statements.
(a)Audited Financial Statements. The audited financial statements delivered on or before the Closing Date in accordance with Section 4.1(a) and thereafter most recently delivered in accordance with Section 6.1(b) (i) were prepared in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein; (ii) fairly present the financial condition of the Borrower and its Subsidiaries as of the date thereof and their results of operations for the period covered thereby in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein; and (iii) show all Material Indebtedness and other liabilities, direct or contingent, of the Borrower and its Subsidiaries as of the date thereof, including liabilities for taxes, material commitments and Indebtedness, as required by GAAP.
(b)Unaudited Financial Statements. The unaudited financial statements delivered on or before the Closing Date in accordance with Section 4.1(a) and thereafter most recently delivered by the Borrower in accordance with Section 6.1(a) (i) were prepared in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein, and (ii) fairly present the financial condition of the Borrower and its Subsidiaries as of the date thereof and their results of operations for the period covered thereby, subject, in the case of clauses (i) and (ii), to the absence of footnotes and to normal year-end audit adjustments.
(c)Accuracy of Financial Statements. Neither the Borrower nor any of its Subsidiaries has any liabilities, contingent or otherwise, or forward or long-term commitments that are not disclosed in the financial statements referred to in clauses (a) and (b) of this Section 5.10 or in the notes thereto, and except as disclosed therein there are no unrealized or anticipated losses from any commitments of the Borrower or any Subsidiary of the Borrower that could reasonably be expected to result in a Material Adverse Change.
(d)Material Adverse Change. Since January 31, 2024, no Material Adverse Change has occurred, that has not been disclosed to the Administrative Agent.
IV.11Margin Stock. None of the Loan Parties nor any Subsidiaries of any Loan Party engages or intends to engage principally, or as one of its important activities, in the business of extending credit for the purpose, immediately, incidentally or ultimately, of purchasing or carrying margin stock (within the meaning of Regulation U, T or X as promulgated by the Board). No part of the proceeds of any Loan has been or will be used, immediately, incidentally or ultimately, to purchase or carry any margin stock or to extend credit to others for the purpose of purchasing or carrying any margin stock or that is inconsistent with the provisions of the regulations of the Board. None of the Loan Parties nor any Subsidiary of any Loan Party holds or intends to hold margin stock in such amounts that more than 25% of the reasonable value of the assets of any Loan Party or Subsidiary of any Loan Party are or will be represented by margin stock.
IV.12Full Disclosure. Neither this Agreement nor any other Loan Document, nor any certificate, statement, agreement or other documents furnished to the Administrative Agent or any Lender in connection herewith or therewith (other than projections and budgets), contains any untrue statement of a material fact or omits to state a material fact necessary in order to make the statements contained herein and therein, in light of the circumstances under which they were made, not misleading. Any projections or budgets provided by or on behalf of the Loan Parties have been prepared by management in good faith and based on assumptions believed by management to be reasonable at the time the projections or budgets were prepared, it being understood that the projections or budgets as to future events are not to be viewed as fact and that actual results during the period or periods covered by the projections or budgets may differ materially from such projected results. There is no fact known to any Loan Party that materially and adversely affects the business, property, assets, financial condition or results of operations of the Loan Parties, taken as a whole, that has not been set forth in this Agreement or in the certificates, statements, agreements or other documents furnished in writing to the Administrative Agent and the Lenders prior to or at the date hereof in connection with the transactions contemplated hereby. As of the Closing Date, the information included in the Beneficial Ownership Certification is true and correct in all respects.
IV.13Taxes. All federal, state, local and other tax returns required to have been filed with respect to each Loan Party and each Subsidiary of each Loan Party have been filed, and payment or adequate provision has been made for the payment of all taxes, fees, assessments and other governmental charges that have or may become due pursuant to said returns or to assessments received, except to the extent that such taxes, fees, assessments and other charges are being contested in good faith by appropriate proceedings diligently conducted and for which such reserves or other appropriate provisions, if any, as shall be required by GAAP shall have been made.
IV.14Intellectual Property; Other Rights. Each Loan Party and each Subsidiary of each Loan Party owns or possesses all the Intellectual Property and all service marks, trade names, domain names, licenses, registrations, franchises, permits and other rights necessary to own and operate its properties and to carry on its business as presently conducted and planned to be conducted by such Loan Party or Subsidiary, and none of the Loan Parties has received any written notice that there is an alleged or actual conflict with the rights of others.
IV.15Liens in the Collateral. The Liens in the Collateral granted to the Administrative Agent for the benefit of the Secured Parties pursuant to the Collateral Documents constitute and will continue to constitute Prior Security Interests in and to the Collateral. All filing fees and other expenses in connection with the perfection of such Liens have been or will be paid by the Borrower.
IV.16Insurance.
(a)The properties of each Loan Party and each of its Subsidiaries are insured pursuant to policies and other bonds that are valid and in full force and effect and that provide coverage satisfying or surpassing the requirements set forth in Section 6.5(a).
(b)Each Loan Party, to the extent required under the Flood Laws, has obtained flood insurance for such structures and contents constituting Collateral located in a flood hazard zone pursuant to policies that are valid and in full force and effect and which provide coverage meeting the requirements of Section 6.5(b).
IV.17Employee Benefits Compliance.
(a)Each Plan is in material compliance with its terms and with the applicable provisions of ERISA, the Code and other federal or state Laws. Each Plan that is intended to qualify under Section 401(a) of the Code has (i) received the most recently available favorable determination letter from the IRS, or (ii) an application for such a letter currently being processed by the IRS with respect thereto, or (iii) been adopted by means of a prototype or volume submitter plan document that has received the most recently available opinion letter from the IRS on which the plan sponsor is entitled to rely and, to the Knowledge of the Authorized Officer, nothing has occurred that would prevent, or cause the loss of, such qualification. The Loan Parties and each ERISA Affiliate have satisfied all of their obligations and liabilities with respect to each Plan and have made all required contributions to each Plan on or before the applicable due date, including contributions to any Pension Plan and any Multiemployer Plan that are required by the Plan Funding Rules or the collective bargaining agreement, and no application for a funding waiver or an extension of any amortization period pursuant to Section 412 of the Code has been made with respect to any Pension Plan or Multiemployer Plan.
(b)There are no pending or, to the best knowledge of any Loan Party, threatened claims, actions or lawsuits, or action by any Governmental Authority, including any audit, investigation or enforcement action, with respect to any Plan. To the Knowledge of the Authorized Officer, there has been no prohibited transaction or violation of the fiduciary responsibility rules with respect to any Plan.
(c)(i) No ERISA Event has occurred or is reasonably expected to occur; and (ii) no Unfunded Liability exists, taking into account only Pension Plans with positive Unfunded Liability.
(d)Each Welfare Benefit Plan can be terminated by a Loan Party or an ERISA Affiliate in its sole discretion without any liability. No Loan Party or ERISA Affiliate reasonably can be expected to incur any liability under Section 4980H(a) of the Code, without qualifying for the reduced assessment under Section 4980H(b) of the Code.
(e)The Unfunded Liability of each Plan, if any, is reflected on the financial statements referenced in Section 5.10.
IV.18Environmental Matters. Except as disclosed on Schedule 5.18:
(a)No Hazardous Materials are now, nor, to the Knowledge of any Authorized Officer, have any Hazardous Materials ever been, placed, stored, located, generated, produced, created, processed, treated, transported, incorporated, discharged, emitted, spilled, released, deposited or disposed of or allowed to escape in, upon, under, over or from the facilities and properties currently owned, leased or operated by any Loan Party or any Subsidiary (the "Property" or the "Properties") (other than substances customarily used or stored at the Property in amounts that are, or at the applicable time were considered to be, advisable for the operation and maintenance of the Property and are stored, used and managed in compliance with all Environmental Laws);
(b)To the Knowledge of any Authorized Officer, no threat exists of a spill, discharge, release or emission of a Hazardous Material upon or from the Property into the environment;
(c)To the Knowledge of any Authorized Officer, the Property has never been used as or for a mine, a landfill, a dump or other disposal facility, an impoundment, industrial or manufacturing purposes, or a gasoline service station;
(d)Borrower has obtained, or has prepared and submitted to the respective jurisdictional Governmental Authority applications for, all permits, licenses and authorizations required
under Environmental Law to develop and conduct activities at any Property or the business operated by the Loan Parties (the "Business"). All existing permits, licenses and authorizations are current and valid and authorize Borrower to operate the Business at each respective Property. No Loan Party or Subsidiary of any Loan Party is aware of any basis for any permit, license, authorization or other approval that is required to operate the Business under any Environmental Law to be denied, delayed, revoked, canceled, limited, terminated, modified, appealed or otherwise challenged;
(e)No underground storage tank is now located in the Property or to the Knowledge of any Authorized Officer has previously been located therein but has been removed therefrom;
(f)No violation of any Environmental Law now exists or to the Knowledge of any Authorized Officer has ever existed in, upon, under, over or from the Property, no notice of any such violation or any alleged violation thereof has been issued or given by any Governmental Authority in connection with the Property, and there is not now nor to the Knowledge of any Authorized Officer has there ever been any investigation or report involving the Property by any Governmental Authority;
(g)No Person, party or private or Governmental Authority has given any written notice of any claim, cause of action, penalty, cost or demand for payment or compensation to any Loan Party, whether or not involving any injury or threatened injury to human health, the environment or natural resources resulting or allegedly resulting from any activity or event described in (a) above;
(h)There are not now, nor to the Knowledge of any Authorized Officer have there ever been, any actions, suits, proceedings or damage settlements relating in any way to Hazardous Materials, in, upon, under, over or from the Property;
(i)To the Knowledge of any Authorized Officer there is no investigation or report involving the Property by any Governmental Authority which in any way relates to Hazardous Materials or Environmental Law;
(j)The Property is not listed or, to the Knowledge of any Authorized Officer, proposed for listing in the United States Environmental Protection Agency’s National Priorities List of Hazardous Waste Sites or any other list, schedule, log, inventory or record of Hazardous Material sites maintained by any federal, state or local Governmental Authority;
(k)Borrower has provided to the Administrative Agent all environmental investigations, assessments and audits relating to the Property of which any Authorized Officer has Knowledge;
(l)The Property is not subject to any engineering controls, institutional controls, or any other activity use limitations or restrictions pursuant to any Environmental Law; and
(m)The Property is not subject to any Lien or claim for Lien or threat of a Lien in favor of any Governmental Authority as a result of any presence, release or threatened release of any Hazardous Material in, on, under, over or from the Property.
IV.19Solvency. Before and after giving effect to any Credit Extension hereunder, each of the Loan Parties is Solvent.
IV.20Qualified ECP Guarantor. Each Loan Party is a Qualified ECP Guarantor.
IV.21Transactions with Affiliates. No Affiliate and no officer or director of any Loan Party or any of its Subsidiaries or any individual related by blood, marriage, adoption or otherwise to any such officer or director, or any Person in which any such officer or director or individual related thereto owns any beneficial interest, is a party to any agreement, contract, commitment or transaction with Loan Parties or has any material interest in any material property used by Loan Parties, except as permitted by Section 7.3 or disclosed on Schedule 5.21.
IV.22Labor Matters. There are no strikes, lockouts or slowdowns against any Loan Party or any Subsidiary of any Loan Party pending or, to the knowledge of the Borrower, threatened except as could not reasonably be expected to result in a Material Adverse Change. The hours worked by and payments made to employees of the Loan Parties and their respective Subsidiaries within the past five (5) years have not been in violation of the Fair Labor Standards Act or any other applicable Federal, state, local or foreign law dealing with such matters, except as could not reasonably be expected to result in a Material Adverse Change. The execution, delivery and performance of the Loan Documents will not give rise to any right of termination or right of renegotiation on the part of any union under any collective bargaining agreement to which any Loan Party or any Subsidiary of any Loan Party is bound.
IV.23Anti-Corruption; Anti-Terrorism and Sanctions.
(a)Each of the Loan Parties and their respective Subsidiaries, Affiliates, their officers, directors, and to the knowledge of the Borrower, their employees and agents, are in compliance, in all respects, with all applicable (i) Anti-Corruption Laws, (ii) Anti-Terrorism Laws and (iii) Sanctions.
(b)[reserved];
(c)None of the Loan Parties or their respective Subsidiaries, Affiliates, their officers, directors, employees or agents are Sanctioned Persons or have engaged in, or are now engaged in, or will engage in, any dealings or transactions with any Sanctioned Person.
(d)No Credit Extension, use of proceeds or other transaction contemplated by this Agreement will violate any applicable (i) Anti-Corruption Laws, (ii) Anti-Terrorism Laws or (iii) Sanctions.
(e)The Loan Parties have provided to the Administrative Agent and the Lenders all information requested by the Administrative Agent and the Lenders regarding the Loan Parties and their respective Subsidiaries, Affiliates, officers, directors, employees and agents that is necessary for the Administrative Agent and the Lenders to collect to comply with applicable Anti-Corruption Laws, Anti-Terrorism Laws, Sanctions and other Laws.
IV.24Material Owned Property and Material Leased Property. Set forth on Schedule 5.24, as of the Closing Date and as of the last date such Schedule 5.24 was required to be updated in accordance with Section 6.10 or Section 6.13, is a list of all Material Owned Property and Material Leased Property (including (i) the name of the Loan Party owning or leasing such property, (ii) the property address, (iii) the city, county, state and zip code which such property is located and (iv) an indication if such location is leased or owned, and if leased, the name of the owner).
V.AFFIRMATIVE COVENANTS
The Loan Parties, jointly and severally, covenant and agree that until Payment In Full of the Secured Obligations, the Loan Parties shall comply at all times with the following covenants:
V.1Reporting Requirements. The Loan Parties will furnish or cause to be furnished to the Administrative Agent and each of the Lenders:
(a)Monthly Financial Statements. As soon as available and in any event within thirty (30) calendar days after the end of each month, financial statements of the Borrower, consisting of a consolidated balance sheet as of the end of such month and related consolidated statements of income, stockholders or members equity and cash flows for such month then ended and the fiscal year through that date, all in reasonable detail and certified by a Compliance Officer of the Borrower as having been prepared in accordance with GAAP (subject to normal year-end audit adjustments), consistently applied, and setting forth in comparative form the respective financial statements for the corresponding date and period in the previous fiscal year, including a Management, Discussion, and Analysis report in form and detail reasonably satisfactory to the Administrative Agent that includes, without limitation, (i) a discussion of the fiscal-year-to-date operating and financial results and (ii) a comparison of the fiscal-year-to-date performance to the corresponding Budget.
(b)Annual Financial Statements. As soon as available and in any event within one hundred and twenty (120) days after the end of each fiscal year of the Borrower, audited financial statements of the Borrower consisting of a consolidated and consolidating balance sheet as of the end of such fiscal year, and related consolidated and consolidating statements of income, stockholders’ equity and cash flows for the fiscal year then ended, all in reasonable detail and setting forth in comparative form the financial statements as of the end of and for the preceding fiscal year, including a comparison of actual performance to the Budget for such fiscal year and year-to-date delivered to the Administrative Agent pursuant to Section 6.1(e)(i), and certified by independent certified public accountants of nationally recognized standing satisfactory to the Administrative Agent. The certificate or report of accountants shall be free of qualifications (other than any consistency qualification that may result from a change in the method used to prepare the financial statements as to which such accountants concur) and shall not indicate the occurrence or existence of any event, condition or contingency that would materially impair the prospect of payment or performance of any covenant, agreement or duty of any Loan Party under any of the Loan Documents. In addition, the Loan Parties shall provide to the Administrative Agent, within ten (10) days of the Loan Parties’ receipt, copies of the final versions of any financial statements for the end of any prior fiscal year that the Loan Parties’ independent auditing firm recommends should be restated.
(c)Compliance Certificate. Concurrently with the financial statements of the Borrower furnished to the Administrative Agent and to the Lenders pursuant to Sections 6.1(a) and (b), a Compliance Certificate duly executed by a Compliance Officer of the Borrower.
(d)Borrowing Base Certificate. As soon as available and in any event within thirty (30) calendar days after the end of each month, a borrowing base certificate in the form of Exhibit L or in such other form as the Administrative Agent shall require from time to time (each, a "Borrowing Base Certificate"), together with such supporting information as the Administrative Agent may reasonably request in connection therewith setting forth (i) the Borrowing Base and its components as of the end of the immediately preceding calendar month and (ii) the sum of the Revolving Facility Usage and the aggregate outstanding principal amount of any Seasonal Term Loans as of the end of the immediately preceding calendar month. Each Borrowing Base Certificate shall be certified as being true, correct and complete in all material respects by an Authorized Officer of the Borrower.
(e)Other Reports.
(i)Annual Budget. The annual consolidated Budget and any forecasts or projections of the Borrower, to be supplied not later than forty-five (45) days after the commencement of the fiscal year to which any of the foregoing may be applicable;
(ii)Accountants' Reports. Promptly upon their becoming available to the Borrower, any reports, including management letters submitted, to the Borrower by independent accountants in connection with any annual, interim or special audit;
(iii)Management Report. Concurrently with the annual financial statements of the Borrower furnished to the Administrative Agent and to the Lenders pursuant to Section 6.1(b), a management report (A) outlining principal factors affecting performance and describing the operations and financial condition of the Borrower and its Subsidiaries for the fiscal year then ended, and (B) discussing the reasons for any significant variations. The information above shall be presented in reasonable detail and shall be certified by a Compliance Officer of the Borrower to the effect that, to his or her knowledge after reasonable diligence, such information fairly presents in all material respects the results of operations and financial condition of the Borrower and its Subsidiaries as at the dates and for the periods indicated.
(iv)Benefit Plan Documentation. Promptly upon request by any Lender, each Loan Party will deliver to the Lender (A) all reports, forms and other documents required to be or otherwise prepared or filed in respect of any Plan pursuant to the Code, ERISA and other applicable Law; (B) all actuarial reports prepared in respect of any Pension Plan or Multiemployer Plan that are available to the Loan Party or that may be made available to the Loan Party upon request; and (C) any documentation regarding withdrawal liability under or the funding status with respect to any Multiemployer Plan.
(v)Warehouse Inspection Reports. Promptly and in any event within thirty (30) days of receipt, a copy of each Federal or state warehouse inspection report received by the Borrower or any Subsidiary from any Governmental Authority or other Person with respect to any grain or other warehouse operated by the Borrower or any Subsidiary.
(vi)Certain Continuing Reports. Within thirty (30) calendar days after a request from the Administrative Agent, the Borrower shall cause to be delivered to the Administrative Agent, such broker statements, market position reports, inventory reports, accounts receivable aging reports and such other reports as the Administrative Agent may reasonably require, each in form and substance consistent with similar reports delivered (if any) to the Administrative Agent prior to the Closing Date or in such form satisfactory to the Administrative Agent.
(f)Notices.
(i)Default. Promptly after any officer of any Loan Party has learned of the occurrence of an Event of Default or Default, a certificate signed by an Authorized Officer setting forth the details of such Event of Default or Default and the action that such Loan Party proposes to take with respect thereto.
(ii)Regulatory and Other Notices. Promptly after filing, receiving or becoming aware thereof, the Loan Parties will deliver or cause to be delivered copies of any filings or communications sent to, or notices and other communications received by, any Loan Party or any of its respective Subsidiaries from any Governmental Authority relating to any noncompliance by any Loan
Party or any of its Subsidiaries with any applicable Law or with respect to any matter or proceeding, in each case, the effect of which could reasonably be expected to result in a Material Adverse Change.
(iii)Litigation. Promptly after the commencement thereof, notice of all actions, suits, proceedings or investigations before or by any Governmental Authority or any other Person against any Loan Party or Subsidiary of any Loan Party that relate to the Collateral, involve a claim or series of claims equal to or in excess of the Threshold Amount or that if adversely determined could reasonably be expected to result in a Material Adverse Change.
(iv)Organizational Documents. Within the time limits set forth in Section 7.14, any amendment to the Organizational Documents of any Loan Party or any Subsidiary of any Loan Party.
(v)Material Agreements. Any material amendment, supplement, waiver or other modification to any of the Material Agreements, or any notice of default or of termination, cancellation or revocation (in each case, prior to any scheduled date of termination) delivered thereunder and, promptly following Administrative Agent's request therefor, copies of the foregoing.
(vi)Erroneous Financial Information. Immediately in the event that the Borrower or its accountants conclude or advise that any previously issued financial statement, audit report or interim review should no longer be relied upon or that disclosure should be made or action should be taken to prevent future reliance.
(vii)ERISA Event. Immediately upon the occurrence of any ERISA Event or Plan Qualification Event or any event reasonably expected to result in an ERISA Event or Plan Qualification Event.
(viii)Material Adverse Change. Promptly after becoming aware thereof, the Borrower will give notice of any change in events or changes in facts or circumstances affecting any Loan Party or any of their respective Subsidiaries which individually or in the aggregate have resulted in or could reasonably be expected to result in a Material Adverse Change.
(ix)Environmental Notices. Promptly after becoming aware of any material violation by any Loan Party or any of its respective Subsidiaries of Environmental Laws or promptly upon receipt of any notice that a Governmental Authority or other Person has asserted that any Loan Party or any of its respective Subsidiaries is not in compliance with Environmental Laws or that its compliance is being investigated, and, in either case, the same would reasonably be expected to result in a Material Adverse Change, the Borrower will give notice thereof and provide such other information as may be reasonably available to any Loan Party or any of its respective Subsidiaries to enable the Administrative Agent and the Lenders to reasonably evaluate such matter.
(g)Other Information. Such other reports and information as any of the Lenders may from time to time reasonably request.
V.2Preservation of Existence, Etc. Each Loan Party shall, and shall cause each of its Subsidiaries to, maintain (a) its legal existence as a corporation, limited partnership or limited liability company or other entity, as the case may be as of the Closing Date or the date of formation or acquisition thereof and its license or qualification and good standing in each jurisdiction in which its ownership or lease of property or the nature of its business makes such license or qualification necessary, except as otherwise expressly permitted in Section 7.7, and (b) all licenses, franchises, permits and other
authorizations and Intellectual Property, the loss, revocation, termination, suspension or adverse modification of which could reasonably be expected to result in a Material Adverse Change.
V.3[RESERVED].
