PILGRIM'S PRIDE CORPORATION
THIRD AMENDMENT TO AMENDED AND RESTATED SECURED CREDIT AGREEMENT
Harris Trust and Savings Bank
Chicago, Illinois
U.S. Bancorp Ag Credit, Inc.
(formerly known as FBS Ag Credit, Inc.)
Denver, Colorado
CoBank, ACB
Wichita, Kansas
SunTrust Bank, Atlanta
Atlanta, Georgia
Credit Agricole Indosuez, Chicago Branch (successor by
merger to Caisse Nationale de Credit Agricole, Chicago Branch)
Chicago, Illinois
Ladies and Gentlemen:
Reference is hereby made to that certain Amended and Restated Secured
Credit Agreement dated as of August 11, 1997, as amended (the "CREDIT
AGREEMENT") among the undersigned, Pilgrim's Pride Corporation, a Delaware
corporation (the "COMPANY"), you (the "BANKS") and Harris Trust and Savings
Bank, as agent for the Banks (the "AGENT"). All defined terms used herein
shall have the same meanings as in the Credit Agreement unless otherwise
defined herein.
The Company, the Agent and the Banks now wish to amend the Credit
Agreement to extend the Termination Date of the Credit Agreement from
May 31, 2001 to May 31, 2002, provide for the transfer of ownership of the
stock of the Company from Mr. and Mrs. Lonnie A. "Bo" Pilgrim to Pilgrim
Interests, Ltd., a Texas limited partnership (the "GUARANTOR"), to provide
for the substitution of Mr. and Mrs. Lonnie A. "Bo" Pilgrim's Guaranty
Agreement dated May 27, 1993 to the Banks with a guaranty from the
Guarantor and to amend certain covenants contained in the Credit Agreement,
all on the terms and conditions and in the manner set forth in this
Amendment.
1. AMENDMENTS.
Upon satisfaction of all of the applicable conditions precedent set
forth in Section 2 hereof, the Credit Agreement shall be amended, effective
as of the dates specified below, as follows:
1.1. Effective as of April 1, 1999, Section 1.1(a) of the Credit
Agreement shall be amended by replacing the date "May 31, 2001" appearing
therein with the date "May 31, 2002".
1.2. Effective as of April 1, 1999, Section 4 of the Credit Agreement
shall be amended by adding thereto the following definitions:
" "PPAHC" shall mean Pilgrim's Pride Affordable Housing Corp., a
Nevada corporation."
1.3. Effective as of the date (the "GUARANTY SUBSTITUTION DATE") on
which all of the conditions precedent set forth in Section 2.2 of this
Amendment are satisfied, Section 4 of the Credit Agreement shall be amended
by adding thereto the following definitions:
"`GUARANTOR' shall mean Pilgrim Interests, Ltd., a Texas limited
partnership.
"PARTNERSHIP GUARANTY" shall mean the Guaranty Agreement from the
Guarantor to the Banks, as the same may be supplemented and amended
from time to time."
1.4. Effective as of the Guaranty Substitution Date, the definition of
the term "Change in Control" contained in Section 4 of the Credit Agreement
shall be amended to read as follows:
"`CHANGE IN CONTROL' means (a) a sale of all or substantially all
the assets of the Company to any Person or related group of Persons as
an entirety or substantially as an entirety in one transaction or
series of transactions, (b) the merger or consolidation of the Company
with or into another corporation or the merger of another corporation
into the Company with the effect that immediately after such
transaction the stockholders of the Company immediately prior to such
transaction hold less than 50% of the total voting power generally
entitled to vote in the election of directors, managers or trustees of
the Person surviving such merger or consolidation, (c) the Guarantor
or the Pilgrim Family shall cease to own more than 50% of the total
voting power generally entitled to vote in the election of directors,
managers or trustees of the Company or more than 50% of all non-voting
classes of Capital Stock of the Company, (d) during any period of two
consecutive years, individuals who at the beginning of such period
constituted the Board of Directors of the Company (together with any
new directors whose election by such Board or whose nomination for
election by the stockholders of the Company was approved by a vote of
a majority of the directors then still in office who were either
directors at the beginning of such period or whose election or
nomination for election was previously so approved) cease for any
reason to constitute a majority of the Board of Directors of the
Company then in office, or (e) the stockholders of the Company shall
approve any plan for the liquidation or dissolution of the Company."
