Exhibit 10.1

 

AMENDED AND RESTATED CREDIT AGREEMENT

 

by and between

 

NATIONAL BEEF PACKING COMPANY, LLC,

 

CERTAIN OF ITS SUBSIDIARIES,

 

VARIOUS ISSUERS AND LENDERS,

 

COÖPERATIEVE CENTRALE RAIFFEISEN BOERENLEENBANK B.A.,

“RABOBANK NEDERLAND”, NEW YORK BRANCH
and
U.S. BANK NATIONAL ASSOCIATION,
as Documentation Agents,

 

BANK OF AMERICA, N.A.
and
BANK OF MONTREAL,
as Syndication Agents,

 

and

 

COBANK, ACB, as Lead Arranger,
Sole Bookrunner, Swing Line Lender
and Administrative Agent

 

Dated as of June 4, 2010

 

--------------------------------------------------------------------------------

 

TABLE OF CONTENTS

 

 

 

Page

ARTICLE I

DEFINITIONS

2

1.1

Terms Defined in Colorado Uniform Commercial Code

2

1.2

Defined Terms

2

1.3

Accounting Terms

25

ARTICLE II

LOANS, SWING LINE AND LETTERS OF CREDIT

26

2.1

Loan Facilities

26

2.2

Letters of Credit

31

ARTICLE III

INTEREST

34

3.1

Interest

34

3.2

Voluntary Conversion of Advance

35

ARTICLE IV

PAYMENTS; PREPAYMENTS; ETC

36

4.1

Payment of Loans and Swing Line Loans

36

4.2

Optional Prepayments of the Loans

36

4.3

Term Loan Installments

37

4.4

Mandatory Prepayments of Notes

37

4.5

Termination of the Commitments

38

ARTICLE V

LIBOR RATE LOANS; INCREASED COSTS; TAXES, ETC.

38

5.1

LIBOR Rate Advances

38

5.2

Increased Costs

39

5.3

Funding Losses

39

5.4

Capital Adequacy Requirements

40

5.5

Taxes

41

ARTICLE VI

FEES

43

6.1

Non-Use Fee

43

6.2

LC Fees

43

6.3

Upfront Fees

43

6.4

Calculation of Fees

44

6.5

Fees Not Interest; Nonpayment

44

ARTICLE VII

REPRESENTATIONS AND WARRANTIES

44

7.1

Judgments, Claims Litigation and Proceedings

44

7.2

Contract Defaults and Disputes

44

7.3

Licenses, Patents, Etc.

45

7.4

Title to Assets

45

 

i

--------------------------------------------------------------------------------

 

7.5

Tax Liabilities

45

7.6

Indebtedness and Producer Payables

45

7.7

Other Fictitious Names

46

7.8

Affiliates

46

7.9

Environmental Matters

46

7.10

Bank Accounts

47

7.11

Other Agreements or Restrictions

47

7.12

[Intentionally Omitted]

47

7.13

Existence

47

7.14

Authority

48

7.15

Binding Effect

48

7.16

Correctness of Financial Statements

48

7.17

Employee Controversies

48

7.18

Compliance with Laws and Regulations

49

7.19

Solvency

49

7.20

ERISA Matters

49

7.21

Margin Security

50

7.22

Investment Company Act Not Applicable

50

7.23

[Intentionally Omitted]

50

7.24

No Consent

50

7.25

Full Disclosure

51

7.26

Intellectual Property

51

7.27

Compliance with Federal Food Security Act

51

7.28

Survival of Warranties

51

7.29

CoBank Equity Interests

52

ARTICLE VIII

CONDITIONS

52

8.1

Conditions to the Restatement Date and the Initial Borrowing

52

8.2

Conditions Precedent to All Borrowings, Conversions, Roll Overs and Issuances of
Letters of Credit

54

ARTICLE IX

AFFIRMATIVE COVENANTS

55

9.1

Financial Statements

55

9.2

Conduct of Business

56

9.3

Maintenance of Properties

56

 

ii

--------------------------------------------------------------------------------

 

9.4

Liability Insurance

57

9.5

Property Insurance

57

9.6

[Intentionally Omitted]

58

9.7

Pension Plans

58

9.8

Notice of Suit, Adverse Change, ERISA Event or Default

58

9.9

[Intentionally Omitted]

59

9.10

Books and Records; Separate Existence

59

9.11

Laws and Obligations

59

9.12

Environmental Laws

59

9.13

Trade Accounts Payable and Producer Payables

60

9.14

Compliance with National Security Laws

60

9.15

Post Closing Matters

60

9.16

Funded Debt to EBITDA Ratio

61

9.17

Adjusted Net Worth

62

9.18

Fixed Charge Coverage Ratio

62

9.19

Additional Collateral

62

ARTICLE X

NEGATIVE COVENANTS

63

10.1

Encumbrances

63

10.2

Consolidations, Mergers or Acquisitions

64

10.3

Deposits, Investments, Advances or Loans

64

10.4

Indebtedness

65

10.5

Guarantees and Other Contingent Obligations

66

10.6

Disposition of Property

66

10.7

Change in Nature of Business

66

10.8

ERISA Matters

66

10.9

[Intentionally Omitted]

66

10.10

Equity Distributions

66

10.11

Amendment of Organizational Documents

67

10.12

Lease Limitations

67

10.13

Use of Other Fictitious Names

67

10.14

[Intentionally Omitted.]

68

10.15

Fiscal Year

68

10.16

Limitations on Bank Accounts

68

 

iii

--------------------------------------------------------------------------------

 

10.17

Use of Trademarks

68

10.18

Amendments of Other Documents

68

10.19

Ownership of Cattle and Deposits on Cattle with Feeders

68

10.20

Enforcement of Certain Documents

68

ARTICLE XI

DEFAULT REMEDIES

69

11.1

Acceleration

69

11.2

Other Remedies

69

11.3

Right to Cure

69

ARTICLE XII

THE AGENT

70

12.1

Authorization and Action

70

12.2

Agent’s Reliance, Etc.

71

12.3

Notices of Defaults

72

12.4

The Agent as a Lender, Fiduciary

72

12.5

Non Reliance on Agent and Other Lenders

73

12.6

Indemnification of the Agent

73

12.7

Successor Agent

74

12.8

Verification of Borrowing Notices

74

12.9

Action Upon Instructions of the Lenders

74

12.10

Action Upon Request of the Borrower

75

12.11

Additional Functions of Certain Lenders

75

ARTICLE XIII

MISCELLANEOUS

75

13.1

Timing of Payments

75

13.2

Attorneys’ Fees and Costs

76

13.3

Expenditures by the Agent

76

13.4

The Agent’s Costs as Additional Liabilities

77

13.5

Indemnification

77

13.6

Inspection

79

13.7

Examination of Banking Records

79

13.8

Governmental Reports

80

13.9

Reliance by the Agent, the Issuers and the Lenders

80

13.10

Parties

80

13.11

Applicable Law; Severability

80

 

iv

--------------------------------------------------------------------------------

 

13.12

SUBMISSION TO JURISDICTION; WAIVER OF BOND AND TRIAL BY JURY

80

13.13

Application of Payments

81

13.14

Marshaling; Payments Set Aside

83

13.15

Section Titles

83

13.16

Continuing Effect

83

13.17

No Waiver

83

13.18

Notices

84

13.19

Maximum Interest

85

13.20

Representations by the Lenders and Swing Line Lender

86

13.21

Counterparts and Facsimile Signatures

86

13.22

Set-off

86

13.23

Assignments and Participation

87

13.24

Loan Agreement Controls

89

13.25

Obligations Several

89

13.26

Pro Rata Treatment

90

13.27

Confidentiality

90

13.28

Independence of Covenants

91

13.29

Amendments and Waivers; Commitment Increases

91

13.30

Binding Effect

92

13.31

FINAL AGREEMENT

92

13.32

[Intentionally Omitted.]

92

13.33

USA Patriot Act Notice

92

13.34

Subsidiaries

92

13.35

Amendment and Restatement; Renewal Notes.

93

 

v

--------------------------------------------------------------------------------

 

List of Exhibits

 

Exhibit 1A

Loan Commitment Amounts and Percentages

Exhibit 1B

Borrowing Base Calculation

Exhibit 1C

Borrowing Base Certificate

Exhibit 1D

Form of NB, Inc. Acknowledgment

Exhibit 1E

Letters of Credit*

Exhibit 2A

Line of Credit Note

Exhibit 2B

Term Note

Exhibit 2C

Swing Line Note

Exhibit 3A(i)

Account Debtors of Borrower*

Exhibit 3B(i)

Borrower’s Inventory Locations*

Exhibit 7A

Litigation*

Exhibit 7B

Material Contract Defaults*

Exhibit 7C

Intellectual Property*

Exhibit 7D

Existing Liens*

Exhibit 7E

Tax Liability Issues*

Exhibit 7F

Indebtedness*

Exhibit 7G

Prior Names*

Exhibit 7H

Affiliates*

Exhibit 7I

Environmental*

Exhibit 7J

Bank Accounts*

Exhibit 7K

Other Agreements*

Exhibit 7L

Employee Controversies*

Exhibit 7M

ERISA Matters*

Exhibit 7N

Intellectual Property Litigation*

Exhibit 8A

List of Closing Documents*

Exhibit 9A

Compliance Certificate

Exhibit 9B

Property Insurance*

Exhibit 13A

Form of Assignment

Exhibit 13B

List of Farm Credit System Voting Participants*

Exhibit 13C

Form of Voting Participant Notice and Consent

 

--------------------------------------------------------------------------------

* Schedule omitted. Registrant agrees to furnish supplementally a copy of any
omitted schedule to the Commission upon request.

 

vi

--------------------------------------------------------------------------------

 

 

AMENDED AND RESTATED CREDIT AGREEMENT

 

THIS AMENDED AND RESTATED CREDIT AGREEMENT (as amended, amended and restated,
supplemented, renewed or otherwise modified from time to time, this “Agreement”)
is made as of June 4, 2010, by and between NATIONAL BEEF PACKING COMPANY, LLC, a
Delaware limited liability company (together with its successors as permitted
herein, the “Borrower”), certain of its Subsidiaries, as Subsidiary Loan
Parties, the lenders from time to time party hereto (collectively, the “Lenders”
and individually, a “Lender”), COÖPERATIEVE CENTRALE RAIFFEISEN BOERENLEENBANK
B.A., “RABOBANK NEDERLAND”, NEW YORK BRANCH and U.S. BANK NATIONAL ASSOCIATION,
as Documentation Agents, BANK OF AMERICA, N.A. and BANK OF MONTREAL, as
Syndication Agents, and COBANK, ACB, an agricultural credit bank (“CoBank”), as
Lead Arranger, Sole Bookrunner, Swing Line Lender and administrative agent for
the Lenders, the Issuers and the Swing Line Lender hereunder (in its capacity as
administrative agent, together with its successors and assigns in such capacity,
the “Agent”).

 

RECITALS

 

WHEREAS, the Borrower, Rabobank, the Agent, and the lenders from time to time
party thereto (collectively, the “Existing Lenders”) are parties to a Sixth
Amended and Restated Credit Agreement dated as of July 25, 2007, as amended by a
First Amendment to Sixth Amended and Restated Credit Agreement dated as of
June 27, 2008, a Second Amendment to Sixth Amended and Restated Credit Agreement
dated as of April 13, 2009, and a Third Amendment to Sixth Amended and Restated
Credit Agreement dated as of October 8, 2009 (as so amended, together with its
predecessor agreements, the “Existing Credit Agreement”), pursuant to which the
Existing Lenders have extended certain revolving credit loans and term loans to
the Borrower;

 

WHEREAS, the Borrower has requested that the Existing Lenders and certain new
Lenders increase and extend the Line of Credit Loan Facility and the Term Loan
Facility in the Existing Credit Agreement, and that other changes be made to the
terms of the Existing Credit Agreement; and

 

WHEREAS, as of and on, but subject to the occurrence of, the Restatement Date,
the Existing Line of Credit Notes will be extended and renewed by the Line of
Credit Notes, the Existing Term Notes will be extended and renewed by the Term
Notes and the Existing Credit Agreement shall be amended and restated as set
forth in this Agreement;

 

NOW, THEREFORE, in consideration of the foregoing and of the terms and
conditions contained in this Agreement, and for any loans or extensions of
credit or other financial accommodations at any time made to or for the benefit
of the Borrower by the Agent or the Lenders, the parties hereto agree that as of
and on, but subject to the occurrence of, the Restatement Date, the Existing
Credit Agreement shall be amended and restated in its entirety to read as
follows:

 

1

--------------------------------------------------------------------------------

 

ARTICLE I
DEFINITIONS

 

1.             Terms Defined in Colorado Uniform Commercial Code

 

All capitalized terms contained in this Agreement or any of the other Financing
Documents which are not specifically defined herein or therein shall have the
meanings set forth in the Uniform Commercial Code of Colorado (“Code”) to the
extent the same are used or defined therein, specifically including, but not
limited to the following: Accounts, Account Debtor, Chattel Paper, Commercial
Tort Claims, Commodity Accounts, Commodity Contracts, Deposit Accounts, General
Intangibles, Goods, Investment Property, Instruments, Letter of Credit Rights,
Money, Payment Intangibles, Securities Accounts and Tangible Chattel Paper.

 

2.             Defined Terms.

 

When used herein, the following capitalized terms shall have the meanings
indicated, whether used in the singular or the plural:

 

“$150 Million Basket” has the meaning set forth in Section 10.10 hereof.

 

“Adjusted Net Worth” means, on any date of determination, an amount equal to the
Net Worth of Borrower and its consolidated Subsidiaries adjusted to exclude any
negative impact occurring as a result of Borrower making any Equity
Distributions in accordance with the $150 Million Basket.

 

“Advance” means any portion of the outstanding Line of Credit Loans or Term
Loans by a Lender as to which one of the available interest rate options and, if
pertinent, an Interest Period, is applicable.  An Advance may be a Base Rate
Advance or a LIBOR Rate Advance.

 

“Affiliate” means any Person: (a) that directly or indirectly, through one or
more intermediaries, controls or is controlled by, or is under common control
with, the Borrower; (b) that directly or beneficially owns or holds ten percent
(10%) or more of any class of the Borrower’s equity; (c) ten percent (10%) or
more of the equity interest of which is owned directly or beneficially or held
by the Borrower; or (d) that is a member of the Borrower.

 

“Agent” has the meaning set forth in the introduction hereof and shall include
any successor agent which has been appointed in accordance with Section 12.7.

 

“Agent’s Letter” means the letter agreement between the Borrower and CoBank
dated April 13, 2010.

 

“Applicable Margin” means, with respect to Line of Credit Loans, Swing Line
Loans, Term Loans, LC Fees or Non-Use Fees, as the case may be, the rates per
annum set forth below for the then applicable “Financial Performance Level”
referenced in the first column below (each being called a “Financial Performance
Level”):

 

National Beef Packing Company Credit Agreement

 

2

--------------------------------------------------------------------------------

 

Financial
Performance
Level:

 

Funded Debt to
EBITDA Ratio:

 

Base Rate Advance
Line of Credit Loans,
Swing Line Loans
and Term Loans:

 

LIBOR Rate
Line of Credit
Loans and
Term Loans:

 

LC Fee:

 

Non-Use
Fee:

 

 

 

 

 

 

 

 

 

 

 

 

 

Level I

 

Less than 1.00: 1.00

 

1.25

%

2.25

%

2.25

%

0.25

%

 

 

 

 

 

 

 

 

 

 

 

 

Level II

 

Greater than or equal to 1.00:1.00 and less than 2.00:1.00

 

1.50

%

2.50

%

2.50

%

0.375

%

 

 

 

 

 

 

 

 

 

 

 

 

Level III

 

Greater than or equal to 2.00:1.00 and less than 3.00:1.00

 

1.75

%

2.75

%

2.75

%

0.50

%

 

 

 

 

 

 

 

 

 

 

 

 

Level IV

 

Greater than or equal to 3.00:1.00

 

2.25

%

3.25

%

3.25

%

0.625

%

 

The initial Financial Performance Level shall be Level II until the Borrower’s
consolidated financial statements (and the related Compliance Certificate) in
respect of the first full fiscal quarter ending after the Closing Date are
delivered pursuant to Section 9.1(b) and, thereafter, upon Agent’s receipt of
the Borrower’s consolidated financial statements (and the related Compliance
Certificate) for each subsequent fiscal quarter.  The Agent will review each of
the Borrower’s Compliance Certificates to determine the Funded Debt to EBITDA
Ratio as of the end of the applicable fiscal quarter.  Any change in the
Financial Performance Level will be effective five (5) days after receipt of the
relevant Compliance Certificate; provided, however, that if the Borrower’s
consolidated financial statements (and the related Compliance Certificate) are
not delivered on a timely basis in accordance with Section 9.1(b), the Agent
may, at its option, deem the Borrower’s Financial Performance Level to be Level
IV until ten (10) Business Days after the Agent’s receipt of such financial
statements (and the Compliance Certificate).

 

Notwithstanding the foregoing, if at any time while any Commitment is in effect
or any of the Liabilities remain outstanding, any financial statement or
Compliance Certificate delivered by the Borrower is shown to be inaccurate, and
such inaccuracy, if it had been corrected prior to the Borrower’s delivery,
would have caused the application of a higher Applicable Margin (as defined
above) for any period than the Applicable Margin that was actually applied for
such period, then (a) within five (5) Business Days of discovery or notice of
discovery of such inaccuracy the Borrower shall deliver to the Agent for
distribution to the Lenders a corrected financial statement or Compliance
Certificate, as applicable, for such period, (b) the Applicable Margin for such
period shall be recalculated and applied as if the higher Applicable Margin had
originally been applicable, and (c) within five (5) Business Days of such
recalculation the Borrower shall pay to the Agent the additional amount of
interest and fees owed as a result of such higher Applicable Margin for such
period to the extent accrued through the last applicable payment date, and any
subsequent payments required to be made on any subsequent payment

 

3

--------------------------------------------------------------------------------

 

date shall be adjusted accordingly.  Nothing contained in this paragraph shall
limit or otherwise prejudice any of the other rights and remedies of the Agent
or the Lenders under this Agreement.

 

“Application” has the meaning set forth in Section 2.2(b) hereof.

 

“Assignee” has the meaning set forth in Section 13.23(a) hereof.

 

“Assignment and Acceptance” has the meaning set forth in
Section 13.23(a) hereof.

 

“Attributable Indebtedness” means, on any date, (a) in respect of any
capitalized lease of any Person, the capitalized amount thereof that would
appear on such Person’s balance sheet prepared as of such date in accordance
with GAAP, and (b) in respect of any Synthetic Lease Obligation, the capitalized
amount of the remaining lease payments under the relevant lease that would
appear on such Person’s balance sheet prepared as of such date in accordance
with GAAP if such lease were accounted for as a capitalized lease.

 

“Available Amount” means, at any time, an amount equal to (a) the aggregate Line
of Credit Loan Commitments minus (b) the sum of (i) the aggregate outstanding
principal amount of the Line of Credit Loans, (ii) the aggregate outstanding
amount of the LC Obligations and (iii) the aggregate outstanding principal
amount of all Swing Line Loans.

 

“Base Rate” means a rate per annum announced by the Agent on the first Business
Day of each week, which shall be the highest of (a) 150 basis points (1.50
percent) greater than the higher of the one week or one month LIBOR Rate,
(b) the Prime Rate; or (c) the Federal Funds Rate plus one half of one percent
(0.5%).

 

“Base Rate Advance” means an Advance with respect to which the interest rate is
determined by reference to the Base Rate.

 

“Bill of Sale” means that certain Bill of Sale dated as of December 1, 2004 from
the Borrower to the City together with any and all amendments, modifications,
supplements, renewals or restatements thereof.

 

“Bond Documents” means, collectively, the Indenture, the Bonds, the Bond
Purchase Agreement, the Deed, the Bill of Sale, the Payment in Lieu of Tax
Agreement and the Lease.

 

“Bond Pledge Agreement” means that certain Bond Pledge Agreement dated
December 29, 2004, executed by the Borrower in favor of the Agent, and any and
all amendments, modifications, supplements, renewals or restatements thereof.

 

“Bond Purchase Agreement” means that certain Bond Purchase Agreement dated as of
December 1, 2004 between the City and the Borrower, together with any and all
amendments, modifications, supplements, renewals or restatements thereof.

 

“Bonds” means the Industrial Development Revenue Bonds (National Beef Packing
Company, LLC Project), Series 2004, issued by the City.

 

“Borrower” has the meaning set forth in the introduction hereof.

 

4

--------------------------------------------------------------------------------

 

“Borrowing Base” means an amount determined as of the most recent date of the
Borrowing Base Certificate delivered pursuant to Section 9.1 and computed as set
forth in Exhibit 1B.

 

“Borrowing Base Availability” means, at any time, an amount (if positive) equal
to (a) the Borrowing Base minus (b) the sum of (i) the aggregate outstanding
principal amount of the Line of Credit Loans, (ii) the aggregate outstanding
amount of the LC Obligations and (iii) the aggregate outstanding principal
amount of the Swing Line Loans.

 

“Borrowing Base Certificate” means a certificate in substantially the form of
Exhibit 1C, signed as indicated thereon, setting forth the amount of the
Borrower’s Borrowing Base.

 

“Borrowing Base Deficiency” means, at any time, the amount, if any, by which 
(a) the sum of (i) the aggregate outstanding principal amount of the Line of
Credit Loans, (ii) the aggregate outstanding amount of the LC Obligations and
(iii) the aggregate outstanding principal amount of the Swing Line Loans exceeds
(b) the Borrowing Base.

 

“Business Day” means any day of the year, other than a Saturday or Sunday, on
which commercial banks in New York, New York and Denver, Colorado are not
required or authorized to close and, if such day relates to any LIBOR Rate
Advance, a day on which dealing in Dollar deposits is occurring among banks in
the London interbank market.

 

“California Property” means the real property located in Brawley, California, as
more particularly described in the Intercompany Deed of Trust.

 

“Cash Equivalent Investments” means, at any time:

 

(a)           any evidence of Indebtedness, maturing not more than one year
after such time, issued or guaranteed by the United States Treasury;

 

(b)           commercial paper, maturing not more than nine months from the date
of issue, which is issued by a corporation (other than an Affiliate of the
Borrower) organized under the laws of any state of the United States or of the
District of Columbia and rated A-l by Standard & Poor’s Rating Services, a
division of The McGraw Hill Companies, Inc. or P-l by Moody’s Investors Service;

 

(c)           any certificate of deposit or banker’s acceptance, maturing not
more than one year after such time, which is issued by a commercial banking
institution that is a member of the Federal Reserve System and has a combined
capital and surplus and undivided profits of not less than $500,000,000 (or the
equivalent thereof in any other currency); or

 

(d)           any repurchase agreement entered into with any Lender or other
commercial banking institution of the stature referred to in clause (c) which

 

(i)            is secured by a fully perfected security interest in any
obligation of the type described in any of clauses (a) through (c); and

 

5

--------------------------------------------------------------------------------

 

(ii)           has a market value at the time such repurchase agreement is
entered into of not less than 100% of the repurchase obligation of such Lender
or other commercial banking institution thereunder.

 

“Change of Control” means the occurrence of any of the following events: (a) at
any time prior to the consummation of a Permitted IPO, the Existing Equity
Holders cease to hold, collectively, directly or indirectly, a controlling
interest in the Borrower, and (b) at any time from and after the consummation of
a Permitted IPO, (i) any “person” or “group” (as such terms are used in Sections
13(d) and 14(d) of the Securities Exchange Act of 1934, but excluding any
employee benefit plan of such person or its Subsidiaries, and any person or
entity acting in its capacity as trustee, agent or other fiduciary or
administrator of any such plan) becomes the “beneficial owner” (as defined in
Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, except that a
person or group shall be deemed to have “beneficial ownership” of all securities
that such person or group has the right to acquire (such right, an “option
right”), whether such right is exercisable immediately or only after the passage
of time), directly or indirectly, of the equity securities of NB, Inc. entitled
to cast thirty-five percent (35%) or more of the votes for members of the board
of directors or equivalent governing body of NB, Inc. on a fully-diluted basis
(and taking into account all such securities that such person or group has the
right to acquire pursuant to any option right), other than the Existing Equity
Holders, (ii) during any period of 12 consecutive months, a majority of the
members of the board of directors or other equivalent governing body of NB, Inc.
ceases to be composed of individuals (A) who were members of that board or
equivalent governing body on the first day of such period, (B) whose election or
nomination to that board or equivalent governing body was approved by
individuals referred to in clause (i) above constituting at the time of such
election or nomination at least a majority of that board or equivalent governing
body or (C) whose election or nomination to that board or other equivalent
governing body was approved by individuals referred to in clauses (A) and
(B) above constituting at the time of such election or nomination at least a
majority of that board or equivalent governing body (excluding, in the case of
both clause (B) and clause (C), any individual whose initial nomination for, or
assumption of office as, a member of that board or equivalent governing body
occurs as a result of an actual or threatened solicitation of proxies or
consents for the election or removal of one or more directors by any person or
group other than a solicitation for the election of one or more directors by or
on behalf of the board of directors), (iii) the Existing Equity Holders cease to
own, directly or indirectly, equity of NB, Inc. entitled to cast thirty-five
percent (35%) or more of the votes for members of the board of directors or
equivalent governing body of NB, Inc., or (iv) NB, Inc. ceases to be the sole
manager of the Borrower.  It being understood and agreed that, in the event the
Permitted IPO occurs but not pursuant to the structure contemplated on the date
hereof, then the term “Change of Control” shall be modified in the reasonable
discretion of the Agent and Borrower in order to address such changes and to
preserve the original intent of the parties hereto.

 

“City” means the City of Dodge City, Kansas, a municipal corporation organized
under the law of the State of Kansas.

 

“Closing Date” means the date of this Agreement.

 

“CoBank” has the meaning set forth in the introduction hereof.

 

6

--------------------------------------------------------------------------------

 

“Code” has the meaning set forth in Section 1.1 hereof.

 

“Collateral” means all real and personal property in which, pursuant to the
terms of the respective Security Documents, the Borrower, any Subsidiary Loan
Party or any third Person has granted to the Agent a security interest or
assigned to the Agent its right, title and interest to secure the Liabilities. 
The Borrower acknowledges and agrees that all of its right, title and interest
in and to the Intercompany Financing Documents and its limited liability company
interests in KC Steak constitute collateral under the Security Documents.

 

“Collateral Accounts” means Deposit Accounts established and maintained in
accordance with Section 4.07 of the Security Agreement.

 

“Commitment” means, as to any Lender, such Lender’s (a) Line of Credit Loan
Commitment, (b) Term Loan Commitment, (c) obligation to purchase participations
in LC Obligations, and/or (d) obligation to purchase participations in Swing
Line Loans, and, as the context requires “Commitments” shall mean, collectively,
such Commitments for all the Lenders.

 

“Compliance Certificate” has the meaning set forth in Section 9.1(b) hereof.

 

“Deed” means that certain Kansas Special Warranty Deed dated as of December 1,
2004 from the Borrower to the City, together with any and all amendments,
modifications, supplements, renewals or restatements thereof.

 

“Default” means the occurrence or existence of: (a) an event which, through the
passage of time or the service of notice or both, would (assuming no action is
taken by the Borrower or any other Person to cure the same) mature into a
Matured Default; or (b) an event which requires neither the passage of time nor
the service of notice to mature into a Matured Default.

 

“Default Rate” has the meaning set forth in Section 3.1(c) hereof.

 

“Defaulting Lender” means any Lender that (a) has failed to fund any portion of
the Loans or participations in LC Obligations or Swing Line Loans required to be
funded by such Lender within three (3) Business Days after the date required to
be funded by it, (b) has otherwise failed to pay over to the Agent or any other
Lender any other amount required to be paid by it within three (3) Business Days
after the date when due, unless the subject of a good faith dispute, or (c) has
been deemed insolvent or become the subject of an insolvency proceeding (or such
parent or holding company of such Lender that has been deemed insolvent or
become the subject of an insolvency proceeding).

 

“Dodge City Facilities” means the beef processing facilities located in Dodge
City, Kansas, as further described in the Kansas Mortgage.

 

“Dollars” and “$” mean lawful currency of the United States of America.

 

“Domestic Subsidiary” means any Subsidiary that is not a Foreign Subsidiary.

 

7

--------------------------------------------------------------------------------

 

“Draft Prospectus” means that certain draft Preliminary Prospectus relating to
the initial public offering of shares of Class A common stock of NB, Inc. dated
April 21, 2010.

 

“EBITDA” means, for any period of determination, the consolidated net income of
the Borrower and its Subsidiaries before provision for income taxes, interest
expense (including without limitation, implicit interest expense on capitalized
leases), depreciation, amortization and other noncash expenses or charges,
excluding (to the extent otherwise included): (a) nonoperating gains (including
without limitation, extraordinary or nonrecurring gains, gains from
discontinuance of operations and gains arising from the sale of assets other
than Inventory or property, plant and equipment) during the applicable period;
and (b) similar nonoperating losses during such period.

 

“Eligible Accounts” means Accounts of the Loan Parties which the Agent
determines in the exercise of the Agent’s reasonable discretion are eligible for
inclusion in the Borrowing Base at any particular time.  Without limiting the
Agent’s right to determine that Accounts do not constitute Eligible Accounts,
but without duplication, the following Accounts of the Loan Parties shall not be
Eligible Accounts:  (a) all Accounts which are at that time unpaid for a period
exceeding twenty one (21) days after the original invoice date of the original
invoice related thereto, except for Accounts which are covered by a letter of
credit; (b) all Accounts owing by an Account Debtor if more than twenty-five
percent (25%) of the Accounts owing by such Account Debtor are at that time
unpaid for a period exceeding that allowed by the preceding clause, except, in
each case, Accounts which are covered by a letter of credit in amount, form and
substance satisfactory to, and from an issuer acceptable to the Agent;
(c)(i) those Accounts, except Accounts owing from the Account Debtors listed on
Exhibit 3A(i), of an Account Debtor, the aggregate face amount of which is in
excess of five percent (5%) of the aggregate face amount of all Eligible
Accounts of all Account Debtors (prior to eliminations based on concentration),
(ii) those Accounts of an Account Debtor listed on Exhibit 3A(i), the aggregate
face amount of which is in excess of ten percent (10%) of the aggregate face
amount of all Eligible Accounts of all Account Debtors (prior to eliminations
based on concentration), and (iii) those Accounts of Wal-Mart and Affiliates
thereof (Sam’s Club, etc.), the aggregate face amount of which is in excess of
fifteen percent (15%) of the aggregate face amount of all Eligible Accounts of
all Account Debtors (prior to eliminations based on concentration), but in each
case only to the extent of such excess; (d) those Accounts owing from the United
States or any department, agency or instrumentality thereof unless the Borrower
shall have complied with the Assignment of Claims Act to the satisfaction of the
Agent; (e) Accounts which arise out of transactions with Affiliates of the
Borrower, except Accounts owing from Beef Products, Inc. up to the aggregate
face amount of $4,000,000; (f) Accounts, except Accounts owing from the Account
Debtors listed on Exhibit 3A(i), of an Account Debtor that are located outside
the United States, unless such Accounts are covered by a letter of credit issued
or confirmed by a bank acceptable to the Agent; (g) Accounts which are or may be
subject to rights of setoff or counterclaim by the Account Debtor (to the extent
of the amount of such setoff or counterclaim); (h) Accounts in which the Agent
does not, for any reason, have a first priority perfected security interest; and
(i) Accounts which in the Agent’s opinion may be subject to liens or conflicting
claims of ownership, whether such liens or conflicting claims are asserted or
could be asserted by any Person except for statutory liens or encumbrances
permitted by Section 10.1(a), (b) and (d).  With regard to Accounts included in
the Borrowing Base by the Borrower in good faith, a determination by the Agent
that such Accounts are not Eligible Accounts in accordance with the

 

8

--------------------------------------------------------------------------------

 

foregoing shall be effective on the third Business Day after notice thereof by
the Agent to the Borrower in accordance with Section 13.18.

 

“Eligible Inventory” means Inventory of the Loan Parties which the Agent
determines in the exercise of the Agent’s reasonable discretion is eligible for
inclusion in the Borrowing Base at any particular time.  Without limiting the
Agent’s right to determine that Inventory does not constitute Eligible
Inventory, but without duplication, the following Inventory of the Loan Parties
shall not be Eligible Inventory: (a) Inventory deemed to be out-of-condition or
otherwise unmerchantable by the United States Department of Agriculture, any
state’s Department of Agriculture, or any other Governmental Authority having
regulatory authority over the Loan Parties or any of the Loan Parties’ assets or
activities; (b) Inventory for which a prepayment has been received;
(c) Inventory in the possession of third parties, unless it is Inventory: (i) at
a location (x) shown on Exhibit 3B(i) or (y) permitted hereunder or under the
Security Agreement, in each case, for which the Agent has received a bailee
letter satisfactory to the Agent, or (ii) covered by negotiable warehouse
receipts or negotiable bills of lading issued by either: (A) a warehouseman
licensed and bonded by the United States Department of Agriculture or any
state’s Department of Agriculture, or (B) a recognized carrier having an office
in the United States and in a financial condition reasonably acceptable to the
Agent, which receipts or bills of lading designate the Agent directly or by
endorsement as the only Person to which or to the order of which the
warehouseman or carrier is legally obligated to deliver such Goods;
(d) Inventory in which the Agent does not, for any reason, have a first priority
perfected security interest; and (e) Inventory which in the Agent’s opinion may
be subject to liens or conflicting claims of ownership, whether such liens or
conflicting claims are asserted or could be asserted by any Person except for
statutory liens or encumbrances permitted by Section 10.1(a), (b) and (d). With
regard to Inventory included in the Borrowing Base by the Borrower in good
faith, a determination by the Agent that such Inventory is not Eligible
Inventory in accordance with the foregoing shall be effective on the third
Business Day after notice thereof by the Agent to the Borrower in accordance
with Section 13.18.

 

“Environmental Laws” has the meaning set forth in Section 7.9 hereof.

 

“Equipment” means any and all Goods, other than Inventory (including without
limitation, equipment, machinery, motor vehicles, implements, tools, parts and
accessories) which are at any time owned by the Borrower, together with any and
all accessions, parts and appurtenances and any other “equipment” (as defined in
the Code).

 

“Equity Cure Issuance” has the meaning set forth in the definition of Equity
Cure Proceeds.

 

“Equity Cure Proceeds” means, with respect to any exercise of the Borrower’s
rights under Section 11.3, the net cash proceeds received by the Borrower
pursuant to a capital contribution to its common equity funded by the concurrent
sale or issuance by the Borrower of shares of its equity interests (the “Equity
Cure Issuance”).

 

“Equity Distribution” means any dividend or other distribution (whether in cash,
securities or other property) with respect to any membership interest or other
equity interest in the Borrower, or any payment (whether in cash, securities or
other property), including any

 

9

--------------------------------------------------------------------------------

 

sinking fund or similar deposit, on account of the purchase, redemption,
retirement, acquisition, cancellation or termination of any such membership or
other equity interest or of any option, warrant or other right to acquire any
such membership or other equity interest.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
and in effect at any time, and all rules, regulations and rulings thereof issued
by the Internal Revenue Service or the Department of Labor thereunder.

 

“ERISA Affiliate” means any trade or business (whether or not incorporated)
under common control with the Borrower within the meaning of Section 414(b) or
(c) of the IRC (and Sections 414(m) and (o) of the IRC for purposes of
provisions relating to Section 412 of the IRC).

 

“ERISA Event” means (a) a Reportable Event with respect to a Pension Plan; (b) a
withdrawal by the Borrower or any ERISA Affiliate from a Pension Plan subject to
Section 4063 of ERISA during a plan year in which it was a substantial employer
(as defined in Section 4001(a)(2) of ERISA) or a cessation of operations that is
treated as such a withdrawal under Section 4062(e) of ERISA; (c) a complete or
partial withdrawal by the Borrower or any ERISA Affiliate from a Multiemployer
Plan or notification that a Multiemployer Plan is in reorganization; (d) the
filing of a notice of intent to terminate, the treatment of a Plan amendment as
a termination under Sections 4041 or 4041A of ERISA, or the commencement of
proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan;
(e) an event or condition which might reasonably be expected to constitute
grounds under Section 4042 of ERISA for the termination of, or the appointment
of a trustee to administer, any Pension Plan or Multiemployer Plan; or (f) the
imposition of any liability under Title IV of ERISA, other than PBGC premiums
due but not delinquent under Section 4007 of ERISA, upon the Borrower or any
ERISA Affiliate.

 

“Excess” has the meaning set forth in Section 13.19 hereof.

 

“Excess Disposition Proceeds” means the Borrower’s net cash proceeds, including
insurance or condemnation proceeds, from the sale or other disposition or loss
of assets (other than the sale of Inventory in the ordinary course of business
or the casualty loss of Inventory), which are not used by the Borrower for the
replacement of the assets sold, disposed of or lost or not used for the
acquisition of other assets with similar business utility within one hundred
eighty (180) days after such sale, disposition or loss, in excess of $100,000 in
the aggregate during any rolling twelve month period.

 

“Excess Equity Proceeds” means, during any period of determination, the
Borrower’s net cash proceeds from the sale or issuance of stock, membership,
partnership or other equity interests (or warrants or other options therefor),
including capital contributions in respect of any such interests previously
issued.

 

“Existing Credit Agreement” has the meaning set forth in the recitals hereof.

 

“Existing Equity Holders” means, collectively, US Premium Beef, TKK Investments,
LLC, TMKCo, LLC and NBPCo Holdings, LLC.

 

10

--------------------------------------------------------------------------------

 

 

“Existing Line of Credit Notes” means the Line of Credit Notes of the Borrower
delivered to the Existing Lenders under the Existing Credit Agreement.

 

“Existing Term Notes” means the Term Notes of the Borrower delivered to the
Existing Lenders under the Existing Credit Agreement.

 

“Facility” means the Line of Credit Loan Facility, the Swing Line, the Term Loan
Facility or the Letter of Credit Sublimit, as the context may require.

 

“Farm Credit System Participant” has the meaning set forth in
Section 13.23(e) hereof.

 

“Farm Products” means all of the Borrower’s harvested or unharvested crops of
all types and descriptions, whether annual or perennial and all other personal
property of the Borrower used or for use in farming or livestock operations,
including without limitation, native grass, grain, harvested crops, feed, feed
additives, feed ingredients, feed supplements, fertilizer, hay, silage, supplies
(including without limitation, veterinary supplies and related Goods), livestock
(including without limitation, the offspring of such livestock and livestock in
gestation) and any other “farm products” (as defined in the Code).

 

“Federal Funds Rate” means, for any day, the rate of interest per annum (rounded
upward, if necessary, to the nearest whole multiple of 1/100th of 1%) equal to
the weighted average of the rates on overnight federal funds transactions with
members of the Federal Reserve System arranged by federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on such day, or if no
such rate is so published on such day, on the most recent day preceding such day
on which such rate is so published.

 

“Feeder Deposits” has the meaning set forth in Section 10.19 hereof.

 

“Financial Performance Level” has the meaning set forth in the definition of
Applicable Margin.

 

“Financing Documents” means this Agreement, the Notes, the Agent’s Letter, the
NB, Inc. Acknowledgment, all Security Documents, and all documents, instruments,
certificates and agreements at any time executed or delivered by the Borrower to
any of the Agent or any one or more of the Lenders pursuant to or in connection
with any of the foregoing, and any and all amendments, modifications,
supplements, renewals, extensions, increases and rearrangements of, and
substitutions for, any of the foregoing.

 

“Fiscal Year” means the Borrower’s fiscal year, which shall be the twelve month
period ending on the last Saturday in August each year; references to a Fiscal
Year with a number corresponding to any calendar year (e.g., the “Fiscal Year
2010”) refer to the Fiscal Year ending on the last Saturday in August of such
calendar year.