V.4Payment of Liabilities, Including Taxes, Etc. Each Loan Party shall, and shall cause each of its Subsidiaries to, duly pay and discharge all indebtedness and other liabilities (including all lawful claims that, if unpaid, would by Law become a Lien on the assets of any Loan Party) to which it is subject or that are asserted against it, promptly as and when the same shall become due and payable, including all taxes, assessments and governmental charges upon it or any of its properties, assets, income or profits, prior to the date on which penalties attach thereto, except to the extent that such liabilities, including taxes, assessments or governmental charges, are being contested in good faith and by appropriate and lawful proceedings diligently conducted and for which such reserve or other appropriate provisions, if any, as shall be required by GAAP shall have been made.
V.5Maintenance of Insurance.
(a)Each Loan Party shall, and shall cause each of its Subsidiaries to, insure its properties and assets against loss or damage by fire and such other insurable hazards as such assets are commonly insured (including fire, extended coverage, property damage, workers' compensation, public liability and business interruption insurance) and against other risks (including errors and omissions) in such amounts as similar properties and assets are insured by prudent companies in similar circumstances carrying on similar businesses, and with reputable and financially sound insurers, including self-insurance to the extent customary, all as reasonably determined by the Administrative Agent. Such insurance policies shall contain additional insured, mortgagee and lender loss payable special endorsements in form and substance satisfactory to the Administrative Agent naming the Administrative Agent as additional insured, mortgagee and lender loss payee, as applicable, and providing the Administrative Agent with notice of cancellation acceptable to the Administrative Agent.
(b)Each Loan Party shall, to the extent required under the Flood Laws, obtain and maintain flood insurance for such structures and contents constituting Collateral located in a flood hazard zone, in such amounts as similar structures and contents are insured by prudent companies in similar circumstances carrying on similar businesses and otherwise satisfactory to the Administrative Agent (but, in any event, providing all flood insurance required by applicable Law).
(c)Each Loan Party shall deliver evidence of the insurance policies and endorsements described above to the Administrative Agent on or prior to the Closing Date. Not less than fifteen (15) days (or such later date as the Administrative Agent shall agree to in its reasonable discretion) prior to the expiration date of the insurance policies required to be maintained by any Loan Party or its Subsidiaries pursuant to the terms hereof, the Borrower will deliver to the Administrative Agent one or more certificates of insurance and endorsements evidencing renewal of the insurance coverage required hereunder plus such other evidence of payment of premiums therefor as Administrative Agent may reasonably request.
(d)If any Loan Party fails to, or fails to cause any of its Subsidiaries to, obtain and maintain any of the policies of insurance required to be maintained pursuant to the provisions of this Section 6.5 or to pay any premium in whole or in part, the Administrative Agent may, without waiving or releasing any obligation or Default or Event of Default, at the Loan Parties' expense, but without any obligation to do so, procure such policies or pay such premiums. All sums so disbursed by the
Administrative Agent, including any reasonable and documented out-of-pocket expenses incurred by the Administrative Agent and reasonable fees, charges and disbursements of counsel for the Administrative Agent, shall be payable by the Loan Parties to the Administrative Agent on demand and shall be additional Obligations hereunder and under the other Loan Documents, secured by the Collateral.
V.6Maintenance of Properties and Leases. Each Loan Party shall, and shall cause each of its Subsidiaries to, maintain in good repair, working order and condition (ordinary wear and tear excepted) in accordance with the general practice of other businesses of similar character and size, all of those properties useful or necessary to its business, and from time to time, such Loan Party will make or cause to be made all appropriate repairs, renewals or replacements thereof.
V.7Visitation Rights. Each Loan Party shall, and shall cause each of its Subsidiaries to, at permit any of the officers or authorized employees or representatives of the Administrative Agent or any of the Lenders to visit and inspect during normal business hours any of its properties and to examine and make excerpts from its books and records and discuss its business affairs, finances and accounts with its officers and to conduct reviews of each Loan Party's Collateral (such reviews to occur on an annual basis or more frequently, as determined by the Administrative Agent, in its discretion), all in such detail and at such times and as often as the Required Lenders or the Administrative Agent may reasonably request, all at the Borrower's expense, provided that prior to the occurrence of an Event of Default the Administrative Agent shall provide the Borrower with reasonable notice prior to any visit or inspection. Prior to occurrence of an Event of Default, the Administrative Agent shall not, without cause (and, for the avoidance of doubt, having previously identified material discrepancies or errors in the calculation of the Borrowing Base shall constitute "cause"), as determined by the Administrative Agent in its reasonable judgment, request reimbursement from the Borrower for more than one (1) such Collateral audit in any calendar year.
V.8Keeping of Records and Books of Account. The Loan Parties shall, and shall cause each Subsidiary of the Borrower to, maintain and keep proper books of record and account that enable the Borrower and its Subsidiaries to issue financial statements in accordance with GAAP and as otherwise required by applicable Laws of any Governmental Authority having jurisdiction over the Borrower or any Subsidiary of the Borrower, and in which full, true and correct entries shall be made in all material respects of all its dealings and business and financial affairs.
V.9Compliance with Laws.
(a)Each Loan Party shall, and shall cause each of its Subsidiaries to, comply with all other applicable Laws, except where failure to comply with any applicable Law would not result in fines, penalties, remediation costs, other similar liabilities or injunctive relief that, in the aggregate, could reasonably be expected to result in a Material Adverse Change.
(b)Each of the Loan Parties shall, and shall cause each of its Subsidiaries, Affiliates, officers, directors, employees and agents to, comply with all applicable (i) Anti-Corruption Laws, (ii) Anti-Terrorism Laws and (iii) Sanctions. On or before the date that is sixty (60) days following the Closing Date, the Borrower shall implement and maintain in effect policies and procedures designed to ensure compliance by the Loan Parties and their respective Subsidiaries, Affiliates, officers, directors, employees and agents with all applicable (i) Anti-Corruption Laws, (ii) Anti-Terrorism Laws and (iii) Sanctions.
(c)Each of the Loan Parties shall, and shall cause each of its Subsidiaries to, (i) conduct its operations and keep and maintain its real property in compliance with all Environmental Laws and environmental permits; (ii) obtain and renew all environmental permits necessary for its operations and properties; and (iii) implement any and all investigation, remediation, removal and response actions that are necessary to maintain the value and marketability of the real property or to otherwise comply with Environmental Laws pertaining to any of its real property (provided, however, that neither a Loan Party nor any of its Subsidiaries shall be required to undertake any such investigation, remediation, removal, response or other action to the extent that its obligation to do so is being contested in good faith and by proper proceedings and adequate reserves have been set aside and are being maintained by the Loan Parties with respect to such circumstances in accordance with GAAP).
V.10Further Assurances.
(a)Generally. Each Loan Party shall, from time to time, at its expense, preserve and protect the Administrative Agent's Lien on and Prior Security Interest in the Collateral and all other real and personal property of the Loan Parties whether now owned or hereafter acquired as a continuing Prior Security Interest therein, and shall do or make, or cause each of its Subsidiaries to do or make, such other acts, deliveries and things as the Administrative Agent in its sole reasonable discretion may deem necessary or advisable from time to time in order to consummate the transactions contemplated hereby, preserve, perfect and protect the Liens granted or purported to be granted under the Loan Documents and to exercise and enforce its rights and remedies thereunder with respect to the Collateral.
(b)Additional Subsidiaries. In furtherance, and not in limitation, of Section 6.10(a), promptly upon (and in any event within thirty (30) days after (or such later date as the Administrative Agent shall agree to in its sole discretion)) the creation or acquisition of any direct or indirect Subsidiary by any Loan Party (it being understood that any Subsidiary becoming a Material Subsidiary shall be deemed to be the acquisition of a Subsidiary for purposes of this Section 6.10(b)), each such new Subsidiary and the Loan Parties will notify the Administrative Agent and (i) if such Subsidiary is a Material Subsidiary, execute and deliver to the Administrative Agent a duly executed Guarantor Joinder in accordance with Section 12.12, pursuant to which such new Material Subsidiary shall become a party hereto as a Guarantor and shall become a party to the Security Agreement as a Grantor (as defined therein), and (ii) the Equity Interests of such new Subsidiary shall be pledged by the applicable Loan Party to the extent provided in the Collateral Documents. Upon the creation or acquisition of any direct or indirect Subsidiary by any Loan Party that is not a Subsidiary, the Equity Interests of such new Subsidiary shall be pledged by the applicable Loan Party to the extent requested by the Administrative Agent. As promptly as reasonably possible, the Loan Parties and their respective Subsidiaries will deliver all certificates evidencing such Equity Interests, together with undated, executed transfer powers, and such other Collateral Documents and such other documents, certificates and opinions (including opinions of local counsel in the jurisdiction of organization of each such new Subsidiary) regarding such new Subsidiary, in form, content and scope reasonably satisfactory to the Administrative Agent, as the Administrative Agent may reasonably request in connection therewith and will take such other action as the Administrative Agent may reasonably request to create in favor of the Administrative Agent a Prior Security Interest in the Collateral, to the extent provided in the Collateral Documents, for the Secured Obligations. It is understood and agreed that, to the extent that, as of the last day of any period of four consecutive Fiscal Quarters for which financial statements were required to be delivered pursuant to Section 6.1(a) or (b), the Loan Parties do not (x) own assets at least equal to ninety percent (90%) of the total assets (as calculated in accordance with GAAP) of the Borrower and its Subsidiaries on a consolidated basis and (y) have earnings before interest expense, tax, depreciation and amortization (as calculated in accordance with GAAP) at least equal to ninety percent (90%) of earnings before interest
expense, tax, depreciation and amortization (as calculated in accordance with GAAP) of the Borrower and its Subsidiaries on a consolidated basis, the Borrower shall, within thirty (30) days (or such longer period of time as is agreed to by the Administrative Agent in its sole discretion), cause Subsidiaries that are not currently deemed Material Subsidiaries as would be necessary to cause the Loan Parties to (x) own assets at least equal to ninety percent (90%) of the total assets (as calculated in accordance with GAAP) of the Borrower and its Subsidiaries on a consolidated basis and (y) have earnings before interest expense, tax, depreciation and amortization (as calculated in accordance with GAAP) at least equal to ninety percent (90%) of earnings before interest expense, tax, depreciation and amortization (as calculated in accordance with GAAP) of the Borrower and its Subsidiaries on a consolidated basis, to execute and deliver to the Administrative Agent a duly executed Guarantor Joinder in accordance with Section 12.12 pursuant to which each such Subsidiary shall become a party hereto as a Guarantor and shall become a party to the Security Agreement as a Grantor (as defined therein), together with such other documents, certificates and opinions (including opinions of local counsel in the jurisdiction of organization of each such Subsidiary regarding each such Subsidiary, in form, content and scope reasonably satisfactory to the Administrative Agent, as the Administrative Agent may reasonably request in connection therewith and will take such other action as the Administrative Agent may reasonably request to create in favor of the Administrative Agent a Prior Security Interest in the Collateral, to the extent provided in the Collateral Documents, for the Secured Obligations.
(c)Real Property. In furtherance, and not in limitation, of Sections 6.10(a) and 6.10(b) and subject to Schedule 6.16, the Loan Parties shall (i) within ten (10) days after the acquisition of any Material Owned Property or Material Leased Property by any Loan Party that is not subject to an existing mortgage or deed of trust in favor of the Administrative Agent, for the benefit of the Secured Parties, notify the Administrative Agent and (ii) if requested by the Administrative Agent, within ninety (90) days of such acquisition (as such time period may be extended by the Administrative Agent, in its sole discretion), deliver such Mortgages, title insurance, flood and other insurance, environmental reports, supplements to the Environmental Indemnity (in a form reasonably satisfactory to the Administrative Agent) and other documents, instruments or agreements requested by the Administrative Agent in connection with granting and perfecting a Prior Security Interest, on such real property in favor of the Administrative Agent, for the ratable benefit of the Secured Parties, all in form and substance acceptable to the Administrative Agent.
(d)Other Property. Pursuant to the terms of this Section 6.10 and of the Security Agreement, the Loan Parties will (i) promptly (and in any event on or before the earlier of (x) if applicable, the time required by Section 6.10(b) or (y) the Borrower's next submission of a Compliance Certificate) notify the Administrative Agent of (A) any Equity Interest, (B) any Copyrights, Patents, Trademarks and Domain Names (each as defined in the Security Agreement) which are material to the continued operation of any Loan Party's Business, (C) any commercial tort claim known to any Loan Party (such that a senior officer of such Loan Party has actual knowledge of the existence of a tort cause of action and not merely of the existence of the facts giving rise to such cause of action) that such Loan Party knows to involve an amount in controversy in the aggregate with any other known commercial tort claim of any Loan Party in excess of the Threshold Amount), (D) any Material Agreements, and (E) any Material Account, in each case, owned, acquired, leased or opened by any Loan Party or any of its Subsidiaries, in each case, of which written notice has not previously been given to the Administrative Agent, and (ii) on or before the earlier of (x) if applicable, the time required by Section 6.10(b) or (y) the Borrower's next submission of a Compliance Certificate in connection with the financial statements required to be delivered pursuant to Section 6.1(b), deliver updated Annexes to the Security Agreement.
The Administrative Agent may elect not to request any documents, instruments, filings or opinions as contemplated by this Section 6.10 or the Security Agreement and the other Loan Documents if it determines in its sole discretion that the costs to the Loan Parties of perfecting a security interest or Lien in such property exceed the relative benefit of such security interest to the Secured Parties.
V.11Farm Credit Equity and Securities.
(a)So long as any Farm Credit Lender is a Lender hereunder, the Borrower will (a) maintain its status as an entity eligible to borrow from such Farm Credit Lender (per applicable Farm Credit Administration regulations) and (b) acquire equity in such Farm Credit Lender in such amounts and at such times as such Farm Credit Lender may require in accordance with such Farm Credit Lender’s Bylaws and Capital Plan (as each may be amended from time to time), except that the maximum amount of equity that the Borrower may be required to purchase in any Farm Credit Lender in connection with the Loans made by such Farm Credit Lender may not exceed the maximum amount permitted by the Bylaws and the Capital Plan at the time this Agreement is entered into. The Borrower acknowledges receipt of a copy of (i) each Farm Credit Lender’s most recent annual report, and if more recent, each Farm Credit Lender’s latest quarterly report, (ii) if applicable, each Farm Credit Lender’s Notice to Prospective Stockholders (or similar document) and (iii) each Farm Credit Lender’s Bylaws and Capital Plan, which describe the nature of all of the Farm Credit Equities as well as capitalization requirements, and agrees to be bound by the terms thereof.
(b)Each party hereto acknowledges that the Bylaws and Capital Plan (as each may be amended from time to time) of each Farm Credit Lender that is a Lender hereunder shall govern (i) the rights and obligations of the parties with respect to the Farm Credit Equities and any patronage refunds or other distributions made on account thereof or on account of the Borrower’s patronage with such Farm Credit Lender, (ii) the Borrower’s eligibility for patronage distributions from such Farm Credit Lender (in the form of Farm Credit Equities and cash) and (iii) patronage distributions, if any, in the event of a sale of a participation interest. Each Farm Credit Lender reserves the right to assign or sell participations in all or any part of its (or its affiliate’s) Commitments or outstanding Loans hereunder on a non-patronage basis.
(c)Notwithstanding anything herein or in any other Loan Document to the contrary, each party hereto acknowledges that: (i) each Farm Credit Lender has a statutory first Lien pursuant to the Farm Credit Act of 1971 (as amended from time to time) on all Farm Credit Equities of such Farm Credit Lender that the Borrower may now own or hereafter acquire, which statutory Lien shall be for such Farm Credit Lender’s (or its affiliate’s) sole and exclusive benefit; (ii) during the existence of any Event of Default, each Farm Credit Lender that is a Lender hereunder may at its sole discretion, but shall not be required to, foreclose on its statutory first Lien on the applicable Farm Credit Equities and/or set off the value thereof or of any cash patronage against the Secured Obligations; (iii) during the existence of any Event of Default, each Farm Credit Lender that is a Lender hereunder may at its sole discretion, but shall not be required to, without notice except as required by applicable Law, retire and cancel all or part of the applicable Farm Credit Equities owned by or allocated to the Borrower in accordance with the Farm Credit Act of 1971 (as amended from time to time) and any regulations promulgated pursuant thereto in total or partial liquidation of the Secured Obligations for such value as may be required pursuant applicable Law and such Farm Credit Lender Bylaws and Capital Plan (as each may be amended from time to time); (iv) the Farm Credit Equities shall not constitute security for the Secured Obligations due to the Administrative Agent, any other Lender or any other Secured Party; (v) to the extent that any of the Loan Documents create a Lien on the Farm Credit Equities, such Lien shall be for each Farm Credit Lender that is a Lender hereunder (or its affiliate’s) sole and exclusive benefit and shall not be subject to
pro rata sharing hereunder; (vi) any setoff effectuated pursuant to the preceding clauses (ii) or (iii) may be undertaken whether or not the Secured Obligations are currently due and payable; and (vii) no Farm Credit Lender that is a Lender hereunder shall have the obligation to retire the Farm Credit Equities upon any Event of Default, Default or any other default by the Borrower or any other Loan Party, or at any other time, either for application to the Obligations or otherwise. The Borrower acknowledges that any corresponding tax liability associated with each Farm Credit Lender’s application of the value of the Farm Credit Equities to any portion of the Obligations is the sole responsibility of the Borrower.
V.12Use of Proceeds. The proceeds of (a) the Revolving Credit Facility shall be used (i) to refinance all outstanding Revolving Facility Loans (including Swing Line Loans) under the Existing Credit Agreement and (ii) for working capital and general corporate purposes of the Borrower and its Subsidiaries, (b) the Revolving Term Credit Facility shall be used for working capital and general corporate purposes of the Borrower and its Subsidiaries, including to finance Capital Expenditures, (c) the Variable Rate Term Loan shall be used to (i) to refinance $40,846,194 of the Variable Rate Term Loan outstanding under the Existing Credit Agreement, (ii) to refinance $14,087,793.16 of the Revolving Term Loans outstanding under the Existing Credit Agreement and (iii) for working capital and general corporate purposes of the Borrower and its Subsidiaries, (d) the Fixed Rate Term Loan shall be used to refinance a corresponding portion of the “Fixed Rate Term Loan” under the Existing Credit Agreement, dollar-for-dollar, pursuant to Section 2.6(a), and (e) any Seasonal Term Loan shall be used solely to repay Revolving Facility Loans, to be applied to such Loans on a pro rata basis. The Loan Parties will use the Letters of Credit and the proceeds of the Loans only in accordance with this Section 6.12 and Sections 5.11 and 5.23 and as permitted by applicable Law.
V.13Updates to Schedules and Annexes. Should any of the information or disclosures provided on any of the Schedules referred to in this Agreement and attached hereto or any Annex to the Security Agreement or the Pledge Agreement become outdated or incorrect in any material respect, the Borrower shall promptly provide the Administrative Agent in writing with such revisions or updates to such Schedule or such Annex as may be necessary or appropriate to update or correct same. No such Schedule or Annex, whether delivered pursuant to this Section 6.13, Section 6.10 or otherwise shall be deemed to have been amended, modified or superseded by any such correction or update, nor shall any breach of warranty or representation resulting from the inaccuracy or incompleteness of any such Schedule or Annex be deemed to have been cured thereby, unless and until the Administrative Agent, in its sole discretion, or the Required Lenders shall have accepted in writing such revisions or updates to such Schedule or Annex; provided, however, that the Borrower (a) may update Schedule 5.6 without any Administrative Agent or Required Lender approval in connection with any transaction not prohibited under Sections 7.7, 7.8 and 7.10 and (b) may supplement Schedule 5.24 and the schedules to the Security Agreement and the Pledge Agreement without any Administrative Agent or Required Lender approval in connection with any transaction not prohibited under the Loan Documents.
V.14Material Agreements. Each of the Loan Parties covenants and agrees that it shall, and shall cause each of its Subsidiaries to, comply in all material respects with each of its Material Agreements.
V.15Benefit Plan Compliance. Each Plan will be in compliance in all material respects with its terms and applicable Law, each of the Loan Parties and the ERISA Affiliates will satisfy their obligations and liabilities with respect to each Plan and each of the Loan Parties and the ERISA Affiliates will make all contributions with respect to any Plan on or before the due date for such contribution.
V.16Post-Closing Deliverables. Unless otherwise set forth on Schedule 6.16, on or before the date that is thirty (30) days after the Closing Date, the Loan Parties will deliver or will cause to be delivered to the Administrative Agent each of the documents, instruments, agreements and information set forth on Schedule 6.16, in each case as required by the Administrative Agent in its sole discretion and in form and substance acceptable to the Administrative Agent in its reasonable discretion.
VI.NEGATIVE COVENANTS
VI.1Indebtedness. No Loan Party shall, nor shall any Loan Party permit any of its Subsidiaries, to, at any time create, incur, assume or suffer to exist any Indebtedness, except:
(a)Indebtedness under this Agreement and the other Loan Documents;
(b)existing Indebtedness as set forth on Schedule 7.1 (including, unless otherwise indicated on such Schedule, any extensions or renewals thereof); provided that unless the Administrative Agent, in its reasonable discretion, approves otherwise, (i) the amount of such Indebtedness is not increased at the time of such refinancing, refunding, renewal or extension except by an amount equal to a reasonable premium or other reasonable amount paid, and fees and expenses reasonably incurred, in connection with such refinancing, refunding, renewal or extension, and (ii) the terms relating to principal amount, amortization, maturity, collateral (if any) and subordination (if any), and other material terms taken as a whole, of any such refinancing, refunding, renewing or extending of such Indebtedness, and of any agreement entered into and of any instrument issued in connection therewith, are no less favorable in any material respect to the Loan Parties or the Lenders than the terms of any agreement or instrument governing the Indebtedness being refinanced, refunded, renewed or extended and the interest rate applicable to any such refinancing, refunding, renewing or extending Indebtedness does not exceed the then applicable market interest rate for such Indebtedness;
(c)(i) Indebtedness incurred with respect to Synthetic Lease Obligations and Capital Leases with Farm Credit Leasing Services Corporation for fixed or capital assets; and (ii) Indebtedness incurred with respect to Purchase Money Security Interests, Synthetic Lease Obligations and Capital Leases with any other Person for fixed or capital assets not in excess of the Threshold in the aggregate outstanding at any time;
(d)unsecured, subordinated Indebtedness of a Loan Party to another Loan Party;
(e)Indebtedness (contingent or otherwise) of any Loan Party arising under (i) any Secured Hedge and (ii) Indebtedness under any Secured Bank Product entered into in the ordinary course of business; provided however, that (i) no Loan Party shall enter into or incur any Secured Hedge that constitutes a Swap Obligation if at the time it enters into or incurs such Swap Obligation it does not constitute an "eligible contract participant" as defined in the Commodity Exchange Act, and (ii) the Loan Parties and their Subsidiaries shall enter into a Secured Hedge only for hedging (rather than speculative) purposes;
(f)Guarantees and other Contingent Obligations permitted by Section 7.4;
(g)unsecured, subordinated Indebtedness owing to Skyland Co-op;
(h)unsecured, subordinated Indebtedness owing to the Andersons Buyer;
(i)(i) unsecured Indebtedness in an aggregate principal amount not to exceed $10,000,000.00 owing to ADM pursuant to a promissory note issued by the Borrower as consideration for the transactions contemplated by, and in the form set forth in, the ADM Interest Redemption Agreement and (ii) unsecured indemnification obligations (contingent or otherwise) of any Loan Party arising under the ADM Interest Redemption Agreement;
(j)obligations (contingent or otherwise) of any Loan Party arising under any Hedge Agreements with respect to commodities; provided however, that the Loan Parties and their Subsidiaries shall enter into such permitted Hedge Agreements only for hedging (rather than speculative) purposes; and
(k)obligations of any Loan Party to pay the deferred purchase price for grain purchases and obligations owed by any Loan Party to producers in connection with prepaid purchases of goods or services by any such producer, in each case, in the ordinary course of business and for which adequate reserves or other appropriate provisions in accordance with GAAP have been set aside on such Loan Party's books.
