CREDIT AGREEMENT
SENIOR SECURED ASSET-BASED REVOLVING CREDIT FACILITY
$80,000,000
Dated as of [●], 2022
among
GREENFIELD AGRICULTURAL PARTNERS LLC, an Iowa limited liability company, as Borrower,
THE GUARANTORS PARTY HERETO,
THE LENDERS PARTY HERETO,
and
HEARTLAND COMMERCE BANK, NATIONAL ASSOCIATION, as Administrative Agent, Collateral Agent, Sole Lead Arranger, Sole Bookrunner, and Issuing Bank
TABLE OF CONTENTS
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SCHEDULES
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EXHIBITS
This CREDIT AGREEMENT (this "Agreement"), dated as of [●], 2022 (the "Closing Date"), is entered into by and among:
GREENFIELD AGRICULTURAL PARTNERS LLC, an Iowa limited liability company (the "Borrower");
GREENFIELD HOLDINGS CORP., a Delaware corporation ("Holdings"), GREENFIELD GRAIN STORAGE LLC, an Iowa limited liability company ("GGS"), and GREENFIELD CROP INPUTS INC., an Illinois corporation ("GCI", and together with Holdings and GGS, the "Guarantors");
THE LENDERS FROM TIME TO TIME PARTY HERETO (each, a "Lender" and collectively, the "Lenders"); and
HEARTLAND COMMERCE BANK, NATIONAL ASSOCIATION, a national banking association organized under the laws of the United States ("HCB"), in its capacities as administrative agent for the Lenders (in such capacity, together with its successors and assigns in such capacity, the "Administrative Agent"), as collateral agent for the Secured Parties (in such capacity, together with its successors and assigns in such capacity, the "Collateral Agent"), as sole lead arranger and sole bookrunner (in such capacity, the "Arranger"), and as issuing bank (in such capacity, the "Issuing Bank").
RECITALS
WHEREAS, the Borrower is engaged in the business of row-crop production (corn, soybeans, and specialty grains), crop-input distribution (seed, fertilizer, and crop protection chemicals), grain storage and merchandising, and contract farming operations across the states of Iowa, Illinois, and Indiana;
WHEREAS, the Borrower has requested that the Lenders provide a senior secured asset-based revolving credit facility to the Borrower in an aggregate principal amount of up to $80,000,000 for the purposes of (i) refinancing and repaying in full the existing revolving credit facility with Prairie National Bank, National Association, pursuant to that certain Revolving Credit Agreement dated as of April 1, 2018, as amended (the "Existing Credit Agreement"), (ii) funding seasonal working capital needs in connection with the Borrower's agricultural operations, including the purchase of seed, fertilizer, and crop protection chemicals, and (iii) general corporate purposes;
WHEREAS, the Guarantors have agreed to guarantee the obligations of the Borrower under this Agreement and the other Loan Documents; and
WHEREAS, the Loan Parties have agreed to secure their obligations under the Loan Documents with a first-priority security interest in substantially all of their assets, including accounts receivable, inventory, grain warehouse receipts, equipment, real property, and all other personal property.
NOW, THEREFORE, in consideration of the mutual covenants, agreements, representations, and warranties contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE I — DEFINITIONS AND INTERPRETATION
Section 1.01 — Defined Terms
As used in this Agreement, the following terms shall have the meanings set forth below:
"Accounts Receivable" means all accounts, as such term is defined in Article 9 of the Uniform Commercial Code as in effect from time to time in the State of Iowa, now existing or hereafter arising, owing to the Borrower or any Subsidiary Guarantor, arising from the sale of goods or the rendition of services in the ordinary course of business, together with all guarantees and security therefor, all supporting obligations, and all rights of enforcement and collection related thereto.
"Administrative Agent" means Heartland Commerce Bank, National Association, in its capacity as administrative agent for the Lenders under this Agreement and the other Loan Documents, together with its successors and assigns in such capacity, and any successor administrative agent appointed in accordance with Section 10.06.
"Affiliate" means, with respect to any Person, any other Person that directly or indirectly controls, is controlled by, or is under common control with, such Person. For purposes of this definition, "control" (including the terms "controlling," "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 or policies of a Person, whether through the ability to exercise voting power, by contract, or otherwise.
"Agreement" means this Credit Agreement, as amended, restated, supplemented, or otherwise modified from time to time.
"Anti-Corruption Laws" means all laws, rules, and regulations of any jurisdiction applicable to the Borrower or any of its Subsidiaries from time to time concerning or relating to bribery or corruption, including the United States Foreign Corrupt Practices Act of 1977, as amended.
"Anti-Money Laundering Laws" means all applicable laws, rules, and regulations of any jurisdiction relating to money laundering or terrorist financing, including the USA PATRIOT Act (Title III of Pub. L. 107-56, as amended) and the regulations promulgated thereunder, the Bank Secrecy Act (31 U.S.C. §§ 5311-5330), and the rules and regulations issued thereunder by the Financial Crimes Enforcement Network.
"Applicable Margin" means, at any time, the applicable percentage per annum set forth below, determined based on the Average Daily Excess Availability for the most recently ended calendar month:
The Applicable Margin shall be determined on a monthly basis, effective as of the first day of each calendar month, based on the Average Daily Excess Availability for the immediately preceding calendar month. From and after the Closing Date through the first adjustment date (which shall be the first day of the second full calendar month following the Closing Date), Level II pricing shall apply. Any adjustment in the Applicable Margin shall be effective on the first day of the calendar month immediately following the calendar month for which the Average Daily Excess Availability has been determined. If the Borrower fails to deliver a Borrowing Base Certificate when required hereunder, Level III pricing shall be deemed to apply until such time as the required Borrowing Base Certificate is delivered.
"Approved Storage Location" means each grain elevator facility and distribution center identified on Schedule 2.09(b) hereto, as such schedule may be amended from time to time with the consent of the Administrative Agent.
