Exhibit
10.27


 


FOURTH AMENDMENT
AGREEMENT


 


FOURTH AMENDMENT AGREEMENT (this “Agreement”) dated as of February 23, 2004 by and between
Griffin Land & Nurseries, Inc. (the “Borrower”) and Fleet National Bank (the “Bank”) amending that
certain Credit Agreement dated as of February 8, 2002 by and between the Bank
and the Borrower, as amended by that certain Amendment Agreement dated as of
August 31, 2002, that certain Second Amendment Agreement dated as of January
31, 2003 and that certain Third Amendment Agreement dated as of May 22, 2003
(as amended and in effect from time to time, the “Credit Agreement”).


 


W I T N E S S E T
H:


 


WHEREAS, the Borrower has requested that the Bank waive certain Events of
Default which exist under the Credit Agreement and amend certain terms and
conditions of the Credit Agreement in the manner set forth herein; and


 


WHEREAS, the Bank is willing to waive such Events of Default and amend certain
terms and conditions of the Credit Agreement on the terms and conditions set
forth herein.


 


NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:


 


§1.                                      Definitions.  Capitalized
terms used herein without definition that are defined in the Credit Agreement
shall have the same meanings herein as therein.


 


§2.                                      Ratification
of Existing Agreements.  The Borrower hereby acknowledges and
agrees that nothing set forth herein shall alter or affect the validity or
effectiveness of any of the Obligations. 
All of the Borrower’s obligations and liabilities to the Bank as
evidenced by or otherwise arising under the Credit Agreement, the Note and the
other Loan Documents, except as otherwise expressly modified in this Agreement
upon the terms set forth herein, are, by the Borrower’s execution of this
Agreement, ratified and confirmed in all respects.  In addition, by the Borrower’s execution of this Agreement, the
Borrower represents and warrants that no counterclaim, right of set-off or
defense of any kind exists or is outstanding as of the date hereof with respect
to such obligations and liabilities.


 


§3.                                      Representations
and Warranties.  The Borrower hereby represents and warrants
to the Bank that (a) all of the representations and warranties made by the
Borrower and the Guarantors in the Credit Agreement, the Note and the other
Loan Documents are true and correct on the date hereof as if made on and as of
the date hereof, except to the extent that any of such representations and
warranties expressly relate by their terms to a prior date and for matters
previously disclosed to the Bank in writing, and (b) after giving effect to the
transactions contemplated hereby, no Default or Event of Default under and as
defined in any of the Loan Documents has occurred and is continuing on the date
hereof.


 

















 


§4.                                      Conditions
Precedent.  The effectiveness of the amendments and waivers
contemplated hereby shall be subject to the satisfaction on or before the date
hereof of each of the following conditions precedent:


 


(a)                                         Representations
and Warranties.  All of the
representations and warranties made by the Borrower herein, whether directly or
incorporated by reference, shall be true and correct on the date hereof, except
as provided in §3 hereof.


 


(b)                                        Performance;
No Event of Default.  The Borrower
shall have performed and complied in all material respects with all terms and
conditions herein required to be performed or complied with by it prior to or
at the time hereof, and, after giving effect to the terms of this Agreement,
there shall exist no Default or Event of Default or condition which, with
either or both the giving of notice of the lapse of time, would result in an
Event of Default upon the execution and delivery of this Agreement.


 


(c)                                        Corporate
Action.  All requisite corporate
action necessary for the valid execution, delivery and performance by the
Borrower and the Guarantors of this Agreement and all other instruments and
documents delivered by the Borrower and the Guarantors in connection therewith
shall have been duly and effectively taken.


 


(d)                                        Delivery.  The relevant parties hereto shall have
executed and delivered this Agreement, the Griffin Security Agreement and the
Imperial Security Agreement, together with all filings, recordings, deliveries
of instruments and other actions necessary or desirable in the opinion of the
Bank to protect and preserve such security interests, all in form and substance
satisfactory to the Bank.


 


(e)                                        Shareholder
Comfort Letter.  The Borrower shall
have delivered to the Bank a comfort letter executed by Frederick M. Danziger
(“Danziger”), in form
and substance satisfactory to the Bank pursuant to which Danziger shall have
(i) acknowledged his commitment to exercise the Stock Option on or before June
1, 2004; and (ii) agreed to execute and deliver such further instruments and
agreements and take all such actions as may be reasonably necessary to exercise
the Stock Option by such date.