VI.2Liens. No Loan Party shall, nor shall any Loan Party permit any of its Subsidiaries to, at any time create, incur, assume or suffer to exist any Lien on any of its property or assets, tangible or intangible, now owned or hereafter acquired, or agree or become obligated to do so, except Permitted Liens.
VI.3Affiliate Transactions. No Loan Party shall, nor shall any Loan Party permit any of its Subsidiaries to, enter into or carry out any transaction (including the transactions contemplated by the Services Agreement) with any Affiliate of any Loan Party (including purchasing property or services from or selling property or services to any Affiliate of any Loan Party or other Person) unless such transaction is (a) not otherwise prohibited by this Agreement, (b) is in accordance with all applicable Law and (c) (i) is among the Loan Parties, (ii) is entered into in the ordinary course of business and on fair and reasonable terms substantially as favorable to the Borrower or such Subsidiary as would be obtainable by the Borrower or such Subsidiary at the time in a comparable arm’s length transaction with a Person other than an Affiliate, (iii) relates to the payment of compensation to directors, officers and employees in the ordinary course of business for services actually rendered in their capacities as directors, officers and employees, provided such compensation is reasonable and comparable with compensation paid by companies of like nature and similarly situated, or (iv) is a Restricted Payment permitted by Section 7.6 or an advance permitted by Section 7.5(b). For the avoidance of doubt, each of the following agreements (each as in effect on the Closing Date) shall be permitted under this Section 7.3 and this Agreement: (i) the Second Amended and Restated Facilities Management Agreement by and between the Borrower and Skyland Co-op dated as of November 1, 2024; and (ii) the Asset Contribution Agreement dated as of June 2, 2023 by and among the Borrower, ADM and Skyland Co-op.
VI.4Contingent Obligations. No Loan Party shall, nor shall it permit any of its Subsidiaries to, at any time, directly or indirectly, create or become or be liable with respect to any Contingent Obligation except for those:
(a)resulting from endorsement of negotiable instruments for collection in the ordinary course of business;
(b)arising in the ordinary course of business with respect to customary indemnification obligations incurred in the ordinary course of business;
(c)incurred in the ordinary course of business with respect to surety and appeal bonds, performance and return-of-money bonds and other similar obligations;
(d)constituting Investments permitted pursuant to Section 7.5;
(e)Guarantees by any Loan Party of Indebtedness permitted hereunder (other than Indebtedness of any Subsidiary that is not a Loan Party and Excluded Swap Obligations); and
(f)Guarantees of obligations of customers of the Borrower to The Cooperative Finance Association; provided that the maximum aggregate liability of all Loan Parties with respect to principal under such guarantees shall not exceed $5,000,000.00; and
(g)Guarantees of obligations of the obligations of customers of the Borrower to John Deere Financial; provided that the maximum aggregate liability of all Loan Parties with respect to principal under such guarantees shall not exceed $100,000.00.
VI.5Loans and Investments. No Loan Party shall, nor shall any Loan Party permit any of its Subsidiaries to, at any time make or suffer to remain outstanding any Investment or agree, become or remain liable to make any Investment, except:
(a)trade credit extended on usual and customary terms in the ordinary course of business (including, but not limited to, for purchases by such Loan Party’s customers for seed and other agricultural products and services);
(b)advances to employees of the Loan Parties to meet expenses incurred by such employees in the ordinary course of business;
(c)Investments in the form of cash and Cash Equivalents;
(d)loans and advances to, and other Investments in, other wholly-owned Loan Parties;
(e)notes payable to, or equity interests issued by, account debtors to any Loan Party in good faith settlement of delinquent obligations and pursuant to any plan of reorganization or similar proceedings upon the bankruptcy or insolvency of any such account debtor;
(f)the Farm Credit Equities and any other stock or securities of, or Investments in, a Farm Credit Lender or its investment services or programs;
(g)Guaranties and other Contingent Obligations permitted by Section 7.4;
(h)any Secured Hedge permitted under Section 7.1;
(i)existing Investments as set forth on Schedule 7.5; and
(j)Investments in the aggregate amount of $5,375,000.00 pursuant to the Borrower’s Crop Input Financing Program; provided, that, no Investments pursuant to this clause (j) shall be increased after the Closing Date.
VI.6Dividends and Related Distributions. No Loan Party shall declare or make, directly or indirectly, any Restricted Payment, or incur any obligation (contingent or otherwise) to do so, except that:
(a)each Subsidiary may make Restricted Payments to any Loan Party and any other Person that owns an Equity Interest in such Subsidiary, ratably according to their respective holdings of the type of Equity Interest in respect of which such Restricted Payment is being made;
(b)the Borrower and each Subsidiary may declare and make dividend payments or other distributions payable solely in the common stock or other common Equity Interests of such Person;
(c)the Borrower and each Subsidiary may purchase, redeem or otherwise acquire Equity Interests issued by it with the proceeds received from the substantially concurrent issue of new shares of its common stock or other common Equity Interests;
(d)so long as no Default or Event of Default shall have occurred and be continuing or would result therefrom, the Borrower may make, declare and pay lawful cash dividends and distributions in amounts sufficient to cover each of its members’ estimated income tax obligations resulting from allocations of net income by the Borrower to such members, as required by the Borrower’s Organizational Documents; and
(e)so long as (i) no Default or Event of Default shall have occurred and be continuing or would result therefrom and (ii) the Loan Parties shall be in compliance with the covenants set forth in Sections 8.1 through 8.3 (in the case of the covenant set forth in Section 8.1, to be tested only to the extent that as of such testing date the Borrowing Base is less than $35,000,000.00) on a pro forma basis after giving effect thereto, the Borrower may make, declare and pay lawful cash dividends and distributions to its Members.
VI.7Liquidations, Mergers, Consolidations, Acquisitions. No Loan Party shall, nor shall any Loan Party permit any of its Subsidiaries to, (i) dissolve, liquidate or wind-up its affairs, (ii) become a party to any merger or consolidation, or (iii) acquire by purchase, lease or otherwise all or substantially all of the assets or capital stock of any other Person or group of related Persons; provided that:
(a)any Subsidiary may merge with (i) the Borrower, provided that the Borrower shall be the continuing or surviving Person, or (ii) any one or more other Subsidiaries, provided that when any Guarantor is merging with another Subsidiary, the Guarantor shall be the continuing or surviving Person; and
(b)any Subsidiary may Dispose of all or substantially all of its assets (upon voluntary liquidation or otherwise) to the Borrower or to a Guarantor; provided that if the transferor in such a transaction is a Guarantor, then the transferee must either be the Borrower or a Guarantor;
provided, that, no Loan Party or Subsidiary of any Loan Party shall engage in, allow or be party to any Division without the written prior consent of the Administrative Agent in its sole discretion .
VI.8Dispositions of Assets. No Loan Party shall, nor shall any Loan Party permit any of its Subsidiaries to, dispose of (including pursuant to any sale and leaseback transaction), voluntarily or involuntarily, any of its properties or assets, tangible or intangible (including sale, assignment, discount or other disposition of accounts, contract rights, chattel paper, equipment or general intangibles with or without recourse or of capital stock, shares of beneficial interest, partnership interests or limited liability company interests or other equity interests of a Subsidiary of such Loan Party), except:
(a)any Disposition of assets in the ordinary course of business that are replaced by substitute assets acquired or leased as permitted in this Agreement, so long as such substitute assets are subject to the Administrative Agent's Prior Security Interest therein;
(b)transactions involving the sale of inventory to customers in the ordinary course of business;
(c)any Disposition of obsolete or worn-out assets in the ordinary course of business that are no longer necessary or required in the conduct of such Loan Party's or such Subsidiary's business;
(d)any Disposition of assets by any Loan Party or any wholly owned Subsidiary of such Loan Party to another Loan Party, so long as such sold or transferred assets are subject to the Administrative Agent's Prior Security Interest therein;
(e)any Disposition permitted by Section 7.5;
(f)any Disposition of Cash Equivalents;
(g)Dispositions by the Borrower and its Subsidiaries of property pursuant to sale-leaseback transactions, provided that the book value of all property so Disposed of in connection with all sale-leaseback transactions with Persons other than Farm Credit Leasing Services Corporation shall not exceed $5,000,000.00 in the aggregate;
(h)Dispositions by the Borrower and its Subsidiaries not otherwise permitted under this Section 7.8; provided that (i) at the time of such Disposition, no Default or Event of Default shall exist or would result from such Disposition, (ii) any Net Cash Proceeds of Dispositions in reliance on this clause (h) in excess of $3,750,000.00 in the aggregate in any fiscal year shall be applied by the Borrower as a mandatory prepayment under Section 2.16(b) and (iii) the aggregate book value of all property Disposed of in reliance on this clause (h) during the term of this Agreement shall not exceed $30,000,000.00; provided, further, that for the purposes of calculating the total amount of Dispositions set forth in the foregoing clause (iii), such amount shall be reduced by an amount equal to the Net Cash Proceeds of any Dispositions in reliance on this clause (h) which are reinvested in Capital Expenditures of the Loan Parties within three hundred sixty-five (365) days after the receipt of such Net Cash Proceeds;
(i)[reserved]; and
(j)any Disposition of titled vehicles or rolling stock not otherwise permitted under this Section 7.8; provided, that (i) at least five (5) Business Days before the consummation of such Disposition, the Borrower has delivered to the Administrative Agent a report in form and detail reasonably satisfactory to the Administrative Agent identifying the assets that are the subject of such Disposition, the book value thereof, the sale price therefor, and the expected Net Cash Proceeds to be generated thereby, and the prospective purchaser(s), and (ii) the aggregate book value of all property Disposed of in reliance on this clause (j) shall not exceed $5,000,000.00 in the aggregate; provided, further, that 100% of the Net Cash Proceeds of such Disposition(s) shall be applied by the Borrower as a mandatory prepayment under Section 2.16(b);
provided, however, that any Disposition pursuant to clause (a) shall be for substantially equivalent value, any Disposition pursuant to clause (c) may be for scrap value and any Disposition pursuant to clauses (b) and (d) through (h) shall be for fair market value; provided, further, that, no Loan
Party or Subsidiary of any Loan Party shall engage in, allow or be party to any Division without the written prior consent of the Administrative Agent in its sole discretion.
VI.9Use of Proceeds. No Loan Party shall (a) use the proceeds of any Loan or other Credit Extension hereunder, whether directly or indirectly, and whether immediately, incidentally or ultimately, to purchase or carry margin stock (within the meaning of Regulation U of the Board) or to extend credit to others for the purpose of purchasing or carrying margin stock or to refund indebtedness originally incurred for such purpose or (b) request any Credit Extension or use (or permit the use by any of its Subsidiaries or its or their respective Affiliates, directors, officers, employees or agents) the proceeds of any Credit Extension, whether directly or indirectly, in violation of Anti-Corruption Laws, Anti-Terrorism Laws, Sanctions or other applicable Law.
VI.10Subsidiaries, Partnerships and Joint Ventures. No Loan Party shall, nor shall any Loan Party permit any of its Subsidiaries to, own or create directly or indirectly any Subsidiaries other than (i) any Subsidiary that has joined this Agreement as Guarantor on the Closing Date; and (ii) any Subsidiary formed or acquired after the Closing Date that joins this Agreement as a Guarantor by delivering to the Administrative Agent (A) an executed Guarantor Joinder; (B) documents in the forms described in Section 4.1 modified as appropriate; and (C) documents necessary to grant and perfect Prior Security Interests to the Administrative Agent for the benefit of the Secured Parties in the Equity Interests of, and Collateral held by, such Subsidiary. Each of the Loan Parties shall not become or agree to become a party to a Joint Venture.
VI.11Continuation of or Change in Business. No Loan Party shall, nor shall any Loan Party permit any of its Subsidiaries to, engage in any line of business other than those lines of business conducted by the Loan Parties on the date hereof, substantially as conducted and operated by such Loan Party or Subsidiary during the present fiscal year and businesses reasonably related thereto.
VI.12Fiscal Year. The Borrower shall not, and shall not permit any Subsidiary of the Borrower to, change its fiscal year from the twelve-month period beginning February 1 and ending January 31; provided, that, the Borrower and any Subsidiary shall change its fiscal year to the twelve-month period beginning January 1 and ending December 31 for the fiscal year ending 2024 (with the 2024 fiscal year being a stub period commencing February 1 and ending December 31); provided, further, that, thereafter, the Borrower shall not, and shall not permit any Subsidiary of the Borrower to, change its fiscal year from the twelve-month period beginning January 1 and ending December 31.
VI.13Issuance of Equity Interests. No Loan Party shall, nor shall any Loan Party permit any of its Subsidiaries to, commence or consummate any Equity Issuance, except for (a) any such Equity Issuances by any Loan Party (other than the Borrower) to and for the benefit of a Loan Party and that are subject to the Administrative Agent's Prior Security Interest therein and otherwise comply with the Pledge Agreement, (b) any Equity Issuance permitted pursuant to Sections 7.6(b) or 7.6(c); and (c) the Borrower may issue and sell its common Equity Interests to the holders of its Equity Interests on the Closing Date.
VI.14Changes in Organizational Documents. No Loan Party shall, nor shall any Loan Party permit any of its Subsidiaries to, amend, restate, supplement or modify in any material respect its Organizational Documents without providing at least thirty (30) calendar days' prior written notice (or such shorter notice as to which the Administrative Agent may agree in its sole reasonable discretion) to the Administrative Agent and the Lenders and, in the event such change would be adverse to the Lenders as determined by the Administrative Agent in its sole discretion, obtaining the prior written consent of the Required Lenders.
VI.15Negative Pledges; Other Inconsistent Agreements. Each of the Loan Parties covenants and agrees that it shall not, and shall not permit any of its Subsidiaries to, enter into any agreement containing any provision which would (a) be breached by any Borrowing by the Borrower hereunder or by the performance by the Loan Parties or their respective Subsidiaries of any of their obligations hereunder or under any other Loan Document; (b) limit the ability of any Loan Party or any Subsidiary of any Loan Party to create, incur, assume or suffer to exist Liens on property of such Person; (c) create or permit to exist or become effective any encumbrance or restriction on the ability of any Loan Party or Subsidiary of any Loan Party to (i) make Restricted Payments to any Loan Party, or pay any Indebtedness owed to any Loan Party, (ii) make loans or advances to any Loan Party, (iii) transfer any of its assets or properties to any Loan Party, or (iv) Guarantee the Indebtedness of any Loan Party, provided, however, that this clause (c) shall not prohibit any negative pledge incurred or provided in favor of any holder of Indebtedness permitted under Section 7.1(c) solely to the extent any such negative pledge relates to the property financed by or the subject of such Indebtedness; or (d) require the grant of a Lien to secure an obligation of such Person if a Lien is granted to secure another obligation of such Person; provided, however, that the foregoing shall not apply to restrictions and conditions imposed by applicable Law or by this Agreement or any other Loan Document.
VI.16Material Agreements; Payments on other Indebtedness. Each of the Loan Parties covenants and agrees that it shall not, and shall not permit any of its Subsidiaries to (a) amend, restate, supplement, waive or otherwise modify, or terminate, cancel or revoke (prior to any scheduled date of termination) any Material Agreement if such modification, termination, cancellation or revocation could reasonably be expected to result in a Material Adverse Change, Default or Event of Default, (b) make any optional prepayments of Indebtedness arising under any Material Indebtedness (other than the Indebtedness permitted pursuant to Section 7.1(i)), except for (i) optional prepayments of Indebtedness between the Loan Parties and (ii) other optional prepayments of Indebtedness; provided that (A) no Default or Event of Default shall exist at the time of such prepayment or arise as a result thereof, (B) the Loan Parties shall be in compliance with the covenants set forth in Sections 8.1 through 8.3 (in the case of the covenant set forth in Section 8.1, to be tested only to the extent that as of such testing date the Borrowing Base is less than $35,000,000.00) on a pro forma basis after giving effect to such payment and (C) such prepayment shall otherwise be permitted pursuant to the terms of any applicable subordination agreement, and (c) make payments, whether mandatory or optional, of Indebtedness permitted pursuant to Section 7.1(i); provided that (A) no Default or Event of Default shall exist at the time of such payment or arise as a result thereof and (B) the Loan Parties shall be in compliance with the covenants set forth in Sections 8.1 through 8.3 (in the case of the covenant set forth in Section 8.1, to be tested only to the extent that as of such testing date the Borrowing Base is less than $35,000,000.00) on a pro forma basis after giving effect to such payment.
VI.17Employee Plans. No Loan Party or ERISA Affiliate will acquire liability (by adopting a new plan, acquisition of another entity, or otherwise) under any Pension Plan under which the Loan Party or ERISA Affiliate has no liability as of the date of this Agreement, except as required by applicable Law; provided that the Loan Party or ERISA Affiliate shall provide the Administrative Agent prior written notice of such liability required by applicable Law as soon as possible but in any event within fifteen (15) calendar days of becoming Known by any Authorized Officer thereof and provided further that the imposition of such liability would not reasonably be expected to exceed the Threshold Amount. No Loan Party or ERISA Affiliate will acquire liability (by adopting a new plan, acquisition of another entity, or otherwise) under any Plan that is not a Pension Plan under which the Loan Party or ERISA Affiliate has no liability as of the date of this Agreement; provided, however, that this provision shall not be breached if applicable Law imposes such liability provided that the Loan Party or ERISA Affiliate provides the Administrative Agent prior written notice of such liability imposed by applicable Law as soon as possible
but in any event within fifteen (15) calendar days of becoming Known by any Authorized Officer thereof and provided further that such liability would not reasonably be expected to exceed the Threshold Amount.
VI.18Management Fees. Each of the Loan Parties covenants and agrees that it shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, pay any management or other similar fees to any Person, except legal or consulting fees paid to Persons that are not Affiliates of any Loan Party for services actually rendered and in amounts typically paid by Persons engaged in a Loan Party's business; provided, however, that the foregoing provisions shall not prohibit any Loan Party from paying usual and customary reasonable directors' fees and expenses and reasonable salaries, benefits, expense reimbursements and other compensation of officers and employees of such Loan Party; provided, further, that, the foregoing provisions shall not prohibit a Loan Party from paying the Andersons Buyer and its Affiliates for services actually performed pursuant to the Services Agreement, subject to compliance with Section 7.3.
VI.19Capital Expenditures. The Loan Parties shall not make any Capital Expenditure if (a) an Event of Default has occurred and is continuing or will result therefrom, or (b) the Loan Parties will fail to comply with the covenants set forth in Sections 8.1 through 8.3 on a pro forma basis after giving effect to such Capital Expenditure and any Indebtedness incurred in connection therewith.
VI.20Anti-Corruption; Anti-Terrorism; Sanctions.
(a)None of the Loan Parties or their respective Subsidiaries, Affiliates, officers, directors, employees or agents will engage in any dealings or transactions with any Sanctioned Person or in violation of any applicable Anti-Corruption Laws, Anti-Terrorism Laws or Sanctions.
(b)No Loan Party will fund all or any part of any payment under this Agreement or any other Loan Document out of proceeds derived from transactions that violate Sanctions, or with any Sanctioned Person, or with or connected to any Sanctioned Country.
VII.FINANCIAL COVENANTS
VII.1Minimum Debt Service Coverage Ratio. Commencing with the delivery of the financial statements required pursuant to Section 6.1(b) and the Compliance Certificate required pursuant to Section 6.1(c), in each case for the fiscal year of the Borrower ending December 31, 2024, and tested as of December 31, 2024 and as of each month end occurring after delivery of such financial statements and Compliance Certificate, to the extent that as of such testing date the Borrowing Base is less than $35,000,000.00, the Loan Parties shall maintain a Debt Service Coverage Ratio of not less than (a) initially, and through and including, the fiscal year of the Borrower ending December 31, 2026, 1.50 to 1.00 and (b) thereafter, 1.75 to 1.00.
VII.2Minimum Working Capital. Commencing with the delivery of the financial statements required pursuant to Section 6.1(b) and the Compliance Certificate required pursuant to Section 6.1(c), in each case for the fiscal year of the Borrower ending December 31, 2024, and tested as of December 31, 2024 and as of each month end occurring after delivery of such financial statements and Compliance Certificate, the Loan Parties shall maintain at all times Working Capital of the Borrower of not less than (a) from the Closing Date through and including December 31, 2026, $55,000,000.00, and (b) thereafter, $60,000,000.00.