 

“Fixed Charge Coverage Ratio” means , as of the end of any fiscal quarter, the
ratio of (a) EBITDA during the eight consecutive fiscal quarters then ended,
less Net Capital Expenditures during such eight fiscal quarter period to (b) the
sum of (i) the aggregate amount of all scheduled payments of principal of and
interest on Funded Debt during such eight fiscal quarter period, (ii) Borrower’s
consolidated cash income taxes incurred and paid during such eight fiscal
quarter

 

11

--------------------------------------------------------------------------------

 

period and (iii) Equity Distributions made by Borrower during such eight fiscal
quarter period (other than (x) Equity Distributions permitted under the $150
Million Basket, (y) up to $125,484,074.72 in Equity Distributions made by
Borrower in April 2009 and (z) up to $8,000,000 in Equity Distributions made by
Borrower pursuant to the terms of the Consent to Sixth Amended and Restated
Credit Agreement dated May 27, 2010.

 

“Foreign Subsidiary” means any direct or indirect Subsidiary of the Borrower
which is organized under the laws of any jurisdiction other than the United
States (or any State thereof) of the District of Columbia.

 

“Funded Debt” means, for any date of determination, the then outstanding
principal amount of all of the Borrower’s consolidated interest-bearing
Indebtedness (including without limitation, capitalized leases) plus the then
undrawn amount of all outstanding letters of credit (including without
limitation, the LCs); provided, however, that (a) LCs or indemnity obligations
issued to support other Indebtedness shall not be included in Funded Debt to the
extent that such other Indebtedness is, itself, included in Funded Debt; (b) the
Borrower’s Class A or B Units subject to redemption rights shall not be included
in Funded Debt; and (c) the Borrower’s obligations under deferred compensation
plans shall not be included in Funded Debt.

 

“Funded Debt to EBITDA Ratio” means, for any date of determination, the ratio
of: (a) Funded Debt as of such date, over (b) EBITDA during the four consecutive
fiscal quarters most recently ended.

 

“GAAP” means generally accepted accounting principles set forth in the opinions
and pronouncements of the Accounting Principles Board of the American Institute
of Certified Public Accountants and statements and pronouncements of the
Financial Accounting Standards Board, or in such other statements by such other
entity as may be in general use by significant segments of the accounting
profession, which are applicable to the circumstances as of the date of
determination.

 

“Georgia Mortgage” means that certain Deed to Secure Debt and Security Agreement
between the Borrower and the Agent, dated as of November 25, 2009 and that
certain financing statement dated as of November 25, 2009, in each case,
together with any and all amendments, modifications, supplements, renewals or
restatements thereof.

 

“Governmental Authority” means any nation or government, any state or other
political subdivision thereof and any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government,
including without limitation, any arbitration panel, any court or any
commission.

 

“Governmental Requirement” means any material law, statute, code, ordinance,
order, rule, regulation, judgment, decree, injunction, franchise, permit,
certificate, license, authorization or other directive or requirement of any
federal, state, county, municipal, parish, provincial or other Governmental
Authority or any department, commission, board, court, agency or any other
instrumentality of any of them.

 

12

--------------------------------------------------------------------------------

 

“Guaranty Agreement” means that certain Guaranty Agreement dated as of even date
herewith, executed by certain of the Borrower’s Subsidiaries in favor of the
Agent, together with any and all amendments, modifications, supplements,
renewals or restatements thereof.

 

“Guaranty Obligation” means, as to any Person, any (a) any obligation,
contingent or otherwise, of such Person guarantying or having the economic
effect of guaranteeing any Indebtedness or other obligation payable or
performable by another Person (the “primary obligor”) in any manner, whether
directly or indirectly, and including any obligation of such Person, direct or
indirect, (i) to purchase or pay (or advance or supply funds for the purchase or
payment of) such Indebtedness or other obligation, (ii) to purchase or lease
property, securities or services for the purpose of assuring the obligee in
respect of such Indebtedness or other obligation of the payment or performance
of such Indebtedness or other obligation, (iii) to maintain working capital,
equity capital or any other financial statement condition or liquidity of the
primary obligor so as to enable the primary obligor to pay such Indebtedness or
other obligation, or (iv) entered into for the purpose of assuring in any other
manner the obligees in respect of such Indebtedness or other obligation of the
payment or performance thereof or to protect such obligees against loss in
respect thereof (in whole or in part), or (b) any Lien on any assets of such
Person securing any Indebtedness or other obligation of any other Person,
whether or not such Indebtedness or other obligation is assumed by such Person;
provided, however, that the term “Guaranty Obligation” shall not include
endorsements of instruments for deposit or collection in the ordinary course of
business.  The amount of any Guaranty Obligation shall be deemed to be an amount
equal to the stated or determinable amount of the related primary obligation, or
portion thereof, in respect of which such Guaranty Obligation is made or, if not
stated or determinable, the maximum reasonably anticipated liability in respect
thereof as determined by the guaranteeing Person in good faith.

 

“Highest Lawful Rate” means, with respect to each Lender, the maximum
nonusurious interest rate, if any, that at any time or from time to time may be
contracted for, taken, reserved, charged, or received with respect to the Notes
or on other amounts, if any, payable to such Lender pursuant to this Agreement
or any other Financing Document, under laws applicable to such Lender which are
presently in effect, or, to the extent allowed by law, under such applicable
laws which may hereafter be in effect and which allow a higher maximum
nonusurious interest rate than applicable laws now allow.

 

“Holding Account” means a deposit account belonging to the Agent into which the
Borrower may be required to make deposits pursuant to the provisions of this
Agreement, such account to be under the sole dominion and control of the Agent
and not subject to withdrawal by the Borrower, with any amounts therein to be
held for application toward payment of any outstanding LCs when drawn upon.  The
Holding Account shall be a money market savings account or substantial
equivalent (or other appropriate investment medium as the Borrower may from time
to time request and to which the Agent in its sole discretion shall have
consented) and shall bear interest in accordance with the terms of similar
accounts held by the Agent for its customers.

 

“Indebtedness” shall mean with respect to any Person and without duplication:

 

13

--------------------------------------------------------------------------------

 

(a)           All obligations of such Person for borrowed money (including,
without limitation, all notes payable and drafts accepted representing
extensions of credit, all obligations evidenced by credit agreements, bonds,
debentures, notes or other similar instruments and all obligations upon which
interest charges are customarily paid);

 

(b)           any direct or contingent obligations of such Person arising under
letters of credit (including standby and commercial), banker’s acceptances, bank
guaranties, surety bonds and similar instruments;

 

(c)           whether or not so included as liabilities in accordance with GAAP,
all obligations of such Person to pay the deferred purchase price of property or
services (other than trade accounts payable incurred in the ordinary course of
the Borrower’s business), and indebtedness (excluding prepaid interest thereon
and excluding operating leases) secured by a Lien on property owned or being
purchased by such Person (including indebtedness arising under conditional sales
or other title retention agreements), whether or not such indebtedness shall
have been assumed by such Person or is limited in recourse;

 

(d)           capitalized leases and Synthetic Lease Obligations;

 

(e)           net obligations under any Swap Contract in an amount equal to
(i) if such Swap Contract has been closed out, the termination value thereof, or
(ii) if such Swap Contract has not been closed out, the mark-to-market value
thereof determined on the basis of readily available quotations provided by any
recognized dealer in such Swap Contract; and

 

(f)            all Guaranty Obligations of such Person in respect of any of the
foregoing.

 

For all purposes hereof, the Indebtedness of any Person shall include the
Indebtedness of any partnership or joint venture in which such Person is a
general partner or a joint venturer, unless such Indebtedness is expressly made
non-recourse to such Person except for customary exceptions acceptable to the
Required Lenders.  The amount of any capitalized lease or Synthetic Lease
Obligation as of any date shall be deemed to be the amount of Attributable
Indebtedness in respect thereof as of such date.

 

“Indemnified Amounts” has the meaning set forth in Section 13.5(b) hereof.

 

“Indemnitee” has the meaning set forth in Section 13.5(b) hereof.

 

“Indenture” means that certain Trust Indenture dated as of December 1, 2004
between the City and Commerce Bank. N.A., as trustee, together with any and all
amendments, modifications, supplements, renewals or restatements thereof.

 

“Insurance Reserve” means a collateral reserve against casualty losses that
would not be covered by insurance as a result of the self-insured retention
deductible provision in the Borrower’s property insurance (a) in an amount equal
to $10,000,000 when the self-insured retention deductible under the Borrower’s
property insurance procured in accordance with

 

14

--------------------------------------------------------------------------------

 

Section 9.5 exceeds $15,000,000; (b) in an amount equal to $5,000,000 when the
self-insured retention deductible under the Borrower’s property insurance
procured in accordance with Section 9.5 exceeds $10,000,000 but is less than or
equal to $15,000,000; and (c) in an amount equal to $0 when the self-insured
retention deductible under the Borrower’s property insurance procured in
accordance with Section 9.5 is less than or equal to $10,000,000.

 

“Intercompany Financing Documents” means: (a) the Loan Agreement dated as of
May 30, 2006, by and between the Borrower and NBC (the “Intercompany Loan
Agreement”), (b) the Security Agreement dated as of May 30, 2006, by NBC in
favor of the Borrower, (c) the Trademark License Agreement between NBC and the
Borrower dated as of May 30, 2006, (d) the Deed of Trust, Assignment of Rents
and Leases, Security Agreement and Fixture Filing from NBC to the Borrower dated
as of June 2, 2006 (the “Intercompany Deed of Trust”), (e) the Note (as defined
in the Intercompany Loan Agreement), (f) the Security Agreement (Security
Interest in Partnership Interests) by NCI in favor of the Borrower dated as of
May 30, 2006, (g) the Loan Agreement dated as of August 6, 2003, among NCI, NCI
Leasing and the Borrower’s predecessor in interest, (h) the Security Agreement
dated as of August 6, 2003, by NCI and NCI Leasing in favor of the Borrower’s
predecessor in interest, (i) the Promissory Note dated as of August 6, 2003,
from NCI and NCI Leasing to the Borrower’s predecessor in interest, (j) the
Trademark Security Agreement dated as of August 6, 2003, by NCI and NCI Leasing
in favor of the Borrower’s predecessor in interest, (k) the Loan Agreement dated
as of May 29, 1998, as amended by the Loan Extension Agreement dated as of
May 31, 2001, the Second Amendment to Loan Agreement dated as of August 21,
2001, the Third Amendment to Loan Agreement dated as of September 1, 2005 and
the Fourth Amendment to Loan Agreement dated as of May 30, 2006, in each case,
between KC Steak and the Borrower’s predecessor in interest, (l) the First
Amended and Restated Security Agreement dated as of August 29, 2001, between KC
Steak and the Borrower’s predecessor in interest, (m) the Amended and Restated
Promissory Note dated as of May 30, 2006, from KC Steak to the Borrower, and any
and all other agreements, chattel mortgages, security agreements, pledges,
guaranties, assignments of proceeds, assignments of contract rights, assignments
of partnership interest, assignments of performance or other collateral
assignments, trademark license agreements, completion or surety bonds, standby
agreements, subordination agreements, undertakings and other similar documents,
agreements, instruments and financing statements at any time executed and
delivered by any of the Borrower’s Subsidiaries or a third Person in connection
with, or as security for the payment or performance of, any agreements or
documents that may from time to time incur, evidence, or govern indebtedness
that any Subsidiary owes from time to time directly or indirectly to the
Borrower, as the foregoing may be amended, supplemented or otherwise modified
from time to time in accordance with this Agreement.

 

“Interest Period” means:  the period of time for which the LIBOR Rate shall be
in effect as to any LIBOR Rate Advance and which shall be a one, two, three or
six month period of time, commencing with the borrowing date of such LIBOR Rate
Advance or the expiration date of the immediately preceding Interest Period, as
the case may be, applicable to and ending on the effective date of any rate
change or rate continuation made as provided herein as the Borrower may specify
in a notice of borrowing or a notice of interest conversion; provided, however,
all interest periods for all LIBOR Rate Advances outstanding under the Existing
Credit Agreement as of the Restatement Date shall be deemed to have ended on the
day immediately preceding the Restatement Date; and provided further that:
(a) any Interest Period which would otherwise end

 

15

--------------------------------------------------------------------------------

 

on a day which is not a Business Day shall be extended to the next succeeding
Business Day unless such Business Day falls in another calendar month, in which
case such Interest Period shall end on the next preceding Business Day, (b) no
Interest Period applicable to a Line of Credit Loan shall extend beyond the
scheduled Maturity Date applicable to the Line of Credit Loan; (c) no Interest
Period for a Term Advance shall extend beyond the Maturity Date applicable to
the Term Loan; (d) there shall be no more than five Interest Periods for LIBOR
Rate Advances outstanding at any one time under the Line of Credit; and
(e) there shall be no more than five Interest Periods for LIBOR Rate Advances at
any one time under the Term Loan.

 

“Inventory” means, with respect to any Person, any and all Goods which shall at
any time constitute “inventory” (as defined in the Code) or Farm Products of
such Person, wherever located (including without limitation, Goods in transit
and Goods in the possession of third parties), or which from time to time are
held for sale, lease or consumption in such Person’s business, furnished under
any contract of service or held as raw materials, work in process, finished
inventory or supplies (including without limitation, packaging and/or shipping
materials).

 

“IPO Proceeds” means the net cash proceeds, if any, received by the Borrower in
connection with the Permitted IPO.

 

“IRC” means the Internal Revenue Code of 1986, as amended, as at any time in
effect, together with all regulations and rulings thereof or thereunder issued
by the Internal Revenue Service.

 

“Issuer” means CoBank or, with respect to the “LCs” issued by Rabobank under
(and as defined in) the Existing Credit Agreement and listed on Exhibit 1E,
Rabobank, as issuers of LCs.

 

“Kansas Mortgage” means the Amended and Restated Mortgage, Assignment of Rents
and Leases, Security Agreement and Fixture Filing between the Borrower and the
Agent, dated December 29, 2004, and the Amended and Restated Collateral
Assignment of Amended and Restated Lease from the Borrower in favor of the
Agent, dated as of December 29, 2004, in each case, together with any and all
further amendments, modifications, supplements, renewals or restatements
thereof.

 

“KC Steak” means Kansas City Steak Company, LLC, a Missouri limited liability
company, a majority owned Subsidiary of the Borrower.

 

“LC” means a documentary, direct pay or standby letter of credit issued for the
account of the Borrower pursuant to Section 2.2, including any “LCs” issued
under (and as defined in) the Existing Credit Agreement.

 

“LC Fee” has the meaning set forth in Section 6.2 hereof.

 

“LC Obligations” means, at any time, an amount equal to the sum of (a) the
aggregate undrawn and unexpired amount of the outstanding LCs plus (b) the
aggregate amount of drawings under LCs which have not then been reimbursed
pursuant to Section 2.2(f).

 

16

--------------------------------------------------------------------------------

 

“LC Sublimit” means an amount equal to the lesser of (a) $75,000,000 and (b) the
Line of Credit Loan Commitments.  For the avoidance of doubt, the LC Sublimit is
part of, and not in addition to, the Line of Credit Loan Commitments.

 

“Lease” means that certain Lease dated as of December 1, 2004 between the City
and the Borrower, together with any and all amendments, modifications,
supplements, renewals or restatements thereof.

 

“Lenders” has the meaning set forth in the introduction hereof.

 

“Liabilities” means any and all liabilities, obligations and indebtedness of the
Borrower to the Agent, the Lenders, the Swing Line Lender, the Issuers, the Swap
Parties and/or the Indemnitees of any and every kind and nature, at any time
owing, arising, due or payable and howsoever evidenced, created, incurred,
acquired or owing, primary, secondary, direct, contingent, fixed or otherwise
(including without limitation, LC Obligations, the Borrower’s obligations under
any Swap Contracts with Swap Parties, fees, charges and obligations of
performance) arising or existing under this Agreement or any of the other
Financing Documents or by operation of law relating to this Agreement or any of
the other Financing Documents.

 

“LIBOR Rate” means (a) with respect to each day during each Interest Period
applicable to a LIBOR Rate Account, the per annum rate for the Interest Period
selected by Borrower, as quoted by the British Bankers’ Association (or if such
quotation source is unavailable, such other quotation source as may be
reasonably selected by the Administrative Agent) for the purpose of displaying
London Interbank Offered Rates for U.S. Dollar deposits, (which shall be the
LIBOR rate in effect two Business Days prior to the related Advance) rounded up
to the 1/100th of 1% per annum, or (b) with respect to the determination of the
Base Rate, the LIBOR rate, as quoted by the British Bankers’ Association (or if
such quotation source is unavailable, such other quotation source as may be
reasonably selected by the Administrative Agent) for the purpose of displaying
London Interbank Offered Rates for U.S. Dollar deposits, in each case divided by
a percentage equal to 100% minus the stated maximum rate of all reserve
requirements (including, without limitation, any marginal, emergency,
supplemental, special or other reserves) applicable on such date to any member
bank of the Federal Reserve System in respect of “Eurocurrency liabilities” as
defined in Regulation D (or any successor category of liabilities under
Regulation D).

 

“LIBOR Rate Advance” means an Advance with respect to which the interest rate is
determined by reference to the LIBOR Rate.

 

“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 of any kind or
nature whatsoever (including any conditional sale or other title retention
agreement, any financing lease having substantially the same economic effect as
any of the foregoing, and the filing of any financing statement under the Code
or comparable laws of any jurisdiction), including the interest of a purchaser
of accounts.

 

“Line of Credit Loan” has the meaning set forth in Section 2.1.1 hereof.

 

17

--------------------------------------------------------------------------------

 

“Line of Credit Loan Commitment” means as to any Lender, such Lender’s
obligation to make Line of Credit Loans up to its Pro Rata Percentage of
$250,000,000, as set forth opposite such Lender’s name under the heading “Line
of Credit Loan Commitments” on Exhibit 1A, subject to Assignments and
Acceptances executed and delivered in accordance with Section 13.23, and as such
amount may be reduced or terminated from time to time pursuant to Section 4.5 or
11.1; and “Line of Credit Loan Commitments” means, collectively, the Line of
Credit Loan Commitments for all the Lenders.

 

“Line of Credit Loan Facility” means, at any time, the aggregate amount of the
Lenders’ Line of Credit Loan Commitments.

 

“Line of Credit Notes” has the meaning set forth in Section 2.1.1 hereof.

 

“Loan” means each Line of Credit Loan and each Term Loan; however, unless
particularly specified in the relevant text, the term “Loan” does not include
Swing Line Loans.

 

“Loan Account” has the meaning set forth in Section 2.1.5(d) hereof.

 

“Loan Date” means the date of the making of any Line of Credit Loan or Swing
Line Loan hereunder.

 

“Loan Parties” means the Borrower and the Subsidiary Loan Parties.

 

“Margin Accounts” means, collectively, all Commodity Accounts and all Commodity
Contracts credited thereto.

 

“Matured Default” means the occurrence or existence of any one or more of the
following events: (a) the Borrower fails to pay any principal or interest
pursuant to any of the Financing Documents at the time such principal or
interest becomes due or is declared due; (b)  the Borrower fails to pay any of
the Liabilities (other than principal and interest) on or before ten (10) days
after such Liabilities become due or are declared due; (c) the Borrower or any
of its  Subsidiaries fails or neglects to perform, keep or observe any of the
covenants, conditions, promises or agreements contained in Sections 2.2(a),
9.16, 9.17, 9.18, 10.1, 10.2 or 10.4 of this Agreement; (d) the Borrower or any
of its Subsidiaries fails or neglects to perform, keep or observe any of the
covenants, conditions, promises or agreements contained in this Agreement or in
any of the other Financing Documents (other than those covenants, conditions,
promises and agreements referred to or covered in (a), (b) or (c) above), and
such failure continues for more than thirty (30) days after such failure or
neglect first occurs, provided that such grace period shall not apply, and a
Matured Default shall be deemed to have occurred and to exist immediately if
such failure or neglect is material and may not, in the Agent’s reasonable
determination, be cured by the Borrower or its Subsidiaries during such thirty
(30) day grace period; (e) the Borrower or any of its Subsidiaries directly or
indirectly contests in any manner the validity, binding nature, or
enforceability of any Financing Document, or, any Lien securing any Liabilities;
(f) any of the Borrower’s Subsidiaries directly or indirectly contests in any
manner the validity, binding nature, or enforceability of any of the
Intercompany Financing Documents or the assignment thereof to the Agent; (g) any
warranty or representation at any time made by or on behalf of the Borrower or
any of its Subsidiaries in connection with this Agreement or any of the other
Financing Documents is untrue or incorrect in any material

 

18

--------------------------------------------------------------------------------

 

respect, or any schedule, certificate, statement, report, financial data,
notice, or writing furnished at any time by or on behalf of either the Borrower
or any of its Subsidiaries to the Agent or the Lenders is untrue or incorrect in
any material respect on the date as of which the facts set forth therein are
stated or certified; (h) a judgment in excess of $3,000,000 is rendered against
the Borrower or any of the other Loan Parties and such judgment remains
unsatisfied or undischarged and in effect for forty-five (45) consecutive days
without a stay of enforcement or execution, provided that this clause shall not
apply to any judgment for which the Borrower or any other Loan Party is fully
insured subject only to a deductible not exceeding $500,000, and with respect to
which the insurer has admitted liability in writing for such judgment; (i) all
or any part of the Borrower’s or any other Loan Party’s assets come within the
possession of any receiver, trustee, custodian or assignee for the benefit of
creditors and the same continues for a period of forty-five (45) days; (j) a
proceeding under any bankruptcy, reorganization, arrangement of debt,
insolvency, readjustment of debt or receivership law or statute is filed against
the Borrower or any of the other Loan Parties and such proceeding is not
dismissed within forty-five (45) days of the date of its filing, or a proceeding
under any bankruptcy, reorganization, arrangement of debt, insolvency,
readjustment of debt or receivership law or statute is filed by either the
Borrower or any of the other Loan Parties, or the Borrower or any of the other
Loan Parties applies for, consents to, or acquiesces in, the appointment of a
trustee, receiver, sequestrate, or other custodian for the Borrower or any of
the other Loan Parties or any of their respective property, or the Borrower or
any of the other Loan Parties makes an assignment for the benefit of creditors;
(k) the Borrower or any of the other Loan Parties becomes insolvent or generally
fails to pay, or admits in writing its inability to pay, debts as they become
due; (l) the Borrower or any of the other Loan Parties voluntarily or
involuntarily dissolves or is dissolved, terminates or is terminated; (m) the
Borrower or any of the other Loan Parties is enjoined, restrained, or in any way
prevented by the order of any court or any administrative or regulatory agency
or by the termination or expiration of any permit or license, from conducting
all or any material part of its respective business affairs; (n) the Borrower or
any of the other Loan Parties fails to make any payment due or otherwise
defaults on any other obligation for borrowed money and the effect of such
failure or default is to cause or permit the holder of such obligation or a
trustee to cause such obligation to become due prior to its date of maturity;
(o) the Agent makes an expenditure under Section 13.3 of this Agreement and such
expenditure is not reimbursed within five (5) Business Days after the Agent
notifies the Borrower of such expenditure; (p) the occurrence of a Change of
Control; (q) the Borrower or any of its Subsidiaries fail to pay any Producer
Payables in accordance with Section 9.13, and such failure continues for a
period of more than three (3) consecutive Business Days; (r) an “event of
default” as defined in the Lease shall occur and the effect is to cause the
Trustee to accelerate the Lease Payments (as defined in the Lease) or act to
dispossess the Borrower and such acceleration or action shall continue without
waiver, cure, rescission or annulment for a period of thirty (30) days;
(s) (i) an ERISA Event occurs with respect to a Pension Plan or Multiemployer
Plan which has resulted or could reasonably be expected to result in liability
of either the Borrower or any of its Subsidiaries under Title IV of ERISA to the
Pension Plan, Multiemployer Plan or the PBGC in an aggregate amount in excess of
$1,000,000, or (ii) the Borrower or any of its Subsidiaries, or any ERISA
Affiliate of the Borrower or any of its Subsidiaries fails to pay when due,
after the expiration of any applicable grace period, any installment payment
with respect to its withdrawal liability under Section 4201 of ERISA under a
Multiemployer Plan in an aggregate amount in excess of $1,000,000; or (t) at any
time from

 

19

--------------------------------------------------------------------------------

 

and after the consummation of the Permitted IPO, NB, Inc fails to keep or
observe any of the covenants, promises or agreements set forth in the NB, Inc.
Acknowledgment.

 

“Maturity Date” means the earliest of (a) the date on which the Commitments are
terminated in whole pursuant to Section 11.1, (b) the date on which the Borrower
voluntarily terminates the Commitments in whole and pays the Liabilities in
full, (c) in the case of the Line of Credit Loans, June 4, 2015, (d) in the case
of the Term Loans, June 4, 2015, and (e) in the case of any Swing Line Loan,
June 4, 2015, or any earlier Business Day specified by notice from the Swing
Line Lender to the Borrower and the Lenders.

 

“Member” means any Person who holds directly or indirectly, an ownership
interest in the Borrower.

 

“Multiemployer Plan” means any employee benefit plan of the type described in
Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA Affiliate makes
or is obligated to make contributions, or during the preceding three calendar
years, has made or been obligated to make contributions.

 

“NBC” means National Beef California, LP, a Delaware limited partnership, and a
wholly owned indirect Subsidiary of the Borrower.

 

“NB, Inc.” means National Beef, Inc., a Delaware corporation.

 

“NB, Inc. Acknowledgment” means that certain Acknowledgment by and between
NB, Inc., and the Agent in form of Exhibit 1D.

 

“NCI” means National Carriers, Inc., a Kansas corporation, and a wholly owned
Subsidiary of the Borrower.

 

“NCI Leasing” means NCI Leasing, Inc., a Kansas corporation, and a wholly owned
Subsidiary of NCI.

 

“Net Capital Expenditures” means, during any period of determination: (a) the
Borrower’s consolidated net property, plant and equipment at the end of such
period, less (b) the Borrower’s consolidated net property, plant and equipment
at the beginning of such period, plus (c) the Borrower’s consolidated
depreciation during such period.

 

“Net Worth” means, as of any date of determination, (a) the aggregate book value
of the assets of Borrower and its consolidated Subsidiaries as of such date
prepared in accordance with GAAP less (b) Total Liabilities (as defined below).

 

“Non-Material Domestic Subsidiary” means any Domestic Subsidiary that, together
with its consolidated Subsidiaries, has (a) assets, as of the last day of the
Borrower’s most recently ended fiscal quarter, with a book value of less than 5%
of the total assets of the Borrower and its Subsidiaries on a consolidated basis
on such date and (b) EBITDA, as of the last day of the Borrower’s most recently
ended Fiscal Year, of less than $20,000,000; provided, that, if the Non-Material
Domestic Subsidiaries, taken as a whole, together with the assets of their
respective consolidated Subsidiaries, have assets, as of the last day of the
Borrower’s most recently ended

 

20

--------------------------------------------------------------------------------

 

 

fiscal quarter, valued at greater than or equal to 10% of the total assets of
the Borrower and its Subsidiaries on a consolidated basis, then the Borrower
shall cause one or more additional Domestic Subsidiaries to become Subsidiary
Loan Parties in accordance with Section 9.19; provided, further, that if a
Non-Material Domestic Subsidiary, together with its consolidated Subsidiaries,
has EBITDA, as of the last day of the Borrower’s most recently ended Fiscal
Year, greater than or equal to $20,000,000, then the Borrower shall cause such
Domestic Subsidiary to become a Subsidiary Loan Party in accordance with
Section 9.19; provided, further, that in no event shall National Beef Leathers,
LLC be or become a Subsidiary Loan Party, except upon the consent of the Agent. 
As of the Restatement Date, each of National Beef Leathers, LLC, NCI Leasing,
National Elite Transportation LLC, National Beef aLF, LLC and NB Finance Corp.
shall be a Non-Material Domestic Subsidiary.

 

“Non-Use Fee” has the meaning set forth in Section 6.1 hereof.

 

“Note” or “Notes” shall mean any one or more of the Line of Credit Notes, the
Term Notes and/or the Swing Line Note, as the context may require.

 

“Owner/Operator Agreement” means an agreement with an owner-operator of a
tractor, for the use of the tractor, which is cancelable upon not more than
ninety days written notice by either party, which agreement has been or may be
considered a lease for accounting purposes.

 

“Payment in Lieu of Tax Agreement” means that certain Payment in Lieu of Tax
Agreement dated as of December 1, 2004 between the Borrower and the City,
together with any and all amendments, modifications, supplements, renewals or
restatements thereof.

 

“PBGC” means the Pension Benefit Guaranty Corporation.

 

“Pennsylvania Mortgage” means the Amended and Restated Open-End Mortgage,
Assignment of Rents and Leases, Security Agreement and Fixture Filing between
the Borrower and the Agent, dated December 29, 2004, together with any and all
further amendments, modifications, supplements, renewals or restatements
thereof.

 

“Pension Plan” means any “employee pension benefit plan” (as such term is
defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by the Borrower or
any ERISA Affiliate or to which the Borrower or any ERISA Affiliate contributes
or has an obligation to contribute, or in the case of a multiple employer plan
(as described in Section 4064(a) of ERISA) has made contributions at any time
during the immediately preceding five plan years.

 

“Permitted IPO” means an initial public offering of shares of common stock of
NB, Inc. in a public offering pursuant to an effective registration statement
filed with the SEC in accordance with the Securities Act and on substantially
the same terms and conditions set forth in the Draft Prospectus or otherwise on
terms and conditions satisfactory to the Required Lenders and the Agent;
provided, that (a) no Default or Matured Default shall have occurred or be
continuing or would be caused thereby, (b) the Borrower shall be in pro forma
compliance (based on assumptions and projections acceptable to the Agent) with
the financial covenants set forth in Section 9.16, 9.17 and 9.18 after giving
effect thereto, (c) NB, Inc. shall substantially simultaneously therewith
execute and deliver the NB, Inc. Acknowledgment and Secretary’s

 

21

--------------------------------------------------------------------------------

 

Certificates relating to resolutions, incumbency, etc., (d) all net cash
proceeds thereof (other than any net cash proceeds paid to the Existing Equity
Holders) shall be used to purchase new equity interests in the Borrower and
(e) the Agent shall have received opinions of counsel for NB, Inc. and such
other information, documents, agreements or instruments that the Agent or
Agent’s counsel may reasonably required in connection therewith.

 

“Person” means an individual, sole proprietorship, partnership, joint venture,
trust, unincorporated organization, association, corporation, limited liability
company, limited liability partnership, institution, joint stock company or
government (whether national, federal, state, provincial, county, city,
municipal or otherwise, including without limitation, any instrumentality,
division, agency, body or department thereof).

 

“Plan” means any “employee benefit plan” (as such term is defined in
Section 3(3) of ERISA) established by the Borrower or any ERISA Affiliate.

 

“Prime Rate” means a rate of interest per annum equal to the “prime rate” as
published from time to time in the Eastern Edition of the Wall Street Journal as
the average prime lending rate for seventy-five percent (75%) of the United
States’ thirty (30) largest commercial banks, or if the Wall Street Journal
shall cease publication or cease publishing the “prime rate’’ on a regular
basis, such other regularly published average prime rate applicable to such
commercial banks as is acceptable to the Administrative Agent in its reasonable
discretion.

 

“Pro Rata Percentage” means with respect to any Lender at any time, a fraction
(expressed as a percentage), the numerator of which shall be the aggregate
amount of the Commitments of such Lender under the applicable Facility or
Facilities at such time, and the denominator of which shall be the aggregate
Commitments of all of the Lenders under the applicable Facility or Facilities at
such time; provided, that if the commitment of each lender to make Loans and the
obligation of the Issuer to issue, extend, renew or increase any LCs have been
terminated pursuant to Section 11.1, then the Pro Rata Percentage of each Lender
shall be determined based on the Pro Rata Percentage of such Lender immediately
prior to such termination and after giving effect to any subsequent assignments
made pursuant to the terms hereof.

 

“Producer Payables” means with respect to any Person, all amounts at any time
payable by such Person for the purchase of cattle, feed, grain or other farm
products.

 

“Rabobank” means Coöperatieve Centrale Raiffeisen - Boerenleenbank, B.A.,
“Rabobank Nederland”, New York Branch.

 

“Reportable Event” means any of the events set forth in Section 4043(c) of
ERISA, other than events for which the 30 day notice period has been waived.

 

“Required Lenders” means, at any time, Lenders having aggregate Total
Percentages of at least 51%.

 

“Restatement Date” means the date on or as of which the conditions precedent set
forth in Section 8.1 hereof are completed to the Agent’s satisfaction.

 

22

--------------------------------------------------------------------------------

 

“Securities Act” has the meaning set forth in Section 13.20 hereof.

 

“Security Agreement” means that certain Amended and Restated Security Agreement
dated as of even date herewith, executed by the Borrower and certain of its
Subsidiaries in favor of the Agent, together with any and all amendments,
modifications, supplements, renewals or restatements thereof.

 

“Security Documents” means the Security Agreement, the Guaranty Agreement, the
Bond Pledge Agreement, the Trademark License, the Kansas Mortgage, the
Pennsylvania Mortgage, the Georgia Mortgage, the letter agreement dated May 30,
2006, pursuant to which the Borrower (in its capacity as a limited partner of
NBC) consented, among other things, to NCI’s pledge to the Borrower of NCI’s
general partnership interest in NBC, the Assignment dated as of May 30, 2006 of
the Deed of Trust, Assignment of Rents and Leases, Security Agreement and
Fixture Filing from NBC to the Borrower dated as of May 30, 2006, as each may be
amended, modified, renewed or extended from time to time in accordance with this
Agreement, and any and all other agreements, chattel mortgages, security
agreements, pledges, guaranties, assignments of proceeds, assignments of
contract rights, assignments of partnership interest, assignments of performance
or other collateral assignments, trademark license agreements, completion or
surety bonds, standby agreements, subordination agreements, undertakings and
other similar documents, agreements, instruments and financing statements at any
time executed and delivered by the Borrower or a third Person in connection
with, or as security for the payment or performance of, any of the Liabilities.

 

“Specified Class A-1 Units” means up to $75,484,071 of the Class A-1 Units
issued by Borrower in April 2009 (as increased by the amount of any payment in
kind notes issued in lieu of cash distributions).

 

“Subsidiary” means, with respect to any Person, a corporation, partnership,
joint venture, limited liability company or other business entity of which a
majority of the shares of securities or other interests having ordinary voting
power for the election of directors or other governing body (other than
securities or interests having such power only by reason of the happening of a
contingency) are at the time beneficially owned, or the management of which is
otherwise controlled, directly, or indirectly through one or more
intermediaries, or both, by such Person.

 

“Subsidiary Loan Parties” means each of the Borrower’s direct and indirect
Subsidiaries that become party to this Agreement and the Security Agreement as a
Subsidiary Loan Party pursuant to the terms of Section 9.19 and the permitted
successors and assigns of each such Person; it being understood and agreed that
no Foreign Subsidiary or Non-Material Domestic Subsidiary shall be required to
be a Subsidiary Loan Party and, so long as the grant of a security interest and
the guarantee of the Borrower’s Indebtedness hereunder shall be limited by KC
Steak’s constituent documents or the applicable minority interest holder, KC
Steak shall not be required to be a Subsidiary Loan Party.

 

“Swap Contract” means (a) any and all rate swap transactions, basis swaps,
credit derivative transactions, forward rate transactions, commodity swaps,
commodity options, forward commodity contracts, equity or equity index swaps or
options, bond or bond price or bond index swaps or options or forward bond or
forward bond price or forward bond index

 

23

--------------------------------------------------------------------------------

 

transactions, interest rate options, forward foreign exchange transactions, cap
transactions, floor transactions, collar transactions, currency swap
transactions, cross-currency rate swap transactions, currency options, spot
contracts, or any other similar transactions or any combination of any of the
foregoing (including any options to enter into any of the foregoing), whether or
not any such transaction is governed by or subject to any master agreement, but
excluding any futures or options contracts credited to any Margin Account, and
(b) any and all transactions of any kind, and the related confirmations, which
are subject to the terms and conditions of, or governed by, any form of master
agreement published by the International Swaps and Derivatives
Association, Inc., the Bond Markets Association, any International Foreign
Exchange Master Agreement, or any other master agreement reasonably acceptable
to the Agent (any such master agreement, together with any related schedules, a
“Master Agreement”), including any such obligations or liabilities under any
Master Agreement.

 

“Swap Party” means any Lender (or affiliate thereof) that is a party to a Swap
Contract with the Borrower.

 

“Swing Line” means the revolving credit facility made available by the Swing
Line Lender pursuant to Section 2.1.3.

 

“Swing Line Lender” means CoBank in its capacity as provider of Swing Line
Loans, or any successor swing line lender hereunder.

 

“Swing Line Loan” has the meaning specified in Section 2.1.3 hereof.

 

“Swing Line Note” has the meaning set forth in Section 2.1.3 hereof.

 

“Swing Line Sublimit” means an amount equal to the lesser of (a) $30,000,000 and
(b) the Line of Credit Loan Commitments.  The Swing Line Sublimit is a part of,
not an addition to, the Line of Credit Loan Commitments.

 

“Synthetic Lease Obligation” means the monetary obligation of a Person under
(a) a so-called synthetic, off-balance sheet or tax retention lease, or (b) an
agreement for the use or possession of property creating obligations that do not
appear on the balance sheet of such Person but which, upon the insolvency or
bankruptcy of such Person, would be characterized as the indebtedness of such
Person (without regard to accounting treatment).

 

“Taxes” has the meaning set forth in Section 5.5(a) and (b) hereof.

 

“Term Loan” has the meaning set forth in Section 2.1.2 hereof.

 

“Term Loan Commitment” means as to any Lender, such Lender’s obligation to make
Term Loans, or additional Term Loans, as the case may be up to its Pro Rata
Percentage of $375,000,000, as set forth opposite such Lender’s name under the
heading “Term Loan Commitments” on Exhibit 1A, subject to Assignments and
Acceptances executed and delivered in accordance with Section 13.23, and as such
amount may be reduced or terminated from time to time pursuant to Section 4.5 or
11.1; and “Term Loan Commitments” means, collectively, the Term Loan Commitments
for all the Lenders that have a Term Loan Commitment.

 

24

--------------------------------------------------------------------------------

 

“Term Loan Facility” means, at any time, (a) prior to the one-year anniversary
of the Closing Date, the aggregate amount of the Lenders’ Term Loan Commitments
and (b) thereafter, the aggregate Term Loans of all Lenders at such time.

 

“Term Notes” has the meaning set forth in Section 2.1.2 hereof.

 

“Total Liabilities” means, as of any date of determination, all obligations of
Borrower and its consolidated Subsidiaries required by GAAP to be classified as
liabilities upon the balance sheet of such persons, including the aggregate
amount of all Indebtedness, liabilities (including tax and other proper
accruals) and reserves of such persons.

 

“Total Percentage” means with respect to any Lender at any time, a fraction
(expressed as a percentage), the numerator of which shall be the combined amount
of (a) such Lender’s outstanding Term Loan principal balance, (b) and such
Lender’s outstanding Term Loan Commitment, and (c) such Lender’s Line of Credit
Loan Commitment (or, if such Lender’s Line of Credit Loan Commitment shall have
expired, the aggregate outstanding principal balance of such Lender’s Line of
Credit Loans, Swing Line Loans and LC Obligations) at such time, and the
denominator of which shall be the combined amount of all the outstanding Term
Loan principal balances, Term Loan Commitments and Line of Credit Loan
Commitments (or, if the relevant Lenders’ Line of Credit Loan Commitments shall
have expired, the aggregate outstanding principal balance of such Lenders’ Line
of Credit Loans, Swing Line Loans and LC Obligations) of all the Lenders at such
time.

 

“Trademark License” means the Fourth Amended and Restated Trademark License
Agreement dated as of December 29, 2004 between the Borrower and the Agent,
together with any and all amendments, modifications, supplements, renewals or
restatements of such agreement.

 

“Type” means, with respect to any Advance, whether such Advance is a Base Rate
Advance or a LIBOR Rate Advance.

 

“UCP” has the meaning set forth in Section 2.2(c) hereof.

 

“Unfunded Pension Liability” means the excess of a Pension Plan’s benefit
liabilities under Section 4001(a)(16) of ERISA, over the current value of that
Pension Plan’s assets, determined in accordance with the assumptions used for
funding the Pension Plan pursuant to Section 412 of the Code for the applicable
plan year.

 

“Unhedged Cattle” has the meaning set forth in Section 10.19 hereof.

 

“Upfront Fee” has the meaning set forth in Section 6.3 hereof.

 

“US Premium Beef” means U.S. Premium Beef, LLC, a Delaware limited liability
company.