1.5. Effective as of the Guaranty Substitution Date, the Credit
Agreement shall be amended by adding the following provision thereto as
Section 5.19:
"SECTION 5.19. ORGANIZATION AND QUALIFICATION OF THE GUARANTOR. The
Guarantor is a limited partnership duly organized and existing and in
good standing under the laws of the State of Texas, has full and
adequate partnership power to carry on its business as now conducted,
is duly licensed or qualified in all jurisdictions wherein the nature
of its activities requires such licensing or qualification except
where the failure to be so licensed or qualified would not have a
material adverse effect on the condition, financial or otherwise, of
the Guarantor, has full right and authority to enter into the
Partnership Guaranty, to guaranty the payment when due of the
Company's indebtedness, obligations and liabilities to the Banks under
the Loan Documents pursuant to the Partnership Guaranty and to perform
each and all of the matters and things therein provided for; and the
Partnership Guaranty does not, nor does the performance or observance
by the Guarantor of any of the matters or things provided for in the
Partnership Guaranty, contravene any provision of law or any provision
of the Guarantor's certificate of limited partnership or its limited
partnership agreement or any covenant, indenture or agreement of or
affecting the Guarantor or its Properties."
1.6. Effective as of April 1, 1999, Section 7.4(a) of the Credit
Agreement shall be amended to read as follows:
"(a) as soon as available, and in any event within 45 days after
the close of each quarterly fiscal period of the Company a copy of the
consolidated and consolidating balance sheet, statement of income and
retained earnings, statement of cash flows, and the results of
operations for each division of the Company, for such period of the
Company and its Subsidiaries, together with all such information for
the year to date, all in reasonable detail, prepared by the Company
and certified on behalf of the Company by the Company's chief
financial officer;".
1.7. Effective as of April 1, 1999, Section 7.7 of the Credit Agreement
shall be amended by adding the following phrase immediately before the
period appearing at the end thereof:
", and (d) the guaranties and environmental indemnities
described in Section 7.17(s) hereof."
1.8. Effective as of April 1, 1999, Section 7.8 of the Credit Agreement
shall be amended to read as follows:
"SECTION 7.8. LEVERAGE RATIO. The Company will not permit the
ratio of its Leverage Ratio at any time during each period specified
below to exceed the ratio specified below for such period:
(a) from the last day of Fiscal Year 1998 through the next
to last day of Fiscal Year 1999, 0.625 to 1; and
(b) on the last day of Fiscal Year 1999 and thereafter, 0.60
to 1."
1.9. Effective as of April 1, 1999, Section 7.14 of the Credit
Agreement shall be amended to read as follows:
"SECTION 7.14. Intentionally Omitted."
1.10. Effective as of April 1, 1999, Section 7.16 of the Credit
Agreement shall be amended by deleting the word "and" appearing after the
semi-colon at the end of subsection (o) thereof, by replacing the period at
the end of subsection (p) thereof with the phrase "; and" and by adding the
following provision thereto as subsection (q):
"(q) liens and security interests granted by PPAHC on its real
estate and all buildings and improvements thereon and all rents,
issues and profits thereof securing indebtedness permitted by
Section 7.17(r) hereof."