"Assignment and Assumption" means an assignment and assumption agreement entered into by a Lender and an assignee, and accepted by the Administrative Agent (and, if required, the Borrower), in substantially the form of Exhibit D hereto, or any other form approved by the Administrative Agent, pursuant to which such assignee agrees to become a Lender hereunder.
"Assignment of Insurance" means each assignment of insurance executed by a Loan Party in favor of the Collateral Agent, in form and substance satisfactory to the Administrative Agent, assigning to the Collateral Agent the Loan Party's rights to receive proceeds of crop insurance and property and casualty insurance policies.
"Availability Reserves" means, at any time of determination, such reserves as may be established by the Administrative Agent in the exercise of its Permitted Discretion and designated as "Availability Reserves," including reserves for rent, landlord claims, consignment claims, customs duties, warehousemen's charges, processor's charges, carrier's charges, dilution, returned goods, environmental liabilities, and such other items as the Administrative Agent may from time to time determine in its Permitted Discretion. As of the Closing Date, the initial Availability Reserves shall be $3,500,000. The Administrative Agent may, in the exercise of its Permitted Discretion, increase or establish additional Availability Reserves upon not less than five (5) Business Days' prior written notice to the Borrower, which notice shall set forth in reasonable detail the basis for such increase or establishment. The Borrower shall have the right to request a review of any Availability Reserve upon not less than ten (10) Business Days' prior written notice to the Administrative Agent, and the Administrative Agent shall, within a reasonable period of time following receipt of such request, review the applicable reserve and determine whether any adjustment is appropriate.
"Average Daily Excess Availability" means, for any period, the quotient obtained by dividing (a) the sum of the Excess Availability at the close of business on each day during such period by (b) the number of days in such period.
"Base Rate" means, for any day, a rate per annum equal to the highest of (a) the Federal Funds Rate for such day plus 0.50%, (b) the rate last quoted by The Wall Street Journal as the "Prime Rate" in the United States (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 as the "bank prime loan" rate), and (c) SOFR for a one-month interest period as of such day plus 1.00%; provided that if the Base Rate shall be less than zero, such rate shall be deemed to be zero for purposes of this Agreement.
"Base Rate Loan" means a Revolving Loan that bears interest at a rate based on the Base Rate.
"Borrower" has the meaning set forth in the preamble to this Agreement.
"Borrowing Base" means, at any time of determination, an amount equal to the sum of:
(a) eighty-five percent (85%) of the face amount of Eligible Accounts Receivable at such time; plus
(b) sixty-five percent (65%) of the Net Orderly Liquidation Value of Eligible Crop Inventory at such time; plus
(c) seventy percent (70%) of the lower of cost or market value of Eligible Crop-Input Inventory at such time; plus
(d) eighty percent (80%) of the market value of Eligible Grain Warehouse Receipts at such time (determined by reference to the applicable CBOT settlement price less the applicable basis, as determined in accordance with Section 2.09(d)); minus
(e) Availability Reserves at such time.
"Borrowing Base Certificate" means a certificate substantially in the form of Exhibit C hereto, duly completed and executed by an Authorized Officer of the Borrower, setting forth the calculation of the Borrowing Base as of the date specified therein.
"Borrowing Request" means a request for a Revolving Loan substantially in the form of Exhibit A hereto, duly completed and executed by an Authorized Officer of the Borrower.
"Business Day" means any day other than a Saturday, a Sunday, or any other day on which banking institutions in Chicago, Illinois or Des Moines, Iowa are authorized or required by law, regulation, or executive order to close; provided that, when used in connection with a SOFR Loan, the term "Business Day" shall also exclude any 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.
"Capital Expenditures" means, for any period, the aggregate of all expenditures made by the Borrower and its Subsidiaries during such period that, in conformity with GAAP, are required to be included in or reflected as additions to property, plant, or equipment or similar fixed or capital asset accounts on the consolidated balance sheet of the Borrower and its Subsidiaries, including expenditures for maintenance and repair to the extent capitalized, and the principal portion of any Capital Lease obligations incurred during such period. Capital Expenditures shall be subject to the limitations set forth in Section 7.08.
"Capital Lease" means, with respect to any Person, any lease of (or other arrangement conveying the right to use) any real or personal property by such Person as lessee that is, or is required to be, classified and accounted for as a capital lease or a finance lease on a balance sheet of such Person prepared in accordance with GAAP.
"CBOT" means the Chicago Board of Trade, a designated contract market and part of the CME Group Inc.
"Change of Control" means the occurrence of any of the following events:
(a) the Lindstrom Family Trust (an irrevocable trust established under the laws of the State of Iowa) ceases to own, , at least fifty-one percent (51%) of the issued and outstanding Equity Interests of Greenfield Holdings Corp., free and clear of all Liens other than Liens in favor of the Collateral Agent;
(b) Greenfield Holdings Corp. ceases to own, directly or indirectly, one hundred percent (100%) of the membership interests of the Borrower; or
(c) the Borrower ceases to own, directly or indirectly, one hundred percent (100%) of the Equity Interests of any Subsidiary Guarantor.
"Closing Date" means the date on which all conditions precedent set forth in Section 4.01 have been satisfied or waived in accordance with the terms of this Agreement.
"Collateral" means all assets and property, whether real, personal, or mixed, tangible or intangible, now existing or hereafter acquired, of any Loan Party that are subject to (or are purported to be subject to) the Liens created by the Security Documents, including all "Collateral" as defined in each Security Document.
"Collateral Agent" means Heartland Commerce Bank, National Association, in its capacity as collateral agent for the Secured Parties under this Agreement and the other Loan Documents, together with its successors and assigns in such capacity, and any successor collateral agent appointed in accordance with Section 10.06.
"Commitment" means, with respect to each Lender, the commitment of such Lender to make Revolving Loans and to acquire participations in Letters of Credit hereunder, in the amount set forth opposite such Lender's name on Schedule 2.01 (as such schedule may be amended from time to time), as such commitment may be (a) reduced or terminated from time to time pursuant to the terms of this Agreement or (b) increased from time to time pursuant to Section 2.11. As of the Closing Date, the aggregate amount of the Commitments of all Lenders equals $80,000,000.