 


(f)                                          Fees
and Expenses.  The Borrower shall
have paid to the Bank a waiver and restructuring fee in the amount of $100,000,
which the Bank acknowledges receipt thereof. 
The Borrower shall also have paid to the Bank (i) an amendment fee in
the amount of $20,000, and (ii) all fees and expenses incurred by the Bank in
connection with this Agreement, the Credit Agreement or the other Loan
Documents on or prior to the date hereof.


 


2

















 


§5.                                      Amendments to the Credit Agreement.


 


§5.1.                         Amendments
to §1.  The following definitions appearing in Section 1 of the
Credit Agreement are each hereby amended and restated in their entirety to read
as follows:


 


Applicable Margin. 
For each period commencing on an Adjustment Date through the date
immediately preceding the next Adjustment Date (each a “Rate Adjustment Period”), the Applicable
Margin shall be the applicable margin set forth below with respect to the Debt
Service Coverage Ratio, as determined for the Debt Service Reference Period of
the Borrower and its Subsidiaries ending on the fiscal quarter ended
immediately prior to the applicable Rate Adjustment Period.


 


	
  Level

  	
   

  	
  Debt
  Service Coverage 

  Ratio

  	
   

  	
  Base Rate 

  Loans

  	
   

  	
  LIBOR Rate
  

  Loans

  	
   

  
	
  I

  	
   

  	
  Less than
  1.00:1.00

  	
   

  	
  1.00

  	
  %

  	
  3.00

  	
  %

  
	
  II

  	
   

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

  	
   

  	
  0.50

  	
  %

  	
  2.50

  	
  %

  
	
  III

  	
   

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

  	
   

  	
  0.00

  	
  %

  	
  1.75

  	
  %

  
	
  IV

  	
   

  	
  Greater than
  3.00:1.00

  	
   

  	
  -0.50

  	
  %

  	
  1.50

  	
  %

  



 


Notwithstanding
the foregoing, (a) for the Loans outstanding during the period commencing on
the Closing Date through the date immediately preceding the first Adjustment
Date to occur after the fiscal quarter ending June 1, 2002, the Applicable
Margin shall be the Applicable Margin set forth in Level II above, and (b) if
the Borrower fails to deliver any Compliance Certificate pursuant to §8.4(d)
hereof then, for the period commencing on the next Adjustment Date to occur
subsequent to such failure through the date immediately following the date on
which such Compliance Certificate is delivered, the Applicable Margin shall be
the highest Applicable Margin set forth above.


 


Commitment. 
The obligation of the Bank to make Loans to, and to issue, extend and
renew Letters of Credit for the account of, the Borrower up to an aggregate
outstanding principal amount not to exceed the result of (a) $20,508,000, minus
(b) the sum of the Commitment Reduction Amounts, minus (c) the amount by
which the amounts available for borrowing under the New 


 


3

















 


Credit Facility exceed $2,500,000, as the same may be reduced from time
to time; or if such commitment is terminated pursuant to the provisions hereof,
zero.


 


Loan Documents. 
This Credit Agreement, the Note, the Guaranties, the Letter of Credit
Applications, the Letters of Credit, the Environmental Indemnity Agreements,
the Security Documents and any document, agreement and/or instrument executed
and/or delivered in connection therewith.


 


Security Documents. The Mortgages, the Assignments of
Leases and Rents, the Griffin Security Agreement, the Imperial Security
Agreement, and all other instruments and documents, including without
limitation Uniform Commercial Code financing statements, required to be
executed or delivered pursuant to any Security Document.


 


§5.2.                         Amendments
to §1.  The following new definitions are hereby added to Section
1 of the Credit Agreement in their proper alphabetical order to read as
follows:


 


Acceptable Capital
Financing.  The sale or other issuance by the Borrower
of any equity securities or Subordinated Debt on or after the Fourth Amendment
Date to a Person that is not the Borrower or any of its Subsidiaries, the Net
Cash Proceeds of which are not less than $14,000,000 and which is otherwise on
terms and conditions reasonably satisfactory to the Bank and the Borrower.