VII.3Minimum Consolidated Net Worth. Commencing with the delivery of the financial statements required pursuant to Section 6.1(b) and the Compliance Certificate required pursuant to Section 6.1(c), in each case for the fiscal year of the Borrower ending December 31, 2024, and tested as of December 31, 2024 and as of each month end occurring after delivery of such financial statements and Compliance Certificate, the Loan Parties shall maintain at all times Consolidated Net Worth of the Borrower of not less than $135,000,000.00, increasing, as of the end of each fiscal year of the Borrower (commencing with the fiscal year of the Borrower ending on December 31, 2025), by 25% of the sum of (a) net income before taxes of the Borrower, determined on a Consolidated basis, without duplication, in accordance with GAAP, at the end of each fiscal year of the Borrower minus (ii) the amount of Restricted Payments permitted to be made by the Borrower pursuant to Section 7.6(d) and actually made during such fiscal year period.
VIII.EVENTS OF DEFAULT
VIII.1Events of Default. An Event of Default means the occurrence or existence of any one or more of the following events or conditions (whatever the reason therefor and whether voluntary, involuntary or effected by operation of Law):
(a)Payments Under Loan Documents. Failure by the Borrower or any other Loan Party to pay, (i) on the date on which such payment becomes due in accordance with the terms of this Agreement or any other applicable Loan Document, any principal of any Loan (including scheduled installments, mandatory prepayments or the payment due at maturity), any Reimbursement Obligation or Letter of Credit Borrowing, or any interest on any Loan, Reimbursement Obligation or Letter of Credit Borrowing, or (ii) within three (3) Business Days after such amount is due, any other amount owing hereunder or under the other Loan Documents, or any other Secured Obligation;
(b)Breach of Warranty. Any representation, warranty, certification or statement of fact made or deemed made at any time by any of the Loan Parties herein or in any other Loan Document, or in any certificate, other instrument or statement furnished pursuant to the provisions hereof or thereof, shall have been false or misleading as of the time it was made or furnished (i) as stated if such representation or warranty contains an express materiality qualification or (ii) in any material respect if such representation or warranty does not contain such qualification;
(c)Breach of Certain Covenants. Any of the Loan Parties shall default in the observance or performance of any covenant contained in Section 6.1, Section 6.2, Section 6.5, Section 6.7, Section 6.9(b), Section 6.11, Section 6.12, Section 6.16, Article VII, or Article VIII;
(d)Breach of Other Covenants. Any of the Loan Parties shall default in the observance or performance of any other covenant, condition or provision hereof or of any other Loan Document, and such default shall continue unremedied for the expressly specified cure period with respect thereto or, if no such cure period is specified, for a period of thirty (30) days after the earlier of (i) the Administrative Agent's delivery of written notice thereof to the Borrower and (ii) an Authorized Officer or any other executive officer of any Loan Party having obtained knowledge thereof;
(e)Defaults in Other Agreements or Indebtedness. A default or event of default shall occur at any time under the terms of any other agreement with respect to Indebtedness or any other credit extension in an aggregate principal amount (including undrawn committed or available amounts) in excess of the Threshold Amount, or with respect to any Hedge Agreement, the Hedge Termination Value of which is equal to or in excess of the Threshold Amount and such breach, default or event of default (i)
arises from the failure to pay (beyond any period of grace permitted with respect thereto, whether waived or not) any related Indebtedness or other credit extensions when due (whether at stated maturity, by acceleration or otherwise) or (ii) the effect of which is to cause, or to permit the holder or holders of such Indebtedness (or a trustee or agent on behalf of such holder or holders) to cause, with the giving of notice and/or lapse of time, if required, the acceleration of any related Indebtedness or other credit extensions (whether or not such right shall have been waived) or the termination of any commitment to lend;
(f)Final Judgments or Orders. Any final judgments or orders for the payment of money in excess of the Threshold Amount in the aggregate (except to the extent and so long as fully covered (other than to the extent of customary deductibles for which Borrower has reserved funds reasonably acceptable to Administrative Agent) by insurance pursuant to which the insurer has not denied or disputed coverage) shall be entered against a Loan Party by a court having jurisdiction in the premises, which judgment is not discharged, satisfied, vacated, bonded or stayed pending appeal within 30 days from the date of entry.
(g)Loan Document Unenforceable. Any of the Loan Documents shall cease to be legal, valid and binding agreements enforceable against the party executing the same or such party's successors and assigns (as permitted under the Loan Documents) in accordance with the respective terms thereof or shall in any way be terminated (except in accordance with its terms) or become or be declared ineffective or inoperative or shall in any way be challenged or contested by any party thereto (other than the Administrative Agent or any Lender) or cease to give or provide the respective Liens, rights, titles, interests, remedies, powers or privileges intended to be created thereby;
(h)Security Interests Unenforceable. Any Lien purported to be created under any Collateral Document shall cease to be, or shall be asserted by any Loan Party not to be, a valid or perfected Lien on any portion of the Collateral, with the priority required by the applicable Collateral Document, except (i) as a result of a release pursuant to Section 11.1(f), or (ii) as a result of the sale or other disposition of the applicable Collateral or the release of the applicable Loan Party in a transaction permitted under the Loan Documents;
(i)Uninsured Losses; Proceedings Against Assets. There shall occur any uninsured damage to or loss, theft or destruction of any portion of the Collateral with a fair market value in excess of the Threshold Amount, or the Collateral or any other of the Loan Parties' or any of their Subsidiaries' assets with a fair market value in excess of the Threshold Amount are attached, seized, levied upon or subjected to a writ or distress warrant, or come within the possession of any receiver, trustee, custodian or assignee for the benefit of creditors and the same is not cured within sixty (60) days thereafter;
(j)Events Relating to Employee Benefit Plans. (i) An ERISA Event or Plan Qualification Event occurs that has resulted or could reasonably be expected to result in liability of any Loan Party or any ERISA Affiliate in an aggregate amount in excess of the Threshold Amount, or (ii) any Loan Party or any ERISA Affiliate fails to pay when due, after the expiration of any applicable grace period, any contribution required to be made with respect to any Pension Plan or Multiemployer Plan in an aggregate amount in excess of the Threshold Amount, including any installment payment with respect to its withdrawal liability under Section 4201 of ERISA under a Multiemployer Plan;
(k)Change of Control. A Change of Control shall have occurred;
(l)Insolvency Proceedings. (i) An Insolvency Proceeding shall have been instituted against any Loan Party or Subsidiary of a Loan Party and such Insolvency Proceeding shall remain
undismissed or unstayed and in effect for a period of sixty (60) consecutive days or such court shall enter a decree or order granting any of the relief sought in such Insolvency Proceeding, (ii) any Loan Party or Subsidiary of a Loan Party institutes, or takes any action in furtherance of, an Insolvency Proceeding, (iii) an order granting the relief requested in any Insolvency Proceeding (including, but not limited to, an order for relief under federal bankruptcy laws) shall be entered, (iv) any Loan Party or Subsidiary thereof shall commence a voluntary case under, file a petition seeking to take advantage of, any bankruptcy, insolvency, reorganization or other similar law, domestic or foreign, (v) any Loan Party or Subsidiary thereof shall consent to or fail to contest in a timely and appropriate manner any petition filed against it in any Insolvency Proceeding, (vi) any Loan Party or Subsidiary thereof shall apply for or consent to, or fail to contest in a timely and appropriate manner, the appointment of, or the taking of possession by, a receiver, custodian, trustee, or liquidator of itself or of a substantial part of its property, domestic or foreign, (vii) any Loan Party or Subsidiary thereof shall take any action to approve or authorize any of the foregoing, or (viii) any Loan Party or any Subsidiary of a Loan Party ceases to be Solvent or admits in writing its inability to pay its debts as they mature;
(m)Material Agreements. If any Loan Party shall default, past any applicable grace and cure period, under any Material Agreement not otherwise described in this Section 9.1, and such default would reasonably be expected to result in a Material Adverse Change, or if any Material Agreement shall be terminated without the prior written consent of the Administrative Agent; or
(n)Material Adverse Change. Any event, change or condition not referred to elsewhere in this Section 9.1 shall occur that results in a Material Adverse Change.
VIII.2Consequences of Event of Default.
(a)Events of Default Other Than Bankruptcy, Insolvency or Reorganization Proceedings. If an Event of Default specified under Section 9.1 (other than Section 9.1(l)) shall occur and be continuing, the Lenders and the Administrative Agent shall be under no further obligation to make Loans and the Issuing Lender shall be under no further obligation to issue Letters of Credit and the Administrative Agent may, and upon the request of the Required Lenders, shall by written notice to the Borrower, (i) declare the unpaid principal amount of the Loans then outstanding and all interest accrued thereon, any unpaid fees and all other Indebtedness of the Borrower to the Lenders hereunder and thereunder to be forthwith due and payable, and the same shall thereupon become and be immediately due and payable to the Administrative Agent for the benefit of each Lender without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived, and (ii) require the Borrower to, and the Borrower shall thereupon, Cash Collateralize all outstanding Letters of Credit, and the Borrower hereby pledges to the Administrative Agent and the Lenders, and grants to the Administrative Agent and the Lenders a security interest in, all such cash as security for such Secured Obligations; and
(b)Bankruptcy, Insolvency or Reorganization Proceedings. If an Event of Default specified under Section 9.1(l) shall occur, the Lenders shall be under no further obligations to make Loans hereunder and the Issuing Lender shall be under no further obligation to issue Letters of Credit and the unpaid principal amount of the Loans then outstanding and all interest accrued thereon, any unpaid fees and all other Indebtedness of the Borrower to the Lenders hereunder and thereunder automatically shall be immediately due and payable, without presentment, demand, protest or notice of any kind, all of which are hereby expressly waived; and
(c)Set-off. If an Event of Default shall have occurred and be continuing, each Lender, the Issuing Lender, and each of their respective Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by applicable law, to set off and apply any and all deposits (general or special, time or demand, provisional or final, in whatever currency) at any time held, and other obligations (in whatever currency) at any time owing, by such Lender, the Issuing Lender or any such Affiliate, to or for the credit or the account of the Borrower or any other Loan Party against any and all of the obligations of the Borrower or such Loan Party now or hereafter existing under this Agreement or any other Loan Document to such Lender or the Issuing Lender or their respective Affiliates, irrespective of whether or not such Lender, Issuing Lender or Affiliate shall have made any demand under this Agreement or any other Loan Document and although such obligations of the Borrower or such Loan Party may be contingent or unmatured or are owed to a branch, office or Affiliate of such Lender or the Issuing Lender different from the branch, office or Affiliate holding such deposit or obligated on such indebtedness; provided that in the event that any Defaulting Lender shall exercise any such right of setoff, (x) all amounts so set off shall be paid over immediately to the Administrative Agent for further application in accordance with the provisions of Section 2.18 and, pending such payment, shall be segregated by such Defaulting Lender from its other funds and deemed held in trust for the benefit of the Administrative Agent, the Issuing Lender, and the Lenders, and (y) the Defaulting Lender shall provide promptly to the Administrative Agent a statement describing in reasonable detail the Obligations owing to such Defaulting Lender as to which it exercised such right of setoff. The rights of each Lender, the Issuing Lender and their respective Affiliates under this Section are in addition to other rights and remedies (including other rights of setoff) that such Lender, the Issuing Lender or their respective Affiliates may have. Each Lender and the Issuing Lender agrees to notify the Borrower and the Administrative Agent promptly after any such setoff and application; provided that the failure to give such notice shall not affect the validity of such setoff and application.
(d)Application of Proceeds. After the exercise of remedies provided for in Section 9.2 (or after the Loans have automatically become immediately due and payable and the Letter of Credit Obligations have automatically been required to be Cash Collateralized as set forth in the proviso to Section 9.2), any amounts received on account of the Secured Obligations shall be applied by the Administrative Agent in the following order:
First, to payment of that portion of the Obligations constituting fees, indemnities, expenses and other amounts (including fees, charges and disbursements of counsel to the Administrative Agent) payable to the Administrative Agent in its capacity as such;
Second, to payment of that portion of the Obligations constituting indemnities, expenses, and other amounts (other than principal, interest and fees) payable to the Lenders and the Issuing Lender (including fees, charges and disbursements of counsel to the respective Lenders and the Issuing Lender and amounts payable under Article X), ratably among them in proportion to the amounts described in this clause Second payable to them;
Third, to payment of that portion of the Obligations constituting accrued and unpaid interest on the Loans, Letter of Credit Borrowings and other Obligations, and fees (including Letter of Credit Fees), ratably among the Lenders and the Issuing Lender in proportion to the respective amounts described in this clause Third payable to them;
Fourth, to payment of that portion of the Obligations constituting unpaid principal of the Loans and Letter of Credit Borrowings, ratably among the Lenders and the Issuing Lender in proportion to the respective amounts described in this clause Fourth held by them;
Fifth, to the Administrative Agent for the account of the Issuing Lender, to Cash Collateralize that portion of Letter of Credit Obligations comprised of the aggregate undrawn amount of Letters of Credit;
Sixth, to payment of all other Obligations, ratably among the Secured Parties in proportion to the respective amounts described in this clause Sixth held by them;
Seventh, to payment or Cash Collateralization (if agreed by the applicable Loan Parties and any provider of any Secured Bank Product or Secured Hedge, as applicable) of that portion of Other Liabilities then outstanding, ratably among the Secured Parties providing the Secured Bank Products and Secured Hedges giving rise to such Other Liabilities in proportion to the respective amounts described in this clause Seventh held by them; and
Last, the balance, if any, after Payment In Full of all of the Secured Obligations, to the Loan Parties or as otherwise required by Law.
Amounts used to Cash Collateralize Secured Obligations pursuant to clause Fifth or Seventh above shall be applied to satisfy drawings under such Letters of Credit as they occur or to pay such Other Liabilities as they become due, as the case may be. If any amount remains on deposit as Cash Collateral after all Letters of Credit have either been fully drawn or expired and/or after Payment In Full of the Other Liabilities, such remaining amount shall be applied to the other Secured Obligations, if any, in the order set forth above.
Amounts distributed with respect to any Secured Obligations attributable to Other Liabilities shall be equal to the lesser of (a) the applicable amount of such Other Liabilities last reported to the Administrative Agent or (b) the actual amount of such Other Liabilities as calculated by the methodology reported to the Administrative Agent for determining the amount due. The Administrative Agent shall have no obligation to calculate the amount to be distributed with respect to any such Other Liabilities, but may rely upon written notice of the amount (setting forth a reasonably detailed calculation) from the applicable Lender or its Affiliate providing such Secured Bank Products or Secured Hedge. In the absence of such notice, the Administrative Agent may assume the amount to be distributed is the amount of such obligations last reported to it.
If and to the extent the Administrative Agent has received notice or other evidence that any amount claimed as a Secured Obligation is or could reasonably be determined to be an Excluded Swap Obligation with respect to any Loan Party, amounts received from such Loan Party or its assets shall not be applied to such Excluded Swap Obligations with respect to such Loan Party, and adjustments shall be made with respect to amounts received from other Loan Parties and their assets as the Administrative Agent may determine, in consultation with or at the direction of, the Lenders to be equitable (which may include the purchase and sale of participation interests) so that, to the maximum extent practical, the benefit of all amounts received from the Loan Parties and their assets are shared in accordance with the allocation of recoveries set forth above that would apply if the applicable Swap Obligations were not Excluded Swap Obligations. Each Loan Party acknowledges and consents to the foregoing.
IX.THE ADMINISTRATIVE AGENT
IX.1Appointment and Authority. Each of the Lenders and the Issuing Lender (on behalf of itself and each of its Affiliates) hereby irrevocably appoints CoBank to act on its behalf as the Administrative Agent hereunder and under the other Loan Documents and authorizes the Administrative Agent to take such actions on its behalf and to exercise such powers as are delegated to the
Administrative Agent by the terms hereof or thereof, together with such actions and powers as are reasonably incidental thereto. The provisions of this Article X are solely for the benefit of the Administrative Agent, the Lenders, the Affiliates of the Lenders who are Secured Parties and the Issuing Lender and, except with respect to Sections 10.8 and 10.9 neither the Borrower nor any other Loan Party shall have rights as a third party beneficiary of any of such provisions. It is understood and agreed that the use of the term "agent" herein or in any other Loan Documents (or any other similar term) with reference to the Administrative Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any applicable law. Instead such term is used as a matter of market custom, and is intended to create or reflect only an administrative relationship between contracting parties.
IX.2Rights as a Lender. The Person serving as the Administrative Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not the Administrative Agent and the term "Lender" or "Lenders" shall, unless otherwise expressly indicated or unless the context otherwise requires, include the Person serving as the Administrative Agent hereunder in its individual capacity. Such Person and its Affiliates may accept deposits from, lend money to, own securities of, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of business with the Borrower or any Subsidiary or other Affiliate thereof as if such Person were not the Administrative Agent hereunder and without any duty to account therefor to the Lenders.
IX.3No Fiduciary Duty. The Administrative Agent shall not have any duties or obligations except those expressly set forth herein and in the other Loan Documents and its duties hereunder shall be administrative in nature. Without limiting the generality of the foregoing, the Administrative Agent:
(a)shall not be subject to any fiduciary or other implied duties, regardless of whether a Default or Event of Default has occurred and is continuing;
(b)shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan Documents that the Administrative Agent is required to exercise as directed in writing by the Required Lenders (or such other number or percentage of the Lenders as shall be expressly provided for herein or in the other Loan Documents); provided that the Administrative Agent shall not be required to take any action that, in its opinion or the opinion of its counsel, may expose the Administrative Agent to liability or that is contrary to any Loan Document or applicable Law, including for the avoidance of doubt any action that may be in violation of the automatic stay under any Debtor Relief Law or that may affect a forfeiture, modification or termination of property of a Defaulting Lender in violation of any Debtor Relief Law; and
(c)shall not, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Borrower or any of its Affiliates that is communicated to or obtained by the Person serving as the Administrative Agent or any of its Affiliates in any capacity.
IX.4Exculpation.
(a)The Administrative Agent shall not be liable for any action taken or not taken by it (i) with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be
necessary, under the circumstances as provided in Sections 11.1 and 9.2) or (ii) in the absence of its own gross negligence or willful misconduct as determined by a court of competent jurisdiction by final and non-appealable judgment. The Administrative Agent shall be deemed not to have knowledge of any Default or Event of Default unless and until notice describing such Default or Event of Default is given to the Administrative Agent by the Borrower, a Lender or the Issuing Lender.
(b)The Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement or any other Loan Document, (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Default or Event of Default, (iv) the validity, enforceability, effectiveness or genuineness of this Agreement, any other Loan Document or any other agreement, instrument or document or (v) the satisfaction of any condition set forth in Article IV or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to the Administrative Agent.
IX.5Reliance by the Administrative Agent. The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message, Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper Person. The Administrative Agent also may rely upon any statement made to it orally or by telephone and believed by it to have been made by the proper Person, and shall not incur any liability for relying thereon. In determining compliance with any condition hereunder to the making of a Loan, or the issuance, extension, renewal or increase of a Letter of Credit, that by its terms must be fulfilled to the satisfaction of a Lender or the Issuing Lender, the Administrative Agent may presume that such condition is satisfactory to such Lender or the Issuing Lender unless the Administrative Agent shall have received notice to the contrary from such Lender or the Issuing Lender prior to the making of such Loan or the issuance of such Letter of Credit. The Administrative Agent may consult with legal counsel (who may be counsel for the Borrower), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.
IX.6Delegation of Duties. The Administrative Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Loan Document by or through any one or more sub-agents appointed by the Administrative Agent. The Administrative Agent and any such sub-agent may perform any and all of its duties and exercise its rights and powers by or through their respective Related Parties. The exculpatory provisions of this Article X shall apply to any such sub-agent and to the Related Parties of the Administrative Agent and any such sub-agent, and shall apply to their respective activities in connection with the syndication of the Facilities as well as activities as Administrative Agent. The Administrative Agent shall not be responsible for the negligence or misconduct of any sub-agents except to the extent that a court of competent jurisdiction determines in a final and non-appealable judgment that the Administrative Agent acted with gross negligence or willful misconduct in the selection of such sub agents.
IX.7Filing Proofs of Claim. In case of the pendency of any proceedings under any Debtor Relief Law or any other judicial proceeding relating to any Loan Party, the Administrative Agent (irrespective of whether the principal of any Loan shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether the Administrative Agent shall have made any
demand therefor) shall be entitled and empowered (but not obligated) by intervention in such proceeding or otherwise:
(a)to file and prove a claim for the whole amount of the owing and unpaid principal and interest in respect to the Secured Obligations and to file such other documents as may be necessary or advisable in order to have the claims of the Lenders and the Administrative Agent (including any claim for the reasonable compensation, expenses, disbursements and advances of the Lenders, the Issuing Lender and the Administrative Agent and their respective agents and counsel and all other amounts due the Lenders, the Issuing Lender and the Administrative Agent under Sections 2.10, 2.13(b), 3.5 and 11.3) allowed in such proceeding;
(b)to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same; and
(c)any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender and the Issuing Lender to make such payments to the Administrative Agent and, in the event that the Administrative Agent shall consent to the making of such payments directly to the Lenders and the Issuing Lender, to pay to the Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its agents and counsel, and any other amounts due the Administrative Agent under Sections 2.10, 2.13(b), 3.5 and 11.3.
IX.8Resignation of the Administrative Agent. The Administrative Agent may at any time give notice of its resignation to the Lenders, the Issuing Lender and the Borrower. Upon receipt of any such notice of resignation, the Required Lenders shall have the right, with the approval of the Borrower (so long as no Event of Default has occurred and is continuing), such approval not to be unreasonably withheld or delayed, to appoint a successor Administrative Agent; provided that the Borrower shall be deemed to have consented to any such appointment unless it shall object thereto by written notice to the Lenders within ten (10) Business Days after having received notice of the proposed appointment. If no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within thirty (30) days after the retiring Administrative Agent gives notice of its resignation (or such earlier date as the Required Lenders may approve), then the retiring Administrative Agent may (but shall not be obligated to) on behalf of the Lenders and the Issuing Lender, appoint a successor Administrative Agent; provided, that if the Administrative Agent shall notify the Borrower and the Lenders that no Person has accepted such appointment, then the Administrative Agent's resignation shall nonetheless become effective in accordance with such notice and (i) the retiring Administrative Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents (except that in the case of any collateral security held by the Administrative Agent on behalf of the Lenders or the Issuing Lender under any of the Loan Documents, the retiring Administrative Agent shall continue to hold such collateral security until such time as a successor Administrative Agent is appointed) and (ii) except for any indemnity payments owed to the retiring Administrative Agent, all payments, communications and determinations provided to be made by, to or through the Administrative Agent shall instead be made by or to each Lender and the Issuing Lender directly, until such time as the Required Lenders appoint a successor Administrative Agent as provided for above in this Section 10.8. Upon the acceptance of a successor's appointment as Administrative Agent hereunder, such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring (or retired) Administrative Agent (other than any rights to indemnity payments owed to the retiring Administrative Agent), and the retiring Administrative Agent shall be discharged from all of its duties and obligations hereunder or under the other Loan Documents (if not already discharged therefrom as provided above in
this Section). The fees payable by the Borrower to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Borrower and such successor. After the retiring Administrative Agent's resignation hereunder and under the other Loan Documents, the provisions of this Article X and Section 11.3 shall continue in effect for the benefit of such retiring Administrative Agent, its sub-agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while the retiring Administrative Agent was acting as Administrative Agent.