"Commodity Hedging Transaction" means any commodity swap, commodity forward, commodity futures contract, commodity option (whether put or call), or other derivative contract or arrangement entered into by the Borrower or any Subsidiary in connection with hedging commodity price risk with respect to agricultural commodities (including corn, soybeans, and specialty grains) produced, purchased, stored, or sold by the Borrower or any Subsidiary in the ordinary course of business.
"Compliance Certificate" means a certificate substantially in the form of Exhibit B hereto, duly completed and executed by an Authorized Officer of the Borrower.
"Consolidated EBITDA" means, for any period, the consolidated net income (or net loss) of the Borrower and its Subsidiaries for such period, determined in accordance with GAAP, plus the following to the extent deducted in calculating such consolidated net income (or net loss): (a) interest expense, (b) income tax expense, (c) depreciation expense, (d) amortization expense, (e) non-cash losses or charges (including non-cash impairment charges), and (f) extraordinary or non-recurring losses or charges approved by the Administrative Agent in its reasonable discretion ; minus (i) interest income, (ii) non-cash gains, and (iii) extraordinary or non-recurring gains; in each case, calculated on a consolidated basis for the Borrower and its Subsidiaries in accordance with GAAP.
"Credit Agreement" means this Agreement.
"Default" means any event or condition that, with the giving of notice, lapse of time, or both, would constitute an Event of Default hereunder.
"Deposit Account Control Agreement" or "DACA" means a deposit account control agreement in substantially the form of Exhibit H hereto, or otherwise in form and substance satisfactory to the Administrative Agent, executed by the applicable Loan Party, the applicable depository bank, and the Administrative Agent (or the Collateral Agent, as applicable), pursuant to which the Administrative Agent (or the Collateral Agent) obtains "control" (as defined in Section 9-104 of the UCC) over the applicable deposit account.
"Eligible Accounts Receivable" means, at any time of determination, Accounts Receivable of the Borrower and the Subsidiary Guarantors that satisfy each of the eligibility criteria set forth in Section 2.09(a). Without limiting the foregoing, an Account Receivable shall not be an Eligible Account Receivable unless such Account Receivable:
(i) arises from a bona fide sale of goods or rendition of services by the Borrower or a Subsidiary Guarantor in the ordinary course of business and in accordance with the terms and conditions of a bona fide order, contract, or agreement;
(ii) is not more than days past the original invoice date;
(iii) is owed by an account debtor that is domiciled in the United States;
(iv) is not subject to any offset, counterclaim, defense, dispute, deduction, discount, recoupment, or allowance asserted or claimed by the account debtor;
(v) is not owed by an Affiliate of any Loan Party;
(vi) is not owed by an account debtor with respect to which more than of the aggregate Accounts Receivable owing by such account debtor are ineligible pursuant to the criteria set forth herein;
(vii) is not evidenced by chattel paper or an instrument (as such terms are defined in the UCC), unless such chattel paper or instrument has been delivered to the Collateral Agent with all necessary endorsements;
(viii) complies with all applicable laws, rules, and regulations, including consumer protection laws and truth-in-lending laws;
(ix) if owed by any governmental entity, has been properly assigned in compliance with the Federal Assignment of Claims Act (31 U.S.C. § 3727) and any applicable state or local assignment of claims statute; and
(x) satisfies such other eligibility criteria as the Administrative Agent may from time to time establish in the exercise of its Permitted Discretion.
"Eligible Crop Inventory" means, at any time of determination, harvested grain (including corn, soybeans, and specialty grains) owned by the Borrower or Greenfield Grain Storage LLC and stored in owned or leased grain elevator facilities operated by the Loan Parties, that satisfies each of the eligibility criteria set forth in Section 2.09(b). Without limiting the foregoing, Eligible Crop Inventory shall meet the following criteria:
(i) such inventory is in good and marketable condition and is not damaged, defective, or otherwise of a quality that would impair its salability in the ordinary course of business;
(ii) such inventory is located at an Approved Storage Location listed on Schedule 2.09(b);
(iii) such inventory is subject to a first-priority perfected security interest in favor of the Collateral Agent (subject only to Permitted Liens);
(iv) such inventory is not subject to any warehouse lien, agricultural lien, landlord lien, or other statutory lien other than Permitted Liens;
(v) such inventory is covered by adequate insurance in compliance with Section 6.05;
(vi) such inventory has been valued on the basis of the most recent Net Orderly Liquidation Value appraisal conducted by Pryor & Associates LLC (or another appraisal firm acceptable to the Administrative Agent in its Permitted Discretion); and
(vii) such inventory satisfies such other eligibility criteria as the Administrative Agent may from time to time establish in the exercise of its Permitted Discretion.
"Eligible Crop-Input Inventory" means, at any time of determination, seed, fertilizer, and crop protection chemicals held by the Borrower or Greenfield Crop Inputs Inc. for distribution and sale in the ordinary course of business, that satisfies each of the eligibility criteria set forth in Section 2.09(c). Without limiting the foregoing, Eligible Crop-Input Inventory shall meet the following criteria:
(i) such inventory is located at an Approved Storage Location listed on Schedule 2.09(b);
(ii) such inventory is not obsolete, damaged, expired, or otherwise unsuitable for sale in the ordinary course of business;
(iii) such inventory is valued at the lower of cost (determined on a first-in, first-out basis) or market value;
(iv) such inventory is subject to a first-priority perfected security interest in favor of the Collateral Agent (subject only to Permitted Liens);
(v) such inventory is covered by adequate insurance in compliance with Section 6.05; and
(vi) such inventory satisfies such other eligibility criteria as the Administrative Agent may from time to time establish in the exercise of its Permitted Discretion.