1.11. Effective as of April 1, 1999, Section 7.17 of the Credit
Agreement shall be amended by deleting the word "and" appearing after the
semi-colon at the end of subsection (p) thereof, by replacing the period at
the end of subsection (q) thereof with the phrase "; and" and by adding the
following provisions thereto as subsections (r) and (s):
"(r) indebtedness of PPAHC to Harris Trust and Savings Bank in an
aggregate principal amount not to exceed $1,750,000 incurred to
finance the construction by PPAHC of an apartment building in Camp
County, Texas, and any indebtedness incurred to refinance such
indebtedness; and
(s) indebtedness of the Company under its guaranty of payment to
Harris Trust and Savings Bank, and any refinancing lender or lenders,
of PPAHC's indebtedness described in subsection (r) above and its
environmental indemnity given to Harris Trust and Savings Bank, and
any refinancing lender or lenders, in connection with PPAHC's
indebtedness described in subsection (r) above."
1.12. Effective as of April 1, 1999, Section 7.18 of the Credit
Agreement shall be amended by deleting the word "and" appearing after the
semi-colon at the end of subsection (k) thereof, by replacing the period at
the end of subsection (l) thereof with the phrase "; and" and by adding the
following provision thereto as subsection (m):
"(m) loans and advances to officers and employees of the Company
and its Subsidiaries made in connection with such officer's and
employee's for housing related expenses or loans associated with the
procurement or sale of personal residences or necessary for the moving
of key personnel, in an aggregate outstanding amount not to exceed
$3,000,000 at any time."
1.13. Effective as of April 1, 1999, Section 7.23 of the Credit
Agreement shall be amended to read as follows:
"SECTION 7.23. CONDUCT OF BUSINESS AND MAINTENANCE OF EXISTENCE. The
Company will, and will cause each Subsidiary to, continue to engage in
business of the same general type as now conducted by it and, in the
case of PPAHC, to engage in no business other than the construction,
acquisition and renting, as landlord, an apartment building in Camp
County, Texas, and the Company will, and will cause each Subsidiary
to, preserve, renew and keep in full force and effect its corporate
existence and its rights, privileges and franchises necessary or
desirable in the normal conduct of business."
1.14. Effective as of April 1, 1999, Section 7.29 of the Credit
Agreement shall be amended to read as follows:
"SECTION 7.29. NEW SUBSIDIARIES. The Company will not, directly or
indirectly, create or acquire any Subsidiary except Funding Corp. and
PPAHC unless (a) after giving effect to any such creation or
acquisition, the total assets (determined in accordance with generally
accepted accounting principles, consistently applied) of all such
Subsidiaries would not exceed 5% of the Total Assets of the Company
and its Subsidiaries, and (b) all Inventory and Receivables of such
Subsidiaries are pledged to the Agent for the benefit of the Banks
pursuant to a security agreement substantially identical to the
Security Agreement."
1.15. Effective as of the Guaranty Substitution Date, Section 7.30 of
the Credit Agreement shall be amended to read as follows:
"SECTION 7.30. GUARANTY FEES. The Company will not, and it will not
permit any Subsidiary to, directly or indirectly, pay to the Guarantor
or any other guarantor of any of the Company's indebtedness,
obligations and liabilities, any fee or other compensation, but
excluding salary, bonus and other compensation for services rendered
as an employee (collectively the "GUARANTY FEES") in an aggregate
amount in excess of $1,400,000 in any Fiscal Year of the Company. For
purposes of this Section 7.30, any Guaranty Fees paid within 45 days
after the last day of any Fiscal Year shall be deemed to have been
paid during such Fiscal Year."
1.16. Effective as of the Guaranty Substitution Date, Sections 8.1(l),
(m) and (n) of the Credit Agreement shall be amended to read as follows:
"(l) Any shares of the capital stock of the Company owned
legally or beneficially by the Guarantor or Mr. and/or Mrs.
Lonnie A. Pilgrim shall be pledged, assigned or otherwise
encumbered for any reason, other than the pledge of up to
2,000,000 shares to secure personal obligations of Mr. and Mrs.
Lonnie A. Pilgrim or such other personal obligations incurred by
any Person so long as such obligations are not related to the
financing of the Company of any of its Subsidiaries;
(m) the Guarantor or Mr. and Mrs. Lonnie A. Pilgrim and
their descendants and heirs shall for any reason cease to have
legal and/or beneficial ownership of no less than 51% of the
issued and outstanding shares of all classes of capital stock of
the Company;
(n) the Guarantor shall terminate, breach, repudiate or
disavow the Partnership Guaranty or any part thereof, or any
event specified in Sections 8.1(i) or (j) shall occur with regard
to the Guarantor;".