Any resignation by CoBank as Administrative Agent pursuant to this Section shall also automatically constitute its resignation as the Issuing Lender and the Swing Line Lender, with replacement of the Administrative Agent as Issuing Lender and Swing Line Lender conducted in accordance with Section 10.9.
IX.9Resignation of Swing Line Lender or Issuing Lender. The Swing Line Lender or the Issuing Lender may at any time give notice of its resignation to the Lenders, the Administrative Agent and the Borrower. Upon receipt of any such notice of resignation, the Required Lenders shall have the right, with approval from the Borrower (so long as no Event of Default has occurred and is continuing), such approval not to be unreasonably withheld or delayed, to appoint a successor Swing Line Lender or Issuing Lender. If no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within thirty (30) days after the retiring Swing Line Lender or Issuing Lender (as applicable) gives notice of its resignation, then the Administrative Agent may on behalf of the Lenders, with approval from the Borrower (so long as no Event of Default has occurred and is continuing), such approval not to be unreasonably withheld or delayed, appoint a successor Swing Line Lender or Issuing Lender (as applicable); provided that the Borrower shall be deemed to have consented to any such appointment unless it shall object thereto by written notice to the Administrative Agent within five (5) Business Days after having received notice of the proposed appointment; provided, further that if the Administrative Agent shall notify the Borrower and the Lenders that no qualifying Person has accepted such appointment, then such resignation shall nonetheless become effective in accordance with such notice and the retiring Swing Line Lender or Issuing Lender (as applicable) shall be discharged from its duties and obligations hereunder and under the other Loan Documents (except that in the case of any collateral security held by the retiring Swing Line Lender or Issuing Lender (as applicable) on behalf of the Lenders or the Swing Line Lender or Issuing Lender under any of the Loan Documents, the retiring Swing Line Lender or Issuing Lender (as applicable) shall continue to hold such collateral security until such time as a successor Swing Line Lender or Issuing Lender (as applicable) is appointed). Upon the acceptance of a successor's appointment as a Swing Line Lender or Issuing Lender (as applicable) hereunder, such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring (or retired) Swing Line Lender or Issuing Lender (as applicable), and the retiring Swing Line Lender or Issuing Lender (as applicable) shall be discharged from all of its duties and obligations hereunder or under the other Loan Documents (if not already discharged therefrom as provided above in this Section). The fees payable by the Borrower to a successor Swing Line Lender or Issuing Lender (as applicable) shall be the same as those payable to its predecessor unless otherwise agreed between the Borrower and such successor. After the retiring Swing Line Lender's or Issuing Lender's (as applicable) resignation hereunder and under the other Loan Documents as a Swing Line Lender or Issuing Lender, as applicable, the provisions of Section 11.3 (and Article X if the Administrative Agent is the resigning Issuing Lender and Swing Line Lender) shall continue in effect for the benefit of such retiring Swing Line Lender or Issuing Lender (as applicable), its sub-agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while the retiring Swing Line Lender or Issuing Lender (as applicable) was acting as the Swing Line Lender or Issuing Lender (as applicable).
In addition to the foregoing requirements, upon the acceptance of a successor's appointment as Issuing Lender hereunder, the successor Issuing Lender shall issue letters of credit in substitution for the Letters of Credit issued by the retiring Issuing Lender, if any, outstanding at the time of such succession or make other arrangements satisfactory to the retiring Issuing Lender to effectively assume the obligations of the retiring Issuing Lender with respect to such Letters of Credit.
IX.10Non-Reliance on the Administrative Agent, Arranger and Other Lenders. Each Lender and the Issuing Lender expressly acknowledges that none of the Administrative Agent, the Arrangers or any of their respective Related Parties has made any representations or warranties to it and that no act taken or failure to act by the Administrative Agent, the Arrangers or any of their respective Related Parties, including any consent to, and acceptance of any assignment or review of the affairs of the Borrower and its Subsidiaries or Affiliates shall be deemed to constitute a representation or warranty of the Administrative Agent, the Arrangers or any of their respective Related Parties to any Lender, the Issuing Lender or any other Person as to any matter, including whether the Administrative Agent, the Arrangers or any of their respective Related Parties have disclosed material information in their (or their respective Related Parties’) possession. Each Lender and the Issuing Lender expressly acknowledges, represents and warrants to the Administrative Agent and the Arrangers that (a) the Loan Documents set forth the terms of a commercial lending facility, (b) it is engaged in making, acquiring, purchasing or holding commercial loans in the ordinary course and is entering into this Agreement and the other Loan Documents to which it is a party as a Lender for the purpose of making, acquiring, purchasing and/or holding the commercial loans set forth herein as may be applicable to it, and not for the purpose of investing in the general performance or operations of the Borrower and its Subsidiaries, or for the purpose of making, acquiring, purchasing or holding any other type of financial instrument such as a security, (c) it is sophisticated with respect to decisions to make, acquire, purchase or hold the commercial loans applicable to it and either it or the Person exercising discretion in making its decisions to make, acquire, purchase or hold such commercial loans is experienced in making, acquiring, purchasing or holding commercial loans, (d) it has, independently and without reliance upon the Administrative Agent, the Arrangers, any other Lender or any of their respective Related Parties and based on such documents and information as it has deemed appropriate, made its own credit analysis and appraisal of, and investigations into, the business, prospects, operations, property, assets, liabilities, financial and other condition and creditworthiness of the Borrower and its Subsidiaries, all applicable bank or other regulatory applicable Laws relating to the Loans and the transactions contemplated by this Agreement and the other Loan Documents and (e) it has made its own independent decision to enter into this Agreement and the other Loan Documents to which it is a party and to extend credit hereunder and thereunder. Each Lender and the Issuing Lender also acknowledges and agrees that (i) it will, independently and without reliance upon the Administrative Agent, the Arrangers or any other Lender or any of their respective Related Parties (A) continue to make its own credit analysis, appraisals and decisions in taking or not taking action under or based upon this Agreement, any other Loan Document or any related agreement or any document furnished hereunder or thereunder based on such documents and information as it shall from time to time deem appropriate and its own independent investigations and (B) continue to make such investigations and inquiries as it deems necessary to inform itself as to the Borrower and its Subsidiaries and (ii) it will not assert any claim under any federal or state securities law or otherwise in contravention of this Section 10.10.
IX.11Enforcement. By its acceptance of the benefits of this Agreement and the other Loan Documents, each Secured Party agrees that (a) the Loan Documents may be enforced only by the Administrative Agent, subject to Section 11.2, (b) no Secured Party shall have any right individually to enforce or seek to enforce this Agreement or the other Loan Documents or to realize upon any Collateral or other security given to secure the payment and performance of the Obligations and (c) no Secured
Party has any right to notice of any action or to consent to, direct or object to any action hereunder or under any other Loan Document or otherwise in respect of the Collateral (including the release or impairment of any Collateral) other than in its capacity as a Lender or the Issuing Lender and, in such case, only to the extent expressly provided in the Loan Documents.
IX.12No Other Duties, etc. Anything herein to the contrary notwithstanding, the Lead Arranger or Sole Bookrunner listed on the cover page hereof shall have no powers, duties or responsibilities under this Agreement or any of the other Loan Documents, except in its capacity, as applicable, as the Administrative Agent, a Lender, the Swing Line Lender or the Issuing Lender hereunder.
IX.13Authorization to Release Collateral and Loan Parties.
(a)The Secured Parties irrevocably authorize the Administrative Agent, at its option and in its discretion,
(i)to release any Lien on any property granted to or held by the Administrative Agent under any Loan Document (w) upon termination of all Commitments and Payment In Full of all Secured Obligations (other than contingent indemnification obligations as to which no claim has been made) and the expiration or termination of all Letters of Credit (other than Letters of Credit and Other Liabilities as to which other arrangements satisfactory to the Administrative Agent and the applicable Lender or Issuing Lender on behalf of itself or its Affiliates shall have been made), (x) that is Disposed of or to be Disposed of as part of or in connection with any sale or other disposition permitted under the Loan Documents, (y) if such property has a value of $2,500,000.00 or less, or (z) subject to Section 11.1, if approved, authorized or ratified in writing by the Required Lenders;
(ii)to subordinate any Lien on any property granted to or held by the Administrative Agent under any Loan Document to the holder of any Lien on such property that is permitted by Section 7.1(c); and
(iii)to release any Guarantor from its obligations under the Loan Documents if such Person ceases to be a Subsidiary as a result of a transaction permitted under the Loan Documents.
Upon request by the Administrative Agent at any time, the Required Lenders will confirm in writing the Administrative Agent's authority to release or subordinate its interest in particular types or items of property, or to release any Guarantor from its obligations under the Loan Documents pursuant to this Section 10.13; provided that the failure of the Administrative Agent to make such request or the Required Lenders to make such confirmation shall not invalidate the action taken by the Administrative Agent hereunder.
(b)The Administrative Agent shall not be responsible for or have a duty to ascertain or inquire into any representation or warranty regarding the existence, value or collectability of the Collateral, the existence, priority or perfection of the Administrative Agent's Lien thereon, or any certificate prepared by any Loan Party in connection therewith, nor shall the Administrative Agent be responsible or liable to the Lenders for any failure to monitor or maintain any portion of the Collateral.
IX.14Compliance with Flood Laws. CoBank has adopted internal policies and procedures that address requirements placed on federally regulated lenders under the Flood Laws. CoBank, as administrative agent or collateral agent on a syndicated facility, will post on the applicable electronic platform (or otherwise distribute to each lender in the syndicate) documents that it receives in connection
with the Flood Laws. However, CoBank reminds each lender and participant in the facility that, pursuant to the Flood Laws, each federally regulated lender (whether acting as a lender or participant in the facility) is responsible for assuring its own compliance with the flood insurance requirements.
IX.15No Reliance on the Administrative Agent's Customer Identification Program. Each Lender acknowledges and agrees that neither such Lender, nor any of its Affiliates, participants or assignees, may rely on the Administrative Agent to carry out such Lender's, Affiliate's, participant's or assignee's customer identification program, or other obligations required or imposed under or pursuant to the USA Patriot Act or the regulations thereunder, including the regulations contained in 31 CFR 103.121 (as hereafter amended or replaced, the "CIP Regulations"), or any other Anti-Terrorism Law, Anti-Corruption Law or Sanctions, including any programs involving any of the following items relating to or in connection with any of the Loan Parties, their Affiliates or their agents, the Loan Documents or the transactions hereunder or contemplated hereby: (a) any identity verification procedures, (b) any recordkeeping, (c) comparisons with government lists, (d) customer notices or (e) other procedures required under the CIP Regulations or such other Laws.
IX.16Affiliates as Secured Parties. To the extent any Affiliate of a Lender is a party to a Secured Hedge or a Secured Bank Product and thereby becomes a beneficiary of the Liens pursuant to any Collateral Document for so long as such Lender remains a Lender, such Affiliate of a Lender shall be a Secured Party and shall be deemed to appoint the Administrative Agent its nominee and agent to act for and on behalf of such Affiliate in connection with such Collateral Document and to be bound by the terms of this Article X and the other provisions of this Agreement.
IX.17Certain ERISA Matters.
(a)Each Lender (x) represents and warrants, as of the date such Person became a Lender party hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of, the Administrative Agent and its Affiliates, and not, for the avoidance of doubt, to or for the benefit of the Borrower or any other Loan Party, that at least one of the following is and will be true:
(i)such Lender is not using "plan assets" (within the meaning of Section 3(42) of ERISA or otherwise) of one or more Benefit Plans with respect to such Lender's entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments or this Agreement,
(ii)the transaction exemption set forth in one or more PTEs, such as PTE 84-14 (a class exemption for certain transactions determined by independent qualified professional asset managers), PTE 95-60 (a class exemption for certain transactions involving insurance company general accounts), PTE 90-1 (a class exemption for certain transactions involving insurance company pooled separate accounts), PTE 91-38 (a class exemption for certain transactions involving bank collective investment funds) or PTE 96-23 (a class exemption for certain transactions determined by in-house asset managers), is applicable with respect to such Lender's entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement,
(iii)(A) such Lender is an investment fund managed by a "Qualified Professional Asset Manager" (within the meaning of Part VI of PTE 84-14), (B) such Qualified Professional Asset Manager made the investment decision on behalf of such Lender to enter into, participate in, administer and perform the Loans, the Letters of Credit, the Commitments and this
Agreement, (C) the entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement satisfies the requirements of sub-sections (b) through (g) of Part I of PTE 84-14 and (D) to the best knowledge of such Lender, the requirements of subsection (a) of Part I of PTE 84-14 are satisfied with respect to such Lender's entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement, or
(iv)such other representation, warranty and covenant as may be agreed in writing between the Administrative Agent, in its sole discretion, and such Lender.
(b)In addition, unless either (1) Section 10.17(a)(i) is true with respect to a Lender or (2) a Lender has provided another representation, warranty and covenant as provided in Section 10.17(a)(iv), such Lender further (x) represents and warrants, as of the date such Person became a Lender party hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of, the Administrative Agent and its Affiliates, and not, for the avoidance of doubt, to or for the benefit of the Borrower or any other Loan Party, that the Administrative Agent and its Affiliates, is not a fiduciary with respect to the assets of such Lender involved in such Lender's entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement (including in connection with the reservation or exercise of any rights by the Administrative Agent under this Agreement, any Loan Document or any documents related hereto or thereto).
IX.18Rate Disclaimer. The Administrative Agent does not warrant or accept responsibility for, and each of the parties to this Agreement hereby acknowledge and agree (for the benefit of the Administrative Agent) that the Administrative Agent shall not have any liability with respect to (a) the continuation of, administration of, submission of, calculation of or any other matter related to the Alternate Base Rate, any Benchmark, or any component definition thereof or rates referred to in the definition thereof, or any alternative, successor or replacement rate thereto (including any Benchmark Replacement), including whether the composition or characteristics of any such alternative, successor or replacement rate (including any Benchmark Replacement) will be similar to, or produce the same value or economic equivalence of, or have the same volume or liquidity as, Alternate Base Rate, any initial Benchmark or any other Benchmark or Benchmark Replacement prior to its discontinuance or unavailability, or (b) the effect, implementation or composition of any Benchmark Replacement Conforming Changes. The Administrative Agent and its affiliates or other related entities may engage in transactions that affect the calculation of the Alternate Base Rate, or any Benchmark, any alternative, successor or replacement rate (including any Benchmark Replacement) or any relevant adjustments thereto, in each case, in a manner adverse to the Borrower. The Administrative Agent may select information sources or services in its reasonable discretion to ascertain the Alternate Base Rate, any initial Benchmark or any other Benchmark or Benchmark Replacement, in each case pursuant to the terms of this Agreement, and shall have no liability to the Borrower, any Lender or any other Person for damages of any kind, including direct or indirect, special, punitive, incidental or consequential damages, costs, losses or expenses (whether in tort, contract or otherwise and whether at law or in equity), for any error or calculation of any such rate (or component thereof) provided by any such information source or service.
X.MISCELLANEOUS
X.1Modifications, Amendments or Waivers. With the written consent of the Required Lenders, the Administrative Agent, acting on behalf of all the Lenders, and the Borrower, on behalf of the Loan Parties, may from time to time enter into written agreements amending or changing any provision of
this Agreement or any other Loan Document or the rights of the Lenders or the Loan Parties hereunder or thereunder, or may grant written waivers or consents hereunder or thereunder. Any such agreement, waiver or consent made with such written consent shall be effective to bind all the Lenders and the Loan Parties; provided, that no such agreement, waiver or consent may be made that will:
(a)extend or increase the Commitment of any Lender (or reinstate any obligation to make Loans terminated pursuant to Section 9.2) without the written consent of such Lender whose Commitment is being extended or increased (it being understood and agreed that a waiver of any condition precedent set forth in Section 4.2 or of any Default, Event of Default, mandatory prepayment or a mandatory reduction in Commitments is not considered an extension or increase in Commitments of any Lender);
(b)postpone any date fixed by this Agreement or any other Loan Document for any payment (including mandatory prepayment of Overadvances but excluding other mandatory prepayments) of principal, interest, fees or other amounts due to the Lenders (or any of them) or any scheduled or mandatory reduction of the Commitments hereunder or under any other Loan Document, without the written consent of each Lender entitled to receive such payment or whose Commitments are to be reduced, it being understood that the waiver of any mandatory prepayment of Loans (or any definition relating thereto), other than a mandatory prepayment of Overadvances, shall not constitute a postponement of any date scheduled for the payment of principal or interest;
(c)reduce the principal of, or the rate of interest specified herein on, any Loan or Letter of Credit Borrowing or any fees or other amounts payable hereunder or under any other Loan Document, or change the manner of computation of any financial ratio (including the applicable defined terms) used in determining the Applicable Margin in a manner that would result in a reduction of any interest rate on any Loan or any fee payable hereunder, without the written consent of each Lender directly affected thereby; provided, however, that only the consent of the Required Lenders shall be necessary (i) to amend the definition of "Default Rate" or to waive any obligation of the Borrower to pay interest or Letter of Credit Fees at the Default Rate or (ii) to amend any financial covenant hereunder (or any defined term used therein) even if the effect of such amendment would be to reduce the rate of interest on any Loan or to reduce any fee payable hereunder;
(d)change Section 2.17 or Section 9.2(d) in a manner that would alter the pro rata sharing of payments required thereby without the written consent of each Lender directly affected thereby;
(e)change any provision of this Section 11.1 or the definition of "Required Lenders" without the written consent of each Lender directly affected thereby;
(f)except in connection with a transaction permitted under Section 7.7 or Section 7.8, release all or substantially all of the Collateral without the written consent of each Lender whose Obligations are secured by such Collateral;
(g)release the Borrower without the consent of each Lender, or, except in connection with a transaction permitted under Section 7.7 or Section 7.8, all or substantially all of the value of the Guaranty provided pursuant to Article XII of this Agreement without the written consent of each Lender whose Secured Obligations are guaranteed thereby, except to the extent such release is permitted pursuant to Section 10.13 (in which case such release may be made by the Administrative Agent acting alone); or
(h)subordinate the Secured Obligations hereunder to any other Indebtedness or other obligation, or subordinate the Liens securing the Secured Obligations to Liens securing any other Indebtedness or other obligation, without the written consent of each Lender, in each case except to the extent permitted by Section 7.1 and Section 7.2 (in each case as in effect as of the Closing Date);
provided that (i) no agreement, waiver or consent that would modify the interests, rights or obligations of the Administrative Agent, the Swing Line Lender or the Issuing Lender may be made without the written consent of such Administrative Agent, the Swing Line Lender or the Issuing Lender, as applicable, (ii) only the consent of the Administrative Agent shall be required for any amendment to the Fee Letter, and (iii) the Schedules to this Agreement and the Annexes to the Security Agreement and the Pledge Agreement may be modified as provided in and subject to the terms described in Section 6.10 and Section 6.13; and provided, further that, if in connection with any proposed waiver, amendment or modification referred to in Sections 11.1(a) through 11.1(g) above, the consent of the Required Lenders is obtained but the consent of one or more of such other Lenders whose consent is required is not obtained (each a "Non-Consenting Lender"), then the Borrower shall have the right to replace any such Non-Consenting Lender with one or more replacement Lenders pursuant to Section 3.6.
No Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder (and any amendment, waiver or consent which by its terms requires the consent of all Lenders or each affected Lender may be effected with the consent of the applicable Lenders other than Defaulting Lenders), except that (x) the Commitment of such Defaulting Lender may not be increased or extended without the consent of such Defaulting Lender and (y) any waiver, amendment or modification requiring the consent of all Lenders or each affected Lender that by its terms affects such Defaulting Lender disproportionately adversely relative to other affected Lenders shall require the consent of such Defaulting Lender.
Notwithstanding anything to the contrary contained herein, if following the Closing Date the Administrative Agent and the Borrower shall have jointly identified an obvious error or any error or omission of a technical or immaterial nature, in each case, in any provision of this Agreement or any other Loan Document, then the Administrative Agent and the Borrower shall be permitted to amend such provision and such amendment shall become effective without any further action or consent of any other party to this Agreement or any other Loan Document if the same is not objected to in writing by the Required Lenders within five (5) Business Days following receipt of notice thereof. It is understood that posting such amendment electronically on SyndTrak or another relevant website with notice of such posting by the Administrative Agent to the Required Lenders shall be deemed adequate receipt of notice of such amendment.
Notwithstanding anything to the contrary herein, (a) this Agreement may be amended or amended and restated without the consent of any Lender (but with the consent of the Borrower and the Administrative Agent) if, upon giving effect to such amendment or amendment and restatement, such Lender shall no longer be a party to this Agreement (as so amended or amended and restated), the Commitments of such Lender shall have terminated, such Lender shall have no other commitment or other obligation hereunder and shall have been paid in full all principal, interest and other amounts owing to it or accrued for its account under this Agreement, and (b) any Lender may exchange, continue or rollover all or the portion of its Loans in connection with any refinancing, extension, loan modification or similar transaction permitted by the terms of this Agreement, pursuant to a cashless settlement mechanism approved by the Borrower, the Administrative Agent and such Lender.
X.2No Implied Waivers; Cumulative Remedies. No course of dealing and no delay or failure of the Administrative Agent, the Issuing Lender or any Lender in exercising any right, power, remedy or privilege under this Agreement or any other Loan Document shall affect any other or future exercise thereof or operate as a waiver thereof, nor shall any single or partial exercise thereof preclude any further exercise thereof or of any other right, power, remedy or privilege. The rights and remedies of the Administrative Agent and the Lenders under this Agreement and any other Loan Documents are cumulative and not exclusive of any rights or remedies that they would otherwise have.
