EXHIBIT 10.4
SECURITY AGREEMENT
This Security Agreement
(“Agreement”), dated as of April 3, 2008, is between
Green Plains Grain Company LLC, a Delaware limited liability
company (the “Debtor”), and First National Bank of
Omaha, a national banking association (the “Secured
Party”).
WHEREAS, Debtor has entered into a Credit
Agreement dated of even date with this Agreement (as amended,
restated and in effect from time to time, the “Credit
Agreement”), with Secured Party, pursuant to which Secured
Party, subject to the terms and conditions contained therein, is
to make loans or otherwise to extend credit to Debtor; and
WHEREAS, it is a condition precedent to Secured
Party extending the Obligations to Debtor under the Credit
Agreement that Debtor execute and deliver to Secured Party a
security agreement in substantially the form hereof; and
WHEREAS, Debtor wishes to grant a security
interest in favor of Secured Party as herein provided.
NOW, THEREFORE, in consideration of the promises
contained herein and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged,
the parties hereto agree as follows:
SECTION 1.
Definitions . All
capitalized terms used herein without definitions shall have the
respective meanings provided therefor in the Credit Agreement.
The term “State,” as used herein, means the State of
Nebraska. All terms defined in the Uniform Commercial Code of
the State and used herein shall have the same definitions herein
as specified therein. However, if a term is defined in
Article 9 of the Uniform Commercial Code of the State
differently than in another Article of the Uniform Commercial
Code of the State, the term has the meaning specified in Article
9.
SECTION 2.
Grant of Security Interest .
Debtor hereby grants to Secured Party to secure the
payment and performance in full of all of the Obligations, a
first priority security interest in and so pledges and assigns
to Secured Party all goods, property, assets and rights of
Debtor (other than rolling stock and equipment owned by Debtor
on the date hereof) including, but not limited to, the following
goods, property, assets and rights of Debtor, wherever located,
whether now owned or hereafter acquired or arising, and all
proceeds and products thereof (all of the same being hereinafter
called the “Collateral”):
2.1
All personal and fixture property of every kind
and nature including, without limitation, all rolling stock and
equipment acquired by Debtor after the date hereof, all goods,
inventory, grain, furniture and fixtures, all of every kind and
nature (including any accessions, additions, improvements,
attachments and accessories thereto and products and proceeds
thereof, and all operating manuals, service records, maintenance
logs and warranties applicable thereto), and including all
inventory including, but not limited to, all corn, soybeans,
oats and other grain and non-grain inventory, in which Debtor
has an interest in mass or a joint or other interest or right of
any kind.
1
2.2
All instruments (including promissory notes,
notes receivable and supporting obligations), documents,
negotiable and non-negotiable documents of title, negotiable and
non-negotiable warehouse receipts, bills of lading, transit
receipts or other documents of title, however denominated
(collectively, “Warehouse Receipts”), and the goods
underlying or relating to Warehouse Receipts including, but not
limited to, Debtor’s present and future rights to take
possession and delivery of goods underlying or relating to any
Warehouse Receipt.
2.3
All accounts, all of Debtor’s rights to
goods represented by or securing any accounts, all proceeds from
the disposition or collection of accounts, all of Debtor’s
rights as an unpaid vendor, including the right to reclaim
goods, the right to stop goods in transit and the right to
replevy goods, and all guaranties, letters of credit and other
supports to the payment of accounts, chattel paper (whether
tangible or electronic), deposit accounts (whether maintained
with Secured Party or other financial institutions),
certificates of deposit (whether negotiable or non-negotiable),
letter-of-credit rights (whether or not the letter of credit is
evidenced by a writing), supporting obligations, any other
contract rights (including rights under grain forward contracts)
or rights to the payment of money, insurance claims and
proceeds, trademarks, service marks, copyrights, patents and
other intellectual property rights and all of Debtor’s
rights therein or thereto, software, general intangibles
(including all payment intangibles), all payments and rights to
payments whether or not earned by performance, price support
payments, subsidy payments, guaranty payments, payments in kind,
deficiency payments, letters of entitlements, storage payments,
emergency assistance, diversion payments, production flexibility
contracts, contract reserve payments, grain insurance fund claim
rights, grain insurance fund proceeds and all similar programs
of any and every kind, whether federal, state or local, and any
other rights to payment under or from any preexisting, current
or future federal, state or local government program, and the
products and proceeds of all the foregoing.