2. CONDITIONS PRECEDENT.
2.1. The effectiveness of Sections 1.1, 1.2, 1.6, 1.7, 1.8, 1.9, 1.10,
1.11, 1.12, 1.13 and 1.14 of this Amendment is subject to the satisfaction
of all of the following conditions precedent:
(a) The Company and each of the Banks shall have executed this
Amendment (such execution may be in several counterparts and the several
parties hereto may execute on separate counterparts);
(b) The Agent shall have received, in sufficient counterparts for
distribution to the Banks:
(i) copies (executed or certified as may be appropriate) of
resolutions of the Company's board of directors authorizing the
transactions contemplated by this Amendment and all other legal
documents or proceedings, if any, taken in connection with the
execution and delivery of this Amendment, and the other instruments
and documents contemplated hereby; and
(ii) the opinion of counsel to the Company substantially in the
form of Exhibit C hereto and satisfactory to the Agent, the Banks and
their respective counsel; and
(c) The Agent shall have received for the ratable benefit of the Banks
that execute this Amendment (the "APPROVING BANKS") an amendment fee in an
amount equal to one-eighth of one percent (0.125%) of the maximum amount of
the Revolving Credit Commitment of each of the Approving Banks;
(d) Each of the representations and warranties set forth in Section 5
of the Credit Agreement shall be true and correct;
(e) The Company shall be in full compliance with all of the terms and
conditions of the Credit Agreement, except for its non-compliance with
Section 7.14 of the Credit Agreement as of April 3, 1999 (the " EXISTING
DEFAULT") and no Event of Default or Potential Default, except the Existing
Default, shall have occurred and be continuing thereunder or shall result
after giving effect to this Amendment; and
(f) All legal matters incident to the execution and delivery hereof
and the instruments and documents contemplated hereby shall be satisfactory
to the Banks.
2.2. The effectiveness of Sections 1.3, 1.4, 1.5 and 1.15 of this
Amendment is subject to the satisfaction of all of the following conditions
precedent:
(a) The Agent shall have received, in sufficient counterparts for
distribution to the Banks:
(i) a Guaranty Agreement in the form of Exhibit A hereto executed
by all of the general partners in the Guarantor;
(ii) copies, certified as true and complete by a general partner
in the Guarantor, of the agreement of limited partnership of the
Guarantor and all amendments thereto;
(iii) a copy, certified by the Secretary of State of Texas as of a
date no earlier than 30 days before the date of the Partnership
Guaranty, of the Certificate of Limited Partnership of the Guarantor;
(iv) the opinion of counsel to the Guarantor substantially in the
form of Exhibit B hereto and satisfactory to the Agent, the Banks and
their respective counsel; and
(v) copies (executed or certified as may be appropriate) of
resolutions of all legal documents or proceedings, if any, taken in
connection with the execution and delivery of this Amendment, and the
other instruments and documents contemplated hereby;
(b) Each of the representations and warranties set forth in Section 5
of the Credit Agreement shall be true and correct;
(c) The Company shall be in full compliance with all of the terms and
conditions of the Credit Agreement, except for the Existing Default, and no
Event of Default or Potential Default, except the Existing Default, shall
have occurred and be continuing thereunder or shall result after giving
effect to this Amendment; and
(d) All legal matters incident to the execution and delivery hereof
and the instruments and documents contemplated hereby shall be satisfactory
to the Banks.
3. REPRESENTATIONS AND WARRANTIES.
3.1. The Company, by its execution of this Amendment, hereby represents
and warrants the following:
(a) each of the representations and warranties set forth in
Section 5 of the Credit Agreement is true and correct as of the date
hereof, except that the representations and warranties made under
Section 5.3 shall be deemed to refer to the most recent annual report
furnished to the Banks by the Company; and
(b) the Company is in full compliance with all of the terms and
conditions of the Credit Agreement, except for the Existing Default,
and no Event of Default or Potential Default, except for the Existing
Default, has occurred and is continuing thereunder.