Notwithstanding anything to the contrary contained herein or in any other Loan Document, the authority to enforce rights and remedies hereunder and under the other Loan Documents against the Loan Parties or any of them shall be vested exclusively in, and all actions and proceedings at law in connection with such enforcement shall be instituted and maintained exclusively by, the Administrative Agent for the benefit of the Secured Parties; provided, however, that the foregoing shall not prohibit (a) the Administrative Agent from exercising on its own behalf the rights and remedies that inure to its benefit (solely in its capacity as Administrative Agent) hereunder and under the other Loan Documents, (b) the Issuing Lender or the Swing Line Lender from exercising the rights and remedies that inure to its benefit (solely in its capacity as Issuing Lender or Swing Line Lender, as the case may be) hereunder and under the other Loan Documents, (c) any Lender from exercising setoff rights in accordance with Section 9.2 (subject to the terms of Section 2.17), or (d) any Lender from filing proofs of claim or appearing and filing pleadings on its own behalf during the pendency of a proceeding relative to any Loan Party in any Insolvency Proceedings.
X.3Expenses; Indemnity; Damage Waiver.
(a)Costs and Expenses. The Borrower shall pay (i) all reasonable out of pocket expenses incurred by the Administrative Agent and its Affiliates (including the reasonable fees, charges and disbursements of counsel for the Administrative Agent) in connection with the syndication of the Facilities, the preparation, negotiation, execution, delivery and administration of this Agreement and the other Loan Documents, or any amendments, modifications or waivers of the provisions hereof or thereof (whether or not the transactions contemplated hereby or thereby shall be consummated), (ii) all reasonable out of pocket expenses incurred by the Issuing Lender in connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder, and (iii) all out of pocket expenses incurred by the Administrative Agent, any Lender or the Issuing Lender (including the fees, charges and disbursements of any counsel for the Administrative Agent, any Lender or the Issuing Lender), in connection with the enforcement or protection of its rights (A) in connection with this Agreement and the other Loan Documents, including its rights under this Section, or (B) in connection with the Loans made or Letters of Credit issued hereunder, including all such out of pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans or Letters of Credit.
(b)Indemnification by the Borrower. The Borrower shall indemnify the Administrative Agent (and any sub-agent thereof), each Lender and the Issuing Lender, and each Related Party of any of the foregoing Persons (each such Person being called an "Indemnitee") against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses (including the fees, charges and disbursements of any counsel for any Indemnitee) incurred by any Indemnitee or asserted against any Indemnitee by any Person (including the Borrower or any other Loan Party and the expense of investigation) other than such Indemnitee and its Related Parties arising out of, in connection with, or as a result of (i) the execution or delivery of this Agreement, any other Loan Document or any agreement or instrument contemplated hereby or thereby (including, without limitation,
the Indemnitee’s reliance on any Communication executed using an Electronic Signature, or in the form of an Electronic Record), the performance by the parties hereto of their respective obligations hereunder or thereunder or the consummation of the transactions contemplated hereby or thereby, (ii) any Loan or Letter of Credit or the use or proposed use of the proceeds therefrom (including any refusal by the Issuing Lender to honor a demand for payment under a Letter of Credit if the documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit), (iii) any actual or alleged presence or release of Hazardous Materials on or from any property owned or operated by the Borrower or any of its Subsidiaries, or any Environmental Liability related in any way to the Borrower or any of its Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory, whether brought by a third party or by the Borrower or any other Loan Party, and regardless of whether any Indemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses (x) are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the fraud, gross negligence or willful misconduct of such Indemnitee or (y) result from a claim brought by the Borrower or any other Loan Party against an Indemnitee for breach in bad faith of such Indemnitee's obligations hereunder or under any other Loan Document, if the Borrower or such Loan Party has obtained a final and nonappealable judgment in its favor on such claim as determined by a court of competent jurisdiction. This Section 11.3(b) shall not apply with respect to Taxes other than any Taxes that represent losses, claims, damages and other similar amounts arising from any non-Tax claim.
(c)Reimbursement by Lenders. To the extent that the Borrower for any reason fails to indefeasibly pay any amount required under clause (a) or (b) of this Section 11.3 to be paid by it to the Administrative Agent (or any sub-agent thereof), the Issuing Lender, the Swing Line Lender or any Related Party of any of the foregoing, each Lender severally agrees to pay to the Administrative Agent (or any such sub-agent), the Issuing Lender, the Swing Line Lender or such Related Party, as the case may be, such Lender's pro rata share (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought based on each Lender's Pro Rata Share at such time) of such unpaid amount (including any such unpaid amount in respect of a claim asserted by such Lender); provided, that with respect to such unpaid amounts owed to the Issuing Lender or Swing Line Lender solely in its capacity as such, only the Revolving Facility Lenders shall be required to pay such unpaid amounts, such payment to be made severally among them based on such Revolving Facility Lenders' Pro Rata Share (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought); and provided, further, that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent (or any such sub-agent), the Issuing Lender or the Swing Line Lender in its capacity as such, or against any Related Party of any of the foregoing acting for the Administrative Agent (or any such sub-agent), the Issuing Lender or the Swing Line Lender in connection with such capacity.
(d)Waiver of Consequential Damages, Etc. To the fullest extent permitted by applicable Law, none of the Loan Parties shall assert, and each hereby waives, any claim against any Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Loan Document or any agreement or instrument contemplated hereby, the transactions contemplated hereby or thereby, any Loan or Letter of Credit or the use of the proceeds thereof. No Indemnitee referred to in Section 11.3 shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed by it through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby.
(e)Payments. All amounts due under this Section shall be payable not later than ten (10) days after demand therefor.
(f)Survival. Each party's obligations under this Section 11.3 shall survive the resignation of the Administrative Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all obligations under any Loan Document.
X.4Notices; Effectiveness; Electronic Communication.
(a)Notices Generally. Except in the case of notices and other communications expressly permitted to be given by telephone (and except as provided in clause (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by facsimile (i) if to a Lender, at its address (or facsimile number) set forth in its Administrative Questionnaire or (ii) if to any other Person, to it at its address (or facsimile number) set forth on Schedule 1.1(B). Notices sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices sent by facsimile shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next business day for the recipient). Notices delivered through electronic communications, to the extent provided in clause (b) below, shall be effective as provided in said clause (b).
(b)Electronic Communications. Notices and other communications to the Lenders and the Issuing Lender hereunder may be delivered or furnished by electronic communication (including e-mail and Internet or intranet websites) pursuant to procedures approved by the Administrative Agent, provided that the foregoing shall not apply to notices to any Lender or the Issuing Lender pursuant to Article II if such Lender or Issuing Lender, as applicable, has notified the Administrative Agent that it is incapable of receiving notices under such Article by electronic communication. The Administrative Agent or the Borrower may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications.
Unless the Administrative Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender's receipt of an acknowledgement from the intended recipient (such as by the "return receipt requested" function, as available, return e-mail or other written acknowledgement), and (ii) notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient, at its e-mail address as described in the foregoing clause (i), of notification that such notice or communication is available and identifying the website address therefor; provided that, for both clauses (i) and (ii) above, if such notice, email or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next business day for the recipient.
(c)Change of Address, etc. Any party hereto may change its address, facsimile number or e-mail address, if applicable, for notices and other communications hereunder by notice to the other parties hereto.
(d)Platform.
(i)Each Loan Party agrees that the Administrative Agent may, but shall not be obligated to, make the Platform Communications (as defined below) available to the Issuing Lender and the other Lenders by posting the Platform Communications on Debt Domain, Intralinks, Syndtrak or a substantially similar electronic transmission system (the "Platform").
(ii)The Platform is provided "as is" and "as available." The Agent Parties (as defined below) do not warrant the adequacy of the Platform and expressly disclaim liability for errors or omissions in the Platform Communications. No warranty of any kind, express, implied or statutory, including any warranty of merchantability, fitness for a particular purpose, non-infringement of third-party rights or freedom from viruses or other code defects, is made by any Agent Party in connection with the Platform Communications or the Platform. In no event shall the Administrative Agent or any of its Related Parties (collectively, the "Agent Parties") have any liability to the Borrower or the other Loan Parties, any Lender or any other Person or entity for damages of any kind, including direct or indirect, special, incidental or consequential damages, losses or expenses (whether in tort, contract or otherwise) arising out of any Loan Party's or the Administrative Agent's transmission of communications through the Platform. "Platform Communications" means, collectively, any notice, demand, Communication, information, document or other material provided by or on behalf of any Loan Party pursuant to any Loan Document or the transactions contemplated therein which is distributed to the Administrative Agent, any Lender or the Issuing Lender by means of electronic communications pursuant to this Section, including through the Platform.
X.5Severability. The provisions of this Agreement are intended to be severable. If any provision of this Agreement shall be held invalid or unenforceable in whole or in part in any jurisdiction, such provision shall, as to such jurisdiction, be ineffective to the extent of such invalidity or unenforceability without in any manner affecting the validity or enforceability thereof in any other jurisdiction or the remaining provisions hereof in any jurisdiction.
X.6Duration; Survival. All representations and warranties of the Loan Parties contained herein or made in connection herewith shall survive the execution and delivery of this Agreement, the completion of the transactions hereunder and Payment In Full. All covenants and agreements of the Borrower contained herein relating to the payment of principal, interest, premiums, additional compensation or expenses and indemnification, including those set forth in the Notes, Article II, Article III, Section 11.3 or any other provision of any Loan Document, the agreement of the Lenders set forth in Section 11.3(c), and the agreements of the Loan Parties set forth in Section 11.10 or any other provision of any Loan Documents shall survive Payment In Full and shall protect the Administrative Agent, the Lenders and any other Indemnitees against events arising after such termination as well as before. All other covenants and agreements of the Loan Parties shall continue in full force and effect from and after the date hereof and until Payment In Full.
X.7Successors and Assigns.
(a)Successors and Assigns Generally. The provisions of this Agreement shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns permitted hereby, except that neither the Borrower nor any other Loan Party may assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the Administrative Agent and each Lender and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except (i) to an assignee in accordance with the provisions of this Section, (ii) by way of participation in accordance with the provisions of this Section 11.7, or (iii) by way of pledge or assignment of a security interest subject to the restrictions of this Section 11.7 (and any other attempted
assignment or transfer by any party hereto shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants to the extent provided in this Section 11.7 and, to the extent expressly contemplated hereby, the Related Parties of each of the Administrative Agent, the Issuing Lender and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.
(b)Assignments by Lenders. Any Lender may at any time assign to one or more assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment, all participations in Letters of Credit and Swing Line Loans and the Loans at the time owing to it); provided that (in each case and with respect to any Facility) any such assignment shall be subject to the following conditions:
(i)Minimum Amounts.
(A)in the case of an assignment of the entire remaining amount of the assigning Lender's Commitment and/or the Loans at the time owing to it (in each case with respect to any Facility) or contemporaneous assignments to related Approved Funds that equal at least the amount specified in clause (B) below in the aggregate or in the case of an assignment to a Lender, an Affiliate of a Lender or an Approved Fund, no minimum amount need be assigned; and
(B)in any case not described in clause (i)(A) of this clause (b), the aggregate amount of the Commitment (which for this purpose includes Loans outstanding thereunder) or, if the applicable Commitment is not then in effect, the principal outstanding balance of the Loans of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent or, if "Trade Date" is specified in the Assignment and Assumption, as of the Trade Date) shall not be less than $5,000,000.00, in the case of any assignment in respect of Revolving Credit Facility or the Revolving Term Credit Facility or $1,000,000.00, in the case of any assignment in respect of the Variable Rate Term Loan Facility, Fixed Rate Term Loan Facility or any Tranche of the Seasonal Term Loan Facility, unless each of the Administrative Agent and, so long as no Event of Default has occurred and is continuing, the Borrower otherwise consents (each such consent not to be unreasonably withheld, conditioned or delayed).
(ii)Proportionate Amounts. Each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender's rights and obligations under this Agreement with respect to the Loan or the Commitment assigned, except that this clause (ii) shall not prohibit any Lender from assigning all or a portion of its rights and obligations among separate Facilities on a non-pro rata basis.
(iii)Required Consents. No consent shall be required for any assignment except to the extent required by clause (b)(i)(B) of this Section 11.7 and in addition:
(A)the consent of the Borrower (such consent not to be unreasonably withheld, conditioned or delayed) shall be required unless (x) an Event of Default has occurred and is continuing at the time of such assignment or (y) such assignment is to a Lender, an Affiliate of a Lender or an Approved Fund; provided that the Borrower shall be deemed to have consented to any such assignment unless it shall object thereto by written notice to the Administrative
Agent within five (5) Business Days after having received notice thereof and provided, further, that the Borrower's consent shall not be required during the primary syndication of the Facilities;
(B)the consent of the Administrative Agent (such consent not to be unreasonably withheld or delayed) shall be required for assignments in respect of (i) the Revolving Credit Facility or the Revolving Term Credit Facility, or any unfunded Commitments with respect to the Variable Rate Term Loan Facility, Fixed Rate Term Loan Facility or any Tranche of the Seasonal Term Loan Facility if such assignment is to a Person that is not a Lender with a Commitment in respect of such Facility or Tranche of such Facility, an Affiliate of such Lender or an Approved Fund with respect to such Lender, or (ii) any Variable Rate Term Loans, Fixed Rate Term Loans or Seasonal Term Loans to a Person who is not a Lender, an Affiliate of a Lender or an Approved Fund; and
(C)the consent of the Issuing Lender and Swing Line Lender shall be required for any assignment in respect of Revolving Credit Facility.
(iv)Assignment and Assumption. The parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Assumption, together with a processing and recordation fee of $3,500.00; provided that the Administrative Agent may, in its sole discretion, elect to waive such processing and recordation fee in the case of any assignment. The assignee, if it is not a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire.
(v)No Assignment to Certain Persons. No such assignment shall be made to (i) the Borrower or any of the Borrower's Affiliates or Subsidiaries or (ii) to any Defaulting Lender or any of its Subsidiaries, or any Person who, upon becoming a Lender hereunder, would constitute any of the foregoing Persons described in this clause (v).
(vi)No Assignment to Natural Persons. No such assignment shall be made to a natural Person (or a holding company, investment vehicle or trust for, or owned or operated for the primary benefit of, a natural Person).
(vii)Certain Additional Payments. In connection with any assignment of rights and obligations of any Defaulting Lender hereunder, no such assignment shall be effective unless and until, in addition to the other conditions thereto set forth herein, the parties to the assignment shall make such additional payments to the Administrative Agent in an aggregate amount sufficient, upon distribution thereof as appropriate (which may be outright payment, purchases by the assignee of participations or subparticipations, or other compensating actions, including funding, with the consent of the Borrower and the Administrative Agent, the applicable pro rata share of Loans previously requested but not funded by the Defaulting Lender, to each of which the applicable assignee and assignor hereby irrevocably consent), to (x) pay and satisfy in full all payment liabilities then owed by such Defaulting Lender to the Administrative Agent, the Issuing Lender, the Swing Line Lender and each other Lender hereunder (and interest accrued thereon), and (y) acquire (and fund as appropriate) its full pro rata share of all Loans and participations in Letters of Credit and Swing Line Loans in accordance with its Pro Rata Share. Notwithstanding the foregoing, in the event that any assignment of rights and obligations of any Defaulting Lender hereunder shall become effective under applicable Law without compliance with the provisions of this paragraph, then the assignee of such interest shall be deemed to be a Defaulting Lender for all purposes of this Agreement until such compliance occurs.
Subject to acceptance and recording thereof by the Administrative Agent pursuant to this Section, from and after the effective date specified in each Assignment and Assumption, the assignee thereunder
shall be a party to this Agreement and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender's rights and obligations under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be entitled to the benefits of Sections 3.1, 3.2, 3.5 and 11.3(b) with respect to facts and circumstances occurring prior to the effective date of such assignment; provided, that except to the extent otherwise expressly agreed by the affected parties, no assignment by a Defaulting Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender's having been a Defaulting Lender. Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this Section shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with Section 11.7(d) below.
(c)Register. The Administrative Agent, acting solely for this purpose as an agent of the Borrower, shall maintain at one of its offices in Greenwood Village, Colorado a copy of each Assignment and Assumption delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amounts (and stated interest) of the Loans owing to, each Lender pursuant to the terms hereof from time to time (the "Register"). The entries in the Register shall be conclusive absent manifest error, and the Borrower, the Administrative Agent and the Lenders shall treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement. The Register shall be available for inspection by the Borrower and any Lender, at any reasonable time and from time to time upon reasonable prior notice.
(d)Participations. Any Lender may at any time, without the consent of, or notice to, the Borrower or the Administrative Agent, sell participations to any Person (other than a natural Person or a holding company, investment vehicle or trust for, or owned or operated for the primary benefit of, a natural Person or the Borrower or any of the Borrower's Affiliates or Subsidiaries) (each a "Participant") in all or a portion of such Lender's rights and/or obligations under this Agreement (including all or a portion of its Commitment and/or the Loans owing to it); provided that (i) such Lender's obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) the Borrower, the Administrative Agent, the Issuing Lender and the Lenders shall continue to deal solely and directly with such Lender in connection with such Lender's rights and obligations under this Agreement. For the avoidance of doubt, each Lender shall be responsible for the indemnity under Section 11.3(c) with respect to any payments made by such Lender to its Participant(s).
Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver described in Sections 11.1(a) through (g) that affects such Participant. The Borrower agrees that each Participant shall be entitled to the benefits of Sections 3.1, 3.2 (subject to the requirements and limitations therein, including the requirements under Section 3.2 (it being understood that the documentation required under Section 3.2 shall be delivered to the participating Lender)), 3.5 and 11.3 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to clause (b) of this Section 11.7; provided that such Participant (A) agrees to be subject to the provisions of Section 3.6 as if it were an assignee under clause (b) of this Section 11.7; and (B) shall not be entitled to receive any greater payment under Section 3.1 or 3.2, with respect to any participation, than its
participating Lender would have been entitled to receive, except to the extent such entitlement to receive a greater payment results from a Change in Law that occurs after the Participant acquired the applicable participation. Each Lender that sells a participation agrees, at the Borrower's request and expense, to use reasonable efforts to cooperate with the Borrower to effectuate the provisions of Section 3.6 with respect to any Participant. To the extent permitted by Law, each Participant also shall be entitled to the benefits of Section 9.2(c) as though it were a Lender; provided that such Participant agrees to be subject to Section 2.12 as though it were a Lender. Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant's interest in the Loans or other obligations under the Loan Documents (the "Participant Register"); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register (including the identity of any Participant or any information relating to a Participant's interest in any Commitments, Loans, Letters of Credit or its other obligations under any Loan Document) to any Person except to the extent that such disclosure is necessary to establish that such Commitment, Loan, Letter of Credit or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations. The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. For the avoidance of doubt, the Administrative Agent (in its capacity as Administrative Agent) shall have no responsibility for maintaining a Participant Register. CoBank reserves the right to assign or sell participations in all or part of its Commitments or outstanding Loans hereunder on a non-patronage basis.
Notwithstanding the preceding paragraph, any Participant that is a Farm Credit Lender that has been designated as a voting Participant (a "Voting Participant") in a notice (a "Voting Participant Notice") sent by the relevant Lender (including any existing Voting Participant) to the Administrative Agent and receives, prior to becoming a Voting Participant, the consent of the Administrative Agent (such Administrative Agent consent to be required only to the extent and under the circumstances it would be required if such Voting Participant were to become a Lender pursuant to an assignment in accordance with Section 11.7(b)) and such consent is not required for an assignment to an existing Voting Participant), shall be entitled to vote as if such Voting Participant were a Lender on all matters subject to a vote by Lenders, and the voting rights of the selling Lender (including any existing Voting Participant) shall be correspondingly reduced, on a dollar-for-dollar basis. Notwithstanding the foregoing, each Farm Credit Lender designated as a Voting Participant in Schedule 11.7 shall be a Voting Participant without delivery of a Voting Participant Notice and without the prior written consent of the Administrative Agent. The selling Lender (including any existing Voting Participant) and the purchasing Voting Participant shall notify the Administrative Agent within three (3) Business Days of any termination, reduction or increase of the amount of, such participation. The Administrative Agent shall be entitled to conclusively rely on information contained in Voting Participant Notices and all other notices delivered pursuant hereto. The voting rights of each Voting Participant are solely for the benefit of such Voting Participant and shall not inure to any assignee or participant of such Voting Participant that is not a Farm Credit Lender. Notwithstanding the foregoing, no Participant that is not a Farm Credit Participant shall have any voting rights under this Agreement; provided, however, that this sentence shall not be deemed a waiver of any right of any Participant under any agreement or instrument pursuant to which a Lender sells a participation interest.
(e)Certain Pledges. Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank; provided that no such pledge or
assignment shall release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.
X.8Confidentiality. Each of the Administrative Agent, the Lenders and the Issuing Lender agree to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its Affiliates and to its Related Parties (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential); (b) to the extent required or requested by any regulatory authority purporting to have jurisdiction over such Person or its Related Parties (including any self-regulatory authority, such as the National Association of Insurance Commissioners); (c) to the extent required by applicable laws or regulations or by any subpoena or similar legal process; (d) to any other party hereto; (e) in connection with the exercise of any remedies hereunder or under any other Loan Document or any action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder; (f) subject to an agreement containing provisions substantially the same as those of this Section, to (i) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights and obligations under this Agreement, or (ii) any actual or prospective party (or its Related Parties) to any swap, derivative or other transaction under which payments are to be made by reference to the Borrower and its obligations, this Agreement or payments hereunder; (g) on a confidential basis to (i) any rating agency in connection with rating the Borrower or its Subsidiaries or the Facilities or (ii) the CUSIP Service Bureau or any similar agency in connection with the issuance and monitoring of CUSIP numbers with respect to the Facilities; (h) with the consent of the Borrower; or (i) to the extent such Information (x) becomes publicly available other than as a result of a breach of this Section, or (y) becomes available to the Administrative Agent, any Lender, the Issuing Lender or any of their respective Affiliates on a nonconfidential basis from a source other than the Borrower who, to the actual knowledge of the Administrative Agent, such Lender, the Issuing Lender or such Affiliate, as applicable, without any duty of inquiry, is not under obligations of confidentiality to the Borrower or Loan Party.