 


Centaur Shares.  The 5,428,194 B Ordinary Shares of Centaur held by the Borrower.


 


Comfort Letter. The comfort letter, dated on or before
the Fourth Amendment Date, from Frederick M. Danziger in favor of the Bank and
in form and substance satisfactory to the Bank.


 


EBIT.  With respect to any fiscal period, an amount equal to the sum of
(a) Consolidated Net Income (or Loss) for such fiscal period, plus (b)
in each case to the extent deducted in the calculation of Consolidated Net
Income (or Loss) and without duplication, (i) income tax expense for such
fiscal period, plus (ii) Consolidated Total Interest Expense for such
fiscal period, plus (iii) any other non-cash charges for such fiscal
period, all as determined in accordance with generally accepted accounting
principles.


 


Fourth Amendment
Date.  February 23, 2004.


 


Griffin Security
Agreement.  The Pledge Agreement, dated as of the Fourth
Amendment Date, by and between the Borrower and the Bank pursuant to which the
Borrower has granted a first priority perfected security interest in favor of
the Bank in all distributions from, and all proceeds of, the Centaur Shares and
in form and substance satisfactory to the Bank.


 


Imperial Security
Agreement.  The Security Agreement, dated as of the
Fourth Amendment Date, by and between Imperial and the Bank pursuant to 


 


4

















 


which Imperial has granted a first priority perfected security interest
in favor of the Bank on certain assets of Imperial and in form and substance
satisfactory to the Bank.


 


Net Cash Proceeds. 
The cash proceeds (including any cash payment received by way of
deferred payment of principal pursuant to a note or installment receivable or
purchase price adjustment receivable or otherwise, but only as and when
received) from (x) the exercise of the Stock Option, (y) the sale or issuance
by the Borrower of any equity securities or Subordinated Debt pursuant to the
Acceptable Capital Financing, or (z) the sale, transfer or other disposition of
the Centaur Shares by the Borrower, in each case net of all costs of such sale,
including legal costs, underwriting or brokerage costs, and taxes paid or
payable as a result thereof by the Borrower.


 


New Credit
Facility.  A financing arrangement entered into by the
Borrower on or after the Fourth Amendment Date with one or more Persons (other
than the Borrower or an Affiliate of the Borrower) pursuant to which such
Persons have agreed to extend credit to the Borrower in an amount not to exceed
$5,000,000 in the aggregate.


 


Stock Option. 
Stock options held by Frederick M. Danziger resulting in Net Cash
Proceeds of at least $4,000,000 to the Borrower upon the exercise thereof.


 


§5.3.                         Amendment
to §2.1.  Section 2.1 of the Credit Agreement is hereby amended
by inserting the following clause at the end of the first sentence thereof:


 


; provided
further, that the Borrower shall not permit the total outstanding amount of
the Loans (after giving effect to all amounts requested) plus the
Maximum Drawing Amount and all Unpaid Reimbursement Obligations to exceed
$12,000,000 at any time for a minimum of thirty (30) consecutive days during
the period commencing on August 1st and ending on October 31st
of each calendar year.


 


§5.4.                         Amendment
to §3.2.  Section 3.2 of the Credit Agreement is hereby amended
and restated in its entirety to read as follows:


 


3.2. 
Mandatory Repayments of Loans.


 


(a)                                         If at any time the sum of the outstanding
amount of the Loans, the Maximum Drawing Amount and all Unpaid Reimbursement
Obligations exceeds the Commitment, then the Borrower shall immediately pay the
amount of such excess to the Bank for application:  first, to any Unpaid Reimbursement Obligations; second, to the
Loans; and third, to provide to the bank cash collateral for Reimbursement
Obligations as contemplated by §4.2(b) and (c).


 


5

















 


(b)                                        If the Borrower receives any Net Cash
Proceeds then the Borrower shall apply such portion of such Net Cash Proceeds
on such date of receipt toward the prepayment of the Obligations as shall
eliminate the then outstanding indebtedness thereunder in the manner set forth
in clause (a) of this §3.2.  The
Borrower’s obligations pursuant to this Section 3.2(b) shall terminate upon the
earlier of (i) the sale, transfer or other disposition of the Centaur Shares by
the Borrower and the application of the Net Cash Proceeds received therefrom in
accordance with this §3.2(b) and (ii) the consummation of the Acceptable
Capital Financing and the Borrower’s receipt of the proceeds from the exercise
of the Stock Option.