2.4
All farm products including, but not limited to,
all poultry and livestock and their young, together with all
products and replacements for such poultry and livestock; all
crops, annual or perennial, and all products of such crops; and
all grain, feed, seed, fertilizer, chemicals, medicines, and
other supplies used or produced in Debtor’s operations or
sold as inventory, and the products and proceeds and rights to
payments associated with all or any of the foregoing.
2.5
All books, records, ledger sheets or cards,
reports, invoices, purchase orders, customer lists, mailing
lists, files, correspondence, computer programs, tapes, disks
and other documents or data processing software that at any time
relates to any of the foregoing or are otherwise necessary or
helpful in realizing on or collecting on any Collateral.
2.6
All investment property, securities, commodity
contracts, securities accounts and all commodity and securities
entitlements, commodity contracts, securities, investment
property and other rights contained therein, hedging accounts
and all commodity and securities entitlements, commodity
contracts, securities, investment property and other rights
contained therein, and commodity accounts (including, but not
limited to, Account Nos. 344 and 8401 maintained with FCStone,
LLC and Account No. 12550 maintained with Country Hedging, Inc.)
and all commodity and securities entitlements, commodity
contracts, securities, investment property and other rights
contained therein.
2.7
All commercial tort claims now existing or
hereafter arising. Secured Party acknowledges that the
attachment of its security interest in any additional commercial
tort claim as original collateral is subject to Debtor’s
compliance with Section 4.7 below.
2
SECTION 3.
Authorization to File Financing
Statements . Debtor hereby irrevocably authorizes
Secured Party at any time and from time to time to file in any
filing office in any Uniform Commercial Code jurisdiction any
initial financing statements and amendments thereto that
(a) indicate and describe the Collateral including, but not
limited to, descriptions of the Collateral as all assets of
Debtor (other than rolling stock and equipment owned by Debtor
on the date hereof), or words of similar effect, and
(b) provide any other information required by Part 5 of
Article 9 of the Uniform Commercial Code of the State, or
such other jurisdiction, for the sufficiency or filing office
acceptance of any financing statement or amendment, including
(i) whether Debtor is an organization, the type of
organization and any organizational identification number issued
to Debtor and (ii) in the case of a financing statement
filed as a fixture filing or indicating Collateral as
as-extracted collateral or timber to be cut, a sufficient
description of real property to which the Collateral relates.
Debtor agrees to furnish any such information to Secured
Party promptly upon Secured Party’s request. In addition,
Debtor hereby authorizes Secured Party to file all effective
financing statements pursuant to 7 U.S.C. Section 1631, and
amendments to effective statements, describing the Collateral in
any offices as Secured Party, in its sole discretion, may
determine. If requested by Secured Party, Debtor will provide
Secured Party with a list of the buyers, commission merchants
and selling agents to or through whom Debtor may sell farm
products or grain and a list of all elevators, warehousemen or
others where Debtor stores grain. Debtor authorizes
Secured Party to notify all such buyers, commission merchants,
selling agents, elevators, warehousemen or any other person, of
Secured Party’s security interest in Debtor’s farm
products, corn or grain unless prohibited by law. Debtor
also ratifies its authorization for Secured Party to have filed
in any Uniform Commercial Code jurisdiction any like initial
financing statements or amendments thereto if filed prior to the
date hereof.
SECTION 4.
Other Actions . To further the
attachment, perfection and first priority of, and the ability of
Secured Party to enforce Secured Party’s security interest
in the Collateral, and without limitation on Debtor’s
other obligations in this Agreement, Debtor agrees, in each case
at Debtor’s expense, to take the following actions with
respect to the following Collateral:
4.1
Promissory Notes, Instruments and Tangible
Chattel Paper . If Debtor shall at any time hold or
acquire any instruments, promissory notes or tangible chattel
paper, Debtor shall, upon request of Secured Party, forthwith
endorse, assign and deliver the same to Secured Party,
accompanied by such instruments of transfer or assignment duly
executed in blank as Secured Party may from time to time
specify. Debtor will not deliver possession of, endorse or
assign any instruments, promissory notes or tangible chattel
paper to any person or entity other than Secured Party.