 

3.             Accounting Terms.  Any accounting terms used in this Agreement
which are not specifically defined in this Agreement shall have the meanings
customarily given them in accordance with GAAP.  Except as otherwise expressly
provided herein, all terms of an

 

25

--------------------------------------------------------------------------------

 

accounting or financial nature shall be construed in accordance with GAAP, as in
effect from time to time; provided, that, if the Borrower notifies the Agent
that the Borrower requests an amendment to any provision hereof to eliminate the
effect of any change occurring after the date hereof in GAAP or the
methodologies utilized thereunder or in the application thereof on the operation
of such provision (or if the Agent notifies the Borrower that the Required
Lenders request an amendment to any provision hereof for such purpose),
regardless of whether any such notice is given before or after such change in
GAAP or the application thereof, then the Agent and the Borrower shall negotiate
in good faith to amend such provision to preserve the original intent thereof in
light of such change (subject to the approval of the Required Lenders);
provided, further, until so amended, (a) such provision shall continue to be
computed in accordance with GAAP as in effect prior to such change and (b) the
Borrower shall provide to the Agent and the Lenders financial statements and
other documents required under this Agreement or as reasonably requested
hereunder setting forth a reconciliation between calculation of such provision
both before and after giving effect to such change.

 

ARTICLE II
LOANS, SWING LINE AND LETTERS OF CREDIT

 

1.             Loan Facilities.

 

2.1.1       Line of Credit.  Each Lender severally agrees to make loans (each a
“Line of Credit Loan” and collectively, the “Line of Credit Loans”) to the
Borrower from time to time on any one or more Business Days from and after the
Restatement Date (through the Agent as set forth in Section 2.1.4) to but
excluding the Maturity Date applicable to Line of Credit Loans, during which
period the Borrower may borrow, repay and re-borrow in accordance with the
provisions hereof up to an aggregate principal amount not exceeding each such
Lender’s Pro Rata Percentage of the Available Amount on such Business Day, in
aggregate amounts up to the lesser of the Available Amount or the then-current
Borrowing Base Availability (the “Line of Credit”).  The Borrower hereby
acknowledges that $7,000,000.00 of “Line of Credit Advances” and $30,000,000.00
of “Regular Swing Line Loans” under the Existing Credit Agreement are
outstanding as of the date hereof, which shall be deemed to be Line of Credit
Loans or Swing Line Loans under this Agreement on and after the Restatement
Date. Line of Credit Loans may be made as LIBOR Rate Advances or Base Rate
Advances.  The Line of Credit Loans shall be evidenced by and repayable in
accordance with the terms of the Borrower’s promissory notes to each of the
Lenders (as the same may be amended, supplemented or otherwise modified from
time to time, together with any replacements thereof or substitutions therefor,
the “Line of Credit Notes”), the form of which is attached as Exhibit 2A.  The
Lenders, in their unanimous, sole and absolute discretion, may elect to make
Line of Credit Loans to the Borrower in excess of the amounts available pursuant
to the terms of this Agreement, and any such Line of Credit Loans shall also be
governed by the terms hereof. The Lenders shall also have the option, in their
unanimous, sole discretion and without any obligation to do so, to extend the
Maturity Date applicable to the Line of Credit Loans.  In the event that the
Lenders elect to extend such Maturity Date, the Agent shall give notice to the
Borrower pursuant to Section 13.18.

 

2.1.2       Term Loan.  The Borrower acknowledges that, as of the date hereof,
term loans are outstanding under this Section 2.1.2 and owed by the Borrower in
the aggregate principal amount of $228,801.167.00.  Each Lender with a Term Loan
Commitment as set for on Exhibit 

 

26

--------------------------------------------------------------------------------

 

1A severally agrees to make up to three (3) loans to the Borrower from time to
time on any one or more Business Days from (and including) the Restatement Date
(through the Agent as set forth in Section 2.1.4) to but excluding the one-year
anniversary of the date hereof, during which period the Borrower may borrow, up
to an aggregate principal amount not exceeding each such Lender’s Pro Rata
Percentage of the Term Loan Commitments on such Business Day, in aggregate
amounts up to the Term Loan Commitments.  Each Lender’s allocation of term loans
as of the date hereof together with term loans thereafter made under this
Section 2.1.2 is herein collectively called such Lender’s “Term Loan”, and all
such loans of all of the Lenders are herein collectively called the “Term
Loans”.  The Term Loans may be maintained as LIBOR Rate Advances or Base Rate
Advances.  The Term Loans shall be evidenced by and repayable in accordance with
the terms of the Borrower’s promissory notes to each of the Lenders (as the same
may be amended, supplemented or otherwise modified from time to time, together
with any replacements thereof or substitutions therefor, the “Term Notes”), the
form of which is attached as Exhibit 2B.  Amounts representing Term Loans which
have been repaid by the Borrower may not be reborrowed.

 

2.1.3       Swing Line Loans.

 

(a)           The Swing Line Lender agrees to make loans (each a “Swing Line
Loan” and collectively, the “Swing Line Loans”) to the Borrower from time to
time on any one or more Business Days from and after the Restatement Date
through the Maturity Date applicable to the Line of Credit Loans.  The aggregate
outstanding principal amount of Swing Line Loans must not at any time exceed the
Swing Line Sublimit, and no Swing Line Loans may be made to the extent that the
sum of (i) the aggregate outstanding principal amount of the Line of Credit
Loans, (ii) the aggregate outstanding amount of the LC Obligations and (iii) the
aggregate outstanding principal amount of all Swing Line Loans would exceed
either the Borrowing Base or the aggregate Line of Credit Loan Commitments.  All
Swing Line Loans shall bear interest as if they were Base Rate Advances;
provided, however, that Swing Line Loans that are disbursed and repaid on the
same day shall bear one day’s interest. Within the foregoing limits, and subject
to the other terms and conditions hereof, the Borrower may borrow, repay and
reborrow in accordance with the terms hereof and prepay in accordance with
Section 4.2, provided, however, that the Swing Line Lender may terminate or
suspend its commitment to make the Swing Line Loans at any time in its sole
discretion upon notice to the Borrower.  The Swing Line Loans shall be evidenced
by and repayable in accordance with the terms of the Borrower’s promissory note
to the Swing Line Lender (as the same may be amended, supplemented or otherwise
modified from time to time, together with any replacements thereof or
substitutions therefor, the “Swing Line Note”), the form of which is attached as
Exhibit 2C.  Immediately upon the making of a Swing Line Loan, each Lender shall
be deemed to, and hereby irrevocably and unconditionally agrees to, purchase
from Swing Line Lender a risk participation in such Swing Line Loan in an amount
equal to such Lender’s Pro Rata Percentage of such Swing Line Loan, which risk
participation shall be funded in accordance with Section 2.1.3(b). The Borrower
shall make all payments of principal and interest in respect of the Swing Line
Loans directly to Swing Line Lender.

 

27

--------------------------------------------------------------------------------

 

(b)           Refinancing of Swing Line Loans.

 

(i)            In anticipation of the Maturity Date applicable to a Swing Line
Loan, or after the occurrence and during the continuance of any Default or
Matured Default, as the case may be, the Swing Line Lender may request, on
behalf of the Borrower (which hereby irrevocably requests the Swing Line Lender
to act on its behalf), that each Lender make a Line of Credit Loan in an amount
equal to such Lender’s Pro Rata Percentage of the amount of such Swing Line
Loan. Such request shall be made in accordance with the requirements of
Article II, without regard to the minimum and multiples specified therein for
the principal amount of Base Rate Advances.  The Swing Line Lender shall furnish
the Borrower with a copy of the applicable borrowing notice promptly after
delivering such notice to the Agent.  Each Lender shall make an amount equal to
its Pro Rata Percentage of the amount specified in such borrowing notice
available to the Agent in immediately available funds for the account of the
Swing Line Lender at the Agent’s office not later than 11:00 a.m., Denver time,
on the day specified in such borrowing notice, whereupon, subject to clause
(ii) below, each Lender that so makes funds available shall be deemed to have
made a Line of Credit Loan to the Borrower in such amount.  The Agent shall then
remit the funds so received to the Swing Line Lender.

 

(ii)           If for any reason any Advance cannot be requested in accordance
with clause (i) above or any Swing Line Loan cannot be refinanced by such an
Advance, the borrowing notice submitted by the Swing Line Lender shall be deemed
to be a request by the Swing Line Lender that each of the Lenders fund its
participation in the relevant Swing Line Loan, and each Lender’s payment to the
Agent for the account of the Swing Line Lender pursuant to clause (i) above
shall be deemed to be the payment in respect of such participation.

 

(iii)          If any Lender fails to make available to the Agent for the
account of the Swing Line Lender any amount that such Lender is required to pay
pursuant to the foregoing provisions of this subsection (b) by the time
specified in clause (i) above, the Swing Line Lender shall be entitled to
recover from such Lender (acting through the Agent), on demand, such amount with
interest thereon for the period from the date such payment is required to the
date on which such payment is immediately available to the Swing Line Lender at
a rate per annum equal to the Federal Funds Rate from time to time in effect.  A
certificate of the Swing Line Lender submitted to any Lender (directly or
through the Agent) with respect to any amounts owing under this clause
(iii) shall be conclusive absent manifest error.

 

(iv)          Each Lender’s obligation to make Line of Credit Loans or to
purchase and fund participations in Swing Line Loans pursuant to this subsection
(b) shall be absolute and unconditional and shall not be affected by any
circumstance, including (A) any set-off, counterclaim, recoupment, defense or
other right which such Lender may have against the Swing Line Lender, the
Borrower or any other Person for any reason whatsoever, (B) the occurrence or
continuance of a Default or Matured Default, or (C) any other occurrence, event
or condition, whether or not similar to any of the foregoing.  Any such purchase

 

28

--------------------------------------------------------------------------------

 

of participations shall not relieve or otherwise impair Borrower’s obligation to
repay the Swing Line Loans, together with interest as provided herein.

 

(c)           Repayment of Participations.

 

(i)            At any time after any Lender has purchased and funded a
participation in a Swing Line Loan, if the Swing Line Lender receives any
payment on account of such Swing Line Loan, Swing Line Lender will distribute to
such Lender its share of such payment in accordance with such Lender’s Pro Rata
Percentage (appropriately adjusted, in the case of interest payments, to reflect
the period of time during which such Lender’s participation was outstanding and
funded) in the same funds as those received by the Swing Line Lender.

 

(ii)           If any payment received by Swing Line Lender in respect of any
Swing Line Loan is required to be returned by the Swing Line Lender, each Lender
shall pay to the Swing Line Lender its Pro Rata Percentage thereof on demand of
the Swing Line Lender (or the Agent on its behalf), plus interest thereon from
the date of such demand to the date such amount is returned, at a rate per annum
equal to the Federal Funds Rate.  The Agent will make such demand upon the
request of the Swing Line Lender.

 

2.1.4       Borrowing Procedures.

 

(a)           Procedure for Line of Credit Loans.  Any request by the Borrower
for Line of Credit Loans hereunder must be given by the Borrower not later than
11:00 a.m. (Denver time) on the third Business Day prior to the date of any
proposed LIBOR Rate Advance and not later than 1:00 p.m. (Denver time) on the
Business Day prior to the date any Base Rate Advance is proposed to be made. 
Each request for Line of Credit Loans hereunder shall be irrevocable and shall
be deemed to be a representation by the Borrower that on the requested Loan Date
and after giving effect to the requested Line of Credit Loans the applicable
conditions specified in Article VIII have been and will be satisfied.  Each
request for a Line of Credit Loan hereunder shall specify (i) the requested Loan
Date, (ii) the aggregate amount of the Line of Credit Loan to be made on such
date, which shall be in a minimum amount of $1,000,000 and an integral multiple
of $500,000, (iii) whether such Line of Credit Loans is to be funded as a Base
Rate Advances or LIBOR Rate Advances and (iv) in the case of a LIBOR Rate
Advance, the duration of the initial Interest Period applicable thereto. Not
later than 4:00 p.m. (Denver time) on the Business Day a receipt of such notice
is received from the Borrower, the Agent shall advise each Lender of the
requested Line of Credit Loans and of such Lender’s ratable share of such
Loans.  At or before 10:00 a.m. (Denver time) on the date of the requested Line
of Credit Loans, each relevant Lender shall provide the Agent at the Agent’s
principal office in Denver with immediately available funds covering such
Lender’s Pro Rata Percentage of the requested Loans.  Unless the Agent
determines that any applicable condition specified in Article VIII has not been
satisfied or waived, the Agent will make available to the Borrower at the
Agent’s principal office in Denver, Colorado in immediately available funds not
later than 12:00 noon (Denver

 

29

--------------------------------------------------------------------------------

 

time) on the requested Loan Date the amount of the requested Line of Credit
Loans to the extent received by the Agent.  In accordance with
Section 2.1.5(c) the Agent shall not be obligated to provide funds to the
Borrower that are not provided to the Agent in accordance with this
Section 2.1.4(a).

 

(b)           Procedure for Term Loans.  Any request by the Borrower for Term
Loans hereunder shall be made in accordance with the same procedure as required
for Line of Credit Loans as set forth in the preceding subsection (a).

 

(c)           Procedure for Swing Line Loans.  Unless the Swing Line Lender has
notified the Borrower that the Swing Line has been terminated or suspended as
provided in Section 2.1.3, each request by the Borrower for a Swing Line Loan
hereunder must be given by the Borrower to the Swing Line Lender and the Agent
not later than 1:00 p.m. (Denver time) on the Business Day on which such Swing
Line Loan is proposed to be made.  Each request for a Swing Line Loan hereunder
shall be irrevocable and shall be deemed a representation by the Borrower that
on the requested Loan Date and after giving effect to the requested Swing Line
Loan the applicable conditions specified in Article VIII have been and will be
satisfied.  Each request for a Swing Line Loan hereunder shall specify (i) the
requested Loan Date, (ii) the amount of the Swing Line Loan to be made on such
date, which shall be in a minimum amount of $100,000 and an integral multiple of
$100,000.  Unless the Swing Line Lender has received written notice from the
Agent (i) directing the Swing Line Lender not to make such Swing Line Loan as a
result of the limitations set forth in the first proviso to the first sentence
of Section 2.1.3(a) or (ii) that any applicable condition specified in
Article VIII has not been satisfied or waived, the Agent will make available to
the Borrower at the Agent’s principal office in Denver, Colorado in immediately
available funds not later than 2:30 p.m. (Denver time) on the requested Loan
Date the amount of the requested Swing Line Loans to the extent received from
the Swing Line Lender.

 

(d)           Notices.  All notices of the Borrower required under Section 2.1.4
shall be from such natural Persons as have been designated in a written notice
signed by the president, chief executive officer or chief financial officer of
the Borrower.  Such notice shall provide the Agent and Swing Line Lender with a
specimen signature for each such natural Person so designated.  The natural
Persons so designated are authorized to request Loans and Swing Line Loans and
direct the disposition of any such Loans and Swing Line Loans until written
notice of the revocation of such authority is received by the Agent at its
address designated below.  Any such Loans or Swing Line Loans shall be
conclusively presumed to have been made to or for the benefit of the Borrower
when the Agent reasonably believes in good faith that such notice was made by
authorized Persons, or when said Loans are deposited to the credit of the
account of the Borrower regardless of the fact that Persons other than those
authorized hereunder may have authority to draw against such account.

 

2.1.5       General Terms regarding the Notes, the Loans and the Swing Line
Loans.

 

(a)           The Agent shall promptly notify each Lender of any notice that the
Agent receives from the Borrower pursuant to Section 3.2.  In the case of a
proposed LIBOR

 

30

--------------------------------------------------------------------------------

 

Rate Advance, the Agent shall also promptly notify each Lender of the applicable
interest rate.

 

(b)           Unless the Agent shall have received notice from a Lender prior to
the date of any borrowing of a Loan that such Lender will not make available to
the Agent such Lender’s pro rata share of such Loan, the Agent may assume that
such Lender will make such portion available to the Agent in accordance with
Section 2.1.3 and the Agent may, in reliance upon such assumption, make
available to the Borrower on such date a corresponding amount. If and to the
extent that such Lender shall not have so made its pro rata share available to
the Agent in accordance with Section 2.1.3, such Lender and the Borrower
severally agree to repay to the Agent, within five (5) Business Days after
demand therefor, such corresponding amount together with interest thereon, for
each day from the date such amount is made available to the Borrower until the
date such amount is repaid to the Agent, (i) in the case of the Borrower, at the
interest rate applicable at the time the Loans comprising such borrowing were
made, and (ii) in the case of such Lender, at the Federal Funds Rate.  If such
Lender shall repay to the Agent such corresponding amount, such amount so repaid
shall constitute such Lender’s Loan as part of such borrowing for purposes of
this Agreement.

 

(c)           The failure of any Lender to make any Loan or to fund any
participation to be made by it as required by this Agreement shall not relieve
any other Lender of its obligation, if any, to make its Loan on the date the
same is required to be made, but no Lender shall be responsible for the failure
of any other Lender to make Loans or to fund such other Lender’s participation.

 

(d)           The Agent shall maintain a loan account (“Loan Account”) on its
books in which the Agent will record the date and amount of: (i) all Loans and
Swing Line Loans to the Borrower pursuant to this Agreement; (ii) all payments
made by the Borrower on all Loans and Swing Line Loans; and (iii) all other
appropriate debits and credits as provided in this Agreement, including without
limitation, all fees, charges, expenses and interest.  All entries in the
Borrower’s Loan Account shall be made in accordance with the Agent’s customary
accounting practices as in effect from time to time.  The balance in the
Borrower’s Loan Account, as set forth on the Agent’s most recent printout, shall
be rebuttable presumptive evidence of the amounts due and owing to the Agent,
the Lenders, the Swing Line Lender and the Issuers by the Borrower.

 

(e)           The proceeds of all Loans and Swing Line Loans shall be used
(i) to refinance the Indebtedness under the Existing Credit Agreement, (ii) to
pay fees and expenses incurred in connection with this Agreement and (iii) for
the Borrower’s working capital and general corporate purposes, including
financing acquisitions as permitted hereunder, making capital expenditures
within the limitation set forth herein and making Equity Distributions pursuant
to the $150 Million Basket.

 

2.             Letters of Credit.

 

(a)           Subject to the terms and conditions of this Agreement, the
Borrower may from time to time request that an Issuer issue LCs for the
Borrower’s account for any

 

31

--------------------------------------------------------------------------------

 

purpose acceptable to the Agent in its reasonable discretion; provided, however,
that no Issuer shall issue any such LC in an amount exceeding the least of:
(i) $75,000,000 minus the LC Obligations; (ii) the Available Amount or (iii) the
Borrowing Base Availability.  The proposed expiry date for any such LC shall not
be later than the earlier of one year from the date of issuance of such LC or
the scheduled Maturity Date applicable to the Line of Credit Loans.  The
Borrower hereby acknowledges that LCs in the face amounts set forth on
Exhibit 1E are outstanding under the Existing Credit Agreement as of the date
hereof, and shall be deemed to be LCs under this Agreement on and after the
Restatement Date.

 

(b)           In order to effect the issuance of each LC, the Borrower shall
deliver to the Agent and the relevant Issuer a letter of credit application (the
“Application”) not later than 11:00 a.m. (Denver time), five (5) Business Days
prior to the proposed date of issuance of the LC. The Application shall be duly
executed by a responsible officer of the Borrower, shall be irrevocable and
shall (i) specify the day on which such LC is to be issued (which shall be a
Business Day), and (ii) be accompanied by a certificate executed by a
responsible officer setting forth calculations evidencing availability for the
LC as required pursuant to Section 2.2(a) and stating that all conditions
precedent to such issuance have been satisfied.

 

(c)           Upon receipt of the Application, and satisfaction of the
applicable terms and conditions of this Agreement, and provided that no Default
or Matured Default exists, or would, after giving effect to the issuance of the
LC, exist, the relevant Issuer shall issue such LC no later than the close of
business, in Denver, Colorado, on the date so specified. Such Issuer shall
provide the Borrower, the Agent and each Lender with a copy of the LC which has
been issued. Each LC shall (i) provide for the payment of drafts presented for
honor thereunder by the beneficiary in accordance with the terms thereof, when
such drafts are accompanied by the documents described in the LC, if any, and
(ii) to the extent not inconsistent with the express terms hereof or the
applicable Application, be subject to the Uniform Customs and Practice for
Documentary Credits (1993 Revision), International Chamber of Commerce
Publication No. 500 and/or the International Standby Practices (ISP98),
International Chamber of Commerce Publication No. 590, as the relevant Issuer
shall determine to be applicable (collectively, together with any subsequent
revisions thereof approved by a Congress of the International Chamber of
Commerce and adhered to by the relevant Issuer, the “UCP”), and shall, as to
matters not governed by the UCP, be governed by, and construed and interpreted
in accordance with, the laws of the State of Colorado (in the case of CoBank) or
the State of New York (in the case of Rabobank).

 

(d)           Upon the issuance date of each LC, the relevant Issuer shall be
deemed, without further action by any party hereto, to have sold to each other
Lender, and each other Lender shall be deemed, without further action by any
party hereto, to have purchased from such Issuer, a participation, to the extent
of such Lender’s Pro Rata Percentage, in such LC, the obligations thereunder and
in the Borrower’s reimbursement obligations due in respect of drawings made
under such LC. If requested by such Issuer, the other Lenders will execute any
other documents reasonably requested by such Issuer to evidence the purchase of
such participation.

 

32

--------------------------------------------------------------------------------

 

(e)           Upon the relevant beneficiary’s presentation of a draft for honor
under any LC which the relevant Issuer has determined is in compliance with the
conditions for payment thereunder, such Issuer shall promptly notify the
Borrower and the Agent. Each drawing under any LC shall (so long as no Default
or Matured Default shall have occurred and be continuing) constitute a request
by the Borrower to the Agent for a borrowing pursuant to Section 2.1.1 of a Base
Rate Advance in the amount of such drawing. If a Default or Matured Default
shall have occurred and be continuing, or if Base Rate Advances are otherwise
unavailable to the Borrower, at the time when a beneficiary presents a draft for
payment under an LC, the Borrower agrees to reimburse the relevant Issuer for
the amount of such draft immediately upon such presentation.

 

(f)            The Borrower’s obligation to reimburse the relevant Issuer for
the amount of any draft drawn under any LC (whether directly or with the
proceeds of a Base Rate Advance) shall be absolute, unconditional and
irrevocable and shall be paid immediately to the Agent for the account of the
Lenders upon demand by the Agent, and otherwise strictly in accordance with the
terms of this Agreement, under all circumstances whatsoever, including without
limitation, the following circumstances:

 

(i)            The existence of any claim, set-off, defense or other rights
which the Borrower may have at any time against any beneficiary or any
transferee of any LC (or any Person for whom any such beneficiary or any such
transferee may be acting), any Issuer, any Lender, the Agent or any other
Person, whether in connection with this Agreement, any other Financing Document,
the transactions contemplated herein or therein or any unrelated transaction,
unless otherwise provided by the terms of such LC;

 

(ii)           Any statement or any other document presented under any LC
proving to be forged, fraudulent or invalid in any respect or any statement
therein being untrue or inaccurate in any respect;

 

(iii)          Payment by the relevant Issuer under any LC against presentation
of a draft or certificate which does not comply with the terms of such LC,
provided however, that such payment shall not have constituted gross negligence
or willful misconduct on the part of such Issuer; and

 

(iv)          Any other circumstance or event whatsoever, whether or not similar
to the foregoing, provided however, that such other circumstance or event shall
not have been the result of gross negligence or willful misconduct of the
relevant Issuer.

 

(g)           The Borrower assumes all risks of the acts or omissions of the
beneficiary and any transferee of each LC with respect to its use of such LC. 
Neither the Agent, any Issuer nor any Lender shall be liable or responsible for,
and the Borrower indemnifies and holds each Issuer, the Agent and each Lender
harmless for: (i) the use which may be made of any LC or for any acts or
omissions of the beneficiary and any transferee thereof in connection therewith,
or (ii) the validity or genuineness of documents, or of any
endorsement(s) thereon, even if such documents should, in fact

 

33

--------------------------------------------------------------------------------

 

prove to be in any or all respects invalid, fraudulent or forged, or any other
circumstances whatsoever in making or failing to make payment, against the
relevant Issuer, the Agent or any Lender, except damages determined to have been
caused by gross negligence or willful misconduct of the relevant Issuer in
determining whether documents presented under an LC comply with the terms of
such LC and there shall have been a wrongful payment as a result thereof;
provided, however, that it is the intention of the Borrower to indemnify each
Issuer, the Agent and each Lender for its own negligence, other than negligence
constituting gross negligence or willful misconduct. In furtherance and not in
limitation of the foregoing, each Issuer may accept documents that appear on
their face to be in order, without responsibility for investigation, regardless
of any notice or information to the contrary.

 

(h)           In the event that any provision of an Application is inconsistent,
or in conflict with, any provision of this Agreement, including provisions for
the rate of interest applicable to draws thereunder, delivery of collateral or
rights of set-off or any representations, warranties, covenants or any events of
default set forth therein, the provisions of this Agreement shall govern.

 

ARTICLE III
INTEREST

 

1.             Interest.

 

The Borrower shall pay interest on the unpaid principal amount of each Loan and
Swing Line Loan made by each Lender from the date of such Loan or Swing Line
Loan until such principal amount shall be paid in full, at the times and at the
rates per annum set forth below:

 

(a)           Base Rate Advances and Swing Line Loans, so long as no Matured
Default has occurred and is continuing, shall bear interest at a rate per annum
equal to the lesser of (i) the sum of the Base Rate in effect from time to time
plus the then Applicable Margin (calculated according to the Borrower’s actual
Financial Performance Level) and (ii) the Highest Lawful Rate; provided,
however, that with respect to each Base Rate Advance, the rate of interest
accruing shall change concurrently with each change in the Prime Rate as
announced by CoBank or with each change in the Federal Funds Rate, as the case
may be.  Such interest shall be payable (1) in the case of a Swing Line Loan,
monthly in arrears on the first day of each month and on the Maturity Date
applicable thereto, and (2) in the case of other Base Rate Advances, monthly in
arrears on the first day of each month and on the Maturity Date applicable
thereto.

 

(b)           Each LIBOR Rate Advance, so long as no Matured Default has
occurred and is continuing, shall bear interest at a rate per annum during each
day of each Interest Period for such Advance equal to the lesser of (i) the sum
of the LIBOR Rate for such Interest Period for such Advance plus the then
Applicable Margin (calculated according to the Borrower’s actual Financial
Performance Level) and (ii) the Highest Lawful Rate.  Such interest shall be
payable in arrears on the last day of the relevant Interest Period,

 

34

--------------------------------------------------------------------------------

 

and, if such Interest Period exceeds three months, the day which is three months
after the date on which the relevant LIBOR Rate Advance was disbursed.

 

(c)           After the occurrence of a Matured Default and for so long as such
Matured Default is continuing, the Agent may (upon the direction of the Required
Lenders) notify the Borrower that any and all amounts due hereunder, under the
Notes or under any other Financing Document, whether for principal, interest (to
the extent permitted by applicable law), fees, expenses or otherwise, shall bear
interest, from the date of such notice by the Agent and for so long as such
Matured Default continues, payable on demand, at a rate per annum (the “Default
Rate”) equal to the lesser of (A) with respect to a Base Rate Advance, (i) the
sum of two percent (2.0%) per annum plus the Base Rate in effect from time to
time plus the Applicable Margin or (ii) the Highest Lawful Rate; or (B) with
respect to a LIBOR Rate Advance, (i) during the Interest Period in which the
Matured Default has occurred, the sum of two percent (2.0%) per annum plus the
LIBOR Rate then in effect for such LIBOR Rate Advance plus the Applicable
Margin, and in Interest Periods subsequent to that in which the Matured Default
occurred, the Default Rate applicable to a Base Rate Advance as calculated under
(A) hereof, or (ii) the Highest Lawful Rate.

 

(d)           All computations of interest pursuant to Section 3.1(a) shall be
made by the Swing Line Lender or the Agent, each, as the case may be, by
reference to the actual number of days elapsed based on a year of 360 days (in
the case of fees and of LIBOR Rate Advances) or 365 or 366 days (in the case of
Base Rate Advances), as applicable. Each determination of an interest rate by
the Agent or the Swing Line Lender shall be conclusive and binding for all
purposes, absent manifest error.  Any accrued interest unpaid on the Maturity
Date shall be due and payable on the Maturity Date.

 

(e)           The Swing Line Lender shall be responsible for invoicing the
Borrower for interest on the Swing Line Loans.  Until each Lender funds its Line
of Credit Loan or participation pursuant to Section 2.1.3 to refinance such
Lender’s Pro Rata Percentage of any Swing Line Loan, interest in respect of such
Swing Line Loan shall be solely for the account of the Swing Line Lender.

 

2.             Voluntary Conversion of Advance.

 

With respect to Loans, the Borrower may, upon written notice given by the
Borrower to the Agent not later than 11:00 a.m. (Denver time) on the third
Business Day prior to the date of any proposed interest conversion or roll over,
(a) convert Advances of one Type into Advances of another Type, or (b) continue
or roll over existing LIBOR Rate Advances; provided, however, that (i) with
respect to any conversion into or roll over of a LIBOR Rate Advance, no Default
or Matured Default shall have occurred and be continuing, (ii) with respect to
any facsimile notice of interest conversion, the Borrower shall promptly confirm
such notice by sending the original notice to the Agent and (iii) any
continuation or roll over of a LIBOR Rate Advance for the same or a different
Interest Period or into a Base Rate Advance, shall be made on, and only on, the
last day of an Interest Period for such LIBOR Rate Advance.  Each such notice of
interest conversion shall specify therein the requested (x) date of such
conversion, (y) the Advances to be converted and whether such Advances
constitute LIBOR Rate Advances, and (z) if such interest conversion

 

35

--------------------------------------------------------------------------------

 

is into LIBOR Rate Advances, the duration of the Interest Period for each such
Advance.  The Agent shall promptly deliver a copy thereof to each Lender. Each
such notice shall be irrevocable and binding on the Borrower.  If the Borrower
shall fail to give a notice of interest conversion with respect to any LIBOR
Rate Advance as set forth above, such Advance shall automatically convert to a
Base Rate Advance on the last day of the Interest Period with respect thereto. 
The provisions of this Section 3.2 shall also apply to initial Advances on Loans
made as LIBOR Rate Advances.

 

ARTICLE IV
PAYMENTS; PREPAYMENTS; ETC.

 

1.             Payment of Loans and Swing Line Loans.

 

(a)           The outstanding principal balance of the Term Notes, Line of
Credit Notes and the Swing Line Notes shall be due and payable on their
respective Maturity Dates.

 

(b)           Subject to the definition of Interest Period in the case of LIBOR
Rate Advances, whenever any payment hereunder or under any Note shall be due on
a day other than a Business Day, the date for payment of such amounts shall be
extended to the next succeeding Business Day.

 

(c)           The Borrower shall make each payment hereunder and under the Term
Notes and Line of Credit Notes not later than 11:00 a.m. (Denver time) on the
day when due in Dollars and in immediately available funds to the Agent for the
account of the Lenders, unless such payment is scheduled to be made with the
proceeds of a Line of Credit Advance otherwise available hereunder.  Subject to
Section 2.1.3, the Agent will promptly distribute in Dollars and in immediately
available funds to each Lender its Pro Rata Percentage of each such payment
received by the Agent for the account of the Lenders.

 

(d)           The Borrower shall make each Swing Line Loan payment not later
than 1:00 p.m. (Denver time) on the day when due in Dollars and in immediately
available funds to the Swing Line Lender unless such Swing Line Loan is being
refinanced through Line of Credit Loans.

 

2.             Optional Prepayments of the Loans.

 

The Borrower may at any time prepay the outstanding principal amount of any Loan
or Swing Line Loan, in either case in whole or in part, in accordance with this
Section 4.2.  With respect to any prepayment other than prepayments made
pursuant to the Agent’s routine collection of Accounts in accordance with the
provisions of the Security Agreement, the Borrower shall give prior written
notice of any such prepayment to the Agent, which notice shall state the
proposed date of such prepayment (which shall be a Business Day), the Loan or
Swing Line Loan to be prepaid and the aggregate amount of the prepayment, and
which notice shall be delivered to the Agent not later than 11:00 a.m. (Denver
time): (a) with respect to any Base Rate Advance, on the date of the proposed
prepayment, and (b) with respect to any LIBOR Rate

 

36

--------------------------------------------------------------------------------

 

Advance, three (3) Business Days prior to the date of the proposed prepayment.
All prepayments of Base Rate Advances shall be without premium or penalty of any
kind.  All such prepayments of LIBOR Rate Advances shall be made together with
accrued and unpaid interest (if any) to the date of such prepayment on the
principal amount prepaid without premium or penalty thereon; provided, however,
that funding losses incurred by any Lender as described in Section 5.3 shall be
payable with respect to each such prepayment.  All notices of prepayment shall
be irrevocable and the payment amount specified in each such notice shall be due
and payable on the prepayment date described in such notice, together with, in
the case of LIBOR Rate Advances, accrued and unpaid interest (if any) on the
principal amount prepaid and any amounts due under Section 5.3.  The Borrower
shall have no optional right to prepay the principal amount of any LIBOR Rate
Advance other than as provided in this Section 4.2.  Voluntary prepayments of
the Term Notes shall be applied pro rata to the remaining unpaid installments
described in Section 4.3.

 

3.             Term Loan Installments.

 

The principal amount outstanding under the Term Notes shall be payable in
quarterly installments commencing on the first day of the fourth full fiscal
month following the Closing Date and, thereafter, on each three-month
anniversary thereof (each such date, a “Term Loan Payment Date”) as follows:
(a) on each Term Loan Payment Date, in an amount calculated based upon a 10-year
level amortization of the aggregate principal amount of the Term Loans
outstanding as of such payment date and (b) on the Maturity Date, in any amount
equal to the remaining aggregate principal amount of the Term Loans outstanding
on such date.

 

4.             Mandatory Prepayments of Notes.

 

(a)           Mandatory Prepayments—Borrowing Base Deficiency.  If at any time a
Borrowing Base Deficiency exists, the Borrower shall immediately pay on the
principal of the Swing Line Loans and the Line of Credit Loans an aggregate
amount equal to such Borrowing Base Deficiency. Any such payments shall be
applied to the Swing Line Loans first, then to the Line of Credit Loans first
against Base Rate Advances and then to LIBOR Rate Advances in order starting
with the LIBOR Rate Advances having the shortest time to the end of the
applicable Interest Period.  Amounts paid on the Line of Credit Loans under this
Section 4.4(a) shall be for the account of each Lender in proportion to its
share of outstanding Swing Line Loans and Line of Credit Loans.  If, after
paying all outstanding Line of Credit Loans, a Borrowing Base Deficiency still
exists, the Borrower shall pay into the Holding Account an amount equal to the
amount of the remaining Borrowing Base Deficiency.

 

(b)           Other Mandatory Prepayments.  Additional mandatory prepayments of
the Term Notes and Line of Credit Notes shall be payable as follows: (i) upon
receipt thereof, an amount equal to any Excess Disposition Proceeds; and
(ii) from and after the consummation of a Permitted IPO and on or before the
second anniversary of the Restatement Date, concurrent with the receipt by the
Existing Equity Holders of any IPO Proceeds or the making of any Equity
Distributions by the Borrower pursuant to clause (d) of Section 10.10, an amount
equal to, on a dollar-for-dollar basis, (A) the aggregate amount of such IPO
Proceeds received and such Equity Distributions paid

 

37

--------------------------------------------------------------------------------

 

during such period minus (B) $275,000,000.  All prepayments under this
Section 4.4 shall be applied (pro rata among the Lenders) first to the unpaid
installments due under the Term Notes in the inverse order of their maturity
until all such installments are paid, second to the outstanding principal of the
Line of Credit Notes, and third to the outstanding principal of the Swing Line
Loans.

 

5.             Termination of the Commitments.

 

The Borrower shall have the right, upon at least five Business Days’ written
notice to the Lenders, to terminate the Line of Credit Loan Commitments and/or
the Term Loan Commitments, (i) in whole, or (ii) in part, in a minimum amount of
$5,000,000 and an integral multiple of $5,000,000, but not to an amount less
than $50,000,000; provided, however, that any termination of the Line of Credit
Loan Commitments shall be accompanied, (i) in the case of a termination in
whole, by payment of the Liabilities in full and the return or cash coverage
(pursuant to documentation in form and substance satisfactory to the Agent) of
any LC then outstanding, or (ii) in the case of a partial termination, payment
of the Line of Credit Loans, the Swing Line Loans and/or the LC Obligations to
the extent necessary to cause the Available Amount to be not less than zero. 
Any partial reduction of the Line of Credit Loan Commitments or the Term Loan
Commitments pursuant to this Section 4.5 shall result in a reduction pro rata of
the Line of Credit Loan Commitments or the Term Loan Commitments, as applicable,
of each of the Lenders.

 

ARTICLE V
LIBOR RATE LOANS; INCREASED COSTS; TAXES, ETC.

 

1.             LIBOR Rate Advances.

 

Anything in this Agreement to the contrary notwithstanding:

 

(a)           If any Lender shall notify the Agent that the introduction of or
any change in or in the interpretation of any law or regulation makes it
unlawful, or that any central bank or other Governmental Authority asserts that
it is unlawful, for such Lender to perform its obligations to make LIBOR Rate
Advances or to fund or maintain LIBOR Rate Advances (whether or not such
assertion carries the force of law), the obligation of such Lender to make, roll
over or convert Loans into LIBOR Rate Advances shall be suspended until the
Agent shall notify the Borrower and such Lender that the circumstances causing
such suspension no longer exist, and the existing LIBOR Rate Advances of such
Lender shall automatically convert, on and as of the date of such notification,
into Base Rate Advances; provided that each Lender represents and warrants to
the Borrower that as of the later of (i) the Closing Date or (ii) the date on
which it shall have executed an Assignment and Acceptance pursuant to
Section 13.23(a), it has no actual knowledge that it would be unlawful for such
Lender to make LIBOR Rate Advances as contemplated.

 

(b)           If the Required Lenders shall, not later than 11:00 a.m. (Denver
time) one Business Day before the date of any requested borrowing consisting of
LIBOR Rate Advances, notify the Agent that the LIBOR Rate for LIBOR Rate
Advances comprising

 

38

--------------------------------------------------------------------------------

 

such borrowing will not adequately reflect the cost to such Required Lenders of
making or funding their respective LIBOR Rate Advances for such borrowing, the
Borrower’s right to select LIBOR Rate Advances for such borrowing or any
subsequent borrowing respectively shall be suspended until the Required Lenders
shall notify the Agent that the circumstances causing such suspension no longer
exist, and the Advances comprising such requested borrowing shall be Base Rate
Advances.

 

2.             Increased Costs.

 

If, due to either (a) introduction of or any change in or in the interpretation
of any law or regulation or (b) compliance with any guideline or request from
any central bank or other Governmental Authority (whether or not having the
force of law), there shall be any increase in the cost or reduction in yield or
rate of return to any Lender of agreeing to make or making or maintaining any
LIBOR Rate Advance or maintaining its Commitment or any to any Issuer issuing or
maintaining any LC, with respect thereto (other than any increase in income or
franchise taxes imposed on it by the jurisdiction under the laws of which such
Lender is organized or the jurisdiction in which such Lender’s relevant office
is located), then the Borrower shall from time to time, three (3) Business Days
after written demand by such Lender (with a copy of such demand to the Agent),
pay to the Agent for the account of such Lender additional amounts sufficient to
compensate such Lender for such increased cost, reduction in yield or rate of
return over a period not to exceed one hundred eighty (180) days, which amounts
shall be due and payable at the end of such period, subject, however, to the
provisions of Section 12.10.  Any request for payment under this Section 5.2
will be submitted to the Borrower and the Agent by such Lender within sixty (60)
days of such occurrence described in this Section 5.2, identifying with
reasonable specificity the basis for and the amount of such increased cost, and
shall be conclusive and binding for all purposes, absent manifest error.