"Eligible Grain Warehouse Receipts" means, at any time of determination, negotiable or non-negotiable warehouse receipts issued by a federally licensed warehouse (licensed pursuant to the United States Warehouse Act, 7 U.S.C. § 241 et seq.) and held by the Borrower or Greenfield Grain Storage LLC, that satisfy each of the eligibility criteria set forth in Section 2.09(d). Eligible Grain Warehouse Receipts shall be valued at market value based on the applicable CBOT settlement price as of the most recent settlement date, less the applicable basis, as determined in accordance with Section 2.09(d).
"Environmental Laws" means any and all federal, state, local, or foreign laws, statutes, regulations, ordinances, rules, judgments, orders, decrees, permits, concessions, grants, franchises, licenses, agreements, or governmental restrictions relating to pollution, the protection of the environment, or the release, emission, or disposal of hazardous substances, including the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (42 U.S.C. § 9601 et seq.), the Resource Conservation and Recovery Act (42 U.S.C. § 6901 et seq.), the Federal Water Pollution Control Act (33 U.S.C. § 1251 et seq.), the Clean Air Act (42 U.S.C. § 7401 et seq.), the Toxic Substances Control Act (15 U.S.C. § 2601 et seq.), the Federal Insecticide, Fungicide, and Rodenticide Act (7 U.S.C. § 136 et seq.), and any analogous state or local laws.
"Equity Interests" means, with respect to any Person, all shares of capital stock, membership interests, partnership interests, limited liability company interests, trust interests, or other equity interests (whether common, preferred, or otherwise), all warrants, options, or other rights to acquire any of the foregoing, and all other ownership or profit interests in such Person.
"ERISA" means the Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations and rulings issued thereunder.
"ERISA Affiliate" means any trade or business (whether or not incorporated) that is treated as a single employer with the Borrower or any Subsidiary under Section 414(b), (c), (m), or (o) of the Internal Revenue Code.
"Event of Default" has the meaning set forth in Section 9.01.
"Excess Availability" means, at any time of determination, an amount equal to:
(a) the lesser of (i) the Borrowing Base at such time and (ii) the aggregate Commitments of all Lenders at such time; minus
(b) the sum of (i) the aggregate outstanding principal amount of all Revolving Loans at such time and (ii) the aggregate undrawn face amount of all outstanding Letters of Credit (plus the aggregate amount of all unreimbursed draws under Letters of Credit) at such time.
"Existing Credit Agreement" means that certain Revolving Credit Agreement dated as of April 1, 2018, as amended by that certain First Amendment to Revolving Credit Agreement dated as of September 15, 2019, and that certain Second Amendment to Revolving Credit Agreement dated as of March 1, 2021, between the Borrower and Prairie National Bank, National Association, as lender.
"Federal Funds Rate" means, for any day, the rate per annum calculated by the Federal Reserve Bank of New York based on such day's federal funds transactions by depositary institutions (as determined in such manner as the Federal Reserve Bank of New York shall set forth on its public website from time to time), published on the next succeeding Business Day by the Federal Reserve Bank of New York as the federal funds effective rate; provided that if such rate shall be less than zero, such rate shall be deemed to be zero for purposes of this Agreement.
"Field Examination" means an examination of the Collateral, books, and records of the Loan Parties conducted by an independent examination firm (including Pryor & Associates LLC) engaged by the Administrative Agent in accordance with this Agreement, including a review of accounts receivable, inventory, cash management, and general financial operations.
"Fixed Charge Coverage Ratio" means, for any period, the ratio of:
(a) Consolidated EBITDA for such period, minus unfinanced Capital Expenditures made during such period, minus cash taxes paid during such period, minus Restricted Payments (including distributions) made during such period; to
(b) the sum of (i) scheduled principal payments on Indebtedness (including Capital Lease obligations) made or required to be made during such period, (ii) cash interest expense paid or payable during such period, and (iii) payments on Capital Lease obligations made or required to be made during such period (to the extent not included in clause (i) or (ii));
in each case, calculated on a consolidated basis for the Borrower and its Subsidiaries in accordance with GAAP.
"GAAP" means generally accepted accounting principles in the United States of America, as in effect from time to time, consistently applied.
"Governmental Authority" means any federal, state, local, municipal, or foreign government, or any political subdivision thereof, or any agency, instrumentality, regulatory body, court, commission, board, bureau, or authority thereof, or any other body exercising executive, legislative, judicial, taxing, regulatory, or administrative functions of or pertaining to government, including the Securities and Exchange Commission, the Internal Revenue Service, the Iowa Secretary of State, the Illinois Secretary of State, the Delaware Secretary of State, the United States Department of Agriculture, and any court of competent jurisdiction.
"Guarantor" means each of (a) Greenfield Holdings Corp., a Delaware corporation, (b) Greenfield Grain Storage LLC, an Iowa limited liability company, and (c) Greenfield Crop Inputs Inc., an Illinois corporation, and any other Person that becomes a guarantor pursuant to Section 6.12 of this Agreement.
"Guaranty" means the Guaranty Agreement, dated as of the Closing Date, executed by the Guarantors in favor of the Administrative Agent for the benefit of the Lenders and the other Secured Parties, as amended, restated, supplemented, or otherwise modified from time to time.
"Indebtedness" means, with respect to any Person at any time, without duplication, (a) all obligations for borrowed money, (b) all obligations evidenced by bonds, debentures, notes, or similar instruments, (c) all Capital Lease obligations, (d) all obligations for the deferred purchase price of property or services (other than trade payables incurred in the ordinary course of business), (e) all obligations arising under letters of credit, bankers' acceptances, and similar instruments, (f) all Guarantees of Indebtedness of any other Person, and (g) all Commodity Hedging obligations (determined on a mark-to-market basis).
"Internal Revenue Code" means the Internal Revenue Code of 1986, as amended from time to time, and any successor statute thereto.
"Issuing Bank" means Heartland Commerce Bank, National Association, in its capacity as the issuer of Letters of Credit hereunder, together with its successors and assigns in such capacity.