For purposes of this Section, "Information" means all information received from the Borrower or any of its Subsidiaries relating to the Borrower or any of its Subsidiaries or any of their respective businesses, assets or property, other than any such information that is available to the Administrative Agent, any Lender or the Issuing Lender on a nonconfidential basis prior to disclosure by the Borrower or any of its Subsidiaries. Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.
In addition to the foregoing, the Administrative Agent and the Borrower hereby agree that, with the prior written consent of the Borrower (such consent not to be unreasonably conditioned, withheld or delayed), the Administrative Agent may, in its discretion, place advertisements with respect to the credit facility evidenced by this Agreement in financial and other newspapers and periodicals, and on a home page or similar place for dissemination of information on the Internet or worldwide web. The Borrower hereby agrees that the Administrative Agent may, in its discretion and without any additional consent of or notice to the Borrower or any other Person, circulate and/or publish similar promotional materials with respect to the credit facility evidenced by this Agreement after the Closing Date in the form of a “tombstone” or otherwise describing the names and including the logo(s) of the Borrower and its affiliates (or any of them), and/or the amount of the credit facility, type of credit facility and Closing Date. All such advertisements and promotional materials shall be at the Administrative Agent’s expense.
X.9Counterparts; Integration; Effectiveness.
(a)This Agreement may be executed in as many counterparts as necessary or convenient (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. For the avoidance of doubt, the authorization under this paragraph may include, without limitation, use or acceptance of a manually signed paper Communication which has been converted into electronic form (such as scanned into PDF format), or an electronically signed Communication converted into another format, for transmission, delivery and/or retention. This Agreement and the other Loan Documents, and any separate letter agreements with respect to fees payable to the Administrative Agent, constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. Except as provided in Article IV, this Agreement shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto. Delivery of an executed counterpart of a signature page of this Agreement by facsimile or in electronic (i.e., “pdf” or “tif”) format shall be effective as delivery of a manually executed counterpart of this Agreement.
(b)Electronic Execution of Loan Documents. This Agreement, any Loan Document and any other Communication, including Communications required to be in writing, may be in the form of an Electronic Record and may be executed using Electronic Signatures. Each of the Loan Parties and each of the Administrative Agent and each Lender (collectively, each a “Credit Party”) agrees that any Electronic Signature on or associated with any Communication shall be valid and binding on such Person to the same extent as a manual, original signature, and that any Communication entered into by Electronic Signature, will constitute the legal, valid and binding obligation of such Person enforceable against such Person in accordance with the terms thereof to the same extent as if a manually executed original signature was delivered.
(c)Electronic Records of Loan Documents. The Administrative Agent and each of the Credit Parties may, at its option, create one or more copies of any Communication in the form of an imaged Electronic Record (“Electronic Copy”), which shall be deemed created in the ordinary course of such Person’s business, and destroy the original paper document. All Communications in the form of an Electronic Record, including an Electronic Copy, shall be considered an original for all purposes, and shall have the same legal effect, validity and enforceability as a paper record. Notwithstanding anything contained herein to the contrary, the Administrative Agent is under no obligation to accept an Electronic Signature in any form or in any format unless expressly agreed to by such Person pursuant to procedures approved by it; provided, further, without limiting the foregoing, (a) to the extent the Administrative Agent has agreed to accept such Electronic Signature, the Administrative Agent and each of the Credit Parties shall be entitled to rely on any such Electronic Signature purportedly given by or on behalf of any Loan Party and/or any Credit Party without further verification and (b) upon the request of the Administrative Agent or any Credit Party, any Electronic Signature shall be promptly followed by such manually executed counterpart. For purposes hereof, “Electronic Record” and “Electronic Signature” shall have the meanings assigned to them, respectively, by 15 USC §7006, as it may be amended from time to time. Each of the Loan Parties and each Credit Party hereby waives (i) any argument, defense or right to contest the legal effect, validity or enforceability of this Agreement, any other Loan Document based solely on the lack of paper original copies of this Agreement, such other Loan Document, and (ii) waives any claim against the Administrative Agent, each Credit Party and each Related Party for any liabilities arising solely from the Administrative Agent’s and/or any Credit Party’s reliance on or use of Electronic Signatures, including any liabilities arising as a result of the failure of the Loan Parties to use
any available security measures in connection with the execution, delivery or transmission of any Electronic Signature.
(d)Reliance. The Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into the sufficiency, validity, enforceability, effectiveness or genuineness of any Loan Document or any other agreement, instrument or document (including, for the avoidance of doubt, in connection with the Administrative Agent’s reliance on any Electronic Signature transmitted by telecopy, emailed .pdf or any other electronic means). The Administrative Agent shall be entitled to rely on, and shall incur no liability under or in respect of this Agreement or any other Loan Document by acting upon, any Communication (which writing may be a fax, any electronic message, Internet or intranet website posting or other distribution or signed using an Electronic Signature) or any statement made to it orally or by telephone and believed by it to be genuine and signed or sent or otherwise authenticated (whether or not such Person in fact meets the requirements set forth in the Loan Documents for being the maker thereof).
(e)Amendment and Restatement. The parties hereto agree that, on the Closing Date, the following shall be deemed to occur automatically, without further action by any party hereto: (a) the Existing Credit Agreement shall be deemed to be amended and restated in its entirety pursuant to this Agreement and (b) all references in the other Loan Documents to the Existing Credit Agreement shall be deemed to refer without further amendment to this Agreement. The parties hereto further acknowledge and agree that this Agreement constitutes an amendment to the Existing Credit Agreement made under and in accordance with the terms of Section 11.1 of the Existing Credit Agreement.
X.10Choice of Law; Submission to Jurisdiction; Waiver of Venue; Service of Process; Waiver of Jury Trial.
(a)Governing Law. This Agreement and the other Loan Documents and any claims, controversy, dispute or cause of action (whether in contract or tort or otherwise) based upon, arising out of or relating to this Agreement or any other Loan Document (except, as to any other Loan Document, as expressly set forth therein) and the transactions contemplated hereby and thereby shall be governed by, and construed in accordance with, the law of the State of New York without regard to conflicts of law principles that require or permit application of the laws of any other state or jurisdiction.
(b)SUBMISSION TO JURISDICTION. EACH OF THE BORROWER AND OTHER LOAN PARTIES IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT THE
ADMINISTRATIVE AGENT, ANY LENDER OR THE ISSUING LENDER MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST THE BORROWER OR ANY OTHER LOAN PARTY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.
(c)WAIVER OF VENUE. EACH OF THE BORROWER AND OTHER LOAN PARTIES IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED TO IN THIS SECTION 11.10. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT AND AGREES NOT TO ASSERT ANY SUCH DEFENSE.
(d)SERVICE OF PROCESS. EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 11.4. NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.
(e)WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, ADMINISTRATIVE AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
X.11USA Patriot Act Notice. Each Lender that is subject to the USA Patriot Act and the Administrative Agent (for itself and not on behalf of any Lender) hereby notifies Loan Parties that pursuant to the requirements of the USA Patriot Act, it is required to obtain, verify and record information that identifies the Loan Parties, which information includes the name and address of Loan Parties and other information that will allow such Lender or Administrative Agent, as applicable, to identify the Loan Parties in accordance with the USA Patriot Act. The Borrower shall, promptly following a request by the Administrative Agent or any Lender, provide all documentation and other information that the Administrative Agent or such Lender requests in order to comply with its ongoing obligations under applicable Anti-Corruption Laws, Anti-Terrorism Laws and Sanctions, including the USA PATRIOT Act.
X.12Payments Set Aside. To the extent any Loan Party makes a payment or payments to the Administrative Agent for the ratable benefit of the Lenders or Secured Parties or the Administrative Agent receives any payment or proceeds of the Collateral which payments or proceeds or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside and/or required to be
repaid to a trustee, receiver or any other party under any Insolvency Proceeding, other applicable Law or equitable cause, then, to the extent of such payment or proceeds repaid, the Secured Obligations or part thereof intended to be satisfied shall be revived and continued in full force and effect as if such payment or proceeds had not been received by the Administrative Agent.
X.13Secured Bank Products and Secured Hedge Agreements. No Secured Party (other than the Administrative Agent) that obtains the benefit of the Guaranty set forth in Article XII or of any security interest in any of the Collateral shall have any right to notice of any action or to consent to, direct or object to any action hereunder or under any other Loan Document (including the release, impairment or modification of any Guarantors' Obligations or security therefor) other than in its capacity as a Lender and, in such case, only to the extent expressly provided in the Loan Documents. No Hedge Bank or provider of any Secured Bank Product shall have any voting rights hereunder or under any other Loan Document in its capacity as the provider of such Secured Hedge or Secured Bank Product. Notwithstanding any other provision of this Agreement to the contrary, the Administrative Agent shall only be required to verify the payment of, or that other reasonably satisfactory arrangements have been made with respect to, the Secured Obligations arising with respect to Secured Bank Products and Secured Hedges to the extent the Administrative Agent has received written notice of such Secured Obligations, together with such supporting documentation as it may request, from the applicable Lender (or its Affiliate) or Hedge Bank, as the case may be. Each Secured Party not a party to this Agreement that obtains the benefit of this Agreement or any other Loan Document shall be deemed to have acknowledged and accepted the appointment of the Administrative Agent pursuant to the terms of this Agreement, and acknowledges and agrees that the Administrative Agent is and shall be entitled to all the rights, benefits and immunities conferred under this Agreement with respect to each such Secured Party.
X.14Interest Rate Limitation. Notwithstanding anything to the contrary contained in any Loan Document, the interest paid or agreed to be paid under the Loan Documents, together with all fees, charges and other amounts treated as interest under applicable Laws (collectively, "Charges") shall not exceed the maximum rate of non-usurious interest permitted by applicable Law (the "Maximum Rate"). If the Administrative Agent or any Lender shall receive interest and Charges in an amount that exceeds the Maximum Rate, the excess interest and Charges shall be applied to the principal of the Loans or, if it exceeds such unpaid principal, refunded to the Borrower. In determining whether the interest and Charges contracted for, charged, or received by the Administrative Agent or a Lender exceeds the Maximum Rate, such Person may, to the extent permitted by applicable Law, (a) characterize any payment that is not principal as principal, an expense, fee, or premium rather than interest, (b) exclude voluntary prepayments and the effects thereof, and (c) amortize, prorate, allocate, and spread in equal or unequal parts the total amount of interest throughout the contemplated term of the Obligations hereunder.
X.15[RESERVED].
X.16Keepwell. Each Qualified ECP Guarantor hereby jointly and severally absolutely, unconditionally and irrevocably undertakes to provide such funds or other support to each other Loan Party as may be needed by such Loan Party from time to time to honor all of its obligations under this Agreement and the other Loan Documents to which it is a party with respect to Swap Obligations permitted under this Agreement that would, in the absence of the agreement in this Section 11.16, otherwise constitute Excluded Swap Obligations (but, in each case, only up to the maximum amount of such liability that can be hereby incurred without rendering such Qualified ECP Guarantors' obligations and undertakings under this Section voidable under applicable Law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount). The obligations, undertakings and guaranty of the Qualified ECP Guarantors under this Section 11.16 shall remain in full force and effect until Payment In
Full of the Obligations and termination of all the Commitments. The Borrower and the Qualified ECP Guarantors intend this Section 11.16 to constitute, and this Section 11.16 shall be deemed to constitute, a guarantee of the obligations of, and a "keepwell, support, or other agreement" for the benefit of, each Loan Party for all purposes of the Commodity Exchange Act.
X.17No Advisory or Fiduciary Responsibility. In connection with all aspects of each transaction contemplated hereby (including in connection with any amendment, waiver or other modification hereof or of any other Loan Document), the Borrower acknowledges and agrees, and acknowledges its Affiliates' understanding, that: (a) (i) no fiduciary, advisory or agency relationship between the Borrower and its Subsidiaries and the Arranger, the Administrative Agent or any Lender is intended to be or has been created in respect of the transactions contemplated hereby or by the other Loan Documents, irrespective of whether the Arranger, the Administrative Agent, or any Lender has advised or is advising the Borrower or any Subsidiary on other matters, (ii) the arranging and other services regarding this Agreement provided by the Arranger, the Administrative Agent and the Lenders are arm's-length commercial transactions between the Borrower and its Affiliates, on the one hand, and the Arranger, the Administrative Agent and the Lenders, on the other hand, (iii) the Borrower has consulted its own legal, accounting, regulatory and tax advisors to the extent that it has deemed appropriate and (iv) the Borrower is capable of evaluating, and understands and accepts, the terms, risks and conditions of the transactions contemplated hereby and by the other Loan Documents; and (b) (i) the Arranger, the Administrative Agent and the Lenders each is and has been acting solely as a principal and, except as expressly agreed in writing by the relevant parties, has not been, is not, and will not be acting as an advisor, agent or fiduciary for the Borrower or any of its Affiliates; (ii) none of the Arranger, the Administrative Agent and the Lenders has any obligation to the Borrower or any of its Affiliates with respect to the transactions contemplated hereby except those obligations expressly set forth herein and in the other Loan Documents; and (iii) the Arranger, the Administrative Agent and the Lenders and their respective Affiliates may be engaged, for their own accounts or the accounts of customers, in a broad range of transactions that involve interests that differ from those of the Borrower and its Affiliates, and none of the Arranger, the Administrative Agent and the Lenders has any obligation to disclose any of such interests to the Borrower or its Affiliates. To the fullest extent permitted by Law, the Borrower hereby waives and releases any claims that it may have against any of the Arranger, the Administrative Agent and the Lenders with respect to any breach or alleged breach of agency or fiduciary duty in connection with any aspect of any transaction contemplated hereby.
X.18Recovery of Erroneous Payments. Without limitation of any other provision in this Agreement, if at any time the Administrative Agent makes a payment hereunder in error to any Lender or the Issuing Lender (each, a "Lender Party"), whether or not in respect of an Obligation due and owing by the Borrower at such time (any such payment, an "Erroneous Payment"), then in any such event, each Lender Party receiving an Erroneous Payment severally agrees to repay to the Administrative Agent promptly upon demand the Erroneous Payment received by such Lender Party in immediately available funds (and in the currency so received), with interest thereon for each day from and including the date such Erroneous Payment is received by it to but excluding the date of payment to the Administrative Agent, at the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation. Each Lender Party irrevocably waives any and all defenses, including any "discharge for value" (under which a creditor might otherwise claim a right to retain funds mistakenly paid by a third party in respect of a debt owed by another) or similar defense to its obligation to return any Erroneous Payment. The Administrative Agent shall inform each Lender Party promptly upon determining that any payment made to such Lender Party comprised, in whole or in part, an Erroneous Payment (and such determination shall be conclusive absent manifest error).
X.19Acknowledgment and Consent to Bail-In of Affected Financial Institutions. Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any Affected Financial Institution arising under any Loan Document, to the extent such liability is unsecured, may be subject to the write-down and conversion powers of the applicable Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:
(a)the application of any Write-Down and Conversion Powers by the applicable Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an Affected Financial Institution; and
(b)the effects of any Bail-In Action on any such liability, including, if applicable:
(i)a reduction in full or in part or cancellation of any such liability;
(ii)a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such Affected Financial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or
(iii)the variation of the terms of such liability in connection with the exercise of the write-down and conversion powers of the applicable Resolution Authority.
XI.GUARANTY
XI.1Guaranty. Each Guarantor hereby jointly and severally, unconditionally, absolutely, continually and irrevocably guarantees to the Administrative Agent for the benefit of the Secured Parties the payment and performance in full of the Guaranteed Liabilities. For all purposes of this Article XII, notwithstanding the foregoing, the liability of each Guarantor individually with respect to its Guarantors' Obligations shall be limited to an aggregate amount equal to the Maximum Guarantor Liability. Each Guarantor agrees that it is jointly and severally, directly and primarily liable (subject to the limitation in the immediately preceding sentence) for the Guaranteed Liabilities. The Guarantors' Obligations are secured by the Collateral.
XI.2Payment. If the Borrower or any other Loan Party shall default in payment or performance of any of the Guaranteed Liabilities, whether principal, interest, premium, indemnification obligations, fees (including, but not limited to, reasonable attorney's fees and expenses), expenses or otherwise, when and as the same shall become due, and after expiration of any applicable grace period, whether according to the terms of this Agreement, by acceleration, or otherwise, or upon the occurrence and during the continuance of any Event of Default, then any or all of the Guarantors will, upon demand thereof by the Administrative Agent, (i) fully pay to the Administrative Agent, for the benefit of the Secured Parties, an amount equal to all the Guaranteed Liabilities then due and owing or declared or deemed to be due and owing, including for this purpose, in the event of any Event of Default under Section 9.1(l) (and irrespective of the applicability of any restriction on acceleration or other action as against any other Loan Party in any Insolvency Proceeding), the entire outstanding or accrued amount of all Secured Obligations or (ii) perform such Guaranteed Liabilities, as applicable. For purposes of this Section 12.2, the Guarantors acknowledge and agree that "Guaranteed Liabilities" shall be deemed to include any amount (whether principal, interest, premium, fees, expenses, indemnification obligations and/or any other payment obligation of any kind or nature) which would have been accelerated in
accordance with Section 9.2 but for the fact that such acceleration could be unenforceable or not allowable in any Insolvency Proceeding or otherwise under any applicable Law. Notwithstanding anything herein to the contrary, upon the occurrence and continuation of an Event of Default, then notwithstanding any Collateral or other direct or indirect security or credit support for the Guaranteed Liabilities, at the Administrative Agent's election and without notice thereof or demand therefor, each of the Guaranteed Liabilities and the Guarantors' Obligations shall immediately be and become due and payable.
XI.3Absolute Rights and Obligations. This is a guaranty of payment and not of collection. The Guarantors' Obligations under this Article XII shall be joint and several, absolute and unconditional irrespective of, and each Guarantor hereby expressly waives, to the extent not otherwise expressly prohibited by applicable law, any defense to its obligations under this Article XII and all other Loan Documents to which it is a party by reason of:
(a)any lack of legality, validity or enforceability of this Agreement, or any of the Notes, or any other Loan Document, or of any other agreement or instrument creating, providing security for, or otherwise relating to any of the Guarantors' Obligations, any of the Guaranteed Liabilities, or any other guaranty of any of the Guaranteed Liabilities (the Loan Documents, the documentation with respect to any Other Liabilities and all such other agreements and instruments being collectively referred to as the "Related Agreements");
(b)any action taken under any of the Related Agreements, any exercise of any right or power therein conferred, any failure or omission to enforce any right conferred thereby, or any waiver of any covenant or condition therein provided;
(c)any acceleration of the maturity of any of the Guaranteed Liabilities, of the Guarantors' Obligations of any other Guarantor, or of any other obligations or liabilities of any Person under any of the Related Agreements;
(d)any release, exchange, non-perfection, lapse in perfection, disposal, deterioration in value, or impairment of any security for any of the Guaranteed Liabilities, for any of the Guarantors' Obligations of any Guarantor, or for any other obligations or liabilities of any Person under any of the Related Agreements;
(e)any change in the corporate or limited liability company existence, structure or ownership, including dissolution, of the Borrower, any Guarantor, any other Loan Party or any other party to a Related Agreement, or the combination or consolidation of the Borrower, any Guarantor, any other Loan Party or any other party to a Related Agreement into or with another entity or any transfer or disposition of any assets of the Borrower, any Guarantor or any other Loan Party or any other party to a Related Agreement;
(f)any extension (including extensions of time for payment), renewal, amendment, restructuring or restatement of, any acceptance of late or partial payments under, or any change in the amount of any borrowings or any credit facilities available under, this Agreement, any of the Notes or any other Loan Document or any other Related Agreement, in whole or in part;
(g)the existence, addition, modification, termination, reduction or impairment of value, or release of any other guaranty (or security therefor) of the Guaranteed Liabilities (including the Guarantors' Obligations of any other Guarantor and obligations arising under any other Guaranty or any other Loan Document now or hereafter in effect);
(h)any waiver of, forbearance or indulgence under, or other consent to any change in or departure from any term or provision contained in this Agreement, any other Loan Document or any other Related Agreement, including any term pertaining to the payment or performance of any of the Guaranteed Liabilities, any of the Guarantors' Obligations of any other Guarantor, or any of the obligations or liabilities of any party to any other Related Agreement;
(i)any failure to assert any breach of or default under any Loan Document or with respect to the payment or performance of any of the Guaranteed Liabilities, any of the Guarantors' Obligations of any Guarantor, or any of the obligations or liabilities of any party to any other Related Agreement; any extensions of credit in excess of the amount committed under or contemplated by the Loan Documents, or in circumstances in which any condition to such extensions of credit has not been satisfied; any other exercise or non-exercise, or any other failure, omission, breach, default, or delay in connection with any exercise or non-exercise, of any right or remedy against the Borrower, any other Loan Party or any other Person under or in connection with any Loan Document, any Related Agreement or any of the Guaranteed Liabilities or any Guarantors' Obligation; any refusal of payment or performance by a Guarantor of any of the Guaranteed Liabilities or any Guarantors' Obligation, whether or not with any reservation of rights against any Guarantor; or any application of collections (including but not limited to collections resulting from realization upon any direct or indirect security for the Guaranteed Liabilities) to other obligations, if any, not entitled to the benefits of the Guaranty provided for in this Article XII, in preference to Guaranteed Liabilities or Guarantors' Obligations entitled to the benefits of the Guaranty provided for in this Article XII, or if any collections are applied to the payment of Guaranteed Liabilities, any application to particular Guaranteed Liabilities;
(j)any taking, exchange, amendment, modification, waiver, supplement, termination, subordination, compromise, release, surrender, loss, or impairment of, or any failure to protect, perfect, or preserve the value of, or any enforcement of, realization upon, or exercise of rights, or remedies under or in connection with, or any failure, omission, breach, default, or delay by the Administrative Agent or the other Secured Parties, or any of them, or any other Person in connection with the enforcement of, realization upon, or exercise of rights or remedies under or in connection with, or, any other action or inaction by the Administrative Agent or the other Secured Parties, or any of them, or any other Person acting on behalf of the Administrative Agent or the Secured Parties in respect of, any direct or indirect security for any of the Guaranteed Liabilities. As used in this Article XII, "direct or indirect security" for the Guaranteed Liabilities, and similar phrases, includes any collateral security, guaranty, suretyship, letter of credit, capital maintenance agreement, put option, subordination agreement, or other right or arrangement of any nature providing direct or indirect assurance of payment or performance of any of the Guaranteed Liabilities, made by or on behalf of any Person;
(k)Any merger, consolidation, liquidation, dissolution, winding-up, charter revocation, or forfeiture, or other change in, restructuring or termination of the corporate structure or existence of, the Borrower, any other Loan Party or any other Person; any bankruptcy, insolvency, reorganization or similar proceeding with respect to the Borrower, any other Loan Party or any other Person; or any action taken or election made by the Administrative Agent or the other Secured Parties, or any of them (including but not limited to any election under Section 1111(b)(2) of the Bankruptcy Code), the Borrower, any other Loan Party or any other Person in connection with any such proceeding;
(l)any defense, set-off, or counterclaim which may at any time be available to or be asserted by the Borrower, any other Loan Party or any other person with respect to any Loan Document, any of the Guaranteed Liabilities, any Guarantors' Obligation, or with respect to any Related Agreement; or any discharge by operation of law or release of the Borrower, any other Loan Party or any other Person
from the performance or observance of any Loan Document or any of the Guaranteed Liabilities or Guarantors' Obligations;
(m)any other circumstance whatsoever (with or without notice to or knowledge of any Guarantor or any other Loan Party) which might in any manner or to any extent vary the risks of such Loan Party, or might otherwise constitute a legal or equitable defense available to, or discharge of, a surety or a guarantor, including any right to require or claim that resort be had to the Borrower or any other Loan Party or to any Collateral or other security in respect of the Guaranteed Liabilities or Guarantors' Obligations.