 

3.             Funding Losses.

 

The Borrower will indemnify each Lender against, and reimburse each Lender on
demand for, any loss, cost or expense incurred or sustained by such Lender
(including without limitation, any loss or expense incurred by reason of the
liquidation or redeployment of deposits or other funds acquired by such Lender
to fund or maintain any LIBOR Rate Advance and/or loss of net yield) as a result
of (a) any payment, conversion, roll over, or prepayment of all or a portion of
any LIBOR Rate Advance on a day other than the last day of an Interest Period
for such LIBOR Rate Advance, (b) any payment, conversion, roll over or
prepayment (whether required hereunder or otherwise) of such Lender’s LIBOR Rate
Advance made after the delivery of a notice of borrowing (whether oral or
written) but before the proposed date for such LIBOR Rate Advance if such
payment or prepayment prevents the proposed borrowing from becoming fully
effective, (c) after the Agent receives a notice of borrowing, the failure of
any LIBOR Rate Advance to be made or effected by such Lender due to any
condition precedent to a borrowing not being satisfied or due to any other
action or inaction of the Borrower or (d) any rescission of a notice of
borrowing or a notice of interest conversion.  Any Lender demanding payment
under this Section 5.3 shall deliver to the Borrower and the Agent a statement
reasonably setting forth the amount and manner of determining such loss, cost or
expense, which statement shall be conclusive and binding for all purposes,
absent manifest error.  Compensation owing to a Lender as a result of any such
loss, cost or expense resulting from a payment, prepayment, conversion or

 

39

--------------------------------------------------------------------------------

 

roll over of a LIBOR Rate Advance shall include without limitation, an amount
equal to the sum of (i) the difference between (A) the amount of interest that,
but for such event, such Lender would have earned during the period from the
date of such event to the last day of the applicable Interest Period and (B) the
amount of interest such Lender would have earned for such period at the market
interest rate which such Lender would obtain, at the commencement of such
period, for U.S. Dollar deposits of a comparable amount and period (excluding,
in the case of clauses (A) and (B) loss of the Applicable Margin) plus (ii) any
reasonable expense incurred by such Lender in connection with such payment,
prepayment, conversion or roll over.  Notwithstanding any provision herein to
the contrary, each Lender shall be entitled to fund and maintain its funding of
all of any part of the LIBOR Rate Advance in any manner it elects; it being
understood, however, that all determinations hereunder shall be made as if the
Lender had actually funded and maintained each LIBOR Rate Advance during the
Interest Period for such Advance through the purchase of deposits having a term
corresponding to such Interest Period and bearing an interest rate equal to the
LIBOR Rate for such Interest Period (whether or not the Lender shall have
granted any participations in such Loans).

 

4.             Capital Adequacy Requirements.

 

(a)           If any Lender or Issuer shall have determined that the adoption
after the date of this Agreement of any applicable law, rule or regulation
regarding capital adequacy, or any change therein after the date of this
Agreement, or any change in the interpretation or administration thereof after
the date of this Agreement by any Governmental Authority, central bank or
comparable agency charged with the interpretation or administration thereof, or
compliance by such Lender or Issuer with any request or directive regarding
capital adequacy (whether or not having the force of law) of any such authority,
central bank or comparable agency issued after the date of this Agreement,
affects or would affect the amount of capital required or expected to be
maintained by such Lender or Issuer or any corporation controlling such Lender
or Issuer, and that the amount of such capital requirement is increased, or has
or would have the effect of reducing the rate of return on such Lender’s or such
Issuer’s or such corporation’s capital to a level below that which such Lender
or Issuer or such corporation could have achieved but for such adoption, change
or compliance, in each case as a consequence of its obligations hereunder
(taking into consideration such Lender’s or Issuer’s policies with respect to
capital adequacy), then the Borrower shall pay to such Lender such additional
amount or amounts as such Lender or Issuer  reasonably determines to be
sufficient to compensate such Lender or Issuer or such corporation in the light
of such circumstances, for a period not to exceed one hundred eighty (180) days,
which amounts shall be due and payable at the end of such period, subject to the
provisions of Section 12.10.

 

(b)           A certificate of such Lender or Issuer setting forth such amount
or amounts as shall be necessary to compensate such Lender or Issuer as
specified in Section 5.4(a) above shall be delivered within sixty (60) days of
such occurrence described in Section 5.4(a) above to the Borrower and shall be
conclusive and binding, absent manifest error.  The Borrower shall pay such
Lender or Issuer the amount shown as due on any such certificate within fifteen
(15) days after such Lender or Issuer delivers such certificate. In preparing
such certificate, such Lender or Issuer may

 

40

--------------------------------------------------------------------------------

 

employ such assumptions and allocations of costs and expenses as it shall in
good faith deem reasonable and may use any reasonable averaging and attribution
method.

 

5.             Taxes.

 

(a)           Except as otherwise provided in Section 5.5(d), any and all
payments by the Borrower hereunder or under the other Financing Documents shall
be made free and clear of and without deduction for any and all present or
future taxes, deductions, charges or withholdings, and all liabilities with
respect thereto, including without limitation, such taxes, deductions, charges,
withholdings or liabilities whatsoever imposed, assessed, levied or collected by
any taxing authority and all (other than to the extent due to the gross
negligence or willful misconduct of the relevant Lender, Issuer or Swing Line
Lender) interest, penalties, expenses or similar liabilities with respect
thereto (“Taxes”), excluding, however, from the definition of Taxes, in the case
of each Lender, each Issuer, the Swing Line Lender and the Agent, (i) taxes
imposed on its income (including penalties and interest payable in respect
thereof), and franchise taxes imposed on it, by the jurisdiction under the laws
of which such Lender, such Issuer, the Swing Line Lender or the Agent (as the
case may be) is organized or any political subdivision thereof and (ii) taxes
imposed on its income (including penalties and interest payable in respect
thereof), and franchise taxes imposed on it, by the applicable jurisdiction in
which such Person’s relevant office is located or any political subdivision
thereof.  If the Borrower shall be required by law to deduct any Taxes from or
in respect of any sum payable hereunder or under any Note to any Lender, any
Issuer, the Swing Line Lender or the Agent (other than payments for which taxes
are withheld pursuant to the last sentence of Section 5.5(d) under circumstances
in which the recipient is able to deliver the relevant forms under applicable
law), (i) the sum payable shall be increased as may be necessary so that after
making all required deductions (including deductions applicable to additional
sums payable under this Section 5.5) such recipient receives an amount equal to
the sum it would have received had no such deductions been made and (ii) the
Borrower shall pay the full amount deducted to the relevant taxation authority
or other authority in accordance with applicable law, less any credits due to
the Borrower.

 

(b)           In addition, the Borrower agrees to pay any present or future
stamp or documentary taxes or any other excise or property taxes, charges or
similar levies which arise from any payment made hereunder or under any other
Financing Document or from the execution, delivery or registration of, or
otherwise with respect to, this Agreement or any other Financing Document
(hereinafter included within the definition of “Taxes”).

 

(c)           The Borrower will indemnify each Lender, each Issuer, the Swing
Line Lender and the Agent for the full amount of Taxes (including without
limitation, any Taxes imposed by any jurisdiction on amounts payable under this
Section 5.5) paid by such Person and any liability arising therefrom or with
respect thereto, whether or not such Taxes were correctly or legally asserted.
This indemnification shall be made within five (5) days from the date such
Person makes written demand therefor; provided, however, that to the extent that
any such recipient is reimbursed for any Taxes that were incorrectly or
illegally asserted with respect to the Borrower, such recipient shall

 

41

--------------------------------------------------------------------------------

 

promptly return to the Borrower the amount of such reimbursement net of any
costs of recovery incurred by such recipient, together with any interest that
may have been paid by the taxing jurisdiction with respect thereto, to the
extent the Borrower has actually paid such recipient with respect thereto.

 

(d)           Prior to the date of any Lender becoming a Lender hereunder, and
from time to time thereafter if requested by the Borrower or the Agent (to the
extent that such Person is still able to do so under applicable law), each
Lender organized outside the United States shall provide the Agent and the
Borrower with the forms prescribed by the Internal Revenue Service of the United
States (including, without limitation, Form W-8BEN, Form W-8ECI, or Form W-9)
certifying such Lender’s exemption from United States withholding taxes with
respect to all payments to be made to such Lender hereunder and under the other
Financing Documents. Unless the Borrower and the Agent have received forms or
other documents satisfactory to them indicating that payments hereunder or under
the other Financing Documents are not subject to United States withholding tax
or are subject to such tax at a rate reduced by an applicable tax treaty, the
Borrower or the Agent shall withhold taxes from such payments for the account
and benefit of the Borrower at the applicable statutory rate in the case of
payments to or for any Lender organized under the laws of a jurisdiction outside
the United States; provided, however, that all such withholding for such Lender
shall cease upon delivery by such Lender of the applicable forms to the Borrower
and Agent.

 

(e)           Promptly after the date on which payment of any Taxes are due
pursuant to applicable law, the Borrower will, at the request of the Agent, any
Issuer or any Lender, furnish to the Agent, such Issuer or such Lender evidence
in form and substance satisfactory to the Agent, such Issuer or such Lender,
that the Borrower has met its obligations under this Section 5.5.

 

(f)            Without prejudice to the survival of the Borrower’s other
agreements, the Borrower’s agreements and obligations contained in this
Section 5.5 shall survive the payment in full of the Liabilities.

 

(g)           Each Lender, each Issuer and the Swing Line Lender agrees that,
upon the occurrence of any event giving rise to any payment by the Borrower
pursuant to this Section 5.5 with respect to such Lender, it will, if requested
by the Borrower, use reasonable efforts (subject to its overall policy
considerations) to designate another lending office for any Loans and other
extensions of credit affected by such event with the object of avoiding the
consequences of such event; provided, that such designation is made on terms
that, in such Lender’s sole judgment, cause such Lender and its lending
office(s) to suffer no economic, legal or regulatory disadvantage.

 

42

--------------------------------------------------------------------------------

 

ARTICLE VI
FEES

 

1.             Non-Use Fee.

 

Commencing on the Closing Date, the Borrower agrees to pay to the Agent for
distribution to the Lenders (based on their applicable respective Pro Rata
Percentages) a quarterly non-use fee (the “Non-Use Fee”) on the daily average
unused amount of the Line of Credit Loan Commitments and the Term Loan
Commitments, as the case may be, at the applicable rate per annum for the
relevant Financial Performance Level set forth in the definition of Applicable
Margin.  The Non-Use Fee shall be due and payable in arrears on the first day of
each January, April, July and October hereafter through the Maturity Date.  A
pro-rated Non-Use Fee shall be due and payable on the first day of the quarter
following the Closing Date and on the applicable Maturity Date.  The Non-Use Fee
shall be earned as it accrues.  Swing Line Loans shall not be considered usage
of the Line of Credit Loan Commitments for purposes of this Section 6.1.

 

2.             LC Fees.

 

The Borrower agrees to pay to the Agent, for distribution to the Lenders (based
on their respective Pro Rata Percentages), a quarterly fee in respect of each LC
issued hereunder (the “LC Fee”), computed at the applicable rate per annum set
forth in the definition of Applicable Margin on the daily average amount
available to be drawn under such LC for as long as it is outstanding.  The
quarterly letter of credit fee shall be due and payable in arrears on the first
day of each January, April, July and October hereafter through the Maturity Date
applicable to the Line of Credit Loans.  A pro-rated letter of credit fee shall
be due and payable on the first day of the quarter following the Closing Date
and on the Maturity Date applicable to the Line of Credit Loans.  Each quarterly
letter of credit fee shall be earned as it accrues.  The Borrower shall also pay
to the Agent for the account of each Issuer the normal and customary processing
fees that such Issuer charges in connection with the issuance of or drawings
under each such LC (to include, without limitation, a fee in respect of the
issuance, increase or renewal of any LC in an amount equal to the greater of
(x) $2,000 and (y) 0.125% of the face amount of such LC).  A pro-rated letter of
credit fee shall be due and payable to the Lenders under the Existing Credit
Agreement on the Restatement Date.

 

3.             Upfront Fees.

 

The Borrower agreed to pay to the Agent, for distribution to the Lenders (based
on their respective Commitments as of the Restatement Date), an upfront fee (the
“Upfront Fee”), computed as specified in the Agent’s Letter.  The Upfront Fee
shall be due and payable on the Restatement Date; provided, that the portion of
the Upfront Fee attributable to any Term Loans advanced after the Restatement
Date shall be payable in respect thereof in two equal installments on (a) the
Restatement Date and (b) the date of the borrowing of the applicable Term Loan
as a condition thereof.  Amounts paid in respect of the Term Loans on the
Restatement Date shall be fully earned whether or not the Borrower shall draw
(or shall be permitted, pursuant to the terms hereof, to draw) additional Term
Loans after the Restatement Date.

 

43

--------------------------------------------------------------------------------

 

4.             Calculation of Fees.

 

The fees payable under Sections 6.1 and 6.2 shall be calculated by the Agent on
the basis of a 360-day year, for the actual days (including the first day but
excluding the last day) occurring in the period for which such fee is payable.
Each determination by the Agent of fees payable under Sections 6.1 and 6.2 shall
be conclusive and binding for all purposes, absent manifest error.

 

5.             Fees Not Interest; Nonpayment.

 

The fees described in this Agreement represent compensation for services
rendered and to be rendered separate and apart from the lending of money or the
provision of credit and do not constitute compensation for the use, detention,
or forbearance of money, and the Borrower’s obligation to pay each fee described
herein shall be in addition to, and not in lieu of, the Borrower’s obligation to
pay interest and expenses otherwise described in this Agreement. Fees shall be
payable when due in Dollars and in immediately available funds.  All fees shall
be non-refundable.

 

ARTICLE VII
REPRESENTATIONS AND WARRANTIES

 

In order to induce the Agent, each Issuer, the Swing Line Lender and the Lenders
to enter into this Agreement and to induce each Issuer to issue LCs under this
Agreement, each of the Borrower and the other Loan Parties represents and
warrants to the Agent, each Issuer, the Swing Line Lender and the Lenders that
the following statements are and on each date hereafter that the Borrower is
required to execute and deliver a Compliance Certificate to the Agent, will be,
true and correct:

 

1.             Judgments, Claims Litigation and Proceedings.

 

Except as set forth on Exhibit 7A or as disclosed in writing to the Agent from
time to time hereafter, no judgments are outstanding against the Borrower or any
of its Subsidiaries, nor is there now pending or threatened any litigation,
contested claim, or governmental proceeding by or against the Borrower or any of
its Subsidiaries, except for judgments and pending or threatened litigation,
contested claims and governmental proceedings which are not, in the aggregate,
material to the financial condition, results of operations or business of the
Borrower and its Subsidiaries, taken as a whole.

 

2.             Contract Defaults and Disputes.

 

Except as set forth on Exhibit 7B, none of the Borrower nor any of its
Subsidiaries is in default under any material contract, lease or commitment to
which it is a party or by which it is bound, which is material to the continued
financial success and well-being of the Borrower and its Subsidiaries, taken as
a whole.  Except as set forth on Exhibit 7B or as disclosed in writing to the
Agent from time to time hereafter, none of the Borrower nor any of its
Subsidiaries knows of any material dispute relating to any contract, lease, or
commitment, which is material to the

 

44

--------------------------------------------------------------------------------

 

continued financial success and well-being of the Borrower and its Subsidiaries,
taken as a whole.

 

3.             Licenses, Patents, Etc.

 

All of the Borrower’s and its Subsidiaries’ licenses, patents, copyrights,
trademarks and trade names and all of the Borrower’s and its Subsidiaries’
applications for any of the foregoing are set forth on Exhibit 7C. There is no
action, proceeding, claim or complaint pending or threatened to be brought
against any of the Borrower or its Subsidiaries by any Person which might
jeopardize any of the Borrower’s or any of its Subsidiaries interest in any of
the foregoing licenses, patents, copyrights, trademarks, trade names or
applications and which, if successful, would have a material adverse effect on
the consolidated financial condition, results of operations or business of the
Borrower and its Subsidiaries.

 

4.             Title to Assets.

 

Except for the security interests granted in the Security Documents, as
permitted under Section 10.1 or as set forth on Exhibit 7D, the Borrower and
each of its Subsidiaries owns all of their respective assets free and clear of
all security interests, liens, claims, and encumbrances.  No Goods held by the
Borrower or any of its Subsidiaries on consignment or under sale or return
contracts have been represented to be Inventory and no amounts receivable by the
Borrower or any of its Subsidiaries in respect of the sale of such Goods (except
markups or commissions which have been fully earned by the Borrower or its
Subsidiaries) have been represented to be Accounts.  The Borrower represents
that all amounts in the form of ordinary trade payables which are owing to
suppliers of any of the Inventory of the Borrower or any of its Subsidiaries
have been paid when due and that none of such suppliers has asserted any
interest in the Inventory.  The Borrower will furnish, at the Agent’s request,
the names and addresses of all Persons who supply Inventory to the Borrower or
any of its Subsidiaries or who deliver Goods to the Borrower or any of its
Subsidiaries on consignment or under sale or return contracts.

 

5.             Tax Liabilities.

 

Each of the Borrower and its Subsidiaries has filed all federal and all other
material tax reports and returns required by any law or regulation to be filed
and each of the Borrower and its Subsidiaries have either duly paid all taxes,
duties and charges indicated to be due on the basis of such returns and reports
or have made adequate provision for the payment thereof, and the assessment of
any material amount of additional taxes in excess of those paid and reported is
not reasonably expected.  The reserves for taxes reflected on the Borrower’s
consolidated balance sheet are materially adequate in amount for the payment of
all of the Borrower’s consolidated liabilities for all taxes (whether or not
disputed) accrued through the date of such balance sheet.  There are no material
unresolved questions or claims concerning any tax liability of any of the
Borrower or its Subsidiaries, except as described on Exhibit 7E or as disclosed
in writing to the Agent from time to time hereafter.

 

6.             Indebtedness and Producer Payables.

 

Except (a) for the Loans and Swing Line Loans from the Lenders and the Swing
Line Lender respectively, and the LC Obligations, each as contemplated by this
Agreement; (b) as

 

45

--------------------------------------------------------------------------------

 

disclosed on Exhibit 7F; and (c) as disclosed on the financial statements
identified in Section 7.16 of this Agreement, none of the Borrower nor any of
its Subsidiaries has any other indebtedness, known contingent obligations or
liabilities, outstanding bonds, letters of credit or acceptances to any other
Person or loan commitments from any other Person which in the aggregate, are
material to the financial position of the Borrower and its Subsidiaries, taken
as a whole.  None of the Borrower’s nor any of its Subsidiaries’ Producer
Payables, other than those being contested in good faith by any of such Persons,
are past due.

 

7.             Other Fictitious Names.

 

During the preceding five (5) years, neither the Borrower nor any of its
Subsidiaries has been known by or used any fictitious name, or changed its
organizational form, the location of its chief executive office, or the
jurisdiction of its organization except as disclosed on Exhibit 7G.

 

8.             Affiliates.

 

Neither the Borrower nor any of its Subsidiaries has any Affiliates, other than
those Persons disclosed on Exhibit 7H or those disclosed in writing to the Agent
from time to time hereafter, and the legal relationships of the Borrower and its
Subsidiaries to each such Affiliate are accurately and completely described
thereon.

 

9.             Environmental Matters.

 

Except as disclosed on Exhibit 7I or as disclosed in writing to the Agent from
time to time hereafter, (a) none of the Borrower nor any of its Subsidiaries has
received any notice to the effect, and does not have any knowledge, that their
respective operations are not in compliance with any of the requirements of
applicable federal, state and local environmental, health and safety statutes
and regulations (“Environmental Laws”) or are the subject of any federal or
state investigation evaluating whether any remedial action is needed to respond
to a release of any toxic or hazardous waste or substance into the environment,
which non-compliance or remedial action could have a material adverse effect on
the consolidated business, operations, assets or condition (financial or
otherwise) of the Borrower and its Subsidiaries, taken as a whole; (b) there
have been no releases of hazardous materials at, on or under the Borrower’s or
any of its Subsidiaries’ premises that, singly or in the aggregate, have, or may
reasonably be expected to have, a material adverse effect on the consolidated
financial condition, operations, assets, business or prospects of the Borrower
and its Subsidiaries, taken as a whole; (c) there are no underground storage
tanks, active or abandoned, including petroleum storage tanks, on or under the
Borrower’s or any of its Subsidiaries’ premises that, singly or in the
aggregate, have, or may reasonably be expected to have, a material adverse
effect on the consolidated financial condition, operations, assets, business or
prospects of the Borrower and its Subsidiaries, taken as a whole; (d) none of
the Borrower nor any of its Subsidiaries has directly transported or directly
arranged for the transportation of any hazardous material to any location which
is listed or proposed for listing on the National Priorities List pursuant to
the Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended from time to time, or on any similar federal, state or local
list or which is the subject of federal, state or local enforcement actions or
other investigations which may lead to claims against the Borrower or any of its
Subsidiaries for any remedial work, damage to natural resources or personal
injury, including claims under the

 

46

--------------------------------------------------------------------------------

 

Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended from time to time, that are material in the aggregate to the
consolidated financial position of the Borrower and its Subsidiaries; and (e) to
the best of the Borrower’s and each of its Subsidiaries’ knowledge, no
conditions exist at, on or under the Borrower’s or any of its Subsidiaries’
premises which, with the passage of time, or the giving of notice or both, would
give rise to any liability under any Environmental Laws that would be material
relative to the consolidated financial position of the Borrower and its
Subsidiaries.

 

10.          Bank Accounts.

 

Exhibit 7J sets forth, as of the Closing Date, the account numbers and location
of each of the Borrower’s and any of its Subsidiaries bank accounts (including
blocked accounts).

 

11.          Other Agreements or Restrictions.

 

Except as disclosed on Exhibit 7K, none of the Borrower nor any of its
Subsidiaries is a party to any contract or agreement or subject to any
restriction which restricts the conduct of its respective business which could
have a material adverse effect on the consolidated financial condition,
operations, assets, business or prospects of the Borrower and its Subsidiaries. 
None of the Borrower nor any of its Subsidiaries is in default under or in
violation of any Governmental Requirement related to the Loans, the LCs, or the
Swing Line Loans or any other Governmental Requirement which default could have
a material adverse effect on the consolidated financial condition, operations,
assets, business or prospects of the Borrower and its Subsidiaries.  Neither the
execution and delivery of the Financing Documents or the Bond Documents, nor the
consummation of the transactions contemplated thereby, nor fulfillment of and
compliance with the respective terms, conditions and provisions thereof, will
conflict with or result in a breach of any of the terms, conditions or
provisions of, or constitute a default under, or result in any material
violation of, or result in the creation or imposition of any lien or security
interest on any of the Collateral pursuant to: (a) any agreement, instrument or
document pertaining to the governance of the Borrower or any of its
Subsidiaries; (b) any Governmental Requirement applicable to the Borrower or any
of its Subsidiaries; (c) any order, writ, injunction or decree of any court; or
(d) the terms, conditions or provisions of any material agreement or instrument
to which the Borrower or any of its Subsidiaries is a party or by which the
Borrower, NBC or their respective properties is bound or to which the Borrower,
any of its Subsidiaries or their respective properties is subject in any
material respect.

 

12.          [Intentionally Omitted].

 

13.          Existence.

 

Each of the Borrower and its Subsidiaries is duly organized or formed, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation or organization, except in respect of any non-Loan Party to the
extent such failure shall not have a material adverse effect on the financial
condition, results of operations or business of the Borrower and its
Subsidiaries, taken as a whole.  The Borrower and each of its Subsidiaries is
duly licensed to do business in all states where the nature and extent of the
business it transacts or the ownership of its assets make such licensing
necessary, except for those jurisdictions in which the failure to be

 

47

--------------------------------------------------------------------------------

 

so licensed would not, in the aggregate, have a material adverse effect on the
consolidated financial condition, results of operations or business of the
Borrower and its Subsidiaries.

 

14.          Authority.

 

The execution and delivery by the Borrower and each of its Subsidiaries of this
Agreement, the other Financing Documents and the Bond Documents to which it is a
party, and the performance of their respective obligations hereunder and
thereunder, (a) are within the such Person’s powers; (b) are duly authorized by
all necessary corporate or other organizational action; (c) are not in
contravention of any material law or laws, or the terms of such Person’s
operating agreement, or other organizational documents, or of any indenture,
agreement or undertaking to which such Person is a party or by which the
Borrower, any of its Subsidiaries or any of their respective property is bound;
(d) do not require any governmental consent, registration or approval; (e) do
not contravene any contractual or governmental restriction binding upon such
Person; and (f) will not, except as contemplated or permitted by this Agreement,
result in the imposition of any lien, charge, security interest or encumbrance
upon any of the Borrower’s or any of its Subsidiaries’ property under any
existing indenture, mortgage, deed of trust, loan or credit agreement or other
material agreement or instrument to which the Borrower or any of its
Subsidiaries is a party or by which the Borrower, any of its Subsidiaries or any
of their respective property may be bound or affected.

 

15.          Binding Effect.

 

This Agreement, the other Financing Documents and the Bond Documents set forth
the legal, valid and binding obligations of the Borrower and each of its
Subsidiaries party thereto and are enforceable against the Borrower and its
Subsidiaries in accordance with their respective terms.

 

16.          Correctness of Financial Statements.

 

The financial statements delivered by the Borrower to the Agent, the Swing Line
Lender and the Lenders present fairly the consolidated financial condition of
the Borrower and its Subsidiaries, and have been prepared in accordance with
GAAP consistently applied.  Since the end of the Borrower’s Fiscal Year 2009,
there has been no materially adverse change in the condition or operations of
the Borrower and its Subsidiaries, taken as a whole, and none of the Borrower or
any of its Subsidiaries has granted a Lien on any of their respective assets or
properties since such date other than pursuant to the Security Documents, as
permitted under Section 10.1 or as set forth on Exhibit 7D.  As of each date
hereafter that the Borrower is required to execute and deliver a compliance
certificate to the Agent, there has been no materially adverse change in the
condition or operation of the Borrower and its Subsidiaries, taken as a whole,
and (unless otherwise permitted in this Agreement) none of the Borrower or any
of its Subsidiaries has granted a Lien on any of their respective assets or
properties since the date of the most recent financial statement delivered to
the Agent and the Lenders.

 

17.          Employee Controversies.

 

Except as disclosed on Exhibit 7L, there are no controversies pending or
threatened between the Borrower or any of its Subsidiaries, on the one hand, and
any of their respective

 

48

--------------------------------------------------------------------------------

 

employees, on the other hand, other than employee grievances arising in the
ordinary course of the Borrower’s or its Subsidiaries’ respective business which
are not, in the aggregate, material to the continued financial success and
well-being of the Borrower and its Subsidiaries, taken as a whole, and which
employee grievances are disclosed in writing to the Agent from time to time
hereafter.

 

18.          Compliance with Laws and Regulations.

 

The Borrower and each of its Subsidiaries each are in compliance with all laws,
orders, regulations and ordinances of all federal, foreign, state and local
Governmental Authorities relating to the Borrower’s and its Subsidiaries’
business operations and assets, except for laws, orders, regulations and
ordinances, the violation of which would not have a material adverse effect on
the value of the Collateral or the Agent’s interest in any of the Collateral
and, in the aggregate, would not have a material adverse effect on the
consolidated financial condition, results of operations or business of the
Borrower and its Subsidiaries.

 

19.          Solvency.

 

The Borrower and each of the other Loan Parties are solvent, able to pay their
respective debts generally as such debts mature, and have capital sufficient to
carry on their business and all businesses in which the Borrower and the other
Loan Parties each expect to engage. The saleable value of each of the Borrower’s
and the other Loan Parties’ total assets at a fair valuation, and at a present
fair saleable value, are greater than the amount of each of the Borrower’s and
any of the other Loan Parties’ total obligations to all Persons.  None of the
Borrower nor any of the other Loan Parties will be rendered insolvent by the
execution or delivery of this Agreement, the other Financing Documents, the
Intercompany Financing Documents or by the transactions contemplated hereunder
or thereunder.

 

20.          ERISA Matters.

 

(a)           Each Plan is in compliance in all material respects with the
applicable provisions of ERISA, the IRC and other Federal or state Laws, and
each Plan that is intended to qualify under Section 401(a) of the IRC has
received a favorable determination letter from the IRS or an application for
such a letter is currently being processed by the IRS with respect thereto or
may legally rely upon an opinion letter issued by the IRS to a prototype plan
sponsor, and, to the Borrower’s and the other Loan Parties’ best knowledge,
nothing has occurred which would prevent, or cause the loss of, such
qualification. The Borrower, the other Loan Parties and each of their ERISA
Affiliates have made all required contributions to each Plan subject to
Section 412 of the Code, and no application for a funding waiver or an extension
of any amortization period pursuant to Section 412 of the Code has been made
with respect to any Plan.

 

(b)           There are no pending or, to either the Borrower’s or any of the
other Loan Parties’ best knowledge, threatened claims, actions or lawsuits, or
action by any Governmental Authority, with respect to any Plan that could
reasonably be expected to have a material adverse effect on the consolidated
financial condition, results of operations, business or prospects of the
Borrower and its Subsidiaries.  There has been

 

49

--------------------------------------------------------------------------------

 

no prohibited transaction or violation of the fiduciary responsibility
rules with respect to any Plan that has resulted or could be reasonably expected
to result in a material adverse effect on the consolidated financial condition,
results of operations, business or prospects of the Borrower and its
Subsidiaries.

 

(c)           (i) No material ERISA Event (except as set forth in Exhibit 7M has
occurred or is reasonably expected to occur; (ii) no Pension Plan has any
material Unfunded Pension Liability; (iii) none of the Borrower, any of the
other Loan Parties, nor any ERISA Affiliate thereof has incurred, or reasonably
expects to incur, any material liability under Title IV of ERISA with respect to
any Pension Plan (other than premiums due and not delinquent under Section 4007
of ERISA); (iv) none of the Borrower, any of the other Loan Parties, nor any
ERISA Affiliate thereof has incurred, or reasonably expects to incur, any
material liability (and no event has occurred which, with the giving of notice
under Section 4219 of ERISA, would result in such liability) under Sections 4201
or 4243 of ERISA with respect to a Multiemployer Plan; and (v) none of the
Borrower, any of the other Loan Parties, nor any ERISA Affiliate of either has
engaged in a transaction that could be subject to Sections 4069 or 4212(c) of
ERISA.

 

21.          Margin Security.

 

None of the Borrower nor any of its Subsidiaries owns any margin security and
none of the loans advanced hereunder shall be used for the purpose of purchasing
or carrying any margin securities or for the purpose of reducing or retiring any
indebtedness which was originally incurred to purchase any margin securities or
for any other purpose not permitted by Regulations T, U or X of the Board of
Governors of the Federal Reserve System.

 

22.          Investment Company Act Not Applicable.

 

None of the Borrower nor any of its Subsidiaries is an “investment company”, or
a company “controlled” by an “investment company”, within the meaning of the
Investment Company Act of 1940, as amended.

 

23.          [Intentionally Omitted].

 

24.          No Consent.

 

The execution, delivery and performance of, and the effectuation of the
transactions contemplated under, this Agreement, the other Financing Documents
and the Bond Documents by the Borrower and each of its Subsidiaries which is a
party thereto, and the borrowings contemplated herein, do not require the
consent or approval of any other Person, except such consents or approvals as
have been obtained or will be obtained by the Restatement Date.  None of the
Borrower nor any of its Subsidiaries has otherwise failed to obtain any material
governmental consent, approval, license, permit, franchise or other governmental
authorization necessary to the ownership of any of its properties or the conduct
of its business.

 

50

--------------------------------------------------------------------------------

 

25.          Full Disclosure.

 

The factual information taken as a whole in the materials furnished by or on
behalf of the Borrower and its Subsidiaries to the Agent, any Lender, any
Issuer, the Swing Line Lender, or any Existing Lender for purposes of or in
connection with the transactions contemplated under this Agreement, the Existing
Credit Agreement, the other Financing Documents and the Bond Documents does not
contain any untrue statement of a material fact or omit to state any material
fact necessary to keep the statements contained therein from being misleading as
of the date of this Agreement, and thereafter as supplemented by information
provided to the Agent and the Lenders, any Issuer and the Swing Line Lender in
writing pursuant to this Agreement. The financial projections and other
financial information furnished to the Agent and the Lenders by the Borrower and
its Subsidiaries, and to be delivered under Section 9.1 of this Agreement, were
prepared in good faith on the basis of information and assumptions that the
Borrower and each of its Subsidiaries believed to be reasonable as of the date
of such information.

 

26.          Intellectual Property.

 

Except as set forth in Exhibit 7C, the Borrower and each of its Subsidiaries
owns or possesses (or will be licensed or otherwise have the full right to use)
all intellectual property which is necessary for the operation of their
respective businesses, without any known conflict with the rights of others. 
Except as set forth in Exhibit 7N, no product of the Borrower or any of its
Subsidiaries infringes upon any intellectual property owned by any other Person
and no claim or litigation is pending or (to the Borrower’s and each of its
Subsidiaries’ knowledge) threatened against or affecting such Person, contesting
the Borrower’s or any of its Subsidiaries’ right to sell or to use any product
or material, in any case which could have a material adverse effect on the
consolidated financial condition, operations, assets, or business of the
Borrower and its Subsidiaries.  To the best of their knowledge, none of the
Borrower nor any of its Subsidiaries is in violation of any of their respective
obligations with respect to any material patent, trademark, trade name, service
mark, copyright or license owned or used by the Borrower or any of its
Subsidiaries.

 

27.          Compliance with Federal Food Security Act.

 

The Borrower and each of its Subsidiaries have adequate procedures in place to
insure that Collateral purchased by the Borrower or any of its Subsidiaries is
free of security interests in favor of Persons other than the Agent in
accordance with the Federal Food Security Act.  The Borrower and each of its
Subsidiaries will furnish, at the Agent’s request, the names and addresses of
all Persons who supply Inventory to the Borrower or any of its Subsidiaries or
who deliver Goods to the Borrower or any of its Subsidiaries on consignment or
under sale or return contracts.

 

28.          Survival of Warranties.

 

All representations and warranties contained in this Agreement or any of the
other Financing Documents shall survive the execution and delivery of this
Agreement and shall be true on the date of this Agreement and on each date
hereafter on which the Borrower is required to execute and deliver a compliance
certificate to the Agent, until the Liabilities shall be paid in

 

51

--------------------------------------------------------------------------------

 

full and the Commitments have been fully terminated in accordance with the
provisions of this Agreement.

 

29.          CoBank Equity Interests.

 

So long as CoBank is a Lender under this Agreement, the Borrower will acquire
equity in CoBank in such amounts and at such times as CoBank may require in
accordance with CoBank’s Bylaws and Capital Plan (as each may be amended from
time to time), except that the maximum amount of equity that the Borrower may be
required to purchase in CoBank in connection with the Loans and Swing Line Loans
made by CoBank under this Agreement shall not exceed the maximum amount
permitted by CoBank’s Bylaws as of the date of this Agreement.  The rights and
obligations of the parties with respect to such equity and any distributions
made on account thereof or on account of the Borrower’s patronage with CoBank
shall be governed by CoBank’s Bylaws, except that if CoBank sells a
participation in a portion of any Loans due to CoBank, such portion of the Loans
due to CoBank shall not be entitled to patronage distributions.  A sale of a
participation interest may include certain voting rights of the participants
regarding the loans hereunder (including without limitation the administration,
servicing and enforcement thereof).  The Borrower hereby consents and agrees
that the amount of any distributions with respect to the Borrower’s patronage
with CoBank that are made in qualified written notices of allocation (as defined
in 26 U.S.C. § 1388) and that are received by the Borrower from CoBank will be
taken into account by the Borrower at the stated Dollar amounts whether the
distribution is evidenced by a stock certificate or other form of written notice
that such distribution has been made and recorded in the Borrower’s name on
CoBank’s records.  The Loans due to CoBank under this Agreement and other
Indebtedness due to CoBank hereunder shall be secured by a statutory first Lien
on all equity that the Borrower may now own or hereafter acquire in CoBank. 
Such equity shall not, however, constitute security for Indebtedness due to any
other Lender under this Agreement.  CoBank shall not be obligated to set off or
otherwise apply such equities to the Borrower’s Indebtedness to CoBank.

 

ARTICLE VIII
CONDITIONS

 

1.             Conditions to the Restatement Date and the Initial Borrowing.

 

The occurrence of the Restatement Date, each Lender’s obligation to make its
Loans, the Swing Line Lender’s obligation to make the Swing Line Loans, and each
Issuer’s obligation to issue one or more LCs comprising a part of the initial
borrowing hereunder, are subject to the following conditions precedent:

 

(a)           Documents.

 

The Agent shall have received, appropriately dated and in form and substance
reasonably satisfactory to the Agent (together with original counterparts or
copies, as the case may be, for each Lender), the documents listed on the List
of Closing Documents which is attached as Exhibit 8A.

 

52

--------------------------------------------------------------------------------

 

(b)           Actions and Events.

 

(i)            Payment of Fees and Expenses.

 

The Borrower shall have paid all fees (including, without limitation, the
Upfront Fee) due on or before the Restatement Date as specified herein or in the
Agent’s Letter and all fees and expenses of or incurred by the Agent and its
special and local counsel to the extent billed on or before the Restatement
Date;

 

(ii)           No Prohibitions.

 

No law or regulation shall prohibit, and no order, judgment or decree of any
Governmental Authority shall prohibit, and no litigation shall be pending or
threatened which would enjoin, prohibit, restrain or otherwise adversely affect
the consummation of the transactions contemplated under the Financing Documents
or the Intercompany Financing Documents, or which would otherwise have a
material adverse effect on either the Borrower’s or any of its Subsidiaries’
financial condition, results of operations or business;

 

(iii)          Material Adverse Change.

 

No material adverse change shall have occurred since: (i) the end of Fiscal Year
2009, or (ii) the date of the most recent financial statement delivered to the
Agent and the Lenders, as applicable, with respect to:

 

(A) the Borrower’s and its Subsidiaries’ condition (financial or otherwise),
business, assets, liabilities (actual or contingent), operations or prospects;

 

(B) the syndication markets for credit facilities similar in nature to those
discussed in this Agreement; or

 

(C) the financial, banking or capital markets, the effect of which would have an
adverse change or effect in the syndication market;

 

in each case, as determined by the Agent in its sole discretion.

 

(iv)          Wiring Instructions.

 

The Agent shall have received wiring instructions with respect to the proceeds
of the Loans and Swing Line Loans (if any) to be made on the Restatement Date;

 

(v)           Other Documents.

 

The Borrower and each of its Subsidiaries shall have taken such actions, and the
Agent shall have received such other documents (including, without limitation,
amendments or modifications to the Security Documents and the Intercompany Loan
Documents specified by the Agent in order to reflect the changes to the Existing
Credit Agreement that are set forth in this Agreement), as the Agent may
reasonably request; and

 

53

--------------------------------------------------------------------------------

 

(vi)          Compliance.

 

Each of the Borrower’s and its Subsidiaries’ representations and warranties
contained in this Agreement shall be true on and as of the Restatement Date as
if such representations and warranties had been made on and as of the
Restatement Date, and no Default or Matured Default shall have occurred and be
continuing or shall exist, as evidence by a current compliance certificate in
the format required to be delivered to the Agent from time to time in accordance
with Section 9.1.

 

2.             Conditions Precedent to All Borrowings, Conversions, Roll Overs
and Issuances of Letters of Credit.

 

Each Lender’s obligation to make (or convert or roll over) a Loan, the Swing
Line Lender’s obligation to make Swing Line Loans, and each Issuer’s obligation
to issue an LC on the occasion of each borrowing (including the initial
borrowing), conversion, roll over or issuance of an LC shall be subject to the
further condition precedent that the following statements shall be true (and the
Borrower’s acceptance of the proceeds of each borrowing, the delivery of the
notice of interest conversion under Section 3.2 in the case of a conversion or
roll over, or the delivery of the Application in the case of the issuance of an
LC, shall be deemed to constitute a representation and warranty by the Borrower
that on the date of such borrowing, conversion, roll over or issuance of LC such
statements are true) and on the date of each borrowing the Agent shall have
received a certificate (dated the date of such borrowing) from a responsible
officer of the Borrower certifying that all conditions under Section 8.1 have
been satisfied and that such statements are true:

 

(a)           The Borrower is duly authorized and empowered to make such request
for borrowing, conversion, roll over or issuance of LC and such borrowing,
conversion, roll over or issuance of LC will not violate any Governmental
Requirement;

 

(b)           No material adverse change has occurred with respect to the
Borrower’s consolidated financial condition, business, operations or prospects
since the date of the last audited financial statements delivered to the Agent
and the Lenders;

 

(c)           The representations and warranties set forth in Article 7 are, as
of the Restatement Date, true and correct in all respects and are, from and
after the Restatement Date, true and correct in all material respects, in each
case, with the same effect as if then made (unless stated to relate solely to an
earlier date, in which case the representations and warranties shall be true and
correct as of such earlier date);

 

(d)           No event has occurred and is continuing, or would result from such
borrowing, conversion, roll over or issuance of LC, which constitutes a Default
or a Matured Default;

 

(e)           The Borrower has delivered to the Agent its notice of borrowing or
notice of interest conversion;

 

54

--------------------------------------------------------------------------------

 

(f)            The Borrower has complied with any post-closing requirements of
the Agent by the deadline for such requirements;

 

(g)           The Borrower has paid any portion of the Upfront Fees due on or
before the applicable date of borrowing as specified in the Agent’s Letter; and

 

(h)           With respect to the issuance of any LC, the Borrower has delivered
to the Agent an Application for such LC as described in Section 2.2(b).