"Lenders" means (a) Heartland Commerce Bank, National Association, (b) Meridian Agricultural Credit Corporation, and (c) Tallgrass Capital Fund II, LP, and, in each case, their respective successors and assigns, together with any other Person that becomes a party hereto as a Lender pursuant to an Assignment and Assumption, and "Lender" means any one of them.
"Letter of Credit" means any standby or commercial letter of credit issued by the Issuing Bank pursuant to Section 2.04.
"Letter of Credit Obligations" means, at any time, the sum of (a) the aggregate undrawn face amount of all outstanding Letters of Credit at such time, plus (b) the aggregate amount of all unreimbursed draws under Letters of Credit at such time.
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge, or preference, priority, or other security interest or preferential arrangement in the nature of a security interest of any kind or nature whatsoever (including any conditional sale or other title retention agreement, any easement, right-of-way, or other encumbrance on title to real property, and any financing lease having substantially the same economic effect as any of the foregoing).
"Lindstrom Family Trust" means the Marcus A. Lindstrom Irrevocable Family Trust, dated October 12, 1987, established under the laws of the State of Iowa, as amended from time to time.
"Loan Documents" means, collectively, this Agreement, the Guaranty, the Security Agreement, the Pledge Agreement, the Mortgages, the Deposit Account Control Agreements, the Assignment of Insurance, the Borrowing Base Certificates, the Compliance Certificates, the Borrowing Requests, and any other document, instrument, agreement, or certificate delivered by any Loan Party pursuant to or in connection with this Agreement or any of the foregoing, as each may be amended, restated, supplemented, or otherwise modified from time to time.
"Loan Parties" means, collectively, the Borrower and the Guarantors, and "Loan Party" means any one of them.
"Material Adverse Change" or "MAC" means any event, circumstance, development, change, or condition that, individually or in the aggregate, has had or would reasonably be expected to have a on:
(a) the business, operations, assets, properties, liabilities, or financial condition of the Borrower and the Subsidiaries, taken as a whole;
(b) the ability of any Loan Party to perform its payment or other material obligations under any of the Loan Documents;
"Maturity Date" means the date that is four (4) years after the Closing Date; provided that if such date is not a Business Day, the Maturity Date shall be the immediately preceding Business Day.
"Minimum Excess Availability" means .
"Mortgage" means each mortgage, deed of trust, or deed to secure debt, as applicable, executed by a Loan Party in favor of the Collateral Agent for the benefit of the Secured Parties, covering real property Collateral owned by such Loan Party, in substantially the form of Exhibit F-1 hereto (with respect to real property located in the State of Iowa) or Exhibit F-2 hereto (with respect to real property located in the State of Illinois), as each may be amended, restated, supplemented, or otherwise modified from time to time.
"Net Orderly Liquidation Value" or "NOLV" means, with respect to any Eligible Crop Inventory at any time, the estimated amount, expressed in United States dollars, that could be realized from a liquidation sale of such inventory, conducted over a reasonable period of time to find a purchaser or purchasers, with the seller being compelled to sell on an as-is, where-is basis, net of all direct costs and expenses of such liquidation, as determined by the most recent appraisal conducted by Pryor & Associates LLC (or another independent appraisal firm acceptable to the Administrative Agent in its Permitted Discretion).
"Obligations" means all present and future indebtedness, liabilities, and obligations of every kind and nature of any Loan Party to any Secured Party arising under or in connection with any Loan Document, whether direct or indirect, absolute or contingent, joint or several, due or not due, primary or secondary, liquidated or unliquidated, secured or unsecured, original, renewed, or extended, whether arising before, during, or after any proceeding under any Debtor Relief Law naming such Loan Party as debtor, including principal, interest (including interest accruing during the pendency of any bankruptcy, insolvency, receivership, or other similar proceeding, whether or not allowed in such proceeding), fees, charges, expenses, attorneys' fees, indemnities, and other amounts.
"Organizational Documents" means, with respect to any Person, (a) if such Person is a corporation, the articles or certificate of incorporation and bylaws (or the equivalent thereof), (b) if such Person is a limited liability company, the certificate of formation or organization and the limited liability company agreement or operating agreement (or the equivalent thereof), (c) if such Person is a limited partnership, the certificate of limited partnership and the partnership agreement, and (d) if such Person is any other type of entity, the organizational and governing documents of such Person.
"Permitted Discretion" means a determination made in the exercise of reasonable (from the perspective of a secured asset-based lender) business judgment, exercised in good faith and in a commercially reasonable manner .
"Permitted Liens" means Liens permitted under Section 7.02.
"Person" means any individual, partnership, corporation (including a business trust), limited liability company, joint stock company, trust, unincorporated association, joint venture, or other entity, or any Governmental Authority.
"Pledge Agreement" means the Pledge Agreement, dated as of the Closing Date, executed by the Borrower in favor of the Collateral Agent for the benefit of the Secured Parties, pursuant to which the Borrower pledges one hundred percent (100%) of the membership interests in Greenfield Grain Storage LLC and one hundred percent (100%) of the issued and outstanding stock of Greenfield Crop Inputs Inc. to the Collateral Agent, as amended, restated, supplemented, or otherwise modified from time to time.
"Pro Rata Share" means, with respect to each Lender at any time, the percentage obtained by dividing (a) the Commitment of such Lender at such time by (b) the aggregate Commitments of all Lenders at such time (or, if the Commitments have been terminated, by dividing the aggregate outstanding principal amount of such Lender's Revolving Loans and participations in Letters of Credit at such time by the aggregate outstanding principal amount of all Revolving Loans and participations in Letters of Credit at such time). As of the Closing Date, the Pro Rata Share of each Lender is as follows: Heartland Commerce Bank, N.A.: 50.00%; Meridian Agricultural Credit Corporation: 31.25%; and Tallgrass Capital Fund II, LP: 18.75%.
"Required Lenders" means, at any time, Lenders having Commitments representing more than fifty percent (50%) of the aggregate Commitments of all Lenders at such time (or, if the Commitments have been terminated, Lenders having aggregate outstanding Revolving Loans and participations in Letters of Credit representing more than fifty percent (50%) of the aggregate outstanding Revolving Loans and participations in Letters of Credit at such time).
