Exhibit 10.3


 


Loan No. RIE539T05E


 


NON-REVOLVING CREDIT SUPPLEMENT


LETTERS OF CREDIT


 


THIS SUPPLEMENT to the Master Loan Agreement dated May 23,
2005 (the “MLA”), is entered into as of January 22, 2008 between CoBANK, ACB (“CoBank”) and DAKOTA
GROWERS PASTA COMPANY, INC., Carrington, North Dakota (the “Company”),
and amends and restates the Supplement dated May 15, 2007 and numbered
RIE539T05D.


 


SECTION 1.         The
Non-Revolving Credit Facility.  On the terms and conditions set forth in the
MLA and this Supplement, CoBank agrees to make loans to the Company during the
period set forth below in an aggregate principal amount not to exceed
$350,000.00 at any one time outstanding (the “Commitment”).  Within the limits of the Commitment, amounts
borrowed and later repaid may not be reborrowed.


 


SECTION 2.         Purpose.  The purpose of the Commitment is to reimburse
CoBank for any drafts that it may honor under letter(s) of credit issued
hereunder (“Letter of Credit”).  If
CoBank honors any such drafts submitted under a Letter of Credit, Company
hereby irrevocably authorizes CoBank to make a loan hereunder to reimburse
CoBank for such draft payments.


 


SECTION 3.         Term.  The term of the Commitment shall be from the
date hereof, up to and including September 30, 2009, or such later date as
CoBank may, in its sole discretion, authorize in writing.


 


SECTION 4.         Interest.  The Company agrees to pay interest on the
unpaid balance of the loan(s) in accordance with the following interest
rate:


 


CoBank Base Rate.  At a
rate per annum equal at all times to 2% above the rate of interest established
by CoBank from time to time as its CoBank Base Rate, which rate is intended by
CoBank to be a reference rate and not its lowest rate.  The CoBank Base Rate will change on the date
established by CoBank as the effective date of any change therein and CoBank
agrees to notify the Company of any such change.  Interest shall be calculated on the actual
number of days each loan is outstanding on the basis of a year consisting of
360 days and shall be payable monthly in arrears by the 20th day of the
following month or on such other day in such month as CoBank shall require in a
written notice to the Company.


 


SECTION 5.         Promissory
Note.  The Company promises to repay
the unpaid principal balance of the loans on the last day of the term of the
Commitment.  In addition to the above,
the Company promises to pay interest on the unpaid principal balance of the
loans at the times and in accordance with the provisions set forth in Section 4
hereof.  This note replaces and
supersedes, but does not constitute payment of the indebtedness evidenced by,
the promissory note set forth in the Supplement being amended and restated
hereby.


 


SECTION 6.         Letters of
Credit.  If agreeable to CoBank in
its sole discretion in each instance, in addition to loans, the Company may
utilize the Commitment to open irrevocable letters of credit for its
account.  Each letter of credit will be
issued within a reasonable period of time after receipt of a duly completed and
executed copy of CoBank’s then current form of application or, if applicable,
in accordance with the terms of any CoTrade Agreement between the parties, and
shall reduce the amount available under the Commitment by the maximum amount
capable of being drawn thereunder.  Any
draw under any letter of credit issued hereunder shall be deemed an advance
under the Commitment.  Each letter of
credit must be in form and content acceptable to CoBank and must expire no
later than the maturity date of the loans.


 


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                IN WITNESS WHEREOF, the parties
have caused this Supplement to be executed by their duly authorized officers as
of the date shown above.


 


	
  CoBANK,
  ACB

  	
  DAKOTA
  GROWERS PASTA COMPANY, INC.

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
  /s/
  Edward Irion

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
  Title:

  	
  CFO

  



 


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