 

ARTICLE IX
AFFIRMATIVE COVENANTS

 

The Borrower and each other Loan Party covenants and agrees that from the date
of execution hereof until the Liabilities are paid in full, and the Commitments,
all LCs and all other obligations of the Agent, the Issuers, the Swing Line
Lender and the Lenders hereunder are finally terminated, the Borrower will
comply (and will cause its Subsidiaries to comply) with the following provisions
of this Article 9:

 

1.             Financial Statements.

 

Except as otherwise expressly provided for in this Agreement, the Borrower and
its Subsidiaries each shall keep proper books of record and account in which
full and true entries will be made of all dealings and transactions of or in
relation to the Borrower’s and its Subsidiaries’ business and affairs, in
accordance with GAAP consistently applied in all material respects, and the
Borrower shall cause to be furnished to the Agent and the Lenders, from time to
time and in a form acceptable to the Agent, such information as the Agent may
reasonably request, including without limitation, the following as to the
Borrower and/or its Subsidiaries (as the case may be):

 

(a)           as soon as practicable and in any event within thirty (30) days
after the end of each monthly accounting period in each Fiscal Year (as measured
at the end of such monthly accounting period), or, during the existence of any
Default, as frequently as the Agent may request, a Borrowing Base Certificate of
the chief financial or other authorized officer of the Borrower;

 

(b)           as soon as practicable and in any event within thirty (30) days
after the end of each fiscal quarter in each Fiscal Year (i) consolidated
statements of income and retained earnings for such fiscal quarter and for the
period from the beginning of the then current Fiscal Year to the end of such
fiscal quarter, and a consolidated balance sheet as of the end of such fiscal
quarter, setting forth in each case in comparative form, figures for the
corresponding periods in the preceding Fiscal Year, all in reasonable detail and
certified as accurate by the chief financial or other authorized officer,
subject to changes resulting from normal year-end adjustments, (ii) copies of
statements of cash flow, and (iii) a compliance certificate of the chief
financial or other authorized officer of the Borrower in substantially the form
attached as Exhibit 9A (the “Compliance Certificate”);

 

55

--------------------------------------------------------------------------------

 

(c)           as soon as practicable and in any event within one hundred twenty
(120) days after the end of each Fiscal Year, (i) audited consolidated
statements of income, retained earnings and changes in the financial condition
for each year, and a consolidated balance sheet for such year, setting forth in
each case, in comparative form, corresponding figures as of the end of the
preceding Fiscal Year, all in reasonable detail and satisfactory in scope to the
Agent and certified to the Borrower by KPMG LLP or such other independent public
accountants as are selected by the Borrower and satisfactory to the Agent, whose
opinion shall be in scope and substance satisfactory to the Agent, (ii) a true
and complete copy of the management letter from KPMG LLP or such other
independent public accountants as are selected by the Borrower and satisfactory
to the Agent, in connection with such audited financial statements; and (iii) a
Compliance Certificate; and

 

(d)           as soon as practicable and in any event within thirty (30) days
after the end of each Fiscal Year, a month by month operating and capital budget
for the then current Fiscal Year and annual operating and capital budgets for
the three following Fiscal Years.

 

2.             Conduct of Business.

 

Except as contemplated by this Agreement, the Borrower and each of its
Subsidiaries shall:  (a) not fail to maintain their respective existence and not
fail to maintain in full force and effect all material licenses, bonds,
franchises, leases, patents, contracts and other rights necessary or appropriate
which if not maintained could be reasonably expected to have a material adverse
effect on the consolidated financial condition, operations, assets, business or
prospects of the Borrower and its Subsidiaries; (b) continue in, and limit each
of the Borrower’s and its Subsidiaries’ operations to, the same general line of
business as that presently conducted by the Borrower and each of its
Subsidiaries; (c) comply with all applicable laws and regulations of any
Governmental Authority, except for such laws and regulations the violation of
which would not, in the aggregate, have a material adverse effect on the
consolidated financial condition, results of operations or business of the
Borrower and its Subsidiaries; and (d) keep and conduct their respective
businesses separate and apart from the business of the Borrower’s Affiliates;
provided, however, that the Borrower and its Subsidiaries may enter into
transactions with its Affiliates as long as such transactions are entered into
in the ordinary course of the Borrower’s or its Subsidiaries’ business, and as
long as such transactions are not less favorable to the Borrower or its
Subsidiaries than similar transactions with non-Affiliates would be.

 

3.             Maintenance of Properties.

 

The Borrower and each of its Subsidiaries each shall keep its real estate,
leaseholds, equipment and other fixed assets in good condition, repair and
working order, normal wear and tear excepted, except to the extent such real
estate, leaseholds, equipment or other fixed assets are not material to the
conduct of its business.

 

56

--------------------------------------------------------------------------------

 

4.             Liability Insurance.

 

The Borrower and each of its Subsidiaries shall maintain, at the Borrower’s
and/or such Subsidiaries own expense (as the case may be), such public liability
and property damage insurance as is ordinarily maintained by other companies in
similar businesses, provided that in no event shall such public liability
insurance provide for coverage less than $10,000,000 per occurrence for personal
injury and $10,000,000 per occurrence for property damage.  Each of the
Borrower’s and its Subsidiaries’ public liability insurance may provide for a
deductible of not more than $500,000 per occurrence.  All such policies of
insurance shall be in form and with insurers reasonably acceptable to the Agent
and proper certificates evidencing the same, shall be provided to the Agent
within ten (10) days of receipt thereof.

 

5.             Property Insurance.

 

At the Borrower’s own cost and expense, or at the cost and expense of a
Subsidiary, in the case of property owned by such Subsidiary, the Borrower shall
keep all of its and its Subsidiaries’ assets fully insured, with carriers, and
in amounts acceptable to the Agent, against the hazards of fire, theft,
collision, spoilage, hail, those covered by extended or all risk coverage
insurance and such others as may reasonably be required by the Agent.  The
Borrower shall cause to be delivered to the Agent the proper certificates
evidencing the same. All such policies covering the Borrower’s and the other
Loan Parties’ assets shall provide, in manner satisfactory to the Agent, that
any amounts in excess of $500,000 payable under such policies shall be payable
first to the Agent (for the ratable benefit of the Lenders), as the Agent’s
interest may appear.  Each such policy covering the Borrower’s or any of the
other Loan Parties’ assets shall include a provision for thirty (30) days’ prior
written notice to the Agent of any cancellation or expiration thereof and show
the Agent as lender loss payee as provided in a form of loss payable endorsement
in form and substance satisfactory to the Agent.  In the event of any loss
covered by any such policy covering the Borrower’s or any of the other Loan
Parties’ assets, the Borrower or such Loan Party, as applicable, shall direct
the carrier named in such policy to make payment for such loss to the Agent for
application to the Liabilities and not to the Borrower or such Loan Party, as
applicable, or to the Borrower or such Loan Party, as applicable, and the Agent
jointly.  The Borrower and each of and the other Loan Parties irrevocably makes,
constitutes and appoints the Agent (and all officers, employees or agents
designated by the Agent) as the Borrower’s and such Loan Party’s true and lawful
attorney and agent-in-fact for the purpose of making, settling or adjusting
claims under such policies of insurance after the occurrence of a Matured
Default.  If payment as a result of any insurance losses under such policies of
insurance covering the Borrower’s or any of the Loan Parties’ assets shall be
paid by check, draft or other instrument payable to the Borrower or any of the
other Loan Parties, or to the Borrower or any of the other Loan Parties, as
applicable, and the Agent jointly, the Agent (for the ratable benefit of the
Lenders) may endorse the Borrower’s or such Loan Party’s name on such check,
draft or other instrument, and may do such other things as the Agent may deem
advisable to reduce the same to cash.  Subject to Section 4.4(b)(i), all loss
recoveries received by the Agent on account of any such insurance on the
Collateral up to $2,500,000 may be reinvested by the Borrower in the
Collateral.  All loss recoveries received by the Agent on account of any such
insurance on the Collateral in excess of $2,500,000 may be applied and credited
by the Agent to the Liabilities, to the extent that there are at the time
Liabilities outstanding, or subject to Section 4.4(b)(i), reinvested by the
Borrower in the Collateral in the discretion of the Agent.  The Borrower and

 

57

--------------------------------------------------------------------------------

 

each of it’s the other Loan Parties hereby assigns all of the Borrower’s and
such Loan Party’s insurance coverage proceeds to the Agent (for the ratable
benefit of the Lenders) as additional collateral security for the Liabilities. 
To the extent actually received by the Agent in immediately available funds, the
Agent shall pay any surplus of insurance proceeds from such insurance policies
in excess of the Liabilities to the Borrower.  If the Borrower or any of its
Subsidiaries fails to procure insurance as provided in this Agreement, or to
keep the same in force, or fails to perform any of its other obligations
hereunder, then the Agent may, at the Agent’s option, and without obligation to
do so, obtain such insurance and pay the premium thereon for the account of the
Borrower or any of its Subsidiaries, or make whatever other payments the Agent
may deem appropriate to protect the Agent’s security for the Liabilities.  Any
such payments shall be additional Liabilities of the Borrower, each payable on
demand and secured by the Collateral.  Upon the Agent’s written request, copies
of the policies of insurance referred to in this Section 9.5 and in Section 9.4,
together with all amendments and schedules thereto, shall be provided to the
Agent by the Borrower. The Borrower’s and each of its Subsidiaries’ insurance
policies are summarized on Exhibit 9B.

 

6.             [Intentionally Omitted].

 

7.             Pension Plans.

 

The Borrower and each of its Subsidiaries each shall:  (a) keep in full force
and effect any and all Plans which are presently in existence or may, from time
to time, come into existence under ERISA, unless such Plans can be terminated
without material liability to the Borrower in connection with such termination
(as distinguished from any continuing funding obligation); (b) make
contributions to all Plans in a timely manner and in an amount sufficient to
comply with the requirements of ERISA; (c) comply with all requirements of ERISA
which relate to such Plans; and (d) notify the Agent immediately upon the
Borrower’s or any of its Subsidiaries’ receipt of any notice of the institution
of any proceeding or other action which may result in the termination of any
Plan.  Notwithstanding the requirements of this Section 9.7, neither the
Borrower’s nor any of its Subsidiaries’ failure to comply with any of said
requirements shall constitute a Default or a Matured Default under this
Agreement, unless such failure could result in the imposition on the Borrower or
such Subsidiary of a liability in excess of $1,000,000 on a consolidated basis
for the Borrower and its Subsidiaries.

 

8.             Notice of Suit, Adverse Change, ERISA Event or Default.

 

The Borrower and each of its Subsidiaries shall, as soon as possible, and in any
event within ten (10) Business Days after either the Borrower or such Subsidiary
learns of the following, give written notice to the Agent of (a) any proceeding
being instituted or threatened to be instituted by or against the Borrower or
any of its Subsidiaries in any federal, state, local or foreign court or before
any commission or other regulatory body (federal, state, local or foreign) for
which claimed damages exceed $2,000,000, (b) any material adverse change in the
business, assets or condition, financial or otherwise, of the Borrower and its
Subsidiaries, taken as a whole, (c) any ERISA Event and (d) the occurrence of
any Default or Matured Default.  Within three (3) Business Days after the
Agent’s receipt of such written notice, the Agent shall forward such notice to
the Lenders.

 

58

--------------------------------------------------------------------------------

 

9.             [Intentionally Omitted].

 

10.          Books and Records; Separate Existence.

 

The Borrower and each of its Subsidiaries shall maintain proper books of record
and account in accordance with GAAP consistently applied in which true, full and
correct entries will be made of all of their respective dealings and business
affairs.

 

11.          Laws and Obligations.

 

The Borrower and each of its Subsidiaries shall comply with all Governmental
Requirements in all material respects; and pay all taxes, assessments,
governmental charges, claims for labor, supplies and rent, including without
limitation, taxes, assessments, governmental charges, claims for labor, supplies
and rent imposed upon or against or with respect to the ownership, use,
occupancy or enjoyment of any real property owned by the Borrower or any of its
Subsidiaries, or any utility service thereon; provided, however, that the
Borrower and its Subsidiaries shall not be required to pay any ad valorem or
other real property taxes or any other taxes, assessments, governmental charges
or claims or charges of amounts claimed to be due in any event, if, in any such
case, the amount, applicability or validity thereof shall currently be contested
in good faith by appropriate proceedings diligently conducted by or on behalf of
the Borrower or any of its Subsidiaries and, if required under GAAP, the
Borrower and each of its Subsidiaries shall have set up adequate reserves
therefor; and provided further that, with respect to such other taxes,
assessments, governmental charges or claims, no lien is claimed by the United
States or any state or other political subdivision thereof which could have
priority over the liens and security interests granted to the Agent pursuant to
the Security Documents.

 

12.          Environmental Laws.

 

The Borrower and each of its Subsidiaries shall at all times:

 

(a)           use and operate all of its businesses and properties in compliance
in all material respects with all environmental laws; keep all necessary permits
relating to environmental and safety and health matters in effect and remain in
compliance in all material respects therewith; handle all hazardous materials in
compliance in all material respects with all applicable environmental laws; and
dispose of all hazardous materials generated by the Borrower or any of its
Subsidiaries or at any property owned or leased by the Borrower or any of its
Subsidiaries at facilities or with carriers that maintain valid permits for such
disposal or transportation under applicable environmental laws, except to the
extent that failure to so comply shall not have a material adverse effect on the
financial condition, results of operations or business of the Borrower and its
Subsidiaries, taken as a whole;

 

(b)           promptly notify the Agent (and provide copies upon receipt) of all
material claims, complaints, notices or inquiries relating to the environmental
condition of its facilities and properties or its compliance with environmental
laws; and

 

59

--------------------------------------------------------------------------------

 

(c)           provide such other information and certifications which the Agent
may reasonably request from time to time to evidence compliance with this
Section 9.12.

 

13.          Trade Accounts Payable and Producer Payables.

 

The Borrower and each of its Subsidiaries shall pay, within two (2) Business
Days after the Borrower’s or such Subsidiary’s purchase of the related
Inventory, all cattle Producer Payables other than (a) those not yet due for
livestock priced on a grade and yield matrix, and (b) those which are not yet
due and have deferred payment terms.  The Borrower and each of its Subsidiaries
shall pay, within five (5) Business Days after the Borrower’s or any of its
Subsidiaries’ purchase of the related Inventory, all grain Producer Payables. 
The Borrower and each of its Subsidiaries may pay Producer Payables by wire
transfer on the date of presentment of checks representing payment of Producer
Payables.  The Borrower and each of its Subsidiaries shall pay all cattle
Producer Payables for livestock priced on a grade and yield matrix and those
which have deferred payment terms, in accordance with the terms governing the
same.  The Borrower and each of its Subsidiaries shall pay all trade accounts
payable other than Producer Payables on a basis not more than forty-five (45)
days past due, except (a) accounts payable contested in good faith or
(b) accounts payable in an aggregate amount not to exceed at any time
outstanding $250,000 and with respect to which no proceeding to enforce
collection has been commenced or, to the knowledge of the Borrower or any of its
Subsidiaries, threatened.  Packers and Stockyard Act claims shall remain: 
(i) unsecured at all times; (ii) secured by LCs; (iii) secured by performance
bonds satisfactory to Agent; or (iv) secured by a trust account or other form of
security permitted by the Packers and Stockyards Act and satisfactory to the
Agent.

 

14.          Compliance with National Security Laws.

 

The Borrower shall (a) ensure, and cause each Subsidiary to ensure, that no
person who owns a controlling interest in or otherwise controls the Borrower or
any Subsidiary is or shall be listed on the Specially Designated Nationals and
Blocked Person List or other similar lists maintained by the Office of Foreign
Assets Control (“OFAC”), the Department of the Treasury, or included in any
Executive Orders, (b) not use or permit the use of the LCs or the proceeds of
the Loans or Swing Line Loans to violate any of the foreign asset control
regulations of OFAC or any enabling statute or Executive Order relating thereto,
and (c) comply, and cause each Subsidiary to comply, with all applicable Bank
Secrecy Act (“BSA”) laws and regulations, as amended.

 

15.          Post Closing Matters.

 

(a)           The Borrower shall use commercially reasonable efforts to deliver
to the Agent on or before July 8, 2010, bailee letters in form and substance
satisfactory to the Agent in respect of each location of Inventory of the Loan
Parties and KC Steak listed on Exhibit 3B(i);

 

(b)           On or before the date that is 120 days after the Restatement Date
(or such later date as the Agent may agree in its sole discretion), NBC shall
have delivered to the Agent, in form and substance acceptable to the Agent, a
Deed of Trust, Assignment of

 

60

--------------------------------------------------------------------------------

 

Rents and Leases, Security Agreement and Fixture Filing and an Assignment of
Leases and Rents together with such other instruments as Agent may require to
create a Lien on the California Property to secure the Liabilities, and such
instruments shall be recorded, at Borrower’s cost, in the Official Records of
Imperial County, California.  Agent shall cause the Intercompany Deed of Trust
to be released upon satisfaction of the foregoing requirement.   In addition, on
or before the date that is 120 days after the Restatement Date (or such later
date as the Agent may agree in its sole discretion), the Borrower shall have
delivered to the Agent, in form and substance acceptable to the Agent, (i) a
mortgagee title insurance policy in the amount of $61,542,000.00 on the
California Property naming Lenders as the insureds; and (ii) an opinion of legal
counsel in the State of California.; and

 

(c)           On or before the date that is 90 days after the Restatement Date
(or such later date as the Agent may agree in its sole discretion), the Borrower
shall have delivered to the Agent, in form and substance acceptable to the
Agent, with respect to the Kansas Mortgage, the Pennsylvania Mortgage and
Georgia Mortgage and the properties covered thereby: (i) mortgagee title
insurance policies, or date down and modification endorsements to existing
policies, as the case may be; and (ii) if and to the extent requested by the
Agent, modifications to the Kansas Mortgage, the Pennsylvania Mortgage and the
Georgia Mortgage to reflect the new Maturity Date, the increase in the
Indebtedness and such other matters with respect to this Agreement as Agent
shall require.  The Borrower shall pay all costs required to comply with this
Section 9.15(c).

 

(d)           On or before the date that is 90 days after the Restatement Date
(or such later date as the Agent may agree in its sole discretion), Borrower
shall have taken action satisfactory to Agent to obtain good and insurable title
to the strip of land between Parcel A-4 and the adjoining real property as shown
on the survey of the Dodge City Facilities dated May 4, 2010 prepared by
Cornerstone Professional Services.

 

(e)           On or before the date that is 10 days after the Restatement Date
(or such later date as the Agent may agree in its sole discretion), the Loan
Parties shall deliver to the Agent the endorsements required by Section 9.5 of
this Agreement in respect of property insurance.

 

(f)            On or before the date that is 30 days after the Restatement Date
(or such later date as the Agent may agree in its sole discretion), the Loan
Parties shall deliver to the Agent each certificate (if any) representing
“Pledged Equity” (as defined in the Security Agreement) that is required to be
delivered under the Security Agreement, together with corresponding stock or
transfer powers executed in blank.

 

16.          Funded Debt to EBITDA Ratio.

 

The Borrower shall have a Funded Debt to EBITDA Ratio of not more than 3.25 to
1.00 as at the end of each fiscal quarter.

 

61

--------------------------------------------------------------------------------

 

17.          Adjusted Net Worth

 

The Borrower and its consolidated Subsidiaries shall have Adjusted Net Worth of
not less than $275,000,000 as at the end of each Fiscal Year.

 

18.          Fixed Charge Coverage Ratio.

 

The Borrower shall have a Fixed Charge Coverage Ratio of at least 1.05 to 1.00
as at the end of each fiscal quarter.

 

19.          Additional Collateral.

 

(a)           Upon the formation or acquisition of any new direct or indirect
Subsidiary by the Borrower (other than a Foreign Subsidiary or Non-Material
Domestic Subsidiary), the Borrower shall, at the Borrower’s expense, within
sixty (60) days after such formation or acquisition or such longer period as the
Agent may agree in its sole discretion, cause each such Subsidiary to execute
and deliver to the Agent a joinder to this Agreement, the Security Agreement and
the Guaranty Agreement in form and substance reasonably satisfactory to the
Agent; provided, further, that, if at any time a Non-Material Domestic
Subsidiary shall, together with its consolidated Subsidiaries, have assets, as
of the last day of the Borrower’s most recently ended fiscal quarter, with a
book value of 5% or more of the total assets of the Borrower and its
Subsidiaries on a consolidated basis on such date, then the Borrower shall cause
such Non-Material Domestic Subsidiary to execute and deliver to the Agent a
joinder to this Agreement, the Security Agreement and the Guaranty Agreement in
form and substance reasonably satisfactory to the Agent; provided, further,
that, if at any time the aggregate book value of the assets of the Domestic
Subsidiaries which have not become Subsidiary Loan Parties in accordance with
this Section 9.19, together with the assets of their respective consolidated
Subsidiaries, shall equal or exceed 10% of the total book value of the assets of
the Borrower and its Subsidiaries on a consolidated basis, then the Borrower
shall cause one or more additional Domestic Subsidiaries to become Subsidiary
Loan Parties in accordance with this Section 9.19; provided, further, that, if
at any time the aggregate EBITDA of a Domestic Subsidiary which has not become a
Subsidiary Loan Party in accordance with this Section 9.19, together with its
consolidated Subsidiaries, shall be greater than or equal to $20,000,000, then
the Borrower shall cause such Domestic Subsidiary to become Subsidiary Loan
Parties in accordance with this Section 9.19; provided, further, that,
notwithstanding anything else to the contrary contained in this clause (a), in
no event shall National Beef Leathers, LLC be or become a Subsidiary Loan Party,
except upon consent of the Agent.

 

(b)           The Borrower shall cause, and shall cause each other Subsidiary
Loan Party to cause, all of its respective property to be subject at all times
to first priority perfected Liens in favor of or for the benefit of the Agent on
behalf of itself and the other secured parties, subject in each case to Liens
permitted by Section 10.1, in accordance with the terms of the Security
Agreement.  Without limiting the foregoing, subject to the terms of the Security
Documents, the Borrower will, and will cause each Subsidiary Loan Party to,
execute and deliver, or cause to be executed and delivered,

 

62

--------------------------------------------------------------------------------

 

such documents, agreements or instruments and will take or cause to be taken
such further actions (including the filing and recording of financing
statements, fixture filings, mortgages, deeds of trust and other documents)
which may be required by law or which the Agent may, from time to time,
reasonably request to carry out the terms and conditions of this Agreement and
the other Financing Documents and to ensure perfection and priority of the Liens
created or intended to be created by the Security Documents, all at the expense
of the Borrower.

 

(c)           If, in compliance with the terms and provisions of the Financing
Documents, the Borrower or any Subsidiary (i) sells or otherwise transfers
equity interests of any Subsidiary Loan Party to a Person which is not the
Borrower or a Subsidiary and after giving effect to such sale or transfer the
Borrower and its Subsidiaries cease to own any of the equity interests of such
Subsidiary Loan Party, (ii) liquidates or dissolves any Subsidiary Loan Party or
(iii) subject to compliance with clause (a) above, any Subsidiary Loan Party
shall be or become a Non-Material Domestic Subsidiary, in each case, the Agent
will, on behalf of the Lenders, execute and deliver to the Borrower a release of
such Subsidiary Loan Party from its obligations under this Agreement and the
other Financing Documents.

 

ARTICLE X
NEGATIVE COVENANTS

 

The Borrower and each other Loan Party covenants and agrees that from the date
of execution hereof until the Liabilities are paid in full, and the Commitments,
all LCs and all other obligations of the Agent, the Issuers, the Swing Line
Lender and the Lenders hereunder are finally terminated, the Borrower will
comply (and will cause each of its Subsidiaries to comply) with the following
provisions of this Article 10:

 

1.             Encumbrances.

 

Except for those Liens presently in existence and reflected in either the
Borrower’s or its Subsidiaries’ financial statements referred to in Section 7.16
or security interests granted in the Security Documents or in the Intercompany
Financing Documents, none of the Borrower nor any of its Subsidiaries shall
create, incur, assume or suffer to exist any Lien of any nature whatsoever on or
with regard to any of its assets (including, without limitation, the Collateral)
other than:  (a) Liens securing the payment of taxes, either not yet due or the
validity of which is being contested in good faith by appropriate proceedings,
and as to which the Borrower or its Subsidiaries (as the case may be) shall, if
appropriate under GAAP, have set aside on its books and records adequate
reserves; (b) Liens securing deposits under workers’ compensation, unemployment
insurance, social security and other similar laws, or securing the performance
of bids, tenders, contracts (other than for the repayment of borrowed money) or
leases, or securing indemnity, performance or other similar bonds for the
performance of bids, tenders, contracts (other than for the repayment of
borrowed money) or leases, or securing statutory obligations or surety or appeal
bonds, or securing indemnity, performance or other similar bonds in the ordinary
course of the Borrower’s or its Subsidiaries’ business (as the case may be);
(c) Liens granted under the Bond Documents and Liens in favor of the Agent
securing the Liabilities; (d) zoning restrictions, easements, licenses,
covenants and other restrictions affecting the use of the Borrower’s or any

 

63

--------------------------------------------------------------------------------

 

of its Subsidiaries’ real property, and other Liens on property which are
subordinate to the Liens of the Agent securing the Liabilities and which do not,
in the determination of the Required Lenders (i) materially impair the use of
such property or (ii) materially lessen the value of such property for the
purposes for which the same is held by the Borrower or any of its Subsidiaries;
(e) purchase money security interests and capitalized leases securing
indebtedness permitted to be incurred under Section 10.4(d); (f) in the case of
the Borrower, Liens securing the interests of any broker in any Margin Account;
(g) in the case of the Borrower, Liens securing indebtedness permitted to be
incurred under Section 10.4(f); and (h) Liens permitted under Section 7.29.

 

2.             Consolidations, Mergers or Acquisitions.

 

None of the Borrower nor any of its Subsidiaries shall recapitalize or
consolidate with, merge with, or otherwise acquire all or substantially all of
the assets or properties of any other Person; provided, however, that (a) any
Subsidiary of the Borrower shall be permitted to consolidate or merge with
(i) the Borrower, provided that the Borrower shall be the continuing or
surviving Person or (ii) any one or more other Subsidiaries of the Borrower,
provided, that, in the event of a consolidation or merger with a Loan Party, the
Loan Party shall be the continuing or surviving Person, and (b) the Borrower may
make acquisitions, so long as no Default or Matured Default is then continuing
or would occur as a result of such transaction, the Funded Debt to EBITDA Ratio
on a pro forma basis after giving effect to such acquisition (based on
assumptions and projections acceptable to the Agent) shall not exceed 2.50 to
1.00 and the Borrower shall otherwise be in pro forma compliance (based on
assumptions and projections acceptable to the Agent) with the financial
covenants set forth in Sections 9.16 and 9.18.

 

3.             Deposits, Investments, Advances or Loans.

 

None of the Borrower nor any of its Subsidiaries shall make or permit to exist
deposits, investments, advances or loans (other than those existing on the date
of the execution of this Agreement and disclosed to the Lenders in writing on or
prior to such date) in or to Affiliates or any other Person, except: (a) the
Collateral Accounts; (b) deposits under workers’ compensation, unemployment
insurance, social security and other similar laws, or securing the performance
of bids, tenders, contracts (other than for the repayment of borrowed money) or
leases, or securing indemnity, performance or other similar bonds for the
performance of bids, tenders, contracts (other than for the repayment of
borrowed money) or leases, or securing statutory obligations or surety or appeal
bonds, or securing indemnity, performance or other similar bonds in the ordinary
course of the Borrower’s or its Subsidiaries’ business (as the case may be);
(c) in the case of the Borrower, loans not exceeding $2,000,000 in the aggregate
at any one time outstanding; (d) demand deposits (other than payroll accounts
and the Collateral Accounts) not to exceed $250,000 in the aggregate for the
Borrower and its Subsidiaries combined; (e) in the case of the Borrower, margin
deposits required to be made in connection with any Margin Account; (f) in the
case of the Borrower, deposits permitted by Section 10.19 of this Agreement;
(g) in the case of the Borrower, margin deposits required to be made in
connection with the Borrower’s obligations under any Swap Contracts with any
Lender or any Affiliates of a Lender; (h) deposits in trust accounts required
under the Packers and Stockyards Act; (i) in the case of the Borrower, loans to
KC Steak pursuant to the Intercompany Financing Documents not to exceed
$20,000,000 in amount outstanding; (j) investments, advances or loans by a Loan
Party to another Loan Party; (k) Cash Equivalent Investments in which the Agent
has a perfected first

 

64

--------------------------------------------------------------------------------

 

priority security interest, including those credited to any deposit account or
securities account (as the case may be) at CoBank; (l) in the case of the
Borrower, investments in the purchase of Bonds; (m) in the case of the Borrower,
loans to or investments in aLF Ventures, LLC or other investments related to the
development of lactoferrin, in each case, occurring prior to the date hereof not
to exceed $8,000,000 in the aggregate at any one time outstanding;
(n) investments permitted under Section 10.2; (o) in the case of the Borrower,
investments permitted under Section 7.29; (p) in the case of the Borrower and
each of its Subsidiaries, advances for travel and expenses to the officers or
managers or employees of the Borrower and its Subsidiaries paid in the ordinary
course of business; (q) in the case of the Borrower, investments in National
Beef Leathers, LLC from and after the Restatement Date in an aggregate amount
not to exceed $50,000,000 for the purpose of making capital improvements,
provided that such investments shall be in a form and subject to documentation
reasonably acceptable to the Agent and all investments in an aggregate amount in
excess of $20,000,000 shall be in the form of a secured intercompany loans which
shall be collateral assigned to the Agent; (r) in the case of the Borrower,
other investments not to exceed $5,000,000 in the aggregate; and (s) at any time
from and after the consummation of a Permitted IPO, in the case of the Borrower,
loans to NB, Inc. in an aggregate amount not to exceed $5,000,000; provided that
such loans shall be unsecured and otherwise on terms and conditions reasonably
satisfactory to the Agent.  The Borrower shall not permit to exist any other
Deposit Accounts for the receipt of Collateral proceeds of any type whatsoever,
except the Collateral Accounts.

 

4.             Indebtedness.

 

Except for those obligations and that Indebtedness presently in existence
referred to in Section 7.6, none or the Borrower nor any of its Subsidiaries
shall incur, create, assume, become or be liable in any manner with respect to,
or permit to exist, any obligations or Indebtedness, direct or indirect, fixed
or contingent, except: (a) the Liabilities and, in the case of its Subsidiaries,
the Indebtedness outstanding under the Intercompany Financing Documents;
(b) obligations secured by liens or security interests permitted under
Section 10.1 or contingent obligations permitted under Section 10.5; (c) trade
obligations, Producer Payables and normal accruals in the ordinary course of the
Borrower’s or its Subsidiaries’ business (as the case may be) not yet due and
payable, or with respect to which the Borrower or its Subsidiaries (as
applicable) is contesting in good faith the amount or validity thereof by
appropriate proceedings, and then only to the extent that the Borrower or any of
its Subsidiaries (as applicable) has set aside on its books adequate reserves
therefor, if appropriate under GAAP; (d) other indebtedness secured by Liens
permitted under clause (e) of Section 10.1, not exceeding $30,000,000 in the
aggregate (on a combined basis for the Borrower and its Subsidiaries) at any one
time outstanding; (e) other unsecured Indebtedness not exceeding $10,000,000 in
the aggregate (on a combined basis for the Borrower and its Subsidiaries) at any
one time outstanding; (f)  in the case of the Borrower, the Bonds; (g) in the
case of the Borrower, the Borrower’s Class A or B Units subject to redemption
rights to the extent classified as debt and obligations arising from the
exercise of those redemption rights; and (h) in the case of the Borrower, Swap
Contracts with any Lender or any of its Affiliates.

 

65

--------------------------------------------------------------------------------

 

5.             Guarantees and Other Contingent Obligations.

 

None of the Borrower nor any of its Subsidiaries shall incur any Guaranty
Obligations, except:  (a) for endorsements of negotiable Instruments for
collection in the ordinary course of business; and (b) in the case of the
Borrower, guaranties of the Indebtedness (including capitalized leases) or
operating lease obligations of Domestic Subsidiaries of the Borrower to the
extent permitted under Section 10.4 or 10.12, respectively; provided, however,
that the amount payable under such guaranties shall (i) in the case of
guaranteed Indebtedness (including capitalized lease obligations) be deemed to
be “Funded Debt” for purposes of Section 9.18 of this Agreement, and (2) in the
case of guaranteed operating lease obligations, the annual amount payable shall
be included in the computation of the Borrower’s annual financial obligations
for purposes of Section 10.12 of this Agreement.

 

6.             Disposition of Property.

 

None of the Borrower nor any of its Subsidiaries shall sell, lease, transfer or
otherwise dispose of any of its properties, assets or rights, to any Person,
except (a) sales or other dispositions of Inventory or obsolete Equipment in the
ordinary course of the Borrower’s or its Subsidiaries’ business (as applicable),
(b) as permitted in the Security Agreement and (c) sales, transfers,
dispositions of assets other than as set forth above of up to $5,000,000 (on a
combined basis for the Borrower and its Subsidiaries) during any single Fiscal
Year. The Agent hereby covenants that upon the sale or disposition of any asset
permitted hereunder it shall release its Lien on such asset.

 

7.             Change in Nature of Business.

 

None of the Borrower nor any of its Subsidiaries shall engage in any material
line of business substantially different from those lines of business conducted
by the Borrower and its Subsidiaries on the Closing Date or any business
reasonably related or ancillary thereto..

 

8.             ERISA Matters.

 

None of the Borrower nor any of its Subsidiaries shall at any time engage in a
transaction which could be subject to Section 4069 or 4212(c) of ERISA, or
permit any Plan to (a) engage in any non-exempt “prohibited transaction” (as
defined in Section 4975 of the IRC); (b) fail to comply with ERISA or any other
applicable laws; or (c) incur any material “accumulated funding deficiency” (as
defined in Section 302 of ERISA), which, with respect to each event listed
above, could be reasonably expected to have a material adverse effect on the
Borrower’s consolidated business, assets, operations, financial condition or
prospects.

 

9.             [Intentionally Omitted].

 

10.          Equity Distributions.

 

None of the Borrower nor any of its Subsidiaries shall directly or indirectly,
make any Equity Distributions, except that (a) the Borrower may make quarterly
distributions to its Members in respect of Borrower’s taxable income, in amounts
proportionate to the respective percentage interests of each of such Member so
that each such Member shall have received an

 

66

--------------------------------------------------------------------------------

 

amount equal to 48% of such Member’s share of the Borrower’s net taxable income
for the relevant quarter (subject to any increase in accordance with the terms
of the Borrower’s Amended and Restated Limited Liability Company Agreement) (the
“Permitted Taxable Distribution Amount”), provided that if the aggregate
distribution made during any calendar year exceeds the Permitted Taxable
Distribution Amount, then the excess distribution for such tax year shall be
applied to the permitted distributions for the immediately subsequent quarters,
Dollar-for-Dollar, until all such excess has been applied to future permitted
distributions,  b) the Borrower may make distributions to pay an annual 5%
return on its Class A Units, so long as no Default or Matured Default has
occurred and is continuing or would be caused thereby, (c) the Borrower may
(i) make distributions to pay up to an annual 7% return on the Specified
Class A-1 Units, so long as no Default or Matured Default has occurred and is
continuing or would be caused thereby, or (ii) if the conditions in clause
(i) are not satisfied, issue payment in kind notes in lieu thereof in an amount
equal to an annual 7% return on the Specified Class A-1 Units, (d) the Borrower
may make distributions in respect of its outstanding equity interests in an
amount not to exceed $150,000,000 in the aggregate during the period from (and
including) the Restatement Date until the first anniversary of the Restatement
Date (the “$150 Million Basket”), (i) so long as no Default or Matured Default
has occurred and is continuing or would be caused thereby, and (ii) subject to
any concurrent mandatory prepayment required to be made pursuant to
Section 4.4(b)(ii), and (e) the Borrower may make additional Equity
Distributions (the “Additional Equity Distributions”), so long as (i) no Default
or Matured Default has occurred and is continuing or would be caused thereby,
(ii) the Borrower shall be in pro forma compliance (based on assumptions and
projections acceptable to the Agent) with the Fixed Charge Coverage Ratio after
giving effect to such Equity Distribution and (iii) to the extent such
Additional Equity Distributions shall be made with IPO Proceeds, subject to any
concurrent mandatory prepayment required to be made pursuant to
Section 4.4(b)(ii).

 

11.          Amendment of Organizational Documents.

 

Neither the Borrower nor any of its Subsidiaries shall amend any agreement,
instrument or document pertaining to either the Borrower’s or any of its
Subsidiaries’ governance, in any manner that affects either of the Borrower’s or
any of its Subsidiaries’ name or jurisdiction of organization or that otherwise
could reasonably be expected to have a material adverse effect on the rights,
powers or remedies of the Agent and/or the Lenders.

 

12.          Lease Limitations.

 

The Borrower’s and its Subsidiaries’ combined annual financial obligations under
all operating leases and other similar agreements (excluding capitalized leases
and Owner/Operator Agreements shall not exceed $25,000,000 in the aggregate in
any of the Borrower’s Fiscal Years.

 

13.          Use of Other Fictitious Names.

 

None of the Borrower nor any of its Subsidiaries shall use any fictitious name
except for the names referred to in Section 7.7 of this Agreement or as
otherwise may be disclosed at least thirty (30) days in advance in writing to
the Agent.

 

67

--------------------------------------------------------------------------------

 

14.          [Intentionally Omitted.]

 

15.          Fiscal Year.

 

None of the Borrower nor any of its Subsidiaries shall change its Fiscal Year or
any of the fiscal quarters or monthly accounting periods therein.

 

16.          Limitations on Bank Accounts.

 

None of the Borrower nor any of its Subsidiaries shall maintain any cash in any
bank accounts other than those listed on Exhibit 7J or as approved by the Agent
from time to time.

 

17.          Use of Trademarks.

 

None of the Borrower nor any of its Subsidiaries shall use any trademarks with
respect to Inventory except for such trademarks as have been properly licensed
to the Agent.

 

18.          Amendments of Other Documents.

 

None of the Borrower nor any of its Subsidiaries shall without the Agent’s
advance written consent (which shall not be unreasonably withheld) amend, waive
any obligation owed to the Borrower or any of its Subsidiaries under, or grant
any consents under any Bond Document or any Intercompany Financing Document, in
each case, in any way that is reasonably likely to be prejudicial to the
interests of the Agent or the other holders of the Liabilities.

 

19.          Ownership of Cattle and Deposits on Cattle with Feeders.

 

The Borrower and its Subsidiaries together shall not at any time own more than
25,000 head of cattle, whether such cattle are hedged or unhedged.  The Borrower
and its Subsidiaries together shall not at any time own more than 10,000 head of
Unhedged Cattle to be finished in any single month.  In determining the number
of hedged or Unhedged Cattle for purposes of this Section 10.19, any partial
ownership interests of the Borrower or any of its Subsidiaries in cattle shall
be counted at the percentage of interest owned.  As used herein, the phrase
“Unhedged Cattle” shall refer to cattle which are not hedged with either futures
contracts or option contracts at prices that limit the Borrower’s or any of its
Subsidiaries’ combined potential losses to no more than $50 per head.
Notwithstanding the provisions of Section 10.3, the Borrower and its
Subsidiaries shall be allowed to make deposits on cattle with such feeders as
are approved by the Agent, up to $75 per head, not to exceed $2,000,000 (on a
combined basis for the Borrower and its Subsidiaries) at any time outstanding in
the aggregate (the “Feeder Deposits”). The Feeder Deposits may not be treated as
tangible assets of the Borrower or any of its Subsidiaries for the purposes of
determining compliance with the covenants set forth herein without the prior
approval of the Required Lenders.