 


§5.5.                         Amendment
to §8.  Section 8 of the Credit Agreement is hereby amended by
inserting the following new §8.14 to read as follows:


 


8.14.  Acceptable Capital Financings. 
If the sale by the Borrower of the Centaur Shares has not occurred by
May 1, 2004, then on or before June 1, 2004, the Borrower shall receive the
proceeds from the exercise of the Stock Option and shall consummate the
Acceptable Capital Financing.  In
addition, the Borrower shall pay a fee in the amount of $5,000 each on the 17th
day of each calendar month, commencing with the first such date falling after
the Fourth Amendment Date, during which the Commitment is outstanding and
continuing until the earlier of (a) the Centaur Shares have been sold and the
Net Cash Proceeds have been applied to the Obligations in accordance with
§3.2(b) or (b) the Stock Option has been exercised and the Acceptable Capital
Financing has been consummated by the Borrower.


 


§5.6.                         Amendment
to §9.1.  Section 9.1 of the Credit Agreement is hereby amended
by deleting the period at the end of subsection (l) and inserting “; and” in
lieu thereof and inserting a new subsection (m) to read as follows:


 


“(m)                             Indebtedness in respect of the New Credit
Facility.”


 


§5.7.                         Amendment
to §9.2.  Section 9.2 of the Credit Agreement is hereby amended
by deleting the word “and” at the end of paragraph (ix) thereof, deleting the
period at the end of clause (x) and inserting the following new clauses (xi)
and (xii):


 


(xi)                                   liens senior to the Bank on the assets of
Imperial granted in favor of the lenders under the New Credit Facility in order
to secure Imperial’s obligations with respect thereto subject to the terms of
an intercreditor agreement in form and substance reasonably satisfactory to the
Bank; and


 


(xii)                              restrictions on the Centaur Shares
contained in the Shareholders’ Agreement, dated August 4, 1998, among Graham
Veere Sherren, the Borrower, VS&A Communications Partners II, L.P. and
Centaur, as such agreement may be amended from time to time, and restrictions
on any capital stock or equity interest issued in 


 


6

















 


exchange
for the Centaur Shares pursuant to any similar shareholders agreement.


 


§5.8.                         Amendment
to §9.3.  Section 9.3 of the Credit Agreement is hereby amended
by deleting the word “and” at the end of paragraph (i) thereof, deleting the
period at the end of clause (j), inserting “;” in lieu thereof and inserting
the following new clauses (k) and (l):


 


(k)                                        any capital stock or equity interests
issued to the Borrower in exchange for Centaur Shares; and


 


(l)                                           319 additional shares of Shemin
Acquisition Corporation.


 


§5.9.                         Amendment
to §9.5.2.  The first sentence of §9.5.2 of the Credit Agreement
is hereby amended and restated in its entirety to read as follows:


 


The Borrower will
not, nor will it permit any of its Subsidiaries to, become a party to or agree
to or effect any disposition of any assets; provided, that the Borrower and its
Subsidiaries may (a) dispose of assets (other than Collateral and the Centaur
Shares) for an amount equal to the fair value of such asset, determined by the
board of directors of the Borrower or such Subsidiary, in each case in the
ordinary course of business consistent with past practices, (b) the Borrower
and any of its Subsidiaries may dispose of real property that constitutes
Collateral for an amount equal to the fair value of such Collateral, determined
by the board of directors of the Borrower, upon ten (10) Business Days prior
written notice by Borrower to Bank so long as no Default or Event of Default
has occurred and is continuing (or would result therefrom), (c) the Borrower
and its Subsidiaries may dispose of inventory in the ordinary course of
business, (d) the Borrower may dispose of damaged, worn-out or obsolete assets
in the ordinary course of business and (e) the Borrower may dispose of the
Centaur Shares for an amount equal to the fair value of such Centaur Shares,
determined by the board of directors of the Borrower, so long as it complies
with the provisions of §3.2(b) of this Credit Agreement in connection with such
disposition.


