Exhibit 10.3
Eleventh Amendment to
Construction Loan Agreement
This Eleventh Amendment to Construction Loan
Agreement is dated as of the 30th day of March, 2006, and is by and
between LSCP, LLLP , an Iowa limited liability limited
partnership (“BORROWER”) and FIRST NATIONAL BANK OF
OMAHA (“BANK”), a national banking association
established at Omaha, Nebraska.
WHEREAS, the BANK and BORROWER executed a
written Construction Loan Agreement dated as of July 25, 2002,
which, together will all amendments thereto, is collectively called
the “AGREEMENT”.
WHEREAS, the BORROWER has requested a waiver of
Section 6.4.12 of the AGREEMENT to allow for a $5,700,000
capital project outside of the $1,000,000 annual Capital
Expenditure limit. This capital project will consist of the
purchase and construction of two 500,000 bushel cement grain bins
in anticipation of the potential 40MM gallon plant expansion, which
is scheduled to begin in August 2006.
WHEREAS, the BORROWER has requested interim
financing of $5,673,025 to finance the construction of grain
storage bins (“BRIDGE LOAN”) which will be paid off
with permanent financing prior to LOAN TERMINATION DATE.
Now, Therefore, in consideration of the
AGREEMENT, and their mutual promises made herein, BANK and BORROWER
agree as follows:
1.
Terms which are typed herein as all
capitalized words and are not defined herein shall have same
meanings as when described in the AGREEMENT.
2.
BORROWER acknowledges and agrees it
owes BANK (as part of its OBLIGATIONS):
•
TERM NOTE 2 which has a current
principal balance of $12,025,680.34;
•
TERM NOTE 3 which has a current
principal balance of $5,876,324.02;
•
TERM NOTE 4 which has a current
principal balance of $0, and a commitment of $5,000,000;
•
REVOLVING NOTE which has a current
principal balance of $0, and a commitment of $3,500,000
3.
Paragraph 1.19 of the AGREEMENT is
hereby amended to read as follows, effective
immediately:
1.19
“LOAN TERMINATION DATE”
means the earliest to occur of the following: (i) as the
REVOLVING NOTE, March 30, 2007; as to TERM NOTE 2, TERM NOTE
3, and TERM NOTE 4 June 1, 2008; as to BRIDGE NOTE
October 1, 2006; (ii) the date the OBLIGATIONS are
accelerated pursuant to this AGREEMENT; and (iii) the date
BANK receives (a) notice in writing from BORROWER of
BORROWER’s election to terminate this AGREEMENT and
(b) indefeasible payment in full of the
OBLIGATIONS.
4.
The following additional paragraphs
2.17 and 2.18 shall be added to the AGREEMENT, immediately
following existing paragraph 2.16:
2.17
BRIDGE LOAN. The BANK agrees, on the
terms and subject to the conditions hereinafter set forth, to make,
from time to time during the period from the date of execution of
this AGREEMENT to and including the LOAN TERMINATION DATE
disbursements to the BORROWER in an aggregate principal amount not
to exceed the amount of the BRIDGE LOAN for the sole purpose of
paying approved costs of the grain storage bins.
2.18
“BRIDGE NOTE” means the
promissory note of the BORROWER in the form of
Exhibit 11-A evidencing borrowings under the BRIDE LOAN of up
to a maximum amount of Five Million Six Hundred Seventy Three
Thousand Twenty Five ($5,673,025) Dollars. Notwithstanding any
provisions of BRIDGE NOTE, interest shall be payable at the rate
provided therein only on such portions of the BRIDGE LOAN proceeds
as actually have been disbursed pursuant to this AGREEMENT. Prior
to LOAN TERMINATION DATE, BORROWER shall pay BANK interest only,
due quarterly beginning June 1, 2006. On LOAN TERMINATION
DATE, the outstanding balance of BRIDGE NOTE will either be
(a) added to the principal balance of TERM NOTE 3, on terms
acceptable to BANK, or (b) paid from proceeds from a new loan
between BORROWER and BANK for the purpose of future expansion
funded at or prior to LOAN TERMINATION DATE.
5.
Paragraph 6.4.12 of the AGREEMENT is
hereby amended to read as follows, effective
immediately:
6.4.12
Make, or commit to make, capital
expenditures (including the total amount of any capital leases) in
an aggregate amount exceeding $1,000,000 in any single fiscal year,
including the current fiscal year; provided, however, BANK consents
to BORROWER’s expenditure of up to $5,700,000.00 in capital
expenditures, in addition to the foregoing limitation, during the
fiscal year 2006 for the purchase and construction of two 500,000
bushel cement grain bins.
6.
BORROWER certifies by its execution
hereof that the representations and warranties set forth in
Section 5 of the AGREEMENT are true as of this date
(exc