 

20.          Enforcement of Certain Documents.

 

The Borrower shall not at any time fail to enforce, or fail to cause its
relevant Subsidiaries to enforce, in all material respects, any of the
Intercompany Financing Documents.

 

68

--------------------------------------------------------------------------------

 

ARTICLE XI
DEFAULT REMEDIES

 

1.             Acceleration.

 

With respect to: (a) any Matured Default described in clauses (i), (j), (k) and
(l) of the definition thereof, all of the Liabilities shall automatically become
immediately due and payable, the Borrower shall without demand pay into the
Holding Account an amount equal to the aggregate undrawn amount of all
outstanding LCs, and the obligations of the Lenders to make Loans, the Swing
Line Lender to make Swing Line Loans, and the Issuers to issue or cause the
issuance of LCs and the Commitments shall automatically terminate, without
presentment, demand, protest or further notice (including without limitation,
notice of intent to accelerate and notice of acceleration) of any kind, all of
which are expressly waived by the Borrower, and (b) any other Matured Default,
the Agent may with the consent of the Required Lenders, and shall at the request
of the Required Lenders, by notice to the Borrower and the Lenders, (i) declare
the several obligations of the Lenders to make Loans, the Swing Line Lender to
make Swing Line Loans, and the Issuers and to issue or cause the issuance of LCs
and the Commitments to be terminated, whereupon such obligations and the
Commitments of each Lender shall terminate, and (ii) declare all of the
Liabilities to be due and payable, whereupon the Liabilities shall become and be
due and payable and the Borrower shall be required to pay into the Holding
Account an amount equal to the aggregate undrawn amount of all outstanding LCs,
without presentment, demand, protest or further notice (including without
limitation, notice of intent to accelerate and notice of acceleration) of any
kind, all of which are expressly waived by the Borrower.

 

2.             Other Remedies.

 

Upon the occurrence and during the continuance of any Matured Default, the Agent
may with the consent of the Required Lenders (subject to the provisions of the
other Financing Documents), and shall at the direction of the Required Lenders,
proceed:  (a) to protect and enforce the rights of the Lenders by suit in
equity, by action at law or both, whether for the specific performance of any
covenant or agreement contained in this Agreement or in any other Financing
Document or in aid of the exercise of any power granted in this Agreement or any
other Financing Document, (b) to enforce the payment of the Liabilities, or
(c) to foreclose upon any Liens granted pursuant to the Security Documents and
other Financing Documents in the manner set forth therein; it being intended
that no remedy conferred herein or in any of the other Financing Documents is to
be exclusive of any other remedy, and each and every remedy contained herein or
in any other Financing Document shall be cumulative and shall be in addition to
every other remedy given hereunder and under the other Financing Documents, or
at any time existing at law or in equity or by statute or otherwise.

 

3.             Right to Cure.

 

If a Matured Default occurs as a result of non-compliance with one or more of
the financial covenants set forth in Sections 9.16 and 9.18 with respect to any
fiscal quarter, the Borrower may engage in an Equity Cure Issuance and apply the
amount of the Equity Cure Proceeds as an addition to EBITDA (with the amount so
applied to be treated for purposes of

 

69

--------------------------------------------------------------------------------

 

Sections 9.16 and/or 9.18, as applicable, as if such application had been made
on the last day of the respective fiscal quarter for which there has been a
non-compliance); provided, that (a) such Equity Cure Proceeds are actually
received by the Borrower and applied to EBITDA no later than the tenth (10th)
day following the earlier of (i) the date of delivery of the financial
statements with respect to such fiscal period or (ii) the date on which the
financial statements are required to be delivered under Section 9.1 (without
regard to any cure periods applicable thereto) with respect to such fiscal
period, (b) in each four (4) fiscal quarter period, there shall be a period of
three (3) fiscal quarters in which no Equity Cure Issuance is made, (c) only two
Equity Cure Issuances may be made during the term of this Agreement, and
(d) this Section 11.3 shall not be relied on for purposes of calculating any
financial ratios other those set forth in Sections 9.16 and 9.18 and the Equity
Cure Issuance shall be disregarded for all other purposes, including, without
limitation, determination of the Applicable Margin and for purposes of
determining availability of any baskets with respect to the covenants contained
in this Agreement.  The Agent and the Lenders agree that from the date of
delivery by the Borrower of notice of its intent to exercise its equity cure
rights under this Section 11.3 (but only if such notice is provided on or before
the financial statements are required to be delivered under Section 9.1 (without
regard to any cure periods applicable thereto) with respect to such fiscal
quarter) until the date that is ten (10) days following the earlier of (i) the
date of delivery of the financial statements with respect to such fiscal period
or (ii) the date on which the financial statements are required to be delivered
under Section 9.1 (without regard to any cure periods applicable thereto) with
respect to such fiscal quarter, neither the Agent nor any Lender shall exercise
any rights or remedies with respect to any Matured Default addressed in such
notice.

 

ARTICLE XII
THE AGENT

 

1.             Authorization and Action.

 

Each Lender and each Issuer appoints the Agent as its Agent under, and
irrevocably authorizes the Agent (subject to Section 12.7) to take such action
on its behalf and to exercise such powers under any Financing Document and under
any Bond Documents as are delegated to the Agent by the terms thereof, together
with such powers as are reasonably incidental thereto. Without limitation of the
foregoing, each Lender and each Issuer expressly authorizes the Agent to
execute, deliver, and perform its obligations under each of the Financing
Documents to which the Agent is a party, and to exercise all rights, powers, and
remedies that the Agent may have thereunder. As to any matters not expressly
provided for by this Agreement (including without limitation, enforcement or
collection of the Liabilities), the Agent shall not be required to exercise any
discretion or take any action, but shall be required to act, or to refrain from
acting (and shall be fully protected in so acting or refraining from acting),
upon the instructions of the Required Lenders (or such other groups of Lenders,
the relevant Issuer and/or the Swing Line Lender as may be required pursuant to
a particular provision of this Agreement or another Financing Document), and
such instructions shall be binding upon all the Lenders, the Issuers, the Swing
Line Lender and all holders of and participants in any Note; provided, however,
that the Agent shall not be required to take any action which exposes the Agent
to personal liability or which is contrary to this Agreement or applicable law. 
Without limiting the generality of the power and authority vested in the Agent
pursuant to this Section 12.1, the power and authority vested in the Agent
includes, but is not limited to, the following:

 

70

--------------------------------------------------------------------------------

 

(a)           To solicit the advice and assistance of each of the Lenders and
Farm Credit System Voting Participants concerning the administration of the
Loans and the exercise by the Agent of its various rights, remedies, powers, and
discretions with respect thereto;

 

(b)           To execute, seal, acknowledge, and deliver as the Agent, all such
instruments as may be appropriate in connection with the administration of the
Loans and the exercise by the Agent of its various rights with respect thereto;

 

(c)           To initiate, prosecute, defend, and to participate in, actions and
proceedings in its name as the Agent for the ratable benefit of the Lenders;

 

(d)           To retain attorneys, accountants, and other professionals to
provide advice and professional services to the Agent, with their fees and
expenses reimbursable in accordance with the terms hereof; and

 

(e)           To exercise powers reasonably incident to the Agent’s discharge of
its duties enumerated in Section 12.1 hereof.

 

2.             Agent’s Reliance, Etc.

 

Neither the Agent nor any of its directors, officers, agents or employees shall
be liable to any Lender or Issuer for any action taken or omitted to be taken by
it or them under or in connection with any Financing Document or Bond Document,
except for its or their own gross negligence or willful misconduct. Without
limiting the generality of the foregoing, the Agent:  (a) may treat the original
or any successor holder of any Note as the holder thereof until it receives
notice from the Lender which is the payee of such Note concerning the assignment
of such Note; (b) may employ and consult with legal counsel (including counsel
for either the Borrower or any of its Subsidiaries), independent public
accountants, and other experts selected by it and shall not be liable to any
Lender for any action taken, or omitted to be taken, in good faith by it or them
in accordance with the advice of such counsel, accountants, or experts received
in such consultations and shall not be liable for any negligence or misconduct
of any such counsel, accountants or other experts; (c) makes no warranty or
representation to any Lender or Issuer and shall not be responsible to any
Lender or Issuer for any opinions, certifications, statements, warranties or
representations made in or in connection with any Financing Document; (d) shall
not have any duty to any Lender or Issuer to ascertain or to inquire as to the
performance or observance of any of the terms, covenants, or conditions of any
Financing Document or any other instrument or document furnished pursuant
thereto or to satisfy itself that all conditions to and requirements for any
credit extension have been met or that the Borrower is entitled to any credit
extension or to inspect the property (including the books and records) of the
Borrower or any of its Subsidiaries; (e) shall not be responsible to any Lender
or Issuer for the due execution, legality, validity, enforceability,
genuineness, sufficiency or value of any item of Collateral or Financing
Document, Bond Document or any other instrument or document furnished pursuant
thereto or hereto, nor for the creation, perfection or priority of any Liens
purported to be created by any Financing Documents; and (f) shall incur no
liability under or in respect of this Agreement by acting upon any notice,
consent, certificate, or

 

71

--------------------------------------------------------------------------------

 

other instrument or writing (which may be by telegram, cable, telex, or
otherwise) believed by it to be genuine and signed or sent by the proper party
or parties.

 

3.             Notices of Defaults.

 

Except as provided in this Section 12.3, the Agent shall not be deemed to have
knowledge of the occurrence of a Default or a Matured Default unless the Agent
has received written notice from a Lender, an Issuer, the Borrower or any of its
Subsidiaries specifying such Default or Matured Default and stating that such
notice is a “Notice of Default”.  Notwithstanding the foregoing, the Agent shall
be deemed to have knowledge of the occurrence of a Default or a Matured
Default:  (a) consisting of the non-payment of principal or interest, on the due
date such principal or interest, (b) on the date the Agent has received a
Compliance Certificate of the Borrower as required by Section 9.1, which
compliance certificate discloses (without review of any financial statements
attached thereto) the existence of any Default or Matured Default, and (c) ten
(10) Business Days after the date the Agent has received a Compliance
Certificate of the Borrower as required by Section 9.1, which compliance
certificate (after review of any financial statements attached thereto) would
disclose the existence of any Default or Matured Default.  In the event that the
Agent obtains such knowledge of the occurrence of a Default or a Matured
Default, the Agent shall within three (3) Business Days thereafter, give prompt
notice thereof to the Lenders and the Issuers.  The Agent shall (subject to
Section 12.1) take such action with respect to such Default as may be directed
by the Required Lenders; provided that, unless and until the Agent shall have
received the directions referred to in Section 12.1, the Agent may (but shall
not be obligated to) take such action, or refrain from taking such action, with
respect to such Default as it shall deem advisable and in the best interest of
the Lenders and the Issuers.

 

4.             The Agent as a Lender, Fiduciary.

 

(a)           With respect to its Commitment, any Loan or Swing Line Loan made
by it, any LC issued by it and any Note issued to it, the Agent shall have the
same rights and powers under this Agreement as any other Lender and may exercise
the same as though it were not the Agent; and the term “Lender” or “Lenders”
shall, unless otherwise expressly indicated, include the Agent in its individual
capacity. The Agent and its affiliates may accept deposits from, lend money to,
act as trustee under indentures of, and generally engage in any kind of business
with, the Borrower, any of its respective Affiliates and any Person who may do
business with or own securities of the Borrower or any such Affiliate, all as if
the Agent were not the Agent and without any duty to account therefor to the
Lenders.

 

(b)           None of the Arranger, any Syndication Agent or Documentation Agent
identified as such in this Agreement shall have any right, power, obligation,
liability, responsibility or duty under this Agreement, except in its capacity,
as applicable, as Agent, a Lender or an Issuer hereunder.  Without limiting the
foregoing, none of the Arranger, any Syndication Agent or Documentation Agent
shall have or be deemed to have a fiduciary relationship with any Lender.

 

72

--------------------------------------------------------------------------------

 

5.             Non Reliance on Agent and Other Lenders.

 

Each Lender and each Issuer agrees that it has, independently and without
reliance on the Agent, any other Issuer, Lender or the Swing Line Lender, and
based on such documents and information as it has deemed appropriate, made its
own credit analysis of the Borrower and its Subsidiaries and its decision to
enter into the transactions contemplated by the Financing Documents and that it
will, independently and without reliance upon the Agent, any other Issuer,
Lender or Swing Line Lender, and based on such documents and information as it
shall deem appropriate at the time, continue to make its own analysis and
decisions in taking or not taking action under any Financing Document. The Agent
shall not be required to keep itself informed as to the performance or
observance by the Borrower, or any of its Subsidiaries, or any other Person of
any Financing Document, Bond Document, Intercompany Financing Document, or to
inspect the properties or books of the Borrower or any of its Subsidiaries. The
Agent assumes no responsibility for the financial condition of the Borrower or
for the performance of the Borrower’s obligations under the Financing
Documents.  Except for notices, reports, and other documents and information
expressly required to be furnished to the Lenders by the Agent hereunder, the
Agent shall not have any duty or responsibility to provide any Lender with any
credit or other information concerning the affairs, financial condition or
business of the Borrower (or any of its Affiliates) which may come into the
possession of the Agent or any of its affiliates.  Notwithstanding the
foregoing, the Agent will, upon the request of any Lender or Issuer, provide to
such Person, at such Person’s expense, copies of any and all written information
provided to the Agent by the Borrower or any of its Subsidiaries (unless
concurrently delivered to such Person by the Borrower or any of its
Subsidiaries).

 

6.             Indemnification of the Agent.

 

Notwithstanding anything to the contrary herein contained, the Agent shall be
fully justified in failing or refusing to take any action unless it shall first
be indemnified to its satisfaction by the Lenders and the Issuers against any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses, and disbursements of any kind or nature
whatsoever which may be imposed on, incurred by or asserted against the Agent in
any way relating to or arising out of its taking or continuing to take any
action. Each Lender agrees to indemnify the Agent (to the extent not reimbursed
by the Borrower), according to such Lender’s Total Percentage, from and against
any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses and disbursements of any kind or nature
whatsoever which may be imposed on, incurred by, or asserted against the Agent
in any way relating to or arising out of any Financing Document, Intercompany
Loan Document or Bond Document or any action taken or omitted by the Agent under
any Financing Document, Intercompany Loan Document or Bond Document (which
indemnity shall survive any termination of this Agreement); provided that no
Lender shall be liable for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses, or disbursements
resulting from the gross negligence or willful misconduct of the Person being
indemnified; provided further, that it is the intention of each Lender to
indemnify the Agent against the consequences of the Agent’s own negligence,
whether such negligence be sole, joint, concurrent, active or passive. Without
limiting the foregoing, each Lender agrees to reimburse the Agent promptly upon
demand for its Total Percentage of any out-of-pocket expenses (including
attorneys’ fees) incurred by the Agent in connection with the preparation,

 

73

--------------------------------------------------------------------------------

 

administration, or enforcement of, or legal advice in respect of rights or
responsibilities under, any Financing Document, Intercompany Loan Document or
Bond Document, to the extent that the Agent is not reimbursed for such expenses
by the Borrower.  If any indemnity in favor of the Agent shall be or become, in
the Agent’s determination, inadequate, the Agent may call for additional
indemnification from the Lenders and/or the Issuers and cease to do the acts
indemnified against hereunder unless such additional indemnity is given.

 

7.             Successor Agent.

 

The Agent may resign at any time as Agent under the Financing Documents by
giving written notice thereof to the Lenders, the Issuers, the Swing Line Lender
and the Borrower and may be removed at any time with or without cause by the
Required Lenders. Upon any such resignation or removal, the Required Lenders
shall have the right to appoint a successor Agent with the prior written consent
of the Borrower, such consent not to be unreasonably withheld (provided that the
Borrower shall have no consent right upon the occurrence and during the
continuance of a Matured Default). If no successor Agent shall have been so
appointed by the Required Lenders or shall have accepted such appointment within
sixty (60) days after the retiring Agent’s giving of notice of resignation or
the Required Lenders’ removal of the Agent, then the retiring Agent may, on
behalf of the Lenders and the Issuers, appoint a successor Agent with the
Borrower’s prior written consent, such consent not to be unreasonably withheld
(provided that the Borrower shall have no consent right upon the occurrence and
during the continuance of a Matured Default), which shall be a bank or other
financial institution having a combined capital and surplus of at least
$500,000,000 or its equivalent. Upon the acceptance of any appointment as Agent
hereunder by a successor Agent, such successor Agent shall be entitled to
receive from the retiring Agent such documents of transfer and assignment as
such successor Agent shall reasonably request and shall thereupon succeed to and
become vested with all the rights, powers, privileges and duties of the retiring
Agent, and the retiring Agent shall be discharged from its duties and
obligations under this Agreement. After the retiring Agent’s resignation or
removal as Agent, the provisions of this Article XII shall inure to its benefit
as to any actions taken or omitted to be taken by it while it was Agent under
this Agreement.

 

8.             Verification of Borrowing Notices.

 

The Agent shall have no duty to verify the authenticity of the signature
appearing on any notice of borrowing, and with respect to any oral request for
an advance, the Agent shall have no duty to verify the identity of any Person
representing himself as one of the natural Persons authorized to make such
request on behalf of the Borrower. Neither the Agent nor any Lender shall incur
any liability to the Borrower in acting upon any telephonic notice referred to
above which the Agent or such Lender believes in good faith to have been given
by a duly authorized Person authorized to borrow on behalf of the Borrower or
for otherwise acting in good faith.

 

9.             Action Upon Instructions of the Lenders.

 

The Agent agrees, upon the written request of the Required Lenders (or such
other groups of Lenders, the Issuers and/or the Swing Line Lender as may be
required pursuant to a particular provision of this Agreement or another
Financing Document), to take any action of the type specified in the Financing
Documents or Bond Document as being within the Agent’s rights,

 

74

--------------------------------------------------------------------------------

 

duties, power or discretion.  The Agent shall in all cases be fully protected in
acting, or in refraining from acting in accordance with written instructions
signed by the Required Lenders, and such instructions and any action taken or
failure to act pursuant thereto shall be binding on all of the Required Lenders,
the Issuers, the Swing Line Lender and on all holders of the Notes.  In the
absence of a request by the Required Lenders, the Agent shall have authority, in
its sole discretion, to take or not to take any action, unless the Financing
Documents specifically require the consent of the Required Lenders, of all of
the Lenders or of other specified Persons.

 

10.          Action Upon Request of the Borrower.

 

If (a) any of the events described in Sections 5.2, 5.3, 5.4 or 5.5 cause the
Borrower to be required to pay to any one of the Lenders other than the Agent,
costs associated with the LIBOR Rate Advances which are materially
disproportionate to such costs required to be paid to the other Lenders (each a
“Non-Proportionate Lender”), or (b) a Lender is a Defaulting Lender, then the
Borrower or the Agent may elect to replace such Non-Proportionate Lender or
Defaulting Lender, as the case may be, as a Lender party to this Agreement in
accordance with and subject to the restrictions contained in, and consents
required by Section 13.23; provided that (a) if such replacement is requested by
the Borrower, the Borrower shall have received the prior written consent of the
Agent, and (b) such Non-Proportionate Lender or Defaulting Lender, as the case
may be, shall have received payment of an amount equal to the outstanding
principal amount of its Loans (including any Swing Line Loans) and
participations in Swing Line Loans and LC Obligations, accrued interest thereon,
accrued fees and all other amounts payable hereunder, from the assignee (to the
extent of such outstanding principal and accrued interest and fees) or the
Borrower (in the case of all other amounts).  Notwithstanding the foregoing,
under no circumstances shall the Lender affected hereby be required to bear any
of the costs or expenses associated with the proposed assignment, all of which
costs and expenses shall be the sole responsibility of the Borrower and the
proposed assignee, and the Lender affected hereby may defer compliance with its
obligations under this Section 12.10 until the Borrower has deposited with such
Lender such amount as such Lender reasonably believes will be sufficient to
reimburse such Lender for such costs and expenses.

 

11.          Additional Functions of Certain Lenders.

 

The Lenders identified in this Agreement as a “Syndication Agent”,
“Documentation Agent”, “Bookrunner” and/or a “Lead Arranger” shall not have any
right, power, obligation, liability, responsibility or duty under this Agreement
other than those applicable to all Lenders as such.

 

ARTICLE XIII
MISCELLANEOUS

 

1.             Timing of Payments.

 

For purposes of determining the outstanding balance of the Liabilities,
including the computations of interest which may from time to time be owing to
the Lenders, the receipt by the Agent of any check or any other item of payment
whether through a blocked account or lockbox or otherwise, shall not be treated
as a payment on account of the Liabilities until such check or

 

75

--------------------------------------------------------------------------------

 

other item of payment is actually received by the Agent at its office in
Greenwood Village, Colorado and is paid to the Agent in cash or a cash
equivalent.

 

2.             Attorneys’ Fees and Costs.

 

If at any time or times hereafter the Agent employs counsel in connection with
protecting or perfecting the Agent’s security interest in the Collateral or in
connection with any matters arising out of this Agreement, whether:  (a) to
commence, defend or intervene in any litigation or to file a petition,
complaint, answer, motion or other pleading; (b) to take any other action in or
with respect to any suit or proceeding (bankruptcy or otherwise); (c) to consult
with officers of the Agent to advise the Agent or to draft documents for the
Agent in connection with any of the foregoing or in connection with any release
of the Agent’s claims or security interests or any proposed extension, amendment
or refinancing of the Liabilities; (d) to protect, collect, lease, sell, take
possession of, or liquidate any of the Collateral; or (e) to attempt to enforce
or to enforce any security interest in any of the Collateral, or to enforce any
rights of the Agent, the Issuers, the Swing Line Lender or the Lenders to
collect any of the Liabilities; then in any of such events, all of the
reasonable attorneys’ fees arising from such services, and any expenses, costs
and charges relating thereto, including without limitation, all fees of all
paralegals, legal assistants and other staff employed by such attorneys whether
outside the Agent or in the Agent’s legal department, together with interest at
the Default Rate provided for in Section 3.1(c) if a Matured Default has
occurred, or at the highest interest rate set forth in any promissory note
referred to herein, shall constitute additional Liabilities, payable on demand
and secured by the Collateral.  In addition, if the Liabilities have been
accelerated in accordance with Section 11.1, and thereafter any Lender employs
counsel (a) in connection with protecting such Lender’s interest in the
Collateral; (b) to commence, defend or intervene in any litigation or to file a
petition, complaint, answer, motion or other pleading; (c) to take any other
action in or with respect to any suit or proceeding (bankruptcy or otherwise);
(d) to protect, collect, lease, sell, take possession of, or liquidate any of
the Collateral; or (e) to attempt to enforce or to enforce any security interest
in any of the Collateral, or to enforce any of such Lender’s rights to collect
any of the Liabilities; then in any of such events, all of the reasonable
attorneys’ fees arising from such services, and any expenses, costs and charges
relating thereto, including without limitation, all fees of all paralegals,
legal assistants and other staff employed by such attorneys whether outside the
Lender or in the Lender’s legal department, together with interest at the
Default Rate provided for in Section 3.1(c), or at the highest interest rate set
forth in any promissory note referred to herein, shall constitute additional
Liabilities, payable on demand and secured by the Collateral.  All of the rights
to reimbursement of expenses set forth in this Section 13.2 that are applicable
to the Agent, shall also be applicable to CoBank and Rabobank in their
respective capacities as an Issuer and/or as the Swing Line Lender.

 

3.             Expenditures by the Agent.

 

In the event that the Borrower shall fail to pay taxes, insurance, assessments,
costs or expenses which the Borrower is, under any of the terms hereof, or of
any of the other Financing Documents or of any of the Bond Documents, required
to pay, or fails to keep its assets free from other security interests, liens or
encumbrances, except as permitted herein, the Agent may, in its sole discretion
and without obligation to do so, make expenditures for any or all of such
purposes, and the amount so expended, together with interest at the Default Rate
provided for in

 

76

--------------------------------------------------------------------------------

 

Section 3.1(c), shall constitute additional Liabilities, payable on demand and
secured by the Collateral.

 

4.             The Agent’s Costs as Additional Liabilities.

 

The Borrower shall reimburse the Agent for all expenses and fees paid or
incurred in connection with the documentation, negotiation and closing of the
loans and other financial accommodations described in this Agreement (including
without limitation, filing and recording fees, and the fees, Synd-Trak fees (up
to $6,000) and expenses of the Agent’s attorneys, paralegals and legal
assistants, whether outside the Agent or in its legal department, and whether
such expenses and fees are incurred prior to or after the Closing Date).  The
Borrower further agrees to reimburse the Agent for all expenses and fees paid or
incurred in connection with the documentation of any renewal or extension of the
loans, any additional financial accommodations, or any other amendments to this
Agreement.  All costs and expenses incurred by the Agent with respect to such
negotiation and documentation together with interest at the highest interest
rate set forth in any promissory note referred to herein, shall constitute
additional Liabilities, payable on demand and secured by the Collateral. All of
the rights to reimbursement of expenses set forth in this Section 13.4 that are
applicable to the Agent, shall also be applicable to CoBank and Rabobank in
their respective capacities as an Issuer and/or as the Swing Line Lender.

 

5.             Indemnification.

 

(a)           The Borrower agrees to indemnify and hold the Agent, each Issuer,
the Swing Line Lender and the Lenders and each of their respective officers,
directors, employees and agents harmless from and against any and all claims,
demands, liabilities, losses, damages, penalties, costs, and expenses (including
without limitation, reasonable attorneys’ fees) relating to or in any way
arising out of the possession, use, operation or control of any of the
Borrower’s assets (irrespective of whether such party is a party to the action
for which indemnification hereunder is sought).  The Borrower shall pay or cause
to be paid all license fees, bonding premiums and related taxes and charges, and
shall pay or cause to be paid all of the Borrower’s real and personal property
taxes, assessments and charges and all of the Borrower’s franchise, income,
unemployment, use, excise, old age benefit, withholding, sales and other taxes
and other governmental charges assessed against the Borrower, or payable by the
Borrower, at such times and in such manner as to prevent any penalty from
accruing or any lien or charge from attaching to the Borrower’s property,
provided that the Borrower shall have the right to contest in good faith, by an
appropriate proceeding promptly initiated and diligently conducted, the
validity, amount or imposition of any such tax, and upon such good faith contest
to delay or refuse payment thereof, if (i) the Borrower establishes adequate
reserves to cover such contested taxes; and (ii) such contest does not and will
not have a material adverse effect on the Borrower’s consolidated financial
condition of the Borrower, the Borrower’s ability to pay any of the Liabilities
or the priority or value of the Agent’s security interests in the Collateral.

 

(b)           The Borrower further agrees to defend, protect, indemnify and hold
harmless the Agent, each Issuer, the Swing Line Lender, the Lenders, their
respective

 

77

--------------------------------------------------------------------------------

 

Affiliates and the respective directors, officers, employees, attorneys and
agents of each of such Persons (each of the foregoing being an “Indemnitee” and
all of the foregoing being collectively the “Indemnitees”) from and against any
and all claims, actions, damages, liabilities, judgments, costs and expenses,
including all reasonable fees and disbursements of counsel which may be incurred
in the investigation or defense of any matter (collectively the “Indemnified
Amounts”) imposed upon, incurred by or asserted against any Indemnitee, whether
direct, indirect or consequential and whether based on any federal, state, local
or foreign laws or regulations (including without limitation securities laws,
Environmental Laws, commercial laws and regulations), under common law or on
equitable cause, or on contract or otherwise:

 

(i)            by reason of, relating to or in connection with the execution,
delivery, performance or enforcement of any Financing Document, Bond Document,
Intercompany Financing Document or LC, any commitments relating thereto, or any
transaction contemplated by any Financing Document, Bond Document, Intercompany
Financing Document or LC; or

 

(ii)           by reason of, relating to or in connection with any credit
extended or used under, or transaction financed by, the Financing Documents, the
Bond Documents, the Intercompany Financing Documents or any LC or any act done
or omitted by any Person, or the exercise of any rights or remedies thereunder,
including the acquisition of any Collateral by the Agent by way of foreclosure
of the Lien thereon, deed or bill of sale in lieu of such foreclosure or
otherwise;

 

provided, however, that the Borrower shall not be liable to any Indemnitee for
any portion of such Indemnified Amounts resulting from such Indemnitee’s gross
negligence or willful misconduct.  In the event this indemnity is unenforceable
as a matter of law as to a particular matter or consequence referred to herein,
it shall be enforceable to the full extent permitted by law.  Furthermore, if
and to the extent that any of the foregoing agreements described in this
Section 13.5 may be unenforceable for any reason, the Borrower hereby agrees to
make the maximum contribution to the payment and satisfaction of each of the
Indemnified Amounts that is permissible under applicable law.

 

(c)           The indemnification set forth in this Section 13.5 applies,
without limitation, to any act, omission, event or circumstance existing or
occurring on or prior to the later of the Termination Date or the date of
payment in full of the Liabilities, including specifically Liabilities arising
under clause (a)(ii) of this Section.  The indemnification provisions set forth
above shall be in addition to any liability the Borrower may otherwise have. 
Without prejudice to the survival of any other obligation of the Borrower
hereunder, the indemnities and obligations of the Borrower contained in this
Section shall survive the payment in full of the Liabilities.

 

(d)           Furthermore, as applied to Liabilities arising under Environmental
Laws, the indemnification set forth in this Section 13.5 (i) shall in no way be
waived, released, discharged, reduced, mitigated or otherwise affected by the
Agent’s, any Issuer’s, the Swing Line Lender’s or any Lender’s extension of
credit under the Financing Documents with knowledge of the matters described in
documents listed on Exhibit 7I

 

78

--------------------------------------------------------------------------------

 

or otherwise made known to the Agent or the Agent’s counsel in connection with
this Credit Agreement or the transactions contemplated hereby; and (ii) shall be
deemed continuing for the benefit of any purchaser at a foreclosure or other
sale under any mortgage and any transferee of the title from the Agent, and
shall survive the satisfaction or release of any mortgage, any foreclosure of or
other sale under a mortgage and/or any acquisition of title to a mortgaged
property or any part thereof by the Agent, or anyone claiming by, through or
under the Agent, by deed in lieu of foreclosure or otherwise.  Notwithstanding
the foregoing, this indemnification shall not apply with respect to any loss,
damage, liability, cost or expense related to a mortgaged property which the
Borrower proves was caused solely by or resulted solely from any act or omission
of any Person, other than the Borrower or an agent, employee, invitee or
contractor of the Borrower, which occurred after the Agent or anyone claiming
by, through or under the Agent acquired title to the relevant mortgaged property
(by foreclosure of the relevant mortgage or deed in lieu of foreclosure or
otherwise) and control of such mortgaged property.  So long as the Borrower has
control of any such mortgaged properties, the Borrower agrees that the
Indemnitees shall have no responsibility for, and the Borrower hereby releases
the Indemnitees from responsibility for, damage or injury to human health,
property, the environment or natural resources caused by hazardous substances,
pollutants or contaminants or for abatement, clean-up, detoxification, removal
or disposal of, or otherwise with respect to, hazardous substance, pollutants
and contaminants, provided, however, that the Borrower shall not be liable to
any Indemnitee for any portion of such Liabilities resulting from such
Indemnitee’s gross negligence or willful misconduct.

 

6.             Inspection.

 

The Agent (by and through its officers and employees), or any Person designated
by the Agent in writing, shall have the right, from time to time upon five
(5) Business Days notice if there has not occurred a Matured Default and without
notice after the occurrence of a Matured Default, to call at the Borrower’s
and/or any of its Subsidiaries’ place or places of business (or any other place
where Collateral or any information relating thereto is kept or located) during
reasonable business hours, and without hindrance or delay, to:  (a) inspect,
audit, check and make copies of and extracts from such Person’s books, records,
journals, orders, receipts and any non-privileged correspondence and other data
relating to such Person’s business or to any transactions between the parties to
this Agreement; (b) make such verification concerning the Collateral (or any
collateral underlying the Intercompany Loan Documents) as the Agent may consider
reasonable under the circumstances; and (c) review operating procedures, review
maintenance of property and discuss such Person’s affairs, finances and business
with such Person’s officers, employees or directors.  The Borrower agrees to pay
to the Agent an annual audit fee in accordance with the Agent’s Letter.  The
Agent will, on the request of any Lender, provide to such Lender a copy of any
written report prepared by the Agent in connection with any inspection or audit
made pursuant to this Section 13.6.

 

7.             Examination of Banking Records.

 

The Borrower and its Subsidiaries consents to the examination by the Agent, the
Agent’s officers, employees and agents, or any of them, whether or not there
shall have occurred a

 

79

--------------------------------------------------------------------------------

 

Matured Default, of any and all of the Borrower’s and its Subsidiaries’ banking
records, wherever they may be found, and directs any Person which may be in
control or possession of such records (including, without limitation, any bank,
other financial institution or accountant) to provide such records to the Agent
and the Agent’s officers, employees and agents, upon their request.  The Agent
may conduct such examination with reasonable notice to the Borrower at the
option of the Agent, any such notice being waived by the Borrower and its
Subsidiaries.  Nothing in this Section 13.7 shall be construed to require any
accountant to provide materials to the Agent or the Agent’s officers, employees
and agents, which is subject to a valid privilege.

 

8.             Governmental Reports.

 

The Borrower will furnish to the Agent, upon the reasonable request of the
Agent, copies of the reports of examinations or inspections of the Borrower by
all Governmental Authorities, and if the Borrower fails to furnish such copies
to the Agent, the Borrower authorizes all such Government Authorities to furnish
to the Agent copies of their reports of examinations or inspections of the
Borrower.

 

9.             Reliance by the Agent, the Issuers and the Lenders.

 

All covenants, agreements, representations and warranties made herein by the
Borrower shall, notwithstanding any investigation by the Agent, any Issuer, the
Swing Line Lender or any of the Lenders, be deemed to be material to and to have
been relied upon by the Agent, the Issuers, the Swing Line Lender and the
Lenders.

 

10.          Parties.

 

Whenever in this Agreement there is reference made to any of the parties hereto,
such reference shall be deemed to include, wherever applicable, a reference to
the respective successors and assigns of the Borrower, the Agent, the Swing Line
Lender, the Lenders and the Issuers.

 

11.          Applicable Law; Severability.

 

This Agreement shall be construed in all respects in accordance with, and
governed by, the laws and decisions of the State of Colorado without regard to
the application of conflict of laws principles.  Wherever possible, each
provision of this Agreement shall be interpreted in such manner as to be
effective and valid under applicable law, but if any provision of this Agreement
shall be prohibited by or invalid under applicable law, such provision shall be
ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of such provisions or the remaining provisions of
this Agreement.

 

12.          SUBMISSION TO JURISDICTION; WAIVER OF BOND AND TRIAL BY JURY.

 

THE BORROWER HEREBY CONSENTS TO THE JURISDICTION OF ANY LOCAL, STATE, OR FEDERAL
COURT LOCATED WITHIN THE CITY AND COUNTY OF DENVER, COLORADO AND WAIVES ANY
OBJECTION WHICH THE BORROWER MAY HAVE BASED ON IMPROPER VENUE OR FORUM NON
CONVENIENS TO THE

 

80

--------------------------------------------------------------------------------

 

CONDUCT OF ANY PROCEEDING IN ANY SUCH COURT, WAIVES PERSONAL SERVICE OF ANY AND
ALL PROCESS UPON THE BORROWER. THE BORROWER HEREBY CONSENTS THAT ALL SUCH
SERVICE OF PROCESS BE MADE BY MAIL OR MESSENGER DIRECTED TO THE BORROWER AT THE
ADDRESS SET FORTH IN SECTION 13.18 OF THIS AGREEMENT.  SERVICE SO MADE SHALL BE
DEEMED TO BE COMPLETED UPON THE EARLIER OF ACTUAL RECEIPT OR THREE (3) DAYS
AFTER THE SAME SHALL HAVE BEEN POSTED TO THE BORROWER’S ADDRESS BY THE
BORROWER’S AGENT AS SET FORTH BELOW.  THE BORROWER HEREBY IRREVOCABLY APPOINTS
THE CORPORATION COMPANY, WITH AN OFFICE ADDRESS LOCATED AT 1675 BROADWAY,
DENVER, COLORADO 80202, AS THE BORROWER’S AGENT FOR THE PURPOSE OF ACCEPTING THE
SERVICE OF ANY PROCESS WITHIN THE STATE OF COLORADO.  AT THE OPTION OF THE
AGENT, THE BORROWER WAIVES, TO THE EXTENT PERMITTED BY LAW, TRIAL BY JURY, AND
WAIVES ANY BOND OR SURETY OR SECURITY UPON SUCH BOND WHICH MIGHT, BUT FOR THIS
WAIVER, BE REQUIRED OF THE AGENT.  THE BORROWER ACKNOWLEDGES AND AGREES THAT IT
HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND EACH
OTHER PROVISION OF EACH OTHER FINANCING DOCUMENT TO WHICH IT IS A PARTY) AND
THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE AGENT, EACH ISSUER, THE
SWING LINE LENDER AND THE LENDERS TO ENTER INTO THIS AGREEMENT AND EACH SUCH
OTHER FINANCING DOCUMENT.

 

13.          Application of Payments.

 

(a)           Application of Payments and Collections Prior to a Matured
Default.

 

(i)                                     Subject to subsection (b) below, the
Agent shall distribute all funds it receives in respect of any payments made by
or on behalf of the Borrower on the Notes or the Non-Use Fees among the Lenders,
in like currency and funds as received, ratably according to each Lender’s
respective Line of Credit Loan Commitment or the outstanding principal amount of
each Lender’s respective Term Loan, as the case may be.

 

(ii)                                  Subject to subsection (b) below, the Agent
shall distribute all funds it receives in respect of any payments made by or on
behalf of the Borrower on the Borrower’s obligations under a Swap Contract to
the applicable Swap Party.

 

(iii)                               Subject to subsection (b) below, the Agent
shall distribute all funds it receives in respect of any payments made by or on
behalf of the Borrower on LC Obligations to the applicable Issuer(s).

 

(iv)                              Subject to subsection (b) below, the Agent
shall distribute all funds it receives in respect of any payments made by or on
behalf of the Borrower on Swing Line Loans to the Swing Line Lender.

 

(b)           Application of Payments and Collections after a Matured Default.
After any Matured Default has occurred, all funds received by the Agent, whether
as

 

81

--------------------------------------------------------------------------------

 

payments by the Borrower or as realization on Collateral or on any guaranties,
shall (except as may otherwise be required by law) be distributed by the Agent
as follows:

 

(i)            First, to pay any unreimbursed cost of collection with respect to
any Loan, any Swing Line Loan, any Note, any LC Obligation, any Collateral or
otherwise relating to this Agreement to the Agent and each Issuer, Lender, Swing
Line Lender or Swap Party who has incurred such costs;

 

(ii)           Second, to pay the Agent and each Issuer, Lender, Swing Line
Lender or Swap Party to whom the Borrower owes any indemnity obligation or other
expense reimbursement obligation (other than those described in the immediately
preceding subsection (a)) with respect to any Loan, any Swing Line Loan, any
Note, any LC Obligation, any Collateral or otherwise relating to this Agreement,
or relating to any Swap Contract, the amount thereof;

 

(iii)          Third, (1) to the Lenders, accrued Non-Use Fees then due and
payable by the Borrower in accordance with their respective Line of Credit Loan
Commitments, (2) to pay to the Agent that portion of the accrued fees payable to
the Agent, and (3) to pay any fees then due and payable to the Issuers pursuant
to this Agreement;

 

(iv)          Fourth, to pay (1) accrued interest that is payable on the Loans
to the Lenders, (2) accrued interest that is payable on the Swing Line Loans to
the Swing Line Lender, and (3) any obligation (other than an early termination
payment obligation) owing to a Swap Party that is due and payable to such Swap
Party pursuant to any Swap Contract;

 

(v)           Fifth, to pay (1) the principal of the Loans to the Lenders,
(2) the principal of the Swing Line Loans to the Swing Line Lender, (3) any
obligation that is due and payable to a Swap Party as a result of an early
termination of a Swap Contract, (4) the aggregate amount of any drawings under
LCs which have not yet been reimbursed to the relevant Issuers, and (5) to the
Holding Account an amount equal to the aggregate undrawn amount of all
outstanding LCs;

 

(vi)          Sixth, to the Borrower or as otherwise may be directed by court
order or by other applicable law.