 


§5.10.                Amendments to
Sections 10.1, 10.2 and 10.4. 
Sections 10.1, 10.2 and 10.4 of the Credit Agreement are hereby amended
and restated in their entirety to read as follows:


 


10.1.                         Net Worth. 
As of the end of each fiscal quarter of the Borrower, the Borrower will
not permit Consolidated Net Worth to be less than an amount equal to (a) the
sum of (i) $93,000,000, plus (ii) on a cumulative basis, seventy-five
percent (75%) of positive Consolidated Net Income for each fiscal year of the
Borrower commencing with the fiscal year ending November 30, 2002, less
(b) the aggregate of any reductions after the Balance Sheet Date in the value,
as included in the Consolidated Total Assets of the Borrower’s Investment in
Centaur and/or Linguaphone, including any reduction in the value of Centaur 


 


7

















 


and/or Linguaphone
as the result of any currency fluctuation after the Balance Sheet Date.


 


10.2.                         Fixed Charge Coverage Ratio.  The Borrower will not permit the Fixed
Charge Coverage Ratio to be less than (a) 0.75:1.00 for the period consisting
of the three consecutive fiscal quarters of the Borrower ending August 28, 2004
and (b) 1.00:1.00 for the period consisting of four consecutive fiscal quarters
of the Borrower ending on or after November 27, 2004.


 


10.4.                         Consolidated Profitability. 
The Borrower will not permit EBIT of the Borrower for any fiscal quarter
ending during any period described in the table set forth below to be (a) in
the case of negative EBIT, greater than the amount set forth opposite such
period, and (b) in the case of positive EBIT, less than the amount set forth
opposite such period:


 


	
  Period

  	
   

  	
  Amount

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  November 30, 2003 to and including February 28, 2004

  	
   

  	
  $

  	
  (1,700,000

  	
  )

  
	
   

  	
   

  	
   

  	
   

  
	
  February 29, 2004 to and including May 29, 2004

  	
   

  	
  $

  	
  400,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  May 30, 2004 to and including August 28, 2004

  	
   

  	
  $

  	
  0.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  August 29, 2004 to and including November 27, 2004

  	
   

  	
  $

  	
  0.00

  	
   

  



 


§5.11.                Amendment to
§13.1(c).  Section 13.1(c) of the Credit Agreement is hereby
amended by inserting “8.14,” after “8.12,” in the second line thereof.


 


§6.                                      Waivers.  Subject
to the satisfaction of the conditions set forth above, the Bank hereby waives
those Events of Default that have occurred under the Credit Agreement as a
result of the Borrower’s failure, on or before the date hereof, to comply with
those sections of the Credit Agreement set forth on Schedule  1
attached hereto.  The waiver set forth
in this §6 shall be effective only for those Events of Defaults contained in
the existing Credit Agreement as specified in the preceding sentence occurring
on or before the date hereof and such waiver shall not entitle the Borrower to
any future waiver in similar or other circumstances.  Without limiting the foregoing, upon the occurrence of an Event
of Default after the date hereof, or if an Event of Default has occurred and is
continuing on the date hereof that is not set forth on Schedule  1,
the Bank shall be free in its sole and absolute discretion to accelerate the
payment in full of the Borrower’s indebtedness to the Bank under the Credit
Agreement and the other Loan Documents, and may, if the Bank so elects, proceed
to enforce any or all of the Bank’s rights under or in respect of the Credit
Agreement and the other Loan Documents and applicable law.


 


8

















 


§7.                                      No
Waiver by Bank.  Except as otherwise expressly provided for
herein, nothing in this Agreement shall extend to or affect in any way the
Borrower’s obligations or the Bank’s rights and remedies arising under the
Credit Agreement or the other Loan Documents, and the Bank shall not be deemed
to have waived any or all of its remedies with respect to any Event of Default
(other than an Event of Default arising under the Credit Agreement as a result
of the Borrower’s failure to comply with those sections of the Credit Agreement
set forth on Schedule  1 attached hereto and then only to the
extent set forth in §6 hereof) or event or condition which, with notice or the
lapse of time, or both would become an Event of Default and which upon the
Borrower’s execution and delivery of this Agreement might otherwise exist or
which might hereafter occur.


