Exhibit 10.8
Execution Copy
SECOND AMENDMENT TO LOAN AGREEMENT
(Series 1990B, Lot 1)
THIS SECOND AMENDMENT TO LOAN AGREEMENT, dated as of this 1st day of
July, 1998, among the Minnesota Agricultural and Economic Development Board,
as the statutory successor to the Minnesota Energy and Economic Development
Authority (the "Authority") (collectively herein, such Board and
Authority shall be referred to as the "Board") and Merrill/May, Inc. (the
"Borrower") is being entered into to amend and modify certain provisions of
the Loan Agreement dated as of July 1, 1990 (the "1990 Loan Agreement") by
and between the Board and May Printing Company (the "1990 Borrower") as
amended by the First Amendment to Loan Agreement dated as of December 31,
1993 (the "First Amendment to Loan Agreement") by and between the Board and
the Borrower; and
WHEREAS, pursuant to the 1990 Loan Agreement, the 1990 Borrower was
provided a loan in the original principal amount of $4,205,000; and
WHEREAS, the 1990 Borrower entered into an agreement under which the
1990 Borrower sold and transferred to Merrill/May, Inc. (the "Borrower")
substantially all of the operating assets and selected liabilities of the
1990 Borrower pursuant to that certain Asset Purchase Agreement dated
December 31, 1993 (the "Asset Purchase Agreement"); and
WHEREAS, in connection with the Asset Purchase Agreement, the Borrower
agreed to assume the obligations of the 1990 Borrower under the 1990 Loan
Agreement by entering into a First Amendment to Loan Agreement dated as of
December 31, 1993 (the "First Amendment to Loan Agreement") (the 1990 Loan
Agreement as amended by the First Amendment to Loan Agreement is referred to
herein as the "Original Loan Agreement") so as to reflect the obligations
under the Original Loan Agreement by the Borrower; and
WHEREAS, the Borrower has requested that the Board issue, pursuant to
MINNESOTA STATUTES, Chapter 41A (and including certain provisions of
MINNESOTA STATUTES 1986, Chapter 116M notwithstanding the repeal thereof)
(collectively the "Act"), its Minnesota Agricultural and Economic
Development Board Minnesota Small Business Development Loan Program Refunding
Revenue Bonds, Series 1998B, Lot 2 (the "Series 1998B Lot 2 Bonds") in the
principal amount not to exceed $3,320,000 to fund a loan to the Borrower to
redeem and prepay on August 1, 1998 the outstanding principal amount of the
Minnesota Agricultural and Economic Development Board Minnesota Small
Business Development Loan Program Revenue Bonds, Series 1990B, Lot 1 (the
"Series 1990B Lot 1 Bonds") previously issued by the Board to finance the
Project (as defined in the Original Loan Agreement);
WHEREAS, the Borrower has requested that the Board enter into this
Second Amendment to Loan Agreement to refund the Series 1990B Lot 1 Bonds; and
WHEREAS, Section 6.08 of the Minnesota Small Business Development Loan
Program Revenue Bonds General Bond Resolution adopted by the Board on
September 26, 1984 (the "General Bond Resolution") provides that the Board
may consent to any amendment or modification of a loan agreement, security
instrument or any other security arrangement that would not impair or
materially adversely affect in any manner the rights or security of holders
of the Bonds (as defined in the General Bond Resolution); and
WHEREAS, the Board approved Resolution 98-317 on June 29, 1998,
approving this Second Amendment to Loan Agreement; and
NOW, THEREFORE, the parties hereby desire to amend the Original Loan
Agreement and hereby covenant and agree as follows:
Section 1. DEFINITIONS. The following definitions in Section 1.1. are
deleted in their entirety and new definitions as follows are substituted in
lieu thereof:
"Agreement" means the Loan Agreement dated as of July 1, 1990
between the 1990 Borrower and the Board as amended and supplemented by
the First Amendment to Loan Agreement dated as of December 31, 1993
between the Borrower and the Board and as further amended and
supplemented by this Second Amendment to Loan Agreement dated as of
July 1, 1998 between the Borrower and the Board.
"Business Loan Reserve Account Requirement" means, as of any date
of calculation, with respect to any Lot of Bonds, that sum which is equal
to (i) the maximum Aggregate Debt Service for any Bond Year over the
period from the date of calculation to (and including) the final
maturity date of such Lot of Bonds or (ii) such lesser amount as shall
be required pursuant to Section 103(c) of the Code to preserve the
tax-exempt status of such Lot of Bonds.
"Note" means the promissory note of the Borrower dated as of the
date of the Series 1998B Lot 2 Bonds, evidencing the Borrower's
obligations pursuant to this Agreement, substantially in the form of
Appendix I hereto.
"Single Lot Bonds" means the Minnesota Agricultural and Economic
Development Board Minnesota Small Business Development Loan Program
Refunding Revenue Bonds, Series 1998B Lot 2 in the aggregate principal
amount of $3,320,000 authorized by the Single Lot Resolution.
"Single Lot Resolution" means the Single Lot Bond Resolution of the
Authority authorizing the issuance of the 1990B Lot 1 Bonds adopted by
the Authority on June 29, 1990 as amended by the resolution by the
Authority on June 29, 1998 authorizing the issuance of the Series
1998B Lot 2 Bonds.
Section 2. APPENDIX I. Appendix I to the Original Loan Agreement is
deleted in its entirety and a new Appendix I is substituted therefore in the
form of Appendix I hereto.
Section 3. AUTHORITY FOR SECOND AMENDMENT TO LOAN AGREEMENT. This
Second Amendment to Loan Agreement is being entered into without need for the
consent of the holders of any Bond (as defined in the General Bond
Resolution) issued under the General Bond Resolution being obtained pursuant
to Section 12.4 of the Loan Agreement and Section 6.08 of the General Bond
Resolution. The Borrower hereby represents that the amendments to the
Original Loan Agreement set forth in this Second Amendment to Loan Agreement
will not impair or materially adversely affect in any manner, the rights or
security of the bondholders of the Related Lot of Bonds (as defined in the
Original Loan Agreement).
Section 4. DELIVERY OF DOCUMENTATION. The Borrower agrees to execute
and deliver to the Board any and all documents, amendments to documents,
filings, and notices as reasonably requested by the
-2-
Board to memorialize this Second Amendment to Loan Agreement and provide
notice as required under law or as deemed appropriate by the Board.
Section 5. NO FURTHER MODIFICATIONS OR REVISIONS. Except as amended
hereby, the Original Loan Agreement and all bond documents issued thereunder,
as they relate thereto, shall remain in full force and effect.
Section 6. EFFECTIVENESS. This Second Amendment to Loan Agreement shall
become effective as of the date first written above.
-3-
IN WITNESS WHEREOF, the Board and the Borrower have caused this Second
Amendment to Loan Agreement to be executed in their respective names as of
the date first above written.
MINNESOTA AGRICULTURAL AND ECONOMIC
DEVELOPMENT BOARD, as statutory
successor to the Minnesota Energy and
Economic Development Authority
By /s/ Paul Moe
-----------------------------------
Its Executive Director
MERRILL/MAY, INC.
By /s/ John Castro
-----------------------------------
Its President
Signature page of the Second Amendment to Loan Agreement between the
Minnesota Agricultural and Economic Development Board and Merrill/May, Inc.
dated as of July 1, 1998.
-4-