 

To the extent that available funds are sufficient to pay only part of the amount
due to all Persons within any of the foregoing clauses, such funds shall be
allocated to all such Persons pro rata in accordance with the respective amounts
owed.  Upon any sale of the Collateral by the Agent (including pursuant to a
power of sale granted by statute or under a judicial proceeding), the receipt by
the Agent or of the officer making the sale shall be a sufficient discharge to
the purchaser or purchasers of the Collateral so sold and such purchaser or
purchasers shall not be obligated to see to the application of any part of the
purchase money paid over to the Agent or such officer or be answerable in any
way for the misapplication thereof.

 

82

--------------------------------------------------------------------------------

 

14.          Marshaling; Payments Set Aside.

 

The Agent shall be under no obligation to marshal any assets in favor of the
Borrower or against or in payment of any or all of the Liabilities.  To the
extent that the Borrower makes a payment or payments to the Agent or the Agent
receives any payment or proceeds of the Collateral for the Borrower’s benefit or
enforces the Agent’s security interests or exercises the Agent’s rights of
set-off, and such payment or payments or the proceeds of such Collateral,
enforcement or set-off or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside and/or required to be
repaid to a trustee, receiver or any other party under any bankruptcy law, state
or federal law, common law or equitable cause, then to the extent of such
recovery, the obligation or part thereof originally intended to be satisfied
shall be revived and continued in full force and effect as if such payment had
not been made or such enforcement or set-off had not occurred.

 

15.          Section Titles.

 

The section titles contained in this Agreement shall be without substantive
meaning or content of any kind whatsoever and are not a part of the agreement
among the parties.

 

16.          Continuing Effect.

 

This Agreement, the Agent’s security interests in the Collateral, and all of the
other Financing Documents shall continue in full force and effect so long as any
Liabilities shall be owed to the Agent and/or any of the Lenders and/or the
Issuers and/or the Swing Line Lender and (even if there shall be no Liabilities
outstanding) so long as the Agent and/or any of the Lenders remains committed to
make Loans under this Agreement and/or any Issuer remains committed to issue LCs
under this Agreement and/or the Swing Line Lender remains committed to make
Swing Line Loans under this Agreement.

 

17.          No Waiver.

 

The Agent’s, any Issuer’s or the Required Lenders’ failure, at any time or times
hereafter, to require strict performance by the Borrower of any provision of
this Agreement shall not waive, affect or diminish any right of the Agent or the
Required Lenders thereafter to demand strict compliance and performance
therewith.  Any suspension or waiver by the Agent or the Required Lenders of any
Default or Matured Default under this Agreement or any of the other Financing
Documents, shall not suspend, waive or affect any other Default or Matured
Default under this Agreement or any of the other Financing Documents, whether
the same is prior or subsequent thereto and whether of the same or of a
different kind or character.  None of the undertakings, agreements, warranties,
covenants and representations of the Borrower contained in this Agreement or any
of the other Financing Documents and no Default or Matured Default under this
Agreement or any of the other Financing Documents, shall be deemed to have been
suspended or waived by the Agent, the Issuers or the Required Lenders unless
such suspension or waiver is in writing signed by an officer of the Agent or
each of the Required Lenders (as applicable) and is directed to the Borrower
specifying such suspension or waiver.

 

83

--------------------------------------------------------------------------------

 

18.          Notices.

 

(a)           All notices and other communications provided for herein shall be
in writing (including telex, facsimile, or cable communication) and shall be
mailed, telexed, cabled or delivered addressed as follows:

 

(i)             If to the Agent at:

CoBank, ACB

5500 South Quebec Street

Greenwood Village, Colorado 80111

Attn:  Jim Matzat

Facsimile: 303-224-2529

 

(ii)           If to the Borrower or any of its Subsidiaries at:

National Beef Packing Company, LLC

12200 North Ambassador Drive

Kansas City, Missouri  64163

Attn: Jay D. Nielsen, Chief Financial Officer

Facsimile: (816) 713-8856

 

with copies to:

 

National Beef Packing Company, LLC

12200 North Ambassador Drive

Kansas City, Missouri  64163

Attn: Bret G. Wilson, General Counsel

Facsimile: (816) 713-8856

 

Husch Blackwell Sanders LLP

4801 Main Street, Suite 1000

Kansas City, Missouri  64112

Attn: John Brungardt, Esq.

Facsimile: (816) 983-9271

 

U.S. Premium Beef, LLC

P.O. Box 20103

Kansas City, MO  64195

Attn: Steven D. Hunt, Chief Executive Officer

Facsimile: (816) 713-8810

 

(i)            If to any of the Lenders or Issuers other than the Agent, at the
address for such Person provided in writing to the Agent and the Borrower and,
as to each party hereto, at such other address as shall be designated by such
party in a written notice to the other parties hereto. All such notices and
communications shall, when mailed, telecopied, telexed, transmitted, or cabled,
become effective when deposited in the mail, confirmed by telex answerback,
transmitted by telecopier, or delivered to the cable company, respectively
except that notices and

 

84

--------------------------------------------------------------------------------

 

communications to the Agent shall not be effective until actually received by
the Agent.

 

(b)           The timing of notices to the Agent of terminations or reductions
of the Commitment, of borrowings, conversions and prepayments of Loans and Swing
Line Loans and of the duration of Interest Periods and of a request for the
issuance of an LC is summarized below:

 

Borrowing of Base Rate Advances
and Swing Line Loans

 

1 Business Day

Borrowing of LIBOR Rate Advances

 

3 Business Days

Conversion of Loans (including changes in
Interest Period for LIBOR Rate Advances)

 

3 Business Days

Prepayments of Base Rate Advances
and Swing Line Loans

 

Same Business Day

Prepayments of LIBOR Rate Advances

 

3 Business Days

LCs

 

5 Business Days

 

19.          Maximum Interest.

 

No agreements, conditions, provisions or stipulations contained in this
Agreement or in any of the other Financing Documents, or any Matured Default, or
any exercise by the Agent of the right to accelerate the payment of the maturity
of principal and interest, or to exercise any option whatsoever, contained in
this Agreement or any of the other Financing Documents, or the arising of any
contingency whatsoever, shall entitle the Agent to collect, in any event,
interest exceeding the Highest Lawful Rate, and in no event shall the Borrower
be obligated to pay interest exceeding the Highest Lawful Rate, and all
agreements, conditions or stipulations, if any, which may in any event or
contingency whatsoever operate to bind, obligate or compel the Borrower to pay a
rate of interest exceeding the Highest Lawful Rate, shall be without binding
force or effect, at law or in equity, to the extent only of the excess of
interest over such Highest Lawful Rate.  In the event any interest is charged in
excess of the Highest Lawful Rate (“Excess”), the Borrower acknowledges and
stipulates that any such charge shall be the result of an accidental and bona
fide error, and such Excess shall be, first, applied to reduce the principal of
any Liabilities due, and, second, returned to the Borrower, it being the
intention of the parties hereto not to enter at any time into a usurious or
otherwise illegal relationship.  The Borrower and the Agent both recognize that,
with fluctuations in the Base Rate and the LIBOR Rate, such an unintentional
result could inadvertently occur.  By the execution of this Agreement, the
Borrower covenants that (a) the credit or return of any Excess shall constitute
the acceptance by the Borrower of such Excess and (b) the Borrower shall not
seek or pursue any other remedy, legal or equitable, against the Agent, any
Issuer, the Swing Line Lender or the Lenders based, in whole or in part, upon
the charging or receiving of any interest in excess of the Highest Lawful Rate. 
For the purpose of determining whether or not any Excess has been contracted
for, charged or received by the Agent, any Issuer, the Swing Line Lender or the
Lenders (as the case may be), all interest at any time contracted for, charged
or received by the Agent, the Issuers, the Swing Line Lender or the Lenders in
connection with the Liabilities shall be amortized, prorated, allocated and
spread in equal parts during the entire term of this Agreement.

 

85

--------------------------------------------------------------------------------

 

20.          Representations by the Lenders and Swing Line Lender.

 

Each Lender and the Swing Line Lender represents that it is such Person’s
present intention, as of the date of its acquisition of its Notes, to acquire
such Notes for its account or for the account of its affiliates, and not with a
view to the distribution or sale thereof, and, subject to any applicable laws,
the disposition of such Lender’s or the Swing Line Lender’s property shall at
all times be within its control. The Notes have not been registered under the
Securities Act of 1933, as amended (the “Securities Act”), and may not be
transferred, sold or otherwise disposed of except (a) in a registered offering
under the Securities Act; (b) pursuant to an exemption from the registration
provisions of the Securities Act; or (c) if the Securities Act shall not apply
to the Notes or the transactions contemplated by the Financing Documents.
Nothing in this Section 13.20 shall affect the characterization of the Loans,
the Swing Line Loans and the transactions contemplated hereunder as commercial
lending transactions.

 

21.          Counterparts and Facsimile Signatures.

 

This Agreement, any other Financing Document and any subsequent amendment to any
of them may be executed in several counterparts and by the different parties on
separate counterparts, each of which together shall be construed as one original
and all of which shall constitute together but one and the same agreement. 
Facsimile signatures on this Agreement, any other Financing Document and any
subsequent amendment to any of them shall be considered as original signatures.

 

22.          Set-off.

 

The Borrower gives and confirms to each Lender and each Issuer a right of
set-off of all moneys, securities and other property of the Borrower (whether
special, general or limited) and the proceeds thereof, at any time delivered to
remain with or in transit in any manner to such Lender or Issuer, its
correspondent or its agents from or for the Borrower, whether for safekeeping,
custody, pledge, transmission, collection or otherwise or coming into possession
of such Lender or Issuer in any way, and also, any balance of any deposit
accounts and credits of the Borrower with, and any and all claims of security
for the payment of the Liabilities owed by the Borrower to such Lender or
Issuer, contracted with or acquired by the Lender or Issuer, whether such
liabilities and obligations be joint, several, absolute, contingent, secured,
unsecured, matured or unmatured, and the Borrower authorizes such Lender or
Issuer at any time or times, without prior notice, to apply such money,
securities, other property, proceeds, balances, credits of claims, or any part
of the foregoing, to such liabilities in such amounts as it may select, whether
such Liabilities be contingent, unmatured or otherwise, and whether any
collateral security therefor is deemed adequate or not. Each Lender and each
Issuer agrees to notify the Agent promptly after any such setoff and application
made by such Lender or Issuer; provided, however, that the failure to give such
notice shall not affect the validity of such setoff and application. The rights
described herein shall be in addition to any collateral security described in
any separate agreement executed by the Borrower and any other right of setoff
under applicable law or otherwise which each Lender and each Issuer may have.

 

86

--------------------------------------------------------------------------------

 

23.          Assignments and Participation.

 

(a)           After the Restatement Date and (except in the case of an
assignment by a Lender or the Swing Line Lender to one or more of its
affiliates) subject to the prior written consent of the Agent and (so long as no
Default or Matured Default shall have occurred and be continuing) the Borrower,
which consent(s) shall not be unreasonably withheld, each Lender and the Swing
Line Lender may assign to any Person (the “Assignee”) all or a portion of its
rights and obligations under this Agreement (including without limitation, all
or a portion of its Commitment and the Notes and/or Swing Line Note held by it);
provided, however, that (i) each such assignment shall be of a constant, and not
a varying, percentage of all of the assigning Lender’s rights and obligations
under this Agreement, (ii) the total amount of the Commitment (based on the
original Commitment without giving effect to any repayments or prepayments) so
assigned to an Assignee or to an Assignee and its affiliates taken as a whole
shall equal or exceed $5,000,000, (iii) the remaining Commitment (based on the
original Commitment without giving effect to any repayments or prepayments) held
by the assigning Lender after giving effect to any such assignment shall equal
or exceed $5,000,000, (iv) the assignment will not cause the Borrower to incur
any additional liability or expense and (v) the parties to each such assignment
shall execute and deliver to the Agent for its acceptance an Assignment and
Acceptance in substantially the form attached as Exhibit 13A (“Assignment and
Acceptance”), together with any Note or Notes to be exchanged in connection with
such assignment and a processing and recordation fee of $3,500 to the Agent. 
Upon such execution, delivery, acceptance and recording, from and after the
effective date specified in each Assignment and Acceptance, which effective date
shall be the date on which such Assignment and Acceptance is accepted by the
Agent, (vi) the Assignee thereunder shall be a party hereto and, to the extent
that rights and obligations hereunder have been assigned to it pursuant to such
Assignment and Acceptance, have the rights and obligations of a Lender under the
Financing Documents and (vii) the Lender assignor thereunder shall be deemed to
have relinquished its rights and to be released from its obligations under the
Financing Documents, to the extent (and only to the extent) that its rights and
obligations hereunder have been assigned by it pursuant to such Assignment and
Acceptance (and, in the case of an Assignment and Acceptance covering all or the
remaining portion of an assigning Lender’s rights and obligations under the
Financing Documents, such Lender shall cease to be a party thereto).

 

(b)           By executing and delivering an Assignment and Acceptance, the
Lender assignor thereunder and the Assignee thereunder confirm to and agree with
each other and the other parties hereto as follows:  (i) other than as provided
in such Assignment and Acceptance, such assigning Lender makes no representation
or warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with the Financing
Documents or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of the Financing Documents or any other instrument or
document furnished pursuant thereto; (ii) such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of the Borrower or the performance or observance by the
Borrower of any of its obligations under the Financing Documents, the Security
Documents or any other instrument or document furnished pursuant hereto;
(iii) such

 

87

--------------------------------------------------------------------------------

 

Assignee confirms that it has received a copy of the Financing Documents,
together with copies of the financial statements referred to in Section 7.16 and
such other documents and information as it has deemed appropriate to make its
own credit analysis and decision to enter into such Assignment and Acceptance;
(iv) such Assignee will, independently and without reliance upon the Agent, such
assigning Lender or any other Lender or Issuer or Swing Line Lender and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
this Agreement; (v) such Assignee appoints and authorizes the Agent to take such
action as the Agent on its behalf and to exercise such powers under the
Financing Documents as are delegated to the Agent by the terms thereof, together
with such powers as are reasonably incidental thereto; and (vi) such Assignee
agrees that it will perform in accordance with their terms all of the
obligations which by the terms of the Financing Documents are required to be
performed by it as a Lender.

 

(c)           The Agent shall maintain at its address referred to in
Section 13.18 a copy of each Assignment and Acceptance delivered to and accepted
by it.

 

(d)           Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender, together with any Note or Notes subject to such assignment,
the Agent shall, if such Assignment and Acceptance has been completed,
(i) accept such Assignment and Acceptance and (ii) give prompt notice thereof to
the Borrower. Within five (5) Business Days after its receipt of such notice,
the Borrower, at its own expense, shall execute and deliver to the Agent in
exchange for the surrendered Note a new Note to the order of such Assignee in an
amount equal to the Commitment assumed by it pursuant to such Assignment and
Acceptance and, if the assigning Lender has retained a Commitment hereunder, a
new Note to the order of the assigning Lender in an amount equal to the
Commitment retained by it hereunder. Such new Note or Notes shall be in an
aggregate principal amount equal to the aggregate principal amount of such
surrendered Note or Notes, shall be dated the effective date of such Assignment
and Acceptance and shall otherwise be in substantially the form of Exhibit 2A or
Exhibit 2B, as the case may be.  Upon the Agent’s receipt of such new Note or
Notes conforming to the requirements set forth in the preceding sentences, the
Agent shall return to the Borrower such surrendered Note or Notes, marked to
show that such surrendered Note or Notes has (have) been replaced, renewed and
extended by such new Note or Notes.

 

(e)           Each Lender may sell participations to one or more banks or other
entities in or to all or a portion of its rights and obligations under this
Agreement (including without limitation, all or a portion of its Commitment and
the Notes held by it); provided however, that (i) such Lender’s obligations
under this Agreement (including without limitation, its Commitments to the
Borrower hereunder) shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations,
(iii) such Lender shall remain the holder of any such Note for all purposes of
this Agreement, (iv) the sale of the participation will not cause the Borrower
to incur any additional liability, and (v) the Borrower, the Agent and the other
Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender’s rights and obligations under this Agreement,
provided that no participant shall be entitled to recover under the
above-described provisions an

 

88

--------------------------------------------------------------------------------

 

amount in excess of the proportionate share which such participant holds of the
original aggregate principal amount hereunder to which the assigning Lender
would otherwise be entitled.  Notwithstanding the foregoing, in the case of
participations sold to members of the Farm Credit System (a “Farm Credit System
Participant”), with the written consent of the Agent and the Borrower and
provided that such participation is not less than $10,000,000, such participant
shall have the right to vote (each, a “Farm Credit System Voting Participant”)
on any matter which requires the consent of the Lenders.  For purposes of
voting, such Farm Credit System Voting Participant shall receive voting rights
in proportion to the interest purchased, and the voting right percentage of the
Lender selling the participation shall be correspondingly reduced.  The initial
list of Farm Credit System Voting Participants is set forth on Exhibit 13B.  In
the case of such participations to Farm Credit System Voting Participants, the
Lender selling such participation shall promptly provide to the Agent a Voting
Participant Notice and Consent in the form of Exhibit 13C.

 

(f)            Any Lender may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this
Section 13.23, disclose to the assignee or participant or proposed assignee or
participant, any information relating to the Borrower furnished to such Lender
by or on behalf of the Borrower; provided that, prior to any such disclosure,
the assignee or participant or proposed assignee or participant shall agree in
writing to preserve the confidentiality of any confidential information relating
to the Borrower received by it from such Lender.

 

(g)           Any Lender may assign and pledge all or any of the instruments
held by it as collateral security; provided that any payment made by the
Borrower for the benefit of such assigning and/or pledging Lender in accordance
with the terms of the Financing Documents shall satisfy the Borrower’s
obligations under the Financing Documents in respect thereof to the extent of
such payment. No such assignment and/or pledge shall release the assigning
and/or pledging Lender from its obligations hereunder.

 

24.          Loan Agreement Controls.

 

If there are any conflicts or inconsistencies among this Agreement and any of
the other Financing Documents, the provisions of this Agreement shall prevail
and control.

 

25.          Obligations Several.

 

Each Lender’s, each Issuer’s, the Agent’s and the Swing Line Lender’s
obligations under each Financing Document to which it is a party are several,
and no Lender, Issuer, Agent or Swing Line Lender shall be responsible for any
obligation or Commitment of any other such Person under any Financing Document
to which it is a party. Nothing contained in any Financing Document to which it
is a party, and no action taken by any Lender, Issuer, Agent or Swing Line
Lender pursuant thereto, shall be deemed to constitute such Persons (or any of
them) as a partnership, an association, a joint venture, or any other kind of
entity.

 

89

--------------------------------------------------------------------------------

 

26.          Pro Rata Treatment.

 

All Loans under, and all payments and other amounts received in connection with
this Agreement for application to the Loans (including, without limitation,
amounts received as a result of the exercise by any Lender of any right of
set-off) shall be effectively shared by the Lenders ratably in accordance with
their respective pro rata shares of the relevant type of Loan. If any Lender
shall obtain any payment (whether voluntary, involuntary, through the exercise
of any right of set-off, or otherwise) on account of the principal of, or
interest on, or fees in respect of, any Note held by it (other than pursuant to
Section 5.2, 5.3 or 5.4) in excess of its pro rata share of payments on account
of similar Notes obtained by all the Lenders, such Lender shall purchase from
the other Lenders such participation in the Notes or Loans made by them as shall
be necessary to cause such purchasing Lender to share the excess payment ratably
with each of them; provided, however, that if all or any portion of such excess
payment is thereafter recovered from such purchasing Lender, such purchase from
each Lender shall be rescinded and such Lender shall repay to the purchasing
Lender the purchase price to the extent of such recovery together with an amount
equal to such Lender’s ratable share (according to the proportion of (a) the
amount of such Lender’s required repayment to (b) the total amount so recovered
from the purchasing Lender) of any interest or other amount paid or payable by
the purchasing Lender in respect of the total amount so recovered.
Disproportionate payments of interest shall be shared by the purchase of
separate participation in unpaid interest obligations, disproportionate payments
of fees shall be shared by the purchase of separate participation in unpaid fee
obligations, and disproportionate payments of principal shall be shared by the
purchase of separate participation in unpaid principal obligations. The Borrower
agrees that any Lender so purchasing a participation from another Lender
pursuant to this Section 13.26 may, to the fullest extent permitted by law,
exercise all its rights of payment (including the right of set-off) with respect
to such participation as fully as if such Lender were the direct creditor of the
Borrower in the amount of such participation. Notwithstanding the foregoing, a
Lender may receive and retain an amount in excess of its pro rata share of the
relevant type of Loan to the extent, but only to the extent, that such excess
results from such Lender’s Highest Lawful Rate exceeding another Lender’s
Highest Lawful Rate.

 

27.          Confidentiality.

 

Each of the Agent, the Issuers, the Swing Line Lender and the Lenders agrees
that it will use its best efforts to keep confidential, in accordance with its
customary procedures for handling confidential information and in accordance
with safe and sound banking practices, any proprietary information of the
Borrower identified in writing by the Borrower to the Agent, as being
proprietary and confidential; provided that the Agent, any Issuer, the Swing
Line Lender or any Lender may disclose any such information  (a) to enable it to
comply with any Governmental Requirement applicable to it, (b) in connection
with the defense of any litigation or other proceeding brought against it
arising out of the transactions contemplated by this Agreement and the other
Financing Documents, (c) in connection with the supervision and enforcement of
the rights and remedies of the Agent, the Issuers, the Swing Line Lender and/or
the Lenders under any Financing Document and (d) as set forth in
Section 13.23(f).

 

90

--------------------------------------------------------------------------------

 

28.          Independence of Covenants.

 

All covenants under Section 10 shall be given independent effect so that if a
particular action or condition is not permitted by any of such covenants, the
fact that it would be permitted by an exception to, or be otherwise within the
limitations of, another covenant shall not avoid the occurrence of a Default or
a Matured Default if such action is taken or condition exists.

 

29.          Amendments and Waivers; Commitment Increases.

 

Any term, covenant, agreement or condition of this Agreement or any Financing
Document may be amended only by a written amendment executed by the Borrower,
the Required Lenders and, if the rights or duties of the Agent are affected
thereby, the Agent, or compliance therewith only may be waived (either generally
or in a particular instance and either retroactively or prospectively), if the
Borrower shall have obtained the consent in writing of the Required Lenders (or
in the case of provisions relating to any Bond Document, any Bond Document or
the Bond Pledge Agreement, the Agent without necessity of consent of the
Required Lenders) and, if the rights or duties of the Agent, Swing Line Lender
and/or an Issuer are affected thereby, such Person; provided, however, that
without the consent in writing of the holders of all outstanding Notes and LC
Obligations, or of all Lenders and the Swing Line Lender if no Notes or LCs are
outstanding, no such amendment or waiver shall (a) change the amount or postpone
the date of payment of any scheduled payment or required payment of principal of
the Notes or reduce the rate or extend the time of payment of interest on the
Notes, or reduce the amount of principal thereof, or modify any of the
provisions of the Notes with respect to the payment or prepayment thereof,
(b) give to any Note any preference over any other Notes, (c) amend the
definition of Required Lenders, (d) alter, modify or amend the provisions of
this Section 13.29, (e) change the amount or term of any of the Commitments or
the fees required under Section 6, (f) alter, modify or amend the provisions of
Section 8 of this Agreement, (g) alter, modify or amend any Lender’s right
hereunder to consent to any action, make any request or give any notice, or
(h) release all or substantially all of the Collateral (except such Collateral
relating to the Bond Documents, which release shall be at the Agent’s sole
discretion), unless such release is permitted by the Financing Documents.  Any
such amendment or waiver shall apply equally to all Lenders and all the holders
of the Notes and/or LC Obligations and shall be binding upon them, upon each
future holder of any Note or LC Obligation and upon the Borrower, whether or not
such Note or LC shall have been marked to indicate such amendment or waiver.  No
such amendment or waiver shall extend to or affect any obligation not expressly
amended or waived.  Notwithstanding the foregoing, the Borrower may increase the
Line of Credit Loan Commitment and the aggregate outstanding principal amount of
the Term Loans from time to time by obtaining applicable commitments from one or
more Lenders (or from other lenders reasonably acceptable to the Agent) so long
as (a)  no Default or Matured Default shall have occurred and be continuing,
(b) the Borrower shall be in pro forma compliance (based on assumptions and
projections acceptable to the Agent) with the financial covenants set forth in
Sections 9.16, 9.17 and 9.18 after giving effect to such increase, (c) the
cumulative increase in the sum of the Line of Credit Loan Commitment and the
Term Loan Commitment may not exceed $100,000,000 and (d) an amendment to this
Agreement, in form satisfactory to the Agent, that amends the definition of
“Line of Credit Loan Commitment” and Exhibit 1A to reflect such increase and
that includes provisions to cause any outstandings relating to the Line of
Credit Loans or the Term Loans to be held by the Lenders on a ratable

 

91

--------------------------------------------------------------------------------

 

basis after giving effect to the relevant increase, shall have been executed and
delivered by the Borrower and the Agent.  Additionally, all new Term Loans and
Line of Credit Loans disbursed pursuant to any increase made under this
Section 13.29 shall have the same Maturity Date as the previously outstanding
Term Loans and Line of Credit Loans (as the case may be) and all the economic
terms of the new Term Loans and Line of Credit Loans (as the case may be),
including the interest margin, yield and fees applicable thereto, shall not be
more favorable to the incremental lenders than the terms of the existing Loans
for the Lenders.

 

30.          Binding Effect.

 

This Agreement and the other Financing Documents set forth the legal, valid and
binding obligations of the Borrower, the Agent, the Issuers, the Swing Line
Lender and the Lenders and are enforceable against the Borrower in accordance
with their respective terms.

 

31.          FINAL AGREEMENT.

 

THIS WRITTEN AGREEMENT, THE NOTES AND THE OTHER FINANCING DOCUMENTS COLLECTIVELY
REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES WITH RESPECT TO THE SUBJECT
MATTER HEREOF AND THEREOF AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

 

32.          [Intentionally Omitted.]

 

33.          USA Patriot Act Notice.

 

Each Lender, each Issuer, the Swing Line Lender and the Agent (for itself and
not on behalf of any Lender) hereby notifies the Borrower that pursuant to the
requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into
law October 26, 2001)) (the “Act”), it is required to obtain, verify and record
information that identifies the Borrower, which information includes the
Borrower’s name and address and other information that will allow such Lender,
such Issuer, the Swing Line Lender or the Agent, as applicable, to identify the
Borrower in accordance with the Act.

 

34.          Subsidiaries.

 

Each Subsidiary party hereto, by its signature hereto, makes each representation
and warranty in the Financing Documents made by the Borrower with respect to
it.  Furthermore, each Subsidiary party hereto, by its signature hereto,
covenants and agrees that, until the Liabilities are paid in full, and the
Commitments, all LCs and all other obligations of the Agent, the Issuers, the
Swing Line Lender and the Lenders hereunder are finally terminated, such
Subsidiary will perform and observe all terms, covenants and agreements
applicable to it set forth in the Financing Documents.

 

92

--------------------------------------------------------------------------------

 

35.          Amendment and Restatement; Renewal Notes.

 

This Agreement amends and restates in its entirety the Existing Credit
Agreement.  This Agreement does not constitute and shall not be construed to
evidence a novation of or a payment and readvance of any of the Liabilities (as
defined in the Existing Credit Agreement), it being the intention of the parties
hereto that this Agreement is an amendment and restatement (but not an
extinguishment) of the Existing Credit Agreement.  From and after the date
hereof, except as the context otherwise provides, (a) all references to the
Existing Credit Agreement (or to any amendment, supplement, modification or
amendment and restatement thereof) in the Financing Documents (other than this
Agreement) and the use of the words “thereunder”, “thereof”, or words of similar
import when referring to the Existing Credit Agreement shall be deemed to refer
to this Agreement, (b) all references to any Article, Section (or clause) of the
Existing Credit Agreement in any Financing Document (other than this Agreement)
shall be amended to become mutatis mutandis, references to the corresponding
provisions of this Agreement and (c) all references to this Agreement herein
(including for purposes of indemnification and reimbursement of fees) shall be
deemed to be references to this Agreement as the same may be further amended,
restated, amended and restated, supplemented or otherwise modified from time to
time pursuant to the terms of this Agreement.  The Borrower reaffirms the Liens
granted pursuant to the Security Documents to the Agent for the benefit of the
Agent, the Issuer, the Lenders, the Swap Parties and any other Person, which
Liens shall continue in full force and effect during the term of this Agreement
and any renewals or extensions thereof.  The Notes have been given in renewal,
extension and modification of the promissory notes delivered in connection with
the Existing Credit Agreement.

 

{SIGNATURE PAGES FOLLOW}

 

93

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day first
written above.

 

 

BORROWER:

 

 

 

NATIONAL BEEF PACKING

 

COMPANY, LLC

 

 

 

By:

/s/ Jay D. Nielsen

 

Name:

Jay D. Nielsen

 

Title:

Chief Financial Officer

 

 

 

 

 

SUBSIDIARY LOAN PARTIES:

 

 

 

NATIONAL BEEF CALIFORNIA, LP

 

 

 

By:

NATIONAL CARRIERS, INC.,

 

 

its General Partner

 

 

 

By:

/s/ Jay D. Nielsen

 

Name:

Jay D. Nielsen

 

Title:

Chief Financial Officer

 

 

 

 

 

NATIONAL CARRIERS, INC.

 

 

 

By:

/s/ Jay D. Nielsen

 

Name:

Jay D. Nielsen

 

Title:

Chief Financial Officer

 

{SIGNATURE PAGE ONE OF THREE TO AMENDED
AND RESTATED CREDIT AGREEMENT}

 

National Beef Packing Company Credit Agreement

 

--------------------------------------------------------------------------------

 

 

LENDERS:

 

 

 

COBANK, ACB, individually and as

 

Lead Arranger, Swing Line Lender

 

and Administrative Agent

 

 

 

 

By:

/s/ James Matzat

 

Its:

Vice President

 

 

 

 

 

 

 

BANK OF AMERICA, N.A., individually and as Syndication Agent

 

 

 

By:

/s/ Daniel J. Ricke

 

Its:

Vice President

 

 

 

 

 

BANK OF MONTREAL, individually and as Syndication Agent

 

 

 

By:

/s/Manuel Diaz

 

Its:

Vice President

 

 

 

COÖPERATIEVE CENTRALE RAIFFEISEN BOERENLEENBANK B.A., “RABOBANK NEDERLAND”, NEW
YORK BRANCH, individually and as Documentation Agent

 

 

 

 

 

By:

/s/ D. Shane Bounds

 

Its:

Executive Director

 

 

 

 

 

By:

/s/ Rebecca O. Morrow

 

Its:

Executive Director

 

{SIGNATURE PAGE TWO OF THREE TO AMENDED
AND RESTATED CREDIT AGREEMENT}

 

National Beef Packing Company Credit Agreement

 

--------------------------------------------------------------------------------

 

 

U.S. BANK NATIONAL ASSOCIATION, individually and as Documentation Agent

 

 

 

 

By:

/s/ Thomas L. Martin

 

Its:

Senior Vice President

 

 

 

 

 

 

 

WELLS FARGO BANK, NATIONAL ASSOCIATION

 

 

 

 

By:

/s/ John R. Carley

 

Its:

Vice President

 

 

 

 

 

 

 

UMB BANK, N.A.

 

 

 

 

By:

/s/ Thomas E. Brusnahan

 

Its:

Community Bank President

 

 

 

 

 

 

 

AMERICAN AGCREDIT, PCA

 

 

 

 

By:

/s/ Gary VanSchuyver

 

Its:

Vice President

 

{SIGNATURE PAGE THREE OF THREE TO AMENDED
AND RESTATED CREDIT AGREEMENT}

 

National Beef Packing Company Credit Agreement

 

--------------------------------------------------------------------------------

 

Exhibit 1A to
Amended and Restated
Credit Agreement

 

Loan Commitment Amounts and Percentages

 

Swing Line Loan Commitments

 

Name of Lender

 

Pro Rata Percentage

 

Commitment Amount

 

CoBank, ACB

 

100.000000000

%

$

30,000,000.00 (Swing Line Loans)

 

 

Line of Credit Loan Commitments

 

Name of Lender

 

Pro Rata Percentage

 

Commitment Amount

 

CoBank, ACB

 

55.200000000

%

$

138,000,000.00

 

Bank of America, N.A.

 

8.000000000

%

$

20,000,000.00

 

Bank of Montreal

 

8.000000000

%

$

20,000,000.00

 

Rabobank Nederland

 

8.000000000

%

$

20,000,000.00

 

U.S. Bank National Association

 

8.000000000

%

$

20,000,000.00

 

Wells Fargo Bank, National Association

 

8.000000000

%

$

20,000,000.00

 

UMB Bank, N.A.

 

3.200000000

%

$

8,000,000.00

 

American AgCredit, PCA

 

1.600000000

%

$

4,000,000.00

 

 

 

 

 

 

 

TOTAL:

 

100.000000000

%

$

250,000,000.00

 

 

Term Loan Commitments

 

Name of Lender

 

Pro Rata Percentage

 

Commitment Amount

 

CoBank, ACB

 

55.200000000

%

$

207,000,000.00

 

Bank of America, N.A.

 

8.000000000

%

$

30,000,000.00

 

Bank of Montreal

 

8.000000000

%

$

30,000,000.00

 

Rabobank Nederland

 

8.000000000

%

$

30,000,000.00

 

U.S. Bank National Association

 

8.000000000

%

$

30,000,000.00

 

Wells Fargo Bank, National Association

 

8.000000000

%

$

30,000,000.00

 

UMB Bank, N.A.

 

3.200000000

%

$

12,000,000.00

 

American AgCredit, PCA

 

1.600000000

%

$

6,000,000.00

 

 

 

 

 

 

 

TOTAL:

 

100.000000000

%

$

375,000,000.00

 

 

97

--------------------------------------------------------------------------------

 

Exhibit 1B to

Amended and Restated
Credit Agreement

 

Formula for Borrowing Base Certificate

 

1.                                       Borrowing Base. The “Borrowing Base” as
of any date of determination shall be:

 

(A)                                  100% OF THE AVAILABLE FUNDS ON DEPOSIT IN
COLLATERAL ACCOUNTS THAT ARE ELIGIBLE FOR INCLUSION IN THE BORROWING BASE
ACCORDING TO SECTION 4.07 OF THE SECURITY AGREEMENT, PLUS

 

(B)                                 100% OF THE NET EQUITY IN MARGIN ACCOUNTS
PROPERLY ASSIGNED TO THE AGENT, PLUS

 

(C)                                  90% OF THE AMOUNT OF ELIGIBLE ACCOUNTS,
PLUS

 

(D)                                 70% OF THE VALUE OF ELIGIBLE INVENTORY
VALUED AT THE LOWER OF COST OR MARKET VALUE IN ACCORDANCE WITH GAAP, PLUS

 

(E)                                  UNLESS AN EVENT OF THE TYPE DESCRIBED IN
ONE OR MORE OF CLAUSES (I) THROUGH (N) OF THE DEFINITION OF MATURED DEFAULT
SHALL HAVE OCCURRED, AND SUCH DEFAULT SHALL BE CONTINUING, WITH RESPECT TO KC
STEAK, THE LESSER OF (I) 100% OF THE PRINCIPAL AMOUNT OUTSTANDING UNDER THE
AMENDED AND RESTATED PROMISSORY NOTE FROM KC STEAK DATED MAY 30, 2006, PAYABLE
TO THE BORROWER IN THE FACE AMOUNT OF $16,000,000 OR (II) THE SUM OF (A) 90% OF
THE ELIGIBLE KC STEAK ACCOUNTS AND (B) 70% OF THE ELIGIBLE KC STEAK INVENTORY,
PLUS

 

(F)                                    100% OF PRODUCER PAYABLES OWED BY THE
BORROWER AND KC STEAK, MINUS

 

(G)                                 100% OF THE AMOUNTS OF ALL UNCLEARED CHECKS
OR DRAFTS ISSUED BY BORROWER AND KC STEAK AND RELATED TO PRODUCER PAYABLES OWED
BY SUCH PERSON, MINUS

 

(H)                                 THE INSURANCE RESERVE.

 

2.                                       DEFINITIONS. CAPITALIZED TERMS USED
HEREIN THAT ARE DEFINED IN THE CREDIT AGREEMENT ARE USED HEREIN WITH THE
RESPECTIVE MEANINGS ATTRIBUTED THERETO IN THE CREDIT AGREEMENT. IN ADDITION, FOR
THE PURPOSES OF THIS EXHIBIT 1B AND FOR DETERMINING THE BORROWING BASE, THE
FOLLOWING TERMS SHALL HAVE THE FOLLOWING RESPECTIVE MEANINGS; PROVIDED, HOWEVER,
THAT IN THE CASE OF CONFLICT, THE DEFINITIONS CONTAINED IN THE CREDIT AGREEMENT
SHALL PREVAIL:

 

“Eligible KC Steak Accounts” means accounts of KC Steak which the Agent
determines in the exercise of the Agent’s reasonable discretion, are eligible
for inclusion in the Borrowing Base at any particular time. Without limiting the
Agent’s right to determine that accounts of KC Steak do not constitute Eligible
KC Steak Accounts, but without duplication, the following accounts shall not be
Eligible KC Steak Accounts: (a) all accounts which are at that time unpaid for a
period exceeding ninety (90) days after the original invoice date of the
original invoice related thereto, except for Accounts which are covered by a
letter of credit; (b) all accounts owing by an account debtor if more than ten
percent (10%) of the accounts owing by such account debtor are at that time
unpaid for a period exceeding ninety (90) days after the original

 

98

--------------------------------------------------------------------------------

 

invoice date of the original invoice related thereto; (c) those accounts, except
accounts owing from the following account debtors: (i) Sysco, (ii) Outback
Steakhouse, (iii) QVC, (iv) IQVC, (v) Wal-Mart and affiliates, (vi) Costco,
(vii) International Traders, and (viii) C&C Wholesale Grocers, of an account
debtor, the aggregate face amount of which is in excess of five percent (5%) of
the aggregate face amount of all other Eligible KC Steak Accounts of all account
debtors, but in each case only to the extent of such excess; (d) those accounts
owing from the United States or any department, agency or instrumentality
thereof unless KC Steak shall have complied with the Assignment of Claims Act to
the satisfaction of the Agent; (e) accounts which arise out of transactions with
affiliates of KC Steak; (f) accounts of account debtors that are located outside
the United States, unless such accounts are covered by a letter of credit issued
or confirmed by a bank acceptable to the Agent; (g) accounts which are or may be
subject to rights of setoff or counterclaim by the account debtor (to the extent
of the amount of such setoff or counterclaim); (h) accounts in which the
Borrower does not, for any reason, have a first priority perfected security
interest, which security interest shall have been collateral assigned to the
Agent; and (i) accounts which in the Agent’s opinion may be subject to liens or
conflicting claims of ownership, whether such liens or conflicting claims are
asserted or could be asserted by any Person except for statutory liens or
encumbrances described in Section 10.1 (a), (b) and (d).