4.2
Deposit Accounts . For each
deposit account that Debtor at any time opens or maintains,
Debtor shall, at Secured Party’s request and option,
pursuant to an agreement in form and substance satisfactory to
Secured Party, either (a) cause the depositary bank to
comply at any time with instructions from Secured Party to such
depositary bank directing the disposition of funds from time to
time credited to such deposit account, without further consent
of Debtor or (b) arrange for Secured Party to become the
customer of the depositary bank with respect to the deposit
account, with Debtor being permitted, only with the consent of
Secured Party, to exercise rights to withdraw funds from such
deposit account. Secured Party agrees with Debtor that
Secured Party shall not give any such instructions or withhold
any withdrawal rights from Debtor, unless an Event of Default
has occurred and is continuing, or would occur, if effect were
given to any withdrawal not otherwise permitted by the Loan
Documents. The provisions of this paragraph shall not apply to
(a) any deposit account for which Debtor, the depositary
bank and Secured Party have entered into a cash collateral
agreement specially negotiated among Debtor, the depositary bank
and Secured Party for the specific purpose set forth therein,
(b) a deposit account for which Secured Party is the
depositary bank and is in automatic control and (c) deposit
accounts specially and exclusively used for payroll, payroll
taxes and other employee wage and benefit payments to or for the
benefit of Debtor’s salaried employees.
3
4.3
Investment Property . If Debtor
shall at any time hold or acquire any certificated securities,
Debtor shall forthwith endorse, assign and deliver the same to
Secured Party, accompanied by such instruments of transfer or
assignment duly executed in blank as Secured Party may from time
to time specify. If any securities now or hereafter acquired by
Debtor are uncertificated and are issued to Debtor or its
nominee directly by the issuer thereof, Debtor shall immediately
notify Secured Party thereof and, at Secured Party’s
request and option, pursuant to an agreement in form and
substance satisfactory to Secured Party, either (a) cause
the issuer to agree to comply with instructions from Secured
Party as to such securities, without further consent of Debtor
or such nominee or (b) arrange for Secured Party to become
the registered owner of the securities. If any commodity
interests or securities, whether certificated or uncertificated,
or other investment property now or hereafter acquired by Debtor
are held by Debtor or its nominee through a securities
intermediary or commodity intermediary, Debtor shall immediately
notify Secured Party thereof and, at Secured Party’s
request and option, pursuant to an agreement in form and
substance satisfactory to Secured Party, either (a) cause
such securities intermediary or (as the case may be) commodity
intermediary to agree to comply with entitlement orders or other
instructions from Secured Party to such securities intermediary
as to such securities or other investment property, or (as the
case may be) to apply any value distributed on account of any
commodity contract as directed by Secured Party to such
commodity intermediary, in each case without further consent of
Debtor or such nominee or (b) in the case of financial
assets or other investment property held through a securities
intermediary, arrange for Secured Party to become the
entitlement holder with respect to such investment property,
with Debtor being permitted, only with the consent of Secured
Party, to exercise rights to withdraw or otherwise deal with
such investment property. Secured Party agrees with Debtor
that Secured Party shall not give any such entitlement orders or
instructions or directions to any such issuer, securities
intermediary or commodity intermediary, and shall not withhold
its consent to the exercise of any withdrawal or dealing rights
by Debtor, unless an Event of Default has occurred and is
continuing, or, after giving effect to any such investment and
withdrawal rights not otherwise permitted by the Loan Documents,
would occur.
4.4
Collateral in the Possession of a
Bailee . If any Collateral is at any time in the
possession of a bailee, warehouseman or elevator, Debtor shall
promptly notify Secured Party thereof and, at Secured
Party’s request and option, shall promptly obtain an
acknowledgement from the bailee, warehouseman or elevator, in
form and substance satisfactory to Secured Party, that the
bailee, warehouseman or elevator holds such Collateral for the
benefit of Secured Party, and that such bailee, warehouseman or
elevator agrees to comply, without further consent of Debtor,
with instructions from Secured Party as to such Collateral
including, but not limited to, the delivery of such Collateral
to Secured Party or as Secured Party directs, or the payment of
the sale proceeds of such Collateral to Secured Party, or as
Secured Party directs. Secured Party agrees with Debtor
that Secured Party shall not give any such instructions unless
an Event of Default has occurred and is continuing or would
occur after taking into account any action by Debtor with
respect to the bailee, warehouseman or elevator.