It is the express purpose and intent of the parties hereto that this Guaranty, the Guaranteed Liabilities and the Guarantors' Obligations hereunder and under each Guarantor Joinder with respect hereto shall be absolute and unconditional under any and all circumstances and shall not be discharged except by payment and performance as herein provided.
XI.4Maximum Liability.
(a)Notwithstanding any provision to the contrary contained herein or in any other of the Loan Documents, to the extent any Guarantors' Obligations shall be adjudicated to be invalid or unenforceable for any reason (including because of any applicable Law relating to fraudulent conveyances or transfers) then the obligations of each such Guarantor hereunder shall be limited to the maximum amount that is permissible under applicable Law (whether federal or state and including any Debtor Relief Law). Any analysis of the provisions hereof for purposes of laws relating to fraudulent conveyances or transfers shall take into account the contribution agreement established in Section 12.5.
(i)Each Guarantor's maximum obligations hereunder (the "Maximum Guarantor Liability") in any case or proceeding referred to below (but only in such a case or proceeding) shall not be in excess of:
(A)in a case or proceeding commenced by or against such Guarantor under the Bankruptcy Code on or within one year from the date on which any of the Guaranteed Liabilities are incurred, the maximum amount that would not otherwise cause the Guarantors' Obligations of such Guarantor (or any other obligations of such Guarantor to Administrative Agent, Lenders and any other Person holding any of the Guaranteed Liabilities or the Guarantors' Obligations) to be avoidable or unenforceable against such Guarantor under (A) Section 548 of the Bankruptcy Code or (B) any state fraudulent transfer or fraudulent conveyance act or statute applied in such case or proceeding by virtue of Section 544 of the Bankruptcy Code; or
(B)in a case or proceeding commenced by or against such Guarantor under the Bankruptcy Code subsequent to one year from the date on which any of the Guaranteed Liabilities or Guarantors' Obligations of such Guarantor are incurred, the maximum amount that would not otherwise cause the Guarantors' Obligations of such Guarantor (or any other obligations of such Guarantor to Administrative Agent, Lenders and any other Person holding any of the Guaranteed Liabilities or the Guarantors' Obligations) to be avoidable or unenforceable against such Guarantor under any state fraudulent transfer or fraudulent conveyance act or statute applied in any such case or proceeding by virtue of Section 544 of the Bankruptcy Code; or
(C)in a case or proceeding commenced by or against such Guarantor under any Debtor Relief Law other than the Bankruptcy Code, the maximum amount that would not otherwise cause the Guarantors' Obligations of such Guarantor (or any other obligations of such
Guarantor to Administrative Agent, Lenders and any other Person holding any of the Guaranteed Liabilities or the Guarantors' Obligations) to be avoidable or unenforceable against such Guarantor under such Debtor Relief Law, including any state fraudulent transfer or fraudulent conveyance act or statute applied in any such case or proceeding. (The substantive state or federal laws under which the possible avoidance or unenforceability of the Guarantors' Obligations of such Guarantor (or any other obligations of such Guarantor to Administrative Agent, Lenders and any other Person holding any of the Guaranteed Liabilities or the Guarantors' Obligations) shall be determined in any such case or proceeding shall hereinafter be referred to as the "Avoidance Provisions").
(ii)To the extent set forth above, but only to the extent that the Guarantors' Obligations of such Guarantor or the transfers made by such Guarantor under the Collateral Documents to which it is a party, would otherwise be subject to avoidance under any Avoidance Provisions if such Guarantor is not deemed to have received valuable consideration, fair value, fair consideration or reasonably equivalent value for such transfers or obligations, or if such transfers or the Guarantors' Obligations of such Guarantor would render such Guarantor insolvent, or leave such Guarantor with an unreasonably small capital or unreasonably small assets to conduct its business, or cause such Guarantor to have incurred debts (or to have intended to have incurred debts) beyond its ability to pay such debts as they mature, in each case as of the time any of such Guarantors' Obligations are deemed to have been incurred and transfers made under such Avoidance Provisions, then such Guarantors' Obligations shall be reduced to that amount which, after giving effect thereto, would not cause the Guarantors' Obligations of such Guarantor (or any other obligations of such Guarantor to Administrative Agent, Lenders and any other Person holding any of the Guaranteed Liabilities or the Guarantors' Obligations), as so reduced, to be subject to avoidance under such Avoidance Provisions. This paragraph is intended solely to preserve the rights hereunder of Administrative Agent, Lenders and any other Person holding any of the Guaranteed Liabilities to the maximum extent that would not cause such Guarantors' Obligations to be subject to avoidance under any Avoidance Provisions, and neither such Guarantor nor any other Person shall have any right, defense, offset, or claim under this paragraph as against Administrative Agent, Lenders or any other Person holding any of the Guaranteed Liabilities or the Guarantors' Obligations that would not otherwise be available to such Person under the Avoidance Provisions.
(b)Each Guarantor agrees that the Guarantors' Obligations of such Guarantor may at any time and from time to time exceed the Maximum Guarantor Liability, without impairing the guaranty or any provision contained herein or affecting the rights and remedies of Administrative Agent hereunder.
XI.5Contribution Agreement. To the extent that any Guarantor shall be required hereunder to pay any portion of any Guaranteed Liability or Guarantors' Obligation exceeding the greater of (i) the amount of the value actually received by such Guarantor and its Subsidiaries from the Loans and other Guaranteed Liabilities and Guarantors' Obligations and (ii) the amount such Guarantor would otherwise have paid if such Guarantor had paid the aggregate amount of the Guaranteed Liabilities and Guarantors' Obligations (excluding the amount thereof repaid by Borrower) in the same proportion as such Guarantor's net worth on the date enforcement is sought hereunder bears to the aggregate net worth of all the Guarantors on such date, then such Guarantor shall be reimbursed by such other Guarantors for the amount of such excess, pro rata, based on the respective net worth of such other Guarantors on such date of enforcement. The contribution agreement in this paragraph is intended only to define the relative rights of the Guarantors and nothing set forth in this paragraph is intended to or shall impair the obligations of the Guarantors, jointly and severally, to pay any amounts as and when the same shall become due and payable in accordance with the terms of this Agreement (up to the Maximum Guarantor Liability).
XI.6Currency and Funds of Payment. All Guarantors' Obligations for payment will be paid in lawful currency of the United States of America and in immediately available funds, regardless of any law, regulation or decree now or hereafter in effect that might in any manner affect the Guaranteed Liabilities, or the rights of any Secured Party with respect thereto as against the Borrower or any other Loan Party, or cause or permit to be invoked any alteration in the time, amount or manner of payment by the Borrower or any other Loan Party of any or all of the Guaranteed Liabilities.
XI.7Subordination. For so long as this Agreement remains in effect, each Guarantor hereby unconditionally subordinates all present and future debts, liabilities or obligations now or hereafter owing to such Guarantor (a) of the Borrower, to the Payment In Full of the Guaranteed Liabilities, (b) of every other Guarantor (an "obligated guarantor"), to the Payment In Full of the Guarantors' Obligations of such obligated guarantor, and (c) of each other Person now or hereafter constituting a Loan Party, to the Payment In Full of the obligations of such Loan Party owing to any Secured Party and arising under the Loan Documents or with respect to any Secured Bank Product or Secured Hedge. All amounts due under such subordinated debts, liabilities, or obligations shall, upon the occurrence and during the continuance of an Event of Default, be collected and, upon request by the Administrative Agent, paid over forthwith to the Administrative Agent for the benefit of the Secured Parties on account of the Guaranteed Liabilities, the Guarantors' Obligations, or such other obligations, as applicable, and, after such request and pending such payment, shall be held by such Guarantor as agent and bailee of the Secured Parties separate and apart from all other funds, property and accounts of such Guarantor.
XI.8Enforcement. Each Guarantor from time to time shall pay to the Administrative Agent for the benefit of the Secured Parties, on demand, at the Administrative Agent's Principal Office or such other address as the Administrative Agent shall give notice of to such Guarantor, the Guarantors' Obligations as they become or are declared due, and in the event such payment is not made forthwith, the Administrative Agent may proceed to suit against any one or more or all of the Guarantors. At the Administrative Agent's election, one or more and successive or concurrent suits may be brought hereon by the Administrative Agent against any one or more or all of the Guarantors, whether or not suit has been commenced against the Borrower, any other Guarantor, or any other Person and whether or not the Secured Parties have taken or failed to take any other action to collect all or any portion of the Guaranteed Liabilities or have taken or failed to take any actions against any Collateral securing payment or performance of all or any portion of the Guaranteed Liabilities, and irrespective of any event, occurrence, or condition described in Section 12.3.
XI.9Set-Off and Waiver. Each Guarantor waives any right to assert against any Secured Party as a defense, counterclaim, set-off, recoupment or cross claim in respect of its Guarantors' Obligations, any defense (legal or equitable) or other claim which such Guarantor may now or at any time hereafter have against the Borrower or any other Loan Party or any or all of the Secured Parties without waiving any additional defenses, set-offs, counterclaims or other claims otherwise available to such Guarantor. Each Guarantor agrees that each Secured Party shall have a lien for all the Guarantors' Obligations upon all deposits or deposit accounts, of any kind, or any interest in any deposits or deposit accounts, now or hereafter pledged, mortgaged, transferred or assigned to such Secured Party or otherwise in the possession or control of such Secured Party for any purpose (other than solely for safekeeping) for the account or benefit of such Guarantor, including any balance of any deposit account or of any credit of such Guarantor with the Secured Party, whether now existing or hereafter established, and hereby authorizes each Secured Party from and after the occurrence of an Event of Default at any time or times with or without prior notice to apply such balances or any part thereof to such of the Guarantors' Obligations to the Secured Parties then due and in such amounts as provided for in this Agreement or otherwise as they may elect.
XI.10Waiver of Notice; Subrogation.
(a)Each Guarantor hereby waives to the extent not otherwise expressly prohibited by applicable law notice of the following events or occurrences: (i) acceptance of the Guaranty set forth in this Article XII; (ii) the Lenders' heretofore, now or from time to time hereafter making Loans and issuing Letters of Credit and otherwise loaning monies or giving or extending credit to or for the benefit of the Borrower or any other Loan Party, or otherwise entering into arrangements with any Loan Party giving rise to Guaranteed Liabilities, whether pursuant to this Agreement or the Notes or any other Loan Document or Related Agreement or any amendments, modifications, or supplements thereto, or replacements or extensions thereof; (iii) presentment, demand, default, non-payment, partial payment and protest; and (iv) any other event, condition, or occurrence described in Section 12.3. Each Guarantor agrees that each Secured Party may heretofore, now or at any time hereafter do any or all of the foregoing in such manner, upon such terms and at such times as each Secured Party, in its sole and absolute discretion, deems advisable, without in any way or respect impairing, affecting, reducing or releasing such Guarantor from its Guarantors' Obligations, and each Guarantor hereby consents to each and all of the foregoing events or occurrences.
(b)Each Guarantor hereby agrees that payment or performance by such Guarantor of its Guarantors' Obligations under this Article XII may be enforced by the Administrative Agent on behalf of the Secured Parties upon demand by the Administrative Agent to such Guarantor without the Administrative Agent being required, such Guarantor expressly waiving to the extent not otherwise expressly prohibited by applicable law any right it may have to require the Administrative Agent, to (i) prosecute collection or seek to enforce or resort to any remedies against the Borrower or any other Guarantor or any other guarantor of the Guaranteed Liabilities, or (ii) seek to enforce or resort to any remedies with respect to any security interests, Liens or encumbrances granted to the Administrative Agent or any Lender or other party to a Related Agreement by the Borrower, any other Guarantor or any other Person on account of the Guaranteed Liabilities or any guaranty thereof, IT BEING EXPRESSLY UNDERSTOOD, ACKNOWLEDGED AND AGREED BY SUCH GUARANTOR THAT DEMAND UNDER THE GUARANTY SET FORTH IN THIS ARTICLE XII MAY BE MADE BY THE ADMINISTRATIVE AGENT, AND THE PROVISIONS HEREOF ENFORCED BY THE ADMINISTRATIVE AGENT, EFFECTIVE AS OF THE FIRST DATE ANY EVENT OF DEFAULT OCCURS AND IS CONTINUING.
(c)Each Guarantor further agrees that such Guarantor shall not exercise any of its rights of subrogation, reimbursement, contribution, indemnity or recourse to security for the Guaranteed Liabilities until at least ninety-five (95) days immediately following the Termination Date shall have elapsed without the filing or commencement, by or against any Loan Party, of any state or federal action, suit, petition or proceeding seeking any reorganization, liquidation or other relief or arrangement in respect of creditors of, or the appointment of a receiver, liquidator, trustee or conservator in respect to, such Loan Party or its assets. If an amount shall be paid to any Guarantor on account of such rights at any time prior to Termination Date, such amount shall be held in trust for the benefit of the Secured Parties and shall forthwith be paid to the Administrative Agent, for the benefit of the Secured Parties, to be credited and applied upon the Guarantors' Obligations, whether matured or unmatured, in accordance with the terms of this Agreement or otherwise as the Secured Parties may elect. The agreements in this subsection shall survive repayment of all of the Guarantors' Obligations, the termination or expiration of this Agreement in any manner and occurrence of the Termination Date.
XI.11No Stay. Without limitation of any other provision set forth in this Article XII, if any declaration of default or acceleration or other exercise or condition to exercise of rights or remedies under
or with respect to any Guarantors' Obligation or any of the Guaranteed Liabilities shall at any time be stayed, enjoined, or prevented for any reason (including but not limited to stay or injunction resulting from the pendency against any Loan Party or any other Person of a bankruptcy, insolvency, reorganization or similar proceeding), the Guarantors agree that, for the purposes of this Article XII and their obligations hereunder, the Guarantors' Obligations and the Guaranteed Liabilities shall be deemed to have been declared in default or accelerated, and such other exercise or conditions to exercise shall be deemed to have been taken or met.
XI.12Additional Guarantors. At any time after the initial execution and delivery of this Agreement to the Administrative Agent and the Lenders, additional Persons may become parties to this Agreement and thereby acquire the duties and rights of being Guarantors hereunder by executing and delivering to the Administrative Agent and the Lenders a duly executed Guarantor Joinder pursuant to this Agreement. No notice of the addition of any Guarantor shall be required to be given to any pre-existing Guarantor and each Guarantor hereby consents thereto.
XI.13Reliance. Each Guarantor represents and warrants to the Administrative Agent, for the benefit of the Secured Parties, that: (a) such Guarantor has adequate means to obtain on a continuing basis (i) from the Borrower, information concerning the Loan Parties and the Loan Parties' financial condition and affairs and (ii) from other reliable sources, such other information as it deems material in deciding to provide its Guaranty under this Article XII and any Guarantor Joinder ("Other Information"), and has full and complete access to the Loan Parties' books and records and to such Other Information; (b) such Guarantor is not relying on any Secured Party or its or their employees, directors, agents or other representatives or Affiliates, to provide any such information, now or in the future; (c) such Guarantor has been furnished with and reviewed the terms of such Loan Documents and Related Agreements as it has requested, is executing this Agreement (or the Guarantor Joinder to which it is a party, as applicable) freely and deliberately, and understands the obligations and financial risk undertaken by providing its Guaranty under this Agreement; (d) such Guarantor has relied solely on the Guarantor's own independent investigation, appraisal and analysis of the Borrower and the other Loan Parties, such Persons' financial condition and affairs, the Other Information, and such other matters as it deems material in deciding to provide this Guaranty and is fully aware of the same; and (e) such Guarantor has not depended or relied on any Secured Party or its or their employees, directors, agents or other representatives or Affiliates, for any information whatsoever concerning the Borrower or the Borrower's financial condition and affairs or any other matters material to such Guarantor's decision to provide this Guaranty, or for any counseling, guidance, or special consideration or any promise therefor with respect to such decision. Each Guarantor agrees that no Secured Party has any duty or responsibility whatsoever, now or in the future, to provide to such Guarantor any information concerning the Borrower or any other Loan Party or such Persons' financial condition and affairs, or any Other Information, other than as expressly provided herein, and that, if such Guarantor receives any such information from any Secured Party or its or their employees, directors, agents or other representatives or Affiliates, such Guarantor will independently verify the information and will not rely on any Secured Party or its or their employees, directors, agents or other representatives or Affiliates, with respect to such information.
XI.14Receipt of Credit Agreement, Other Loan Documents, Benefits.
(a)Each Guarantor hereby acknowledges that it has received a copy of this Agreement and the other Loan Documents and each Guarantor certifies that the representations and warranties made therein with respect to such Guarantor are true and correct in all material respects. Further, each Guarantor acknowledges and agrees to perform, comply with, and be bound by all of the provisions of this Agreement and the other Loan Documents applicable to such Guarantor.
(b)Each Guarantor hereby acknowledges, represents, and warrants that it receives direct and indirect benefits by virtue of its affiliation with Borrower and the other Guarantors and that it will receive direct and indirect benefits from the financing arrangements contemplated by this Agreement and that such benefits, together with the rights of contribution and subrogation that may arise in connection herewith are a reasonably equivalent exchange of value in return for providing the Guaranty set forth in this Article XII.
XI.15Joinder. Each Person that shall at any time execute and deliver to the Administrative Agent a Guarantor Joinder shall thereupon irrevocably, absolutely and unconditionally become a party hereto and obligated hereunder as a Guarantor, and all references herein and in the other Loan Documents to the Guarantors or to the parties to this Guaranty shall be deemed to include such Person as a Guarantor hereunder.
[SIGNATURE PAGES FOLLOW]
IN WITNESS WHEREOF, the parties hereto, by their officers thereunto duly authorized, have executed this Agreement as of the day and year first above written.
BORROWER:
SKYLAND GRAIN, L.L.C., a Kansas limited liability company
By:
Name:
Title:
COBANK, ACB, as Administrative Agent, Issuing Lender and Swing Line Lender
By:
Name:
Title:
FARM CREDIT MID-AMERICA, PCA, as a Lender
By:
Name:
Title:
NEWS RELEASE
Contact:
Mike Hoelter
Vice President, Corporate Controller and Investor Relations
419-897-6715
investorrelations@andersonsinc.com
The Andersons, Inc. Acquires Majority Ownership in Skyland Grain, LLC
MAUMEE, Ohio, November 4, 2024 – The Andersons, Inc. (Nasdaq: ANDE) announced they have finalized the acquisition of a majority ownership in Skyland Grain, LLC.
The transaction enables The Andersons to expand its core grain and fertilizer businesses across strategic markets, including Kansas, Oklahoma, Colorado, and Texas. At the same time, Skyland will benefit from access to The Andersons extensive portfolio of assets and capabilities.
“With Skyland becoming part of The Andersons, we are confident that we are well-positioned to capitalize on the significant opportunities in this region, which boasts the fastest-growing feed demand in the country,” said Bill Krueger, president and CEO of The Andersons. “Skyland’s strong farmer relationships and core assets in grain, agronomy, cotton, and fuel, combined with our grain merchandising presence across the U.S. make this a powerful combination. Further, by bringing together our agronomy businesses, we not only double the size of The Andersons retail farm center business, but our combined buying power and expansive reach will create new opportunities for our customers, enhancing their competitiveness across the North American agricultural supply chain.”
“We are excited to join forces with The Andersons,” said Pete Goetzmann, CEO of Skyland. “Their asset footprint is a strong complement to ours, offering our producers greater access to the best markets. As a leader in the grain trade with a proven track record, The Andersons merchandising expertise, combined with Skyland’s deep local market knowledge and customer base, creates a powerful synergy that aligns perfectly with our mission of connecting our producers to the world.”
Skyland has more than 7,000 active co-op members across over 50 grain and agronomy locations. Skyland was advised on the transaction by Ascendant Partners, LLC and FTI Consulting, Inc.
About The Andersons, Inc.
The Andersons, Inc., named in 2024 to Forbes list of America's Most Successful Small Companies, Newsweek's list of America's Most Responsible Companies, and one of The Americas' Fastest Growing Companies by the Financial Times, is a diversified company rooted in agriculture that conducts business in the commodity merchandising, renewables, and nutrient & industrial sectors. Guided by its Statement of Principles, The Andersons is committed to providing extraordinary service to its customers, helping its employees improve, supporting its communities, and increasing the value of the company. For more information, please visit www.andersonsinc.com.
About Skyland Grain, LLC
Skyland operates grain storage and handling facilities at 50 locations in Kansas, Colorado, Oklahoma, and Texas. It also operates three cotton gins, a full-service agronomy sales and service division, and a retail and wholesale fuel sales and delivery division. Skyland also owns a majority interest in Heartland Soil Services, LLC, a precision agronomy testing, data analysis, and consulting company with operations in five states. For more information, please visit www.skylandgrain.com.
v3.24.3
Cover page
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Nov. 01, 2024 |
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Andersons, Inc.
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OH
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000-20557
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34-1562374
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1947 Briarfield Boulevard
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Maumee
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