 


§8.                                      Release.  The
Borrower, on its own behalf and on behalf of its shareholders, employees and
agents and its successors and assigns, hereby waives, releases and discharges
the Bank and all affiliates of the Bank, and all of their directors, officers,
employees, attorneys and agents, from any and all claims, demands, actions or
causes of action whether known or unknown, arising out of or in any way
relating to this Agreement, the Credit Agreement, the Loan Documents and/or any
documents, agreements, dealings or other matters connected with the Credit
Agreement, the Loan Documents or the administration thereof.


 


§9.                                      Additional
Covenants.  Without any prejudice or impairment whatsoever to
any of the Bank’s rights and remedies contained in the Credit Agreement and the
covenants contained therein, the Note or in any of the other Loan Documents,
the Borrower additionally covenants and agrees with the Bank that the Borrower
shall comply and continue to comply with all of the terms, covenants and
provisions contained in the Credit Agreement, the Note and the other Loan
Documents, except as such terms, covenants and provisions are expressly
modified by this Agreement upon the terms set forth herein.  The Borrower expressly acknowledges and
agrees that any failure by the Borrower to comply with the terms and conditions
of this §9 or any other provisions contained in this Agreement shall constitute
an Event of Default under the Credit Agreement.


 


§10.                             Expenses.  The
Borrower agrees to pay to the Bank (a) on the date hereof an amount equal to
any and all reasonable out-of-pocket costs or expenses (including reasonable
legal fees and disbursements and appraisal expenses) incurred or sustained by
the Bank in connection with the negotiation and preparation of this Agreement
and related matters, (b) on the date hereof Bank’s examiner fees and
disbursements incurred through the date hereof, and (c) upon demand from time
to time any and all reasonable out-of-pocket costs or expenses (including
commercial examiner fees and reasonable legal fees and disbursements) hereafter
incurred by the Bank in connection with the administration of credit extended
by the Bank to the Borrower or the preservation of or enforcement of its rights
under the Credit Agreement, the Note and the other Loan Documents or in respect
of any of the Borrower’s other obligations to the Bank.


 


9

















 


§11.                             Miscellaneous.


 


(a)                                         This
Agreement shall be governed by and construed in accordance with the laws of the
State of Connecticut.


 


(b)                                        Except
as otherwise expressly provided by this Agreement, all of the respective terms,
conditions and provisions of the Credit Agreement shall remain the same.  It is declared and agreed by each of the
parties hereto that the Credit Agreement, as amended hereby, shall continue in
full force and effect, and that this Agreement and the Credit Agreement be read
and construed as one instrument, and all references in the Loan Documents to
the Credit Agreement shall hereafter refer to the Credit Agreement, as amended
by this Agreement.


 


(c)                                        This
Agreement may be executed in any number of counterparts, but all such
counterparts shall together constitute but one instrument.  In making proof of this Agreement it shall
not be necessary to produce or account for more than one counterpart signed by
each party hereto by and against which enforcement hereof is sought.  TIME IS OF THE ESSENCE AS TO ALL OF THE
PROVISIONS HEREIN.


 


[Remainder of page intentionally left
blank; next page is signature page]


 


10

















 


IN WITNESS WHEREOF, each of the parties hereto have caused this Agreement
to be executed in its name and behalf by its duly authorized officer as of the
date first written above.


 


	
   

  	
  FLEET NATIONAL BANK

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Matthew E. Hummel

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  Title: Senior Vice President

  
	
   

  	
   

  
	
   

  	
  GRIFFIN LAND &
  NURSERIES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Anthony Galici

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  Title: Vice President,Chief Financial Officer and
  Secretary

  
	
   

  	
   

  
	
  Each of the undersigned
  Guarantors acknowledges and accepts the foregoing and ratifies and confirms
  its obligations under its respective Guaranty:

  	
   

  
	
   

  	
   

  
	
  IMPERIAL NURSERIES,
  INC.

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Anthony Galici

  	
   

  	
   

  
	
   

  
	
   

  	
  Its Senior Vice
  President

  
	
   

  	
   

  
	
  RIVER BEND ASSOCIATES,
  INC.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Anthony Galici

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Its Vice President

  	
   

  
											



 

















 


SCHEDULE
1


 


The failure of the
Borrower to comply with Section 10.2 (Fixed Charge Coverage Ratio) of the
Credit Agreement for the fiscal quarters ending August 30, 2003 and November
29, 2003.