4
4.5
Electronic Chattel Paper and Transferable
Records . If Debtor at any time holds or acquires an
interest in any electronic chattel paper or any
“transferable record,” as that term is defined in
Section 201 of the federal Electronic Signatures in Global
and National Commerce Act (as hereafter amended), or in
Section 16 of the Uniform Electronic Transactions Act as in
effect in any relevant jurisdiction, Debtor shall promptly
notify Secured Party thereof and, at the request and option of
Secured Party, shall take such action as Secured Party may
reasonably request to vest in Secured Party control, under
Section 9-105 of the Uniform Commercial Code, of such
electronic chattel paper or control under Section 201 of
the federal Electronic Signatures in Global and National
Commerce Act or, as the case may be, Section 16 of the
Uniform Electronic Transactions Act, as so in effect in such
jurisdiction, of such transferable record. Secured Party
agrees with Debtor that Secured Party will arrange, pursuant to
procedures satisfactory to Secured Party and so long as such
procedures will not result in Secured Party’s loss of
control, for Debtor to make alterations to the electronic
chattel paper or transferable record permitted under UCC
Section 9-105 or, as the case may be, Section 201 of
the federal Electronic Signatures in Global and National
Commerce Act or Section 16 of the Uniform Electronic
Transactions Act for a party in control to make without loss of
control, unless an Event of Default has occurred and is
continuing or would occur after taking into account any action
by Debtor with respect to such electronic chattel paper or
transferable record.
4.6
Letter-of-Credit Rights . If
Debtor is at any time a beneficiary under a letter of credit,
Debtor shall promptly notify Secured Party thereof and, at the
request and option of Secured Party, Debtor shall, pursuant to
an agreement in form and substance satisfactory to Secured
Party, either (a) arrange for the issuer and any confirmer
or other nominated person of such letter of credit to consent to
an assignment to Secured Party of the proceeds of the letter of
credit or (b) arrange for Secured Party to become the
transferee beneficiary of the letter of credit, with Secured
Party agreeing, in each case, that the proceeds of the letter to
credit are to be applied to the Obligations in such order and
priority as Secured Party shall require.
4.7
Commercial Tort Claims . If Debtor
shall at any time hold or acquire a commercial tort claim,
Debtor shall immediately notify Secured Party in a writing
signed by Debtor of the particulars thereof and grant to Secured
Party in such writing a security interest therein and in the
proceeds thereof, all upon the terms of this Agreement, with
such writing to be in form and substance satisfactory to Secured
Party.
4.8
Other Actions as to Any and All
Collateral . Debtor further agrees, at the request
and option of Secured Party, to take any and all other actions
Secured Party may determine to be necessary or useful for the
attachment, perfection and first priority of, and the ability of
Secured Party to enforce, Secured Party’s security
interest in any and all of the Collateral including, without
limitation, (a) executing, delivering and, where
appropriate, filing financing statements and amendments relating
thereto under the Uniform Commercial Code, to the extent, if
any, that Debtor’s signature thereon is required therefor,
(b) causing Secured Party’s name to be noted as
secured party on any certificate of title for a titled good if
such notation is a condition to attachment, perfection or
priority of, or ability of Secured Party to enforce, Secured
Party’s security interest in such Collateral,
(c) complying with any provision of any statute, regulation
or treaty of the United States as to any Collateral if
compliance with such provision is a condition to attachment,
perfection or priority of, or ability of Secured Party to
enforce, Secured Party’s security interest in such
Collateral, (d) obtaining governmental and other third
party waivers, consents and approvals in form and substance
satisfactory to Secured Party including, without limitation, any
consent of any licensor, lessor or other person obligated on
Collateral, (e) obtaining waivers from mortgagees and
landlords in form and substance satisfactory to Secured Party
and (f) taking all actions under any earlier versions of
the Uniform Commercial Code or under any other law, as
reasonably determined by Secured Party to be applicable in any
relevant Uniform Commercial Code or other jurisdiction,
including any foreign jurisdiction.
5
4.9
Warehouse Receipts .
(a)
Debtor has delivered or will deliver to Secured
Party any and all documents, instruments and writings in any way
relating to the Warehouse Receipts or in any way relating to the
property evidenced thereby. As long as this Agreement remains in
effect, Debtor shall immediately deliver to Secured Party any
and all future documents, instruments or other writings
applicable or in any way rel