 

“Eligible KC Steak Inventory” means inventory of KC Steak which the Agent
determines in the exercise of the Agent’s reasonable discretion is eligible for
inclusion in the Borrowing Base at any particular time. Without limiting the
Agent’s right to determine that inventory of KC Steak does not constitute
Eligible KC Steak Inventory, but without duplication, the following inventory of
KC Steak shall not be Eligible KC Steak Inventory: (a) inventory deemed to be
out-of-condition or otherwise unmerchantable by the United States Department of
Agriculture, any state’s Department of Agriculture, or any other Governmental
Authority having regulatory authority over the Borrower or any of the Borrower’s
assets or activities; (b) inventory for which a prepayment has been received;
(c) inventory in the possession of third parties, unless it is inventory: (i) at
a location listed below, for which the Agent has received a bailee letter
satisfactory to the Agent (provided, however, that in the case of such inventory
in existence on the Restatement  Date, the Borrower need not deliver such
letters until 30 days after the Restatement  Date), or (ii) covered by
negotiable warehouse receipts or negotiable bills of lading issued by either:
(A) a warehouseman licensed and bonded by the United States Department of
Agriculture or any state’s Department of Agriculture, or (B) a recognized
carrier having an office in the United States and in a financial condition
reasonably acceptable to the Agent, which receipts or bills of lading designate
the Agent directly or by endorsement as the only Person to which or to the order
of which the warehouseman or carrier is legally obligated to deliver such Goods;
(d) inventory in which the Borrower does not, for any reason, have a first
priority perfected security interest, which security interest shall have been
collateral assigned to the Agent; and (e) inventory which in the Agent’s opinion
may be subject to liens or conflicting claims of ownership, whether such liens
or conflicting claims are asserted or could be asserted by any Person except for
statutory liens or encumbrances permitted by Section 10.1(a), (b) and (d).

 

KC Steak Bailee Location:

Midwest Cold Storage, LLC

1101 South 5th Street

Kansas City, KS 66105

 

99

--------------------------------------------------------------------------------

 

Exhibit 1C to

Amended and Restated
Credit Agreement

 

Form of Borrowing Base Certificate

 

DATE PREPARED:                    

CREDIT LINE: $250,000,000

BORROWING BASE MEASUREMENT DATE:          

 

This Borrowing Base Certificate is delivered in accordance with the Amended and
Restated Credit Agreement dated as of June 4, 2010 (as the same may be amended,
amended and restated, supplemented, restated or otherwise modified from time to
time, the “Credit Agreement”) by and among National Beef Packing Company, LLC
(the “Borrower”), CoBank, ACB, as agent (the “Agent”), and the other Persons
from time to time party thereto. Capitalized terms used herein that are defined
in the Credit Agreement shall have the meanings set forth for such terms
therein. All amounts are as of the date shown above except as otherwise stated
herein.

 

The Borrower hereby reaffirms all representations and warranties contained in
the Credit Agreement and certifies and warrants that the following calculations
are true and correct as of the date set forth above and were correctly
determined according to the Credit Agreement.

 

1.

 

ELIGIBLE ACCOUNTS

 

 

 

 

 

 

 

A.

 

Outstanding Accounts Receivable (detail Exhibit A)

 

$

 

 

 

 

 

B.

 

Less Accounts over 21 days old not covered by a letter of credit ($            )

 

 

 

 

 

 

 

C.

 

Less other ineligible Accounts:

 

 

 

 

 

 

 

 

 

1.

25% Rule

 

($            )

 

 

2.

5% Concentration

 

($            )

 

 

3.

10% Concentration

 

($            )

 

 

4.

Excess Wal-Mart Accounts

 

($            )

 

 

5.

US Gov’t without Assignment of Claims compliance

 

($            )

 

 

6.

EXCESS AFFILIATE ACCOUNTS

 

($            )

 

 

7.

Outside US without letter of credit or exemption

 

($            )

 

 

8.

Setoff or counterclaim

 

($            )

 

 

9.

Other:

 

($            )

 

 

10.

Total Ineligible Accounts (sum Lines 1B & 1C 1-9)

 

($            )

 

 

 

 

 

 

D.

 

Eligible Accounts (Line 1A minus 1C10)

 

($            )

 

 

 

 

 

2.

 

ELIGIBLE INVENTORY

 

 

 

 

 

 

 

 

A.

 

Inventory (detail Exhibit B)

 

($            )

 

 

 

 

 

B.

 

Less Ineligible Inventory

 

 

 

1

--------------------------------------------------------------------------------

 

 

 

1.

Out-of-condition Inventory

 

($            )

 

 

2.

Customer deposits, prepaids & advances

 

($            )

 

 

3.

Inventory stored off-premises w/o bailee letter or negotiable receipt at

 

($            )

 

 

4.

Consigned Inventory from:

 

($            ))

 

 

5.

Other:

 

($            )

 

 

6.

Total Ineligible Inventory (Sum Lines 2B 1-5)

 

($            )

 

 

 

 

 

 

C.

 

Eligible Inventory (Line 2A minus 2B6)

 

 

$              

 

 

 

 

 

 

3.

 

BORROWING BASE

 

 

 

 

 

 

 

 

 

A.

 

Cash in Agent-Controlled Accounts

$            x 100%

 

$       

 

 

 

 

 

 

B.

 

Hedge Account Equity

$            x 100%

 

$             

 

 

 

 

 

C.

 

Net Eligible Accounts Receivable (from Line 1D)$

$            X 90%

 

$          

 

 

 

 

 

 

D.

 

Net Eligible Inventory, valued LCM (from Line 2C) $

$            x 70%

 

$

 

 

 

 

 

 

E.

 

Kansas City Steak Accounts & Inventory (detail Exhibit C)

 

 

 

 

 

 

 

 

 

F.

 

Less Producer Payables and related outstanding checks (detail Exhibit D)

 

 

($            )

 

 

 

 

 

 

 

 

G.

 

Total Combined Collateral (sum 3A-F)

 

 

$

 

 

 

 

 

 

H.

 

Less Insurance Reserve

 

 

($            )

 

 

 

 

 

 

I.

 

Borrowing Base (Line 3G minus 3H)

 

 

$

 

 

 

 

 

 

J.

 

Aggregate outstanding principal amount of Line of Credit Loans, Swing Line
Loans, LCs and unreimbursed LC draws on the Borrowing Base Certificate
Measurement Date referenced at the top of this Certificate (maximum permitted is
$250,000,000; if greater than $250,000,000, payment is required)

 

 

$            

 

 

 

 

 

 

K.

 

Borrowing Base Availability on the Borrowing Base Measurement Date referenced at
the top of this Certificate (Line 3I minus Line 3J) (if negative, payment is
required)

 

 

$            

 

2

--------------------------------------------------------------------------------

 

4.

 

ACCOUNTS PAYABLE:

 

 

 

 

 

 

 

 

 

 

 

CURRENT

$

 

 

 

 

PAST DUE

$

 

 

 

 

TOTAL PAYABLES

 

 

$

 

The Borrower further certifies that (a) all amounts outstanding under the Notes
constitute the obligation of the Borrower in accordance with the terms of the
Credit Agreement, (b) the Collateral remains subject to a valid first Lien to
the Agent, and no Lien has been granted in favor of any other person and no
security has been returned to a supplier unless approved by the Agent, and
(c) no circumstances or conditions exist at the date of this Borrowing Base
Certificate which constitute a Default or a Matured Default. The information
provided in this Borrowing Base Report is consistent with what is required by
the Credit Agreement.

 

Prepared by:

 

 

Approved

 

 

3

--------------------------------------------------------------------------------

 

EXHIBIT A TO BORROWING BASE CERTIFICATE

 

Accounts Receivable Detail

 

4

--------------------------------------------------------------------------------

 

EXHIBIT B TO BORROWING BASE CERTIFICATE

 

Inventory Detail

 

5

--------------------------------------------------------------------------------

 

EXHIBIT C TO BORROWING BASE CERTIFICATE

 

Kansas City Steak Account & Inventory

 

1. ELIGIBLE KC STEAK ACCOUNTS

 

 

 

 

 

 

A.

Outstanding KC Steak Accounts Receivable

 

$

 

 

 

 

 

 

B.

Less Accounts over 90 days old not covered by a letter of credit

 

($            )

 

 

 

 

 

 

C.

Less other ineligible Accounts

 

 

 

 

 

 

 

1.

10% Rule

 

 

 

 

2.

5% Concentration

 

($            )

 

 

3.

US Gov’t without Assignment of Claims compliance

 

($            )

 

 

4.

Affiliate Accounts

 

($            )

 

 

5.

Outside US without letter of credit or exemption

 

($            )

 

 

6.

Setoff or counterclaim

 

($            )

 

 

7.

Other:

 

($            )

 

 

8.

Total Ineligible Accounts (sum Lines 1B & 1C1-7)

 

($            )

 

 

 

 

 

 

 

D.

Eligible KC Steak Accounts (Line IA minus 1C8)

 

$

 

 

 

2. ELIGIBLE KC STEAK INVENTORY

 

 

 

 

 

A. KC Steak Inventory

 

$

 

 

 

B. Less Ineligible Inventory

 

 

 

 

 

1.

Out-of-condition Inventory

 

($            )

2.

Customer deposits, prepaids & advances

 

($            )

3.

Inventory stored off-premises w/o bailee letter or negotiable receipt at:

 

($            )

4.

Consigned Inventory from:

 

($            )

5.

Other:

 

($            )

6.

Total Ineligible Inventory (Sum Lines 2B1-5)

 

($            )

 

 

 

C. Eligible KC Steak Inventory (Line 2A minus 2B6)

 

$

 

 

 

3. BORROWING BASE

 

 

 

 

 

 

 

 

A.

Net Eligible KC Steak Accounts (from Line ID)

$            x 90%

 

($            )

 

 

 

 

 

 

 

B.

Net Eligible KC Steak Inventory (from Line 2C)

$            x 70%

 

($            )

 

 

 

 

 

 

C.

Sum of Lines 3 A and 3B

 

($            )

 

 

 

 

 

 

D.

Principal amount outstanding on KC Steak Restated Promissory Note

 

($            )

 

 

 

 

 

 

E.

Lesser of Lines 3C and 3D (to Certificate Line 3F)

 

($            )

 

6

--------------------------------------------------------------------------------

 

EXHIBIT D TO BORROWING BASE CERTIFICATE

 

Producer Payables and Related Outstanding Checks

 

7

--------------------------------------------------------------------------------

 

Exhibit 1D to
Amended and Restated
Credit Agreement

 

Form of NB, Inc. Acknowledgement

 

[Insert Date]

 

CoBank, ACB

5500 South Quebec Street

Greenwood Village, Colorado  80111

Attention: James Stutzman

 

Re:  Acknowledgment

 

Ladies and Gentleman:

 

Reference is made to that certain Amended and Restated Credit Agreement, dated
as of June 4, 2010 (as amended, amended and restated, supplemented or otherwise
modified from time to time, the “Credit Agreement”) among National Beef Packing
Company, LLC, a Delaware limited liability company (the “Borrower”), certain of
its Subsidiaries, the financial institutions from time to time party thereto
(the “Lenders”), and CoBank, ACB, an agricultural credit bank, as Lead Arranger,
Syndication Agent, Swing Line Lender and Administrative Agent for the Lenders
(in such capacity, the “Agent”).  Capitalized terms used but not defined herein
shall have the meanings assigned to such terms in the Credit Agreement.

 

This letter agreement is entered into contemporaneously with the execution and
delivery of the Credit Agreement.  As an inducement to the Agent and the Lenders
to enter into the Credit Agreement and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
National Beef, Inc., a Delaware corporation (“NB, Inc.”) hereby acknowledges and
agrees that it shall not (a) conduct, transact or otherwise engage in any
business or operations other than those incidental to its direct ownership of
the equity interests of the Borrower or the issuance and registration under
federal securities laws of securities and other matters incidental thereto,
(b) incur, create, assume or suffer to exist any Indebtedness except
(i) nonconsensual obligations imposed by operation of law, (ii) obligations with
respect to the intercompany loans permitted under Section 10.3(s) of the Credit
Agreement, and (iii) obligations with respect to its equity interests,
(c) create, assume or permit to exist any Lien upon the equity interests of the
Borrower or any of its other properties or assets, (d) create, organize or
acquire any Subsidiary (other than a Subsidiary of the Borrower to the extent
permitted under the Credit Agreement), or (e) amend any agreement, instrument or
document pertaining to Borrower’s governance in any manner that has or could
reasonably be expected to have a material adverse effect on the rights, powers
or remedies of the Agent and/or the Lenders.  For the avoidance of doubt,
nothing herein shall prohibit NB, Inc. from entering into and performing its
obligations under the Tax Receivable Agreement, Exchange Agreement, Stockholders
Agreement and related documents, in each case, dated on or about the date of the
Permitted IPO and entered into in connection therewith.

 

NB, Inc. hereby further acknowledges and agrees that it will derive substantial
direct and indirect benefit from the execution and delivery of the Credit
Agreement by the parties thereto and acknowledges that this letter agreement
constitutes a Financing Document under the Credit Agreement and that any

 

1

--------------------------------------------------------------------------------

 

failure by NB, Inc. to comply fully with its obligations set forth herein shall
constitute an immediate Matured Default under the Credit Agreement.

 

This letter agreement shall be construed in accordance with and governed by the
laws of the State of Colorado without regard to the application of conflict of
laws principles.  This letter agreement sets forth the entire agreement between
the parties with respect to the matters addressed herein and supersedes all
prior communications, written or oral, with respect hereto.  This letter
agreement shall be binding upon the parties hereto and their respective
successors and assigns.  This letter agreement may be executed in any number of
counterparts, each of which, when so executed, will be deemed to be an original
and all of which, taken together, will constitute one and the same agreement. 
Delivery of an executed counterpart of a signature page to this letter agreement
by facsimile or other electronic means will be as effective as delivery of an
original executed counterpart of this letter agreement.

 

Please indicate your acceptance and agreement to the terms hereof by executing
this letter agreement in the space provided below.

 

 

Very truly yours,

 

 

 

NATIONAL BEEF, INC.

 

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

ACCEPTED AND AGREED TO:

 

 

 

COBANK, ACB, individually and as Lead Arranger,

 

Syndication Agent and Administrative Agent

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

2

--------------------------------------------------------------------------------

 

Exhibit 2A to
Amended and Restated
Credit Agreement

 

Line of Credit Note

 

$

 

Greenwood Village, Colorado

 

 

, 2010

 

FOR VALUE RECEIVED, the undersigned National Beef Packing Company, LLC, a
Delaware limited liability company (together with its successors as permitted in
the Credit Agreement, the “Borrower”), promises to pay to the order of
                             (hereinafter referred to as “Lender”), at such
place as the Agent (as hereinafter defined), may from time to time designate, in
lawful money of the United States of America and in immediately available funds,
the principal sum of                        ($            ) or, if less, the
unpaid principal amount of the Line of Credit Loans from the Lender to the
Borrower outstanding under the Credit Agreement (as hereinafter defined),
together with interest on any and all principal amounts outstanding calculated
in accordance with the provisions set forth below. This note is issued under
that certain Amended and Restated Credit Agreement dated as of June 4, 2010 (as
the same may be amended, amended and restated, replaced, restated, supplemented
or otherwise modified from time to time, the “Credit Agreement”) between the
Borrower, certain of its subsidiaries, CoBank, ACB, an agricultural credit bank,
as agent (in such capacity, together with its successors and assigns in such
capacity, the “Agent”), Lender and the other lenders identified therein
(collectively the “Lenders”).

 

Capitalized terms used and not defined herein shall have the meanings given to
such terms in the Credit Agreement.

 

This note is the one of the Line of Credit Notes referred to in the Credit
Agreement, and is a replacement and substitute for, but does not constitute
payment of, one or more Line of Credit Notes that may have been previously
issued by the Borrower. This note is secured, is subject to scheduled payments
and certain permissive and mandatory prepayments, and is subject to
acceleration, in each case upon the terms provided in the Credit Agreement and
in the Security Documents referenced therein.

 

Borrower shall pay interest on the unpaid principal amount of each Loan made by
the Lender from the date of such Loan until such principal amount shall be paid
in full, at the times and at the rates per annum set forth in the Credit
Agreement.

 

In addition to the repayment requirements imposed upon the Borrower under the
Credit Agreement, together with the agreements referred to therein, the
principal and interest owing under this note shall be due and payable in full on
the Maturity Date applicable to the Line of Credit Loans, without presentment,
demand, protest or further notice of any kind, all of which are expressly waived
by the Borrower. Time is of the essence hereof.

 

The obligations of the Borrower to the Lender hereunder together with the other
Liabilities are secured by certain Collateral as set forth in the Credit
Agreement and in the Security Documents.

 

1

--------------------------------------------------------------------------------

 

In the case of a Matured Default, the undersigned agrees to pay all costs and
expenses of collection, including reasonable attorneys’ fees incurred by the
Agent or its successors and assigns in accordance with the terms of the Credit
Agreement.

 

This note shall be construed in accordance with, and governed by, the laws of
the State of Colorado, without regard to the conflict of laws principles
thereof.

 

 

NATIONAL BEEF PACKING COMPANY, LLC, a Delaware limited liability company

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

2

--------------------------------------------------------------------------------

 

Exhibit 2B to
Amended and Restated
Credit Agreement

 

Term Note

 

$

 

Greenwood Village, Colorado

 

 

, 2010

 

FOR VALUE RECEIVED, the undersigned National Beef Packing Company, LLC, a
Delaware limited liability company (together with its successors as permitted in
the Credit Agreement, the “Borrower”), promises to pay to the order of
                                         (hereinafter referred to as “Lender”),
at such place as the Agent (as hereinafter defined) may from time to time
designate, in lawful money of the United States of America and in immediately
available funds, the principal sum of
                                                 ($                  ) or, if
less, the unpaid principal amount of the Term Loans from the Lender to the
Borrower outstanding under the Credit Agreement (as hereinafter defined),
together with interest on any and all principal amounts outstanding calculated
in accordance with the provisions set forth below. This note is issued under
that certain Amended and Restated Credit Agreement dated as of June 4, 2010 (as
the same may be amended, replaced, amended and restated, restated, supplemented
or otherwise modified from time to time, the “Credit Agreement”) between the
Borrower, certain of its subsidiaries, CoBank, ACB, an agricultural credit bank,
as agent (in such capacity, together with its successors and assigns in such
capacity, the “Agent”), Lender and the other lenders identified therein
(collectively the “Lenders”).

 

This note is one of the Term Notes referred to in the Credit Agreement, and is a
replacement and substitute for, but does not constitute payment of, one or more
Term Notes that may have been previously issued by the Borrower. This note is
secured, is subject to scheduled payments and certain permissive and mandatory
prepayments, and is subject to acceleration, in each case upon the terms
provided in the Credit Agreement and in the Security Documents referenced
therein.

 

Borrower shall pay interest on the unpaid principal amount of each Loan made by
the Lender from the date of such Loan until such principal amount shall be paid
in full, at the times and at the rates per annum set forth in the Credit
Agreement.

 

In addition to the repayment requirements imposed upon the Borrower under the
Credit Agreement, together with the agreements referred to therein, the
principal and interest owing under this note shall be due and payable in full on
the Maturity Date applicable to the Term Loans, without presentment, demand,
protest or further notice of any kind, all of which are expressly waived by the
Borrower. Time is of the essence hereof.

 

The obligations of the Borrower to the Lender hereunder, together with the other
Liabilities, are secured by certain Collateral as set forth in the Credit
Agreement and in the Security Documents.

 

In the case of a Matured Default, the undersigned agrees to pay all costs and
expenses of collection, including reasonable attorneys’ fees incurred by the
Agent or its successors and

 

1

--------------------------------------------------------------------------------

 

assigns in accordance with the terms of the Credit Agreement.

 

This note shall be construed in accordance with, and governed by, the laws of
the State of Colorado without regard to the conflict of laws principles thereof.

 

 

NATIONAL BEEF PACKING COMPANY, LLC, a Delaware limited liability company

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

2

--------------------------------------------------------------------------------

 

Exhibit 2C to
Amended and Restated
Credit Agreement

 

Swing Line Note

 

$

 

Greenwood Village, Colorado

 

 

, 2010

 

FOR VALUE RECEIVED, the undersigned National Beef Packing Company, LLC, a
Delaware limited liability company (together with its successors as permitted in
the Credit Agreement, the “Borrower”), promises to pay to the order of CoBank,
ACB (hereinafter referred to as “Swing Line Lender”), at such place as the Swing
Line Lender may designate, in lawful money of the United States of America and
in immediately available funds, the principal sum of
                                                            
($                    ) or, if less, the unpaid principal amount of the Swing
Line Loans from the Swing Line Lender to the Borrower outstanding under the
Credit Agreement (as hereinafter defined), together with interest on any and all
principal amounts outstanding calculated in accordance with the provisions set
forth below. This note is issued under that certain Amended and Restated Credit
Agreement dated as of June 4, 2010 (as the same has been and may in the future
be amended, amended and restated, replaced, restated, supplemented or otherwise
modified from time to time, the “Credit Agreement”) between the Borrower,
certain of its subsidiaries, CoBank, ACB, an agricultural credit bank, as agent
(in such capacity, together with its successors and assigns in such capacity,
the “Agent”), and the lenders identified therein (the “Lenders”).

 

Capitalized terms used and not defined herein shall have the meanings given to
such terms in the Credit Agreement.

 

This note is the Swing Line Note referred to in the Credit Agreement and is a
replacement and substitution for, but does not constitute payment of, any Swing
Line Note issued to the Swing Line Lender on June 1, 2006 This note is secured,
is subject to scheduled payments and certain permissive and mandatory
prepayments, and is subject to acceleration, in each case upon the terms
provided in the Credit Agreement and in the Security Documents referenced
therein.

 

Borrower shall pay interest on the unpaid principal amount of each Loan made by
the Swing Line Lender from the date of such Loan until such principal amount
shall be paid in full, at the times and at the rates per annum set forth in the
Credit Agreement.

 

In addition to the repayment requirements imposed upon the Borrower under the
Credit Agreement, together with the agreements referred to therein, the
principal and interest owing under this note shall be due and payable in full on
the Maturity Date applicable to the Swing Line Loans, without presentment,
demand, protest or further notice of any kind, all of which are expressly waived
by the Borrower. Time is of the essence hereof.

 

The obligations of the Borrower to the Lender hereunder together with the other
Liabilities are secured by certain Collateral as set forth in the Credit
Agreement and in the Security Documents.

 

1

--------------------------------------------------------------------------------

 

In the case of a Matured Default, the undersigned agrees to pay all costs and
expenses of collection, including reasonable attorneys’ fees incurred by the
Agent or its successors and assigns in accordance with the terms of the Credit
Agreement.

 

This note shall be construed in accordance with, and governed by, the laws of
the State of Colorado without regard to the conflict of laws principles thereof.

 

 

NATIONAL BEEF PACKING COMPANY, LLC, a Delaware limited liability company

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

2

--------------------------------------------------------------------------------

 

Exhibit 9A to
Amended and Restated
Credit Agreement

 

Form of Compliance Certificate
(period from                   , 200    to               , 200  )

 

Pursuant to Section 9.1 of the Amended and Restated Credit Agreement dated as of
June 4, 2010 (as the same may be amended, amended and restated, supplemented,
restated or otherwise modified from time to time, the “Credit Agreement”) by and
among National Beef Packing Company, LLC (the “Borrower”), certain of its
subsidiaries, CoBank, ACB, as agent (the “Agent”), and the Persons from time to
time party thereto, the undersigned certifies to the Agent and the Lenders as
follows:

 

1.                                     The Borrower’s consolidated financial
statements, attached hereto, for the period indicated above (the “Financial
Statements”), have been prepared in accordance with the requirements of
Section 9.1 of the Credit Agreement and have been delivered on or before the
date they are due.

 

2.                                     The representations and warranties
contained in Article VII of the Credit Agreement, as updated by disclosures in
writing to the Agent as permitted therein, are true and correct as of the date
hereof as though made on this date.

 

3.                                     The Borrower is in compliance with all of
the affirmative and negative covenants set forth in Articles IX and X of the
Credit Agreement as of the date hereof.

 

4.                                      Specifically, as of the date of the
Financial Statements:

 

a.                                      The Borrower shall have a Funded Debt to
EBITDA Ratio of not more than 3.25 to 1.00 as at the end of each fiscal quarter.

 

Borrower’s Funded Debt to EBITDA Ratio for the four consecutive fiscal quarters
ending on the date of the Financial Statements was                   to 1.00.

 

In Compliance: Yes o          No o

 

b.                              [The Borrower and its consolidated Subsidiaries
shall have Adjusted Net Worth of not less $275,000,000 as at the end of each
Fiscal Year.

 

The Adjusted Net Worth of the Borrower and its consolidated Subsidiaries as the
date of the Financial Statements was $                                      .

 

In Compliance: Yes o          No o](1)

 

--------------------------------------------------------------------------------

(1) Applicable for Financial Statements delivered in respect of a Fiscal Year
end only.

 

1

--------------------------------------------------------------------------------

 

c.                                      The Borrower shall have a Fixed Charge
Coverage Ratio of at least 1.05 to 1.00 as at the end of each fiscal quarter.

 

Borrower’s Fixed Charge Coverage Ratio for the eight consecutive fiscal quarters
ending on the date of the Financial Statements was                             
to 1.00.

 

In Compliance: Yes o          No o

 

d.                                    The rate at which interest accrues in
respect of the Line of Credit Loans, Swing Line Loans, Term Loans, LC Fees and
Non-Use Fees, as the case may be, is determined in accordance with a Financial
Performance Level (as described in the Credit Agreement), which, in turn, is
determined by the Borrower’s Funded Debt to EBITDA Ratio, as set forth below:

 

Financial
Performance
Level:

 

Funded Debt to
EBITDA Ratio:

 

Base Rate Advance
Line of Credit Loans,
Swing Line Loans
and Term Loans:

 

LIBOR Rate
Line of Credit
Loans and
Term Loans:

 

LC Fee:

 

Non-Use
Fee:

 

 

 

 

 

 

 

 

 

 

 

 

 

Level I

 

Less than 1.00: 1.00

 

1.25

%

2.25

%

2.25

%

0.25

%

 

 

 

 

 

 

 

 

 

 

 

 

Level II

 

Greater than or equal to 1.00:1.00 and less than 2.00:1.00

 

1.50

%

2.50

%

2.50

%

0.375

%

 

 

 

 

 

 

 

 

 

 

 

 

Level III

 

Greater than or equal to 2.00:1.00 and less than 3.00:1.00

 

1.75

%

2.75

%

2.75

%

0.50

%

 

 

 

 

 

 

 

 

 

 

 

 

Level IV

 

Greater than or equal to 3.00:1.00

 

2.25

%

3.25

%

3.25

%

0.625

%

 

As of the date of the Financial Statements, Borrower’s Funded Debt to EBITDA
Ratio was                           and the Financial Performance Level was
          .

 

5.  All adjustments and calculations related to the amounts set forth in each of
4.a. through 4.d. above are attached hereto.

 

2

--------------------------------------------------------------------------------

 

Dated:                   , 200  

 

 

 

 

National Beef Packing Company, LLC

 

 

 

By:

 

 

Its:

 

 

3

--------------------------------------------------------------------------------

 

Schedule 4.a..  Funded Debt to EBITDA Ratio(2)

 

1. Funded Debt

 

 

a. Outstanding Principal Amount of Interest-Bearing Indebtedness (including
Capital Leases)

 

$

b. Undrawn Amount of Outstanding Letters of Credit (including the LCs)

 

$

 

 

 

c. Subtotal (Lines a and b)

 

$

 

 

 

Minus:

 

 

d. LCs or Indemnity Obligations Issued to Support other Indebtedness

 

$

e. Class A or B Units subject to Redemption Rights

 

$

f. Obligations under Deferred Compensation Plans

 

$

 

 

 

g. Subtotal (Lines d through f)

 

$

 

 

 

h. Funded Debt (Line c — Line g)

 

$

 

 

 

2. EBITDA

 

 

a. Net Income

 

 

 

 

$

Plus:

 

 

b. Income Taxes

 

$

c. Interest Expense

 

$

d. Depreciation Expense

 

$

e. Amortization Expense

 

$

f. Other Non-Cash Expenses or Charges

 

$

 

 

 

g. Subtotal (Lines b through f)

 

$

 

 

 

Minus:

 

 

h. Non-Operating Gains

 

$

i. Non-Operating Losses

 

$

 

 

 

j. Subtotal (Lines h and i)

 

$

 

 

 

k. EBITDA (Line a + Line g - Line j)

 

$

 

--------------------------------------------------------------------------------

(2) The Funded Debt to EBITDA Ratio is measured for the four (4) consecutive
fiscal quarters ending on the date of the Financial Statements.

 

4

--------------------------------------------------------------------------------

 

Funded Debt to EBITDA Ratio (Line 1h over Line 2k)

            to 1.00

 

Schedule 4.b.  Adjusted Net Worth

 

a. Book Value of all Assets

 

$

b. Total Liabilities

 

$

 

 

 

c. Net Worth (Line a - Line b)

 

$

 

 

 

d. Negative Impact Occurring as a Result of Making Equity Distributions in
accordance with the $150 Million Basket

 

$

 

 

 

Adjusted Net Worth (Line c - Line d)

 

$

 

Schedule 4.c.  Fixed Charge Coverage Ratio(3)

 

1. EBITDA

 

 

a. Net Income

 

$

 

 

 

Plus:

 

 

b. Income Taxes

 

$

c. Interest Expense

 

$

d. Depreciation Expense

 

$

e. Amortization Expense

 

$

f. Other Non-Cash Expenses or Charges

 

$

 

 

 

g. Subtotal (Lines b through f)

 

$

 

 

 

Minus:

 

 

h. Non-Operating Gains

 

$

i. Non-Operating Losses

 

$

 

 

 

j. Subtotal (Lines g and h)

 

$

 

 

 

k. EBITDA (Line a + Line g - Line j)

 

$

 

--------------------------------------------------------------------------------

(3) The Fixed Charge Coverage Ratio is measured for the eight (8) consecutive
fiscal quarters ending on the date of the Financial Statements.

 

5

--------------------------------------------------------------------------------

 

Minus:

 

 

l. Net Capital Expenditures

 

$

m. Numerator (Line k — Line l)

 

$

 

 

 

2. Fixed Charges

 

 

a. Scheduled Payments of Principal and Interest on Funded Debt

 

$

b. Cash Income Taxes Incurred and Paid

 

$

c. Equity Distributions (other than Equity Distributions under the $150 Million
Basket, Certain Equity Distributions Made in April 2009 and up to $8 Million in
Equity Distributions made in May 2010)

 

$

 

 

 

d. Fixed Charges (Lines a + b +c)

 

$

 

Fixed Charge Coverage Ratio (Line 1m over Line 2d)

                to 1.00

 

6

--------------------------------------------------------------------------------

 

Exhibit 13A to
Amended and Restated
Credit Agreement

 

Form of Assignment and Acceptance

 

Dated:                        

 

ASSIGNMENT AND ACCEPTANCE AGREEMENT, dated as of                     ,
             among                                              (the
“Assignor”),                                              (the “Assignee”) and
CoBank, ACB, as Agent for the lenders from time to time party to the Credit
Agreement described below (in such capacity, the “Agent”).

 

Please refer to the certain Amended and Restated Credit Agreement dated as of
June 4, 2010 (as amended, amended and restated, supplemented, restated or
otherwise modified or renewed from time to time, the “Credit Agreement”) by and
among National Beef Packing Company, LLC, a Delaware limited liability company
(the “Borrower”), certain of its subsidiaries, the Agent and various other
Persons. Terms defined in the Credit Agreement and not defined herein are used
herein with the same meaning.

 

NOW, THEREFORE, the Assignor and the Assignee agree as follows:

 

1.             Upon the execution and delivery of this Assignment and Acceptance
Agreement by the Assignor, the Assignee and the Agent, the Assignee [shall be]
[shall continue to be] a Bank party to the Credit Agreement for all purposes
thereof.

 

2.            Prior to the execution and delivery of this Assignment and
Acceptance Agreement:

 

a.            the Assignor’s and the Assignee’s Line of Credit Loan Commitments
(and the principal amount of the Assignor’s and the Assignee’s outstanding Line
of Credit Loans) were $                       and $                          
(and $                     and $                          ), respectively (the
“Original Line of Credit Commitments”) and the Assignor’s and the Assignee’s Pro
Rata Percentages of the Line of Credit Loans were                        and
                  , respectively (the “Original Line of Credit Percentages”);

 

b.            the Assignor’s and the Assignee’s Term Loan Commitments (and the
outstanding principal amount of the Assignor’s and the Assignee’s Term Loans)
were $               and $                 (and $                     and
$                      ), respectively (the “Original Term Loan Commitments”)
and the Assignor’s and the Assignee’s Pro Rata Percentages of the Term Loans
were                  and           , respectively (the “Original Term Loan
Percentages”);

 

3.            Upon the execution and delivery of this Assignment and Assumption
Agreement:

 

a.            the Line of Credit Loan Commitments of the Assignor and the
Assignee (and the principal amount of the Assignor’s and the Assignee’s
outstanding Line of Credit Loans) shall be $                       and
$                     (and $                       and

 

1

--------------------------------------------------------------------------------

 

$                    ), respectively, the sum of which shall equal the sum of
the Original Line of Credit Commitments, and the Pro Rata Percentages of the
Line of Credit Loans of the Assignor and the Assignee shall be
                                       and                   , respectively, the
sum of which shall equal the sum of the Original Line of Credit Percentages;

 

b.            the Term Loan Commitments of the Assignor and the Assignee (and
the outstanding principal amount of the Assignor’s and the Assignee’s Term
Loans) shall be $                   and $                     (and
$                     and $                      ), respectively, the sum of
which shall equal the Original Term Loan Commitments, and the Pro Rata
Percentages of the Term Loans of the Assignor and the Assignee shall be
                     and                     , respectively, the sum of which
shall equal the Original Term Loan Percentages; and

 

4.             The Assignor: (a) represents and warrants that it is the legal
and beneficial owner of the interest being assigned by it hereunder and that
such interest is free and clear of any adverse claim; (b) makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with any
Financing Document or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of any Financing Document or any other
instrument or document furnished pursuant thereto; (c) makes no representation
or warranty and assumes no responsibility with respect to the financial
condition of the Borrower or the performance or observance by the Borrower of
any of its obligations under any Financing Document or any other instrument or
document furnished pursuant thereto; [and] (d) attaches the [Line of Credit
Note] payable to the Assignor and requests that the Agent exchange such [Line of
Credit Note] for new [Line of Credit Notes] as follows: a [Line of Credit Note]
dated [Insert Date - Same Date as Old Note] in the principal amount of $[Insert
$ Amount], payable to the order of the Assignee and a [Line of Credit Note]
dated [Insert Date — Same Date as Old Note] in the principal amount of $ [Insert
$ Amount], payable to the order of the Assignor; [and (?) attaches the [Term
Note] payable to the Assignor and requests that the Agent exchange such [Term
Note] for new [Term Notes] as follows: a [Term Note] dated [Insert Date - Same
Date as Old Note] in the principal amount of $[Insert $ Amount], payable to the
order of the Assignee and a [Term Note] dated [Insert Date - Same Date as Old
Note] in the principal amount of $[Insert $ Amount], payable to the order of the
Assignor;] [and (?) has delivered and endorsed the Notes held by the Assignor to
the Assignee, payable to the order of the Assignee].

 

5.            The Assignee:  (a) confirms that it has received copies of the
Financing Documents, together with copies of the most recent financial
statements referred to in Section 9.1 of the Credit Agreement and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Assignment and Acceptance; (b) agrees
that it will, independently and without reliance upon the Agent, the Assignor or
any other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Credit Agreement; (c) appoints and authorizes the
Agent to take such action on the Assignee’s behalf and to exercise such powers
under the Financing Documents as are delegated to the Agent by the terms
thereof, together with such powers as are reasonably incidental thereto;
(d) agrees that it will perform in accordance with their terms all of the
obligations which by the terms of the Credit Agreement and the other Financing
Documents are required to be performed

 

2

--------------------------------------------------------------------------------

 

by the Assignee as a Lender; (e) (if such Assignee is a bank or financial
institution organized outside the United States) agrees that it will deliver to
the Agent and the Borrower the forms prescribed by the Internal Revenue Service
of the United States (including without limitation, Form W-8BEN, Form W-8EC1, or
Form W-8IMY) certifying such Assignee’s exemption from United States withholding
taxes with respect to all payments to be made to such Assignee under its Notes
and under any other Financing Document; and (f) specifies as its address for
notices the office set forth beneath its name on the signature pages hereof.

 

6.             The Restatement  date for this Assignment and Acceptance shall be
[Agent inserts date of its acceptance] (the “Restatement  Date”). Following the
execution of this Assignment and Acceptance, it will be delivered to the Agent
for acceptance and recording by the Agent.

 

7.             Upon such acceptance and recording, as of the Restatement  Date:
(a) the Assignee shall be a party to the Credit Agreement and, to the extent
provided in this Assignment and Acceptance, shall have the rights and
obligations of a Lender thereunder and under the other Financing Documents; and
(b) the Assignor shall, to the extent provided in this Assignment and
Acceptance, relinquish its rights and be released from its obligations under the
Credit Agreement and the other Financing Documents and in the event that the
Assignor has assigned to the Assignee hereunder all of its rights and
obligations under the Credit Agreement and the other Financing Documents, the
Assignor shall cease to be a party to the Credit Agreement and such other
Financing Documents.

 

8.             Upon such acceptance and recording, from and after the
Restatement  Date, the Agent shall make all payments under the Credit Agreement
in respect of the interest assigned hereby (including without limitation, all
payments of principal, interest and commitment fees with respect thereto) to the
Assignee. The Assignor and Assignee shall make all appropriate adjustments in
payments under the Credit Agreement for periods prior to the Restatement  Date
directly between themselves.

 

9.             This Assignment and Acceptance shall be governed by, and
construed in accordance with, the laws of the State of Colorado, without regard
to the conflict of laws principles thereof.

 

3

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the parties hereto, by their respective officers thereunto
duly authorized, have executed this Assignment and Acceptance Restatement  as of
the day first written above.

 

 

[NAME OF ASSIGNOR]

 

 

 

By:

 

 

Its:

 

 

 

 

[NAME OF ASSIGNEE]

 

 

 

By:

 

 

Its:

 

 

 

 

Address for Notices:

 

 

 

 

 

 

 

 

Accepted this: [Insert Date]

 

 

 

 

COBANK, ACB, as Agent

5500 South Quebec Street

Greenwood Village, Colorado 80111

Facsimile: 720-528-6225

 

 

 

 

 

By:

 

 

Its:

 

 

 

Consent granted this: [Insert Date]

 

 

 

 

NATIONAL BEEF PACKING COMPANY, LLC,
a Delaware limited liability company

 

 

 

By:

 

 

Its:

 

 

4

--------------------------------------------------------------------------------

 

Exhibit 13C to
Amended and Restated
Credit Agreement

 

Form of Voting Participant Notification and Consent

 

Reference is made to the Amended and Restated Credit Agreement dated as of
June [    ], 2010 (as the same may be amended, amended and restated,
supplemented, restated or otherwise modified from time to time, the “Credit
Agreement”) by and among National Beef Packing Company, LLC (the “Borrower”),
certain of its subsidiaries, CoBank, ACB, as agent (the “Agent”), and the other
Persons from time to time party thereto. Capitalized terms used herein and not
otherwise defined shall have the meanings assigned to such terms in the Credit
Agreement.

 

Pursuant to Section 13.23 of the Credit Agreement, the Lender identified below
hereby notifies the Agent that it is designating the participant identified
below as being entitled to be accorded the rights of a voting participant as
described in Section 13.23(e). Such participants must be members of the Farm
Credit System, have purchased a participation in the minimum amount of
$10,000,000 on or after the Restatement  Date and have received the written
consent of Borrower and the Agent.

 

Lender:

 

 

 

Voting Participant:

 

 

 

Full Legal Name:

 

 

 

Address for Notices:

 

 

 

 

 

 

 

Attention:

 

 

 

Amount of Participation Purchased:

$

 

 

Date of Notification:

 

 

--------------------------------------------------------------------------------

 

 

[Lender]

 

 

 

 

 

By:

 

 

Its:

 

 

 

 

[Participant]

 

 

 

 

 

By:

 

 

Its:

 

 

Pursuant to Section 13.23 of the Credit Agreement, the undersigned hereby
consent to the institution identified herein becoming a voting participant.

 

 

 

NATIONAL BEEF PACKING COMPANY, LLC

 

 

 

 

 

 

 

 

By:

 

 

 

Its:

 

 

 

 

 

 

 

COBANK, ACB, as Agent

 

 

 

 

 

 

 

 

By:

 

 

 

 

--------------------------------------------------------------------------------