4. MISCELLANEOUS.
4.1. The Company has heretofore executed and delivered to the Agent
that certain Security Agreement Re: Accounts Receivable, Farm Products and
Inventory dated as of May 27, 1993, as amended (the "SECURITY AGREEMENT")
and the Company hereby agrees that the Security Agreement shall secure all
of the Company's indebtedness, obligations and liabilities to the Agent and
the Banks under the Credit Agreement as amended by this Amendment, that
notwithstanding the execution and delivery of this Amendment, the Security
Agreement shall be and remain in full force and effect and that any rights
and remedies of the Agent thereunder, obligations of the Company thereunder
and any liens or security interests created or provided for thereunder
shall be and remain in full force and effect and shall not be affected,
impaired or discharged thereby. Nothing herein contained shall in any
manner affect or impair the priority of the liens and security interests
created and provided for by the Security Agreement as to the indebtedness
which would be secured thereby prior to giving effect to this Amendment.
4.2. Except as specifically amended herein the Credit Agreement and the
Notes shall continue in full force and effect in accordance with their
original terms. Reference to this specific Amendment need not be made in
any note, document, letter, certificate, the Credit Agreement itself, the
Notes, or any communication issued or made pursuant to or with respect to
the Credit Agreement, any reference to the Credit Agreement being
sufficient to refer to the Credit Agreement as amended hereby.
4.3. The Company agrees to pay all out-of-pocket costs and expenses
incurred by the Agent and Banks in connection with the preparation,
execution and delivery of this Amendment and the documents and transactions
contemplated hereby, including the fees and expenses of Messrs. Chapman and
Cutler.
4.4. This Amendment may be executed in any number of counterparts, and
by the different parties on different counterparts, all of which taken
together shall constitute one and the same Agreement. Any of the parties
hereto may execute this Amendment by signing any such counterpart and each
of such counterparts shall for all purposes be deemed to be an original.
4.5. (A) THIS AMENDMENT AND THE RIGHTS AND DUTIES OF THE PARTIES
HERETO, SHALL BE CONSTRUED AND DETERMINED IN ACCORDANCE WITH THE INTERNAL
LAWS OF THE STATE OF ILLINOIS, EXCEPT TO THE EXTENT PROVIDED IN
SECTION 4.5(b) HEREOF AND TO THE EXTENT THAT THE FEDERAL LAWS OF THE UNITED
STATES OF AMERICA MAY OTHERWISE APPLY.
(b) NOTWITHSTANDING ANYTHING IN SECTION 4.5(a) HEREOF TO THE CONTRARY,
NOTHING IN THIS AMENDMENT, THE CREDIT AGREEMENT, THE NOTES, OR THE OTHER
LOAN DOCUMENTS SHALL BE DEEMED TO CONSTITUTE A WAIVER OF ANY RIGHTS WHICH
THE COMPANY, THE AGENT OR ANY OF THE BANKS MAY HAVE UNDER THE NATIONAL BANK
ACT OR OTHER APPLICABLE FEDERAL LAW.
4.6. Upon the Guaranty Substitution Date Mr. and Mrs. Lonnie A. "Bo"
Pilgrim shall be released from their obligations under the Guaranty
Agreement dated May 27, 1993, without any further action by the Agent, the
Banks or any of them, and such Guaranty Agreement thereafter shall be of no
force or effect.
Dated as of April 1, 1999.
PILGRIM'S PRIDE CORPORATION
By
Its Chief Financial Officer
Accepted and Agreed to as of the day and year last above written.
HARRIS TRUST AND SAVINGS BANK individually
and as Agent
By
Its Managing Director
U.S. BANCORP AG CREDIT, INC.