"Restricted Payment" means (a) any dividend or other distribution, direct or indirect, on account of any Equity Interests of any Loan Party, (b) any redemption, retirement, sinking fund, or similar payment, purchase, or other acquisition for value, direct or indirect, of any Equity Interests of any Loan Party, and (c) any payment to retire, or to obtain the surrender of, any outstanding warrants, options, or other rights to acquire Equity Interests of any Loan Party.
"Revolving Loan" means each revolving loan made by a Lender to the Borrower pursuant to Section 2.01.
"Sanctioned Person" means any Person that is the subject of sanctions administered or enforced by the United States Department of the Treasury's Office of Foreign Assets Control, the United States Department of State, the United Nations Security Council, the European Union, or Her Majesty's Treasury.
"Secured Parties" means, collectively, the Administrative Agent, the Collateral Agent, the Issuing Bank, the Lenders, and any other Person to whom Obligations are owed under the Loan Documents.
"Security Agreement" means the Security Agreement, dated as of the Closing Date, executed by the Loan Parties in favor of the Collateral Agent for the benefit of the Secured Parties, granting the Collateral Agent a first-priority security interest in substantially all personal property of the Loan Parties, as amended, restated, supplemented, or otherwise modified from time to time.
"Security Documents" means, collectively, the Security Agreement, the Pledge Agreement, the Mortgages, the Deposit Account Control Agreements, the Assignment of Insurance, and all other security agreements, pledge agreements, mortgages, deeds of trust, and other documents creating or purporting to create Liens on the Collateral in favor of the Collateral Agent for the benefit of the Secured Parties.
"SOFR" means, with respect to any Business Day, the Secured Overnight Financing Rate as administered by the Federal Reserve Bank of New York (or a successor administrator of the secured overnight financing rate) and published on the Federal Reserve Bank of New York's website (or any successor source), on the Business Day immediately preceding such Business Day; provided that if SOFR as so determined would be less than the SOFR Floor, then SOFR shall be deemed to be the SOFR Floor for purposes of this Agreement.
"SOFR Floor" means 0.50% per annum.
"SOFR Loan" means a Revolving Loan that bears interest at a rate based on SOFR.
"Subsidiary" means, with respect to any Person at any time, any corporation, limited liability company, partnership, trust, or other entity the accounts of which would be consolidated with those of such Person in such Person's consolidated financial statements if such financial statements were prepared in accordance with GAAP as of such time, as well as any other corporation, limited liability company, partnership, trust, or other entity of which securities or other ownership interests representing more than fifty percent (50%) of the ordinary voting power are, at the time of determination, directly or indirectly owned or controlled by such Person. Unless the context otherwise requires, each reference to a "Subsidiary" shall be a reference to a Subsidiary of the Borrower, including Greenfield Grain Storage LLC and Greenfield Crop Inputs Inc.
"Total Commitment" means the aggregate amount of the Commitments of all Lenders, which, as of the Closing Date, equals $80,000,000, as such amount may be increased pursuant to Section 2.11 or reduced or terminated pursuant to the terms of this Agreement.
"Trigger Period" means any period (a) commencing on the date on which Excess Availability falls below the greater of (i) twelve and one-half percent (12.5%) of the Borrowing Base at such time and (ii) $10,000,000, and (b) ending on the date on which Excess Availability has been equal to or greater than the greater of (i) twelve and one-half percent (12.5%) of the Borrowing Base and (ii) $10,000,000, in each case, for consecutive calendar days.
"UCC" means the Uniform Commercial Code as from time to time in effect in the applicable jurisdiction; provided that, unless otherwise specified, all references to Articles or Sections of the UCC shall refer to the Uniform Commercial Code as in effect in the State of Iowa.
Section 1.02 — Other Interpretive Provisions
Unless the context otherwise requires, the following rules of interpretation shall apply to this Agreement and the other Loan Documents:
(a) The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine, and neuter forms. The words "include," "includes," and "including" shall be deemed to be followed by the phrase "without limitation." The word "will" shall be construed to have the same meaning and effect as the word "shall." Unless the context requires otherwise, (i) any definition of or reference to any agreement, instrument, or other document (including this Agreement) shall be construed as referring to such agreement, instrument, or other document as from time to time amended, restated, supplemented, or otherwise modified (subject to any restrictions on such amendments, restatements, supplements, or modifications set forth herein or therein), (ii) any reference to any Person shall be construed to include such Person's successors and permitted assigns, (iii) the words "herein," "hereof," and "hereunder," and words of similar import when used in this Agreement, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (iv) all references in this Agreement to Articles, Sections, Schedules, Exhibits, and Annexes shall be construed to refer to Articles, Sections of, and Schedules, Exhibits, and Annexes to, this Agreement, and (v) any reference to any law shall include all statutory and regulatory provisions consolidating, amending, replacing, or interpreting such law and any reference to any law or regulation shall, unless otherwise specified, refer to such law or regulation as amended, modified, or supplemented from time to time.
(b) The table of contents and the article, section, schedule, and exhibit headings herein are included for convenience of reference only and shall not affect the interpretation of this Agreement.
(c) The Schedules, Exhibits, and Annexes attached hereto are incorporated herein by reference and shall be part of this Agreement for all purposes.
(d) All references herein to any statute, rule, regulation, or form shall be deemed to refer to such statute, rule, regulation, or form as amended from time to time (or to any successor statute, rule, regulation, or form).
(e) Terms used in Article 9 of the UCC in the State of Iowa that are not otherwise defined herein shall have the meanings set forth in such Article 9 of the UCC; provided that to the extent that the UCC is used to define any term herein and such term is defined differently in different Articles of the UCC, the definition of such term contained in Article 9 of the UCC shall govern, except where the context requires otherwise.