By
Its
COBANK, ACB
By
Its
SUNTRUST BANK, ATLANTA
By
Its
By
Its
CREDIT AGRICOLE INDOSUEZ, CHICAGO BRANCH
By
Its
By
Its
EXHIBIT B
(To Be Retyped On Letterhead Of Counsel
And Dated As Of Date Of Closing)
__________________, 1999
Harris Trust and Savings Bank
Chicago, Illinois
U.S. Bancorp Ag Credit, Inc.
Denver, Colorado
CoBank, ACB
Wichita, Kansas
SunTrust Bank, Atlanta
Atlanta, Georgia
Credit Agricole Indosuez, Chicago Branch
(successor by merger to Caisse Nationale de Credit
Agricole, Chicago Branch)
Chicago, Illinois
Ladies and Gentlemen:
We have served as counsel to Pilgrim Interests, Ltd., a Texas limited
partnership (the "GUARANTOR") in connection with the Guarantor guaranteeing
payment of the indebtedness of Pilgrim's Pride Corporation, a Texas
corporation (the "BORROWER"), to you under the Amended and Restated Secured
Credit agreement dated as of August 11, 1997, as amended (the "CREDIT
AGREEMENT"). As such counsel, we have supervised the taking of the
proceedings necessary to authorize the execution and delivery of, and have
examined executed originals of, the Guaranty Agreement dated
__________________, 1999 (the "GUARANTY") executed and delivered by the
Guarantor to you. As counsel to the Guarantor, we are familiar with the
certificate of limited partnership, limited partnership agreement and any
other agreements under which the Guarantor is organized. We have also
examined such other instruments and records and inquired into such other
factual matters and matters of law as we deem necessary or pertinent to the
formulation of the opinions hereinafter expressed.
Based upon the foregoing and upon our examination of the certificate
of limited partnership and limited partnership agreement of the Guarantor,
we are of the opinion that:
1. The Borrower is a limited partnership duly organized and validly
existing and in good standing under the laws of the State of Texas with
full and adequate power and authority to carry on its business as now
conducted and is duly licensed or qualified and in good standing in all
jurisdictions wherein the conduct of its business or the assets and
properties owned or leased by it require such licensing or qualification.
2. The Guarantor has full right, power and authority to guarantee the
payment of the Borrower's indebtedness to you, to execute and deliver the
Guaranty executed by it and to observe and perform all the matters and
things therein provided for. The execution and delivery of the Guaranty
executed by the Guarantor does not, nor will the observance or performance
of any of the matters or things therein provided for, contravene any
provision of law or of the certificate of limited partnership or limited
partnership agreement of the Guarantor (there being no other agreements
under which the Guarantor is organized) or, to the best of our knowledge
after due inquiry, of any covenant, indenture or agreement binding upon or
affecting the Borrower or any of its properties or assets.
3. The Guaranty executed by the Guarantor has been duly authorized by
all necessary action, has been executed and delivered by the proper
officers of the Guarantor and constitutes the valid and binding agreement
of the Guarantor enforceable against it in accordance with their respective
terms, subject to bankruptcy, insolvency and other similar laws affecting
creditors' rights generally and to general principles of equity.
4. No order, authorization, consent, license or exemption of, or
filing or registration with, any court or governmental department, agency,
instrumentality or regulatory body, whether local, state or federal, is or
will be required in connection with the lawful execution and delivery of
the Guaranty or the observance and performance by the Guarantor of any of
the terms thereof.
5. To the best of our knowledge after due inquiry, there is no
action, suit, proceeding or investigation at law or in equity before or by
any court or public body pending or threatened against or affecting the
Guarantor or any of its assets and properties which, if adversely
determined, could result in any material adverse change in the properties,
business, operations or financial condition of the Guarantor.
Respectfully submitted,
EXHIBIT C
(To Be Retyped On Letterhead Of Counsel
And Dated As Of Date Of Closing)
__________, 1999
Harris Trust and Savings Bank
Chicago, Illinois
U.S. Bancorp Ag Credit, Inc.
(formerly known as FBS Ag Credit, Inc.)