Section 1.03 — Accounting Terms
(a) Except as otherwise expressly provided herein, all accounting terms not otherwise defined herein shall have the meanings assigned to them in conformity with GAAP. Financial statements and other information required to be delivered by the Borrower pursuant to this Agreement shall be prepared in accordance with GAAP as in effect at the time of such preparation, applied on a basis consistent with the audited financial statements of the Borrower for the fiscal year ended December 31, 2021, prepared by Ashford, Kline & Pearce LLP.
(b) If, after the date hereof, any change in GAAP would affect the computation of any financial ratio or requirement set forth in any Loan Document, and either the Borrower or the Required Lenders shall so request, the Administrative Agent, the Lenders, and the Borrower shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP (subject to the approval of the Required Lenders); provided that, until so amended, (i) such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein and (ii) the Borrower shall provide to the Administrative Agent and the Lenders financial statements and other documents required under this Agreement or as reasonably requested hereunder setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change in GAAP.
Section 1.04 — Rounding; Currency
(a) Any financial ratios required to be maintained or tested 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 is expressed herein, and rounding the result up or down to the nearest number (with a rounding-up if there is no nearest number).
(b) Unless otherwise specified herein, all references to monetary amounts shall refer to lawful money of the United States of America. For purposes of calculating Borrowing Base components, all values shall be expressed in United States dollars.
Section 1.05 — Times of Day
Unless otherwise specified, all references to times of day in this Agreement shall refer to Central Time (Chicago, Illinois).
Section 1.06 — SOFR Provisions
(a) Benchmark Replacement. Notwithstanding anything to the contrary herein or in any other Loan Document, if a Benchmark Transition Event occurs, the Administrative Agent and the Borrower may amend this Agreement to replace SOFR with a Benchmark Replacement. Any such amendment shall become effective at 5:00 p.m. (Central Time) on the fifth (5th) Business Day after the Administrative Agent has posted such proposed amendment to all Lenders and the Borrower so long as the Administrative Agent has not received, by such time, written notice of objection to such amendment from Lenders comprising the Required Lenders. No replacement of SOFR with a Benchmark Replacement will occur prior to the applicable Benchmark Transition Start Date.
(b) Benchmark Replacement Conforming Changes. In connection with the use, administration, adoption, or implementation 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 or any other Loan Document.
(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, (ii) the effectiveness of any Benchmark Replacement Conforming Changes, and (iii) the removal or reinstatement of any tenor of SOFR. Any determination, decision, or election that may be made by the Administrative Agent or, if specified, the Required Lenders pursuant to this Section 1.06 — 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 or any selection — will be conclusive and binding absent manifest error and may be made in the Administrative Agent's or the Required Lenders' sole discretion and without consent from any other party to this Agreement or any other Loan Document, except, in each case, as expressly required pursuant to this Section 1.06.
(d) Benchmark Unavailability. At any time that SOFR or a successor Benchmark Replacement is not available or determinable, the Administrative Agent shall promptly notify the Borrower and the Lenders, and all outstanding SOFR Loans shall, on the last day of the applicable Interest Period, automatically convert to Base Rate Loans, and no further SOFR Loans may be made until such time as the SOFR rate or the applicable Benchmark Replacement, as applicable, is again available and determinable.
ARTICLE II — THE CREDIT FACILITY
Section 2.01 — Revolving Commitments
(a) Subject to the terms and conditions set forth herein, each Lender severally (and not jointly) agrees to make Revolving Loans to the Borrower, on a revolving basis, from time to time on and after the Closing Date until the Maturity Date, in an aggregate principal amount at any time outstanding not to exceed such Lender's Commitment; provided that, after giving effect to any Revolving Loan, (i) the aggregate outstanding principal amount of all Revolving Loans made by such Lender, together with such Lender's Pro Rata Share of the Letter of Credit Obligations, shall not exceed such Lender's Commitment, (ii) the aggregate outstanding principal amount of all Revolving Loans, together with the aggregate Letter of Credit Obligations, shall not exceed the lesser of (A) the Borrowing Base at such time and (B) the Total Commitment at such time, and (iii) Excess Availability (after giving effect to such Revolving Loan) shall not be less than the Minimum Excess Availability.
(b) Amounts repaid on account of Revolving Loans may be reborrowed, subject to the terms and conditions of this Agreement. The Commitments shall expire, and all outstanding Revolving Loans, together with all accrued and unpaid interest thereon and all other amounts owing hereunder, shall be due and payable in full, on the Maturity Date.
(c) As of the Closing Date, the Commitment of each Lender is as follows:
(d) The Borrower shall maintain Excess Availability equal to or greater than the Minimum Excess Availability of at all times.
Section 2.02 — Borrowing Procedures
(a) The Borrower shall deliver to the Administrative Agent a Borrowing Request, duly completed and executed by an Authorized Officer of the Borrower, specifying (i) the aggregate principal amount of the requested Revolving Loans, (ii) the date on which such Revolving Loans are to be made (which shall be a Business Day), (iii) whether such Revolving Loans will be SOFR Loans or Base Rate Loans, and (iv) in the case of SOFR Loans, the initial Interest Period applicable thereto.
(b) Each Borrowing Request for SOFR Loans shall be delivered not later than 11:00 a.m. (Central Time) at least one (1) Business Day prior to the proposed borrowing date. Each Borrowing Request for Base Rate Loans shall be delivered not later than 11:00 a.m. (Central Time) on the proposed borrowing date. Each Borrowing Request shall be irrevocable and shall constitute a representation and warranty by the Borrower that the conditions set forth in Section 4.02 have been satisfied on and as of the date of such request and will be satisfied on and as of the proposed borrowing date.
(c) Each Revolving Loan shall be in a minimum aggregate principal amount of $500,000 and integral multiples of $100,000 in excess thereof (or, if less, the remaining unused amount of the Total Commitment minus outstanding Letter of Credit Obligations).