Denver, Colorado
CoBank, ACB
Wichita, Kansas
SunTrust Bank, Atlanta
Atlanta, Georgia
Credit Agricole Indosuez, Chicago Branch (successor by
merger to Caisse Nationale de Credit Agricole, Chicago Branch)
Chicago, Illinois
Ladies and Gentlemen:
We have served as counsel to Pilgrim's Pride Corporation, a Delaware
corporation (the "BORROWER"), in connection with the amendment and
extension of the revolving credit facility being made available by you to
the Borrower pursuant to the Amended and Restated Secured Credit Agreement
dated as of August 11, 1997, as amended (the "CREDIT AGREEMENT"), among the
Borrower and you. As such counsel, we have supervised the taking of the
corporate proceedings necessary to authorize the execution and delivery of,
and have examined executed originals of, the Third Amendment to Amended and
Restated Secured Credit Agreement dated as of ___________________, 1999
(the "AMENDMENT") among the Borrower and you. As counsel to the Borrower,
we are familiar with the articles of incorporation, charter, by-laws and
any other agreements under which the Borrower is organized. We have also
examined such other instruments and records and inquired into such other
factual matters and matters of law as we deem necessary or pertinent to the
formulation of the opinions hereinafter expressed.
Based upon the foregoing and upon our examination of the articles of
incorporation, charter and by-laws of the Borrower, we are of the opinion
that:
1. The Borrower is a corporation duly organized and validly existing
and in good standing under the laws of the State of Delaware with full and
adequate corporate power and authority to carry on its business as now
conducted and is duly licensed or qualified and in good standing in all
jurisdictions wherein the conduct of its business or the assets and
properties owned or leased by it require such licensing or qualification.
2. The Borrower has full right, power and authority to borrow from
you, to mortgage, pledge, assign and otherwise encumber its assets and
properties as collateral security for such borrowings, to execute and
deliver the Amendment executed by it and to observe and perform all the
matters and things therein provided for. The execution and delivery of the
Amendment by the Borrower does not, nor will the observance or performance
of any of the matters or things therein provided for, contravene any
provision of law or of the respective articles of incorporation, charter or
by-laws of the Borrower (there being no other agreements under which the
Borrower is organized) or, to the best of our knowledge after due inquiry,
of any covenant, indenture or agreement binding upon or affecting the
Borrower or any of its properties or assets.
3. The Amendment executed by the Borrower has been duly authorized by
all necessary corporate action (no stockholder approval being required),
has been executed and delivered by the proper officers of the Borrower and
the Credit Agreement, as amended by the Amendment, constitutes a valid and
binding agreement of the Borrower enforceable against it in accordance with
its terms, subject to bankruptcy, insolvency and other similar laws
affecting creditors' rights generally and to general principles of equity.
4. No order, authorization, consent, license or exemption of, or
filing or registration with, any court or governmental department, agency,
instrumentality or regulatory body, whether local, state or federal, is or
will be required in connection with the lawful execution and delivery of
the Amendment or the observance and performance by the Borrower of any of
the terms of the Credit Agreement as amended by the Amendment.
5. To the best of our knowledge after due inquiry, there is no
action, suit, proceeding or investigation at law or in equity before or by
any court or public body pending or threatened against or affecting the
Borrower or any of its assets and properties which, if adversely
determined, could result in any material adverse change in the properties,
business, operations or financial condition of the Borrower or in the value
of the collateral security for your loans and other credit accommodations
to the Borrower.
6. The rates of interest provided for under the Credit Agreement and
the Loan Documents (as defined in the Credit Agreement) and any other
amounts payable thereunder that would constitute interest would not violate
any usury law of the State of Texas should such laws apply to the Credit
Agreement, any of the Loan Documents or any of the indebtedness,
obligations and liabilities of the Borrower thereunder.
We are admitted to practice law only in the State of Texas and do not
purport to be experts in or qualified to express legal conclusions with
respect to the laws of any jurisdiction other than the State of Texas or of
the United States of America, except the Business Corporation Act of the
State of Delaware.
Respectfully submitted,