(d) Promptly upon receipt of a Borrowing Request, the Administrative Agent shall notify each Lender of such request and of such Lender's Pro Rata Share of the requested Revolving Loans. Each Lender shall, on the proposed borrowing date, make its Pro Rata Share of such Revolving Loans available to the Administrative Agent in immediately available funds at the Administrative Agent's office in Chicago, Illinois not later than 1:00 p.m. (Central Time) on such borrowing date (or, in the case of same-day Base Rate Loans, not later than 3:00 p.m. (Central Time)). Upon satisfaction of the applicable conditions set forth in Section 4.02, the Administrative Agent shall make the proceeds of such Revolving Loans available to the Borrower by crediting the deposit account of the Borrower maintained with the Administrative Agent, or by such other means as may be agreed upon by the Administrative Agent and the Borrower.
(e) 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 Pro Rata Share of the requested Revolving Loans, the Administrative Agent may assume that such Lender has made such amount available on such borrowing date in accordance with clause (d) above and may, in reliance upon such assumption, make available to the Borrower a corresponding amount. If a Lender fails to make its Pro Rata Share of the requested Revolving Loans available to the Administrative Agent, such Lender shall, on demand, pay to the Administrative Agent the applicable amount, together with interest thereon at the Federal Funds Rate for the period from and including the borrowing date to but excluding the date on which such Lender makes such amount available to the Administrative Agent.
Section 2.03 — Repayment; Mandatory Prepayments
(a) Repayment at Maturity. The Borrower shall repay all outstanding Revolving Loans in full on the Maturity Date, together with all accrued and unpaid interest thereon and all other amounts owing under the Loan Documents.
(b) Mandatory Prepayments — Borrowing Base Excess. If at any time the aggregate outstanding principal amount of all Revolving Loans, together with the aggregate Letter of Credit Obligations, exceeds the lesser of (i) the Borrowing Base at such time and (ii) the Total Commitment at such time (such excess, a "Borrowing Base Deficiency"), the Borrower shall, within one (1) Business Day after becoming aware of such Borrowing Base Deficiency (whether through delivery of a Borrowing Base Certificate, notification by the Administrative Agent, or otherwise), prepay the Revolving Loans in an amount sufficient to eliminate such Borrowing Base Deficiency. If, after prepayment in full of all outstanding Revolving Loans, a Borrowing Base Deficiency continues to exist due to outstanding Letter of Credit Obligations, the Borrower shall cash collateralize the Letter of Credit Obligations to the extent of such remaining deficiency by depositing cash in a cash collateral account maintained with, and subject to the exclusive dominion and control of, the Administrative Agent.
(c) Mandatory Prepayments — Trigger Period. During a Trigger Period, all Collateral proceeds (including, without limitation, all collections on Accounts Receivable, proceeds of sales of inventory, and proceeds of insurance) shall be deposited into the concentration account described in Section 2.10 and applied on a daily basis to repay outstanding Revolving Loans and, after all Revolving Loans have been repaid in full, to cash collateralize outstanding Letter of Credit Obligations, in each case in accordance with Section 2.10.
(d) Voluntary Prepayments. The Borrower may voluntarily prepay the Revolving Loans, in whole or in part, at any time and from time to time, without premium or penalty (other than any break funding amounts payable pursuant to Section 3.05), upon delivery of a written notice to the Administrative Agent not later than 11:00 a.m. (Central Time) (i) at least one (1) Business Day prior to the date of prepayment in the case of SOFR Loans and (ii) on the date of prepayment in the case of Base Rate Loans. Each such voluntary prepayment shall be in a minimum aggregate principal amount of $500,000 and integral multiples of $100,000 in excess thereof (or, if less, the entire outstanding principal amount of the applicable Revolving Loans).
Section 2.04 — Letters of Credit
(a) General. Subject to the terms and conditions set forth herein, the Issuing Bank agrees to issue, amend, renew, or extend Letters of Credit for the account of the Borrower from time to time on and after the Closing Date until the Maturity Date; provided that (i) the aggregate Letter of Credit Obligations at any time outstanding shall not exceed $10,000,000 (the "LC Sublimit"), (ii) after giving effect to the issuance of any Letter of Credit, the conditions set forth in Section 2.01(a) shall continue to be satisfied, and (iii) each Letter of Credit shall have an expiry date no later than the earlier of (A) twelve (12) months from the date of issuance (or such later date as the Issuing Bank may agree in its sole discretion) and (B) the date that is five (5) Business Days prior to the Maturity Date.
(b) Issuance. The Borrower shall deliver to the Issuing Bank (with a copy to the Administrative Agent) an application and agreement for such Letter of Credit (in the Issuing Bank's customary form) and any other documentation the Issuing Bank may reasonably require, not less than three (3) Business Days prior to the proposed date of issuance (or such shorter period as the Issuing Bank may agree).
(c) Participations. Immediately upon the issuance of each Letter of Credit, each Lender shall be deemed to have irrevocably and unconditionally purchased and received from the Issuing Bank, without recourse or warranty, an undivided participation interest in such Letter of Credit (and each drawing thereunder and each reimbursement obligation with respect thereto) equal to such Lender's Pro Rata Share. If the Issuing Bank is not reimbursed by the Borrower on the date of a drawing under a Letter of Credit, the Administrative Agent shall promptly notify each Lender, and each Lender shall, within one (1) Business Day, fund its Pro Rata Share of such drawing to the Administrative Agent in immediately available funds.
(d) Fees. The Borrower shall pay the following fees with respect to Letters of Credit:
(i) Letter of Credit Fee. A fee on the aggregate undrawn face amount of all outstanding Letters of Credit at a rate per annum equal to the Applicable Margin for SOFR Loans, payable quarterly in arrears to the Administrative Agent for the ratable account of the Lenders.
(ii) Fronting Fee. A fronting fee to the Issuing Bank equal to 0.125% per annum on the aggregate undrawn face amount of all outstanding Letters of Credit issued by the Issuing Bank, payable quarterly in arrears.
(iii) Issuance and Administration Fees. Customary issuance, amendment, renewal, and administration fees as agreed between the Borrower and the Issuing Bank.