Document:

Multistate Limited Guaranty (11-01-2000)

Exhibit 10.12

 

Freddie Mac Loan
Numbers:

Old Loan #002649160

New Loan #504180193

Sun RiverVillageApartments

 

AMENDED AND RESTATED
GUARANTY
MULTISTATE
(RECAST TRANSACTION)

 

(for use in all Property
jurisdictions except California)

REVISION DATE
05/06/2005

This Amended and Restated Guaranty
(Recast Transaction) ("Guaranty") is entered into to be effective as of
October 2, 2009, by the undersigned person(s) (the "Guarantor" jointly
and severally if more than one), for the benefit of the FEDERAL HOME LOAN
MORTGAGE CORPORATION (the "Lender").

                                                                   
RECITALS

 

A.       
Borrower is the maker of a Multifamily Note (the “Note”), dated May 23,
2001 in the original amount of Ten Million and 00/100 Dollars ($10,000,000.00)
evidencing a loan (the “Loan”) to Borrower in such amount from LEND
LEASE MORTGAGE CAPITAL, L.P., a Texas limited partnership (the “Original
Lender”).

B.        
The Note is secured by that certain Multifamily Deed of Trust, Assignment of
Rents and Security Agreement, dated May 23, 2001, from Borrower, as grantor, to
Original Lender, a beneficiary, recorded in the Office of the Maricopa County
Recorder, Arizona (the “Land Records”) as Instrument No. 2001-0438719
(the “Instrument”).  The Instrument encumbers, among other things,
Borrower’s interest in the land described in Exhibit A to the Instrument
and to the Amended and Restated Instrument.

C.       
Pursuant to a Limited Guaranty dated May 23, 2001, AIMCO Properties, L.P., a Delaware
limited partnership, guaranteed some or all of Borrower’s obligations under the
terms of the Note and the Instrument.

D.       
Original Lender (i) endorsed the Note to Lender and (ii) assigned the Instrument
to Lender by Assignment of Security Instrument dated May 23, 2001 and recorded
in the Land Records as Instrument No. 2001-0438722.

E.        
Borrower has confirmed to Lender that Borrower has no defenses or offsets of any
kind against any of the indebtedness due under the Note.

F.        
By Amended and Restated Multifamily Note dated effective as of the date of this
Amended and Restated Instrument, Borrower and Lender have amended and restated
the Note so as to, among other things, (i) reflect an aggregate current unpaid
balance of Seven Million Four Hundred Fifty-Two Thousand Three Hundred
Eighty-Three and 00/100 Dollars ($7,452,383.00), and (ii) amend the terms of
payment.  Borrower and Lender now also desire to amend and restate the
Instrument as provided below.

           
NOW, THEREFORE, in consideration of Lender’s agreement to modify the Note, the
Instrument, and other good and valuable consideration, the receipt and
sufficiency of which are acknowledged, the parties agree that the Guaranty is
amended and restated in its entirety in the form attached hereto and made a part
hereof.

 

 

 

 

 

 

[NO FURTHER
TEXT ON THIS PAGE]

 

 

Freddie Mac Loan
Numbers:

Old Loan #002649160

New Loan # 504180193

Sun RiverVillageApartments

                                                                             

GUARANTY

                                                                
MULTISTATE

 

(for use in all Property
jurisdictions except California)

 

REVISION DATE
05/06/05

 

 

This Guaranty ("Guaranty") is entered into to be
effective as of October 2, 2009, by the undersigned person(s) (the
"Guarantor" jointly and severally if more than one), for the benefit of
FEDERAL HOME LOAN MORTGAGE CORPORATION ("Lender").

 

 

RECITALS

 

A.  CENTURY SUN RIVER,
LIMITED PARTNERSHIP, an Arizona
limited partnership (the "Borrower") has requested that
Lender make a loan to Borrower in the amount of $7,452,383.00(the
"Loan").  The Loan will be evidenced by a Multifamily Note from
Borrower to Lender dated effective as of the effective date of this Guaranty
(the "Note").  The Note will be secured by a Multifamily Mortgage,
Deed of Trust, or Deed to Secure Debt dated effective as of the effective date
of the Note (the "Security Instrument"), encumbering the Mortgaged
Property described in the Security Instrument. 

 

B.   As a condition to making the Loan to
Borrower, Lender requires that the Guarantor execute this Guaranty. 

 

NOW, THEREFORE, in order to induce Lender to make the
Loan to Borrower, and in consideration thereof, Guarantor agrees as
follows:

 

    1.     Defined
Terms.  "Indebtedness,"
"Loan Documents" and "Property Jurisdiction" and other capitalized terms
used but not defined in this Guaranty shall have the meanings assigned to them
in the Security Instrument.

 

    2.     Scope of
Guaranty.

 

           
(a)  Guarantor hereby absolutely, unconditionally and irrevocably
guarantees to Lender:

 

                 
(i)      the full and prompt payment when due, whether
at the Maturity Date or earlier, by reason of acceleration or otherwise, and at
all times thereafter, of each of the following: 

 

                          
(A)    a portion of the Indebtedness equal to zero percent
(0%) of the original principal balance of the Note (the "Base
Guaranty"); and 

                          
(B)    in addition to the Base Guaranty, all other amounts for
which Borrower is personally liable under Sections 9(c), 9(d) and 9(f)
of the Note; and

                          
(C)    all costs and expenses, including reasonable Attorneys'
Fees and Costs incurred by Lender in enforcing its rights under this Guaranty;
and

 

                       
(ii)     the full and prompt
payment and performance when due of all of Borrower’s obligations under
Section 18 of the Security Instrument.

 

           
(b)  If the Base Guaranty stated in Section 2(a)(i)(A) is 100 percent
of the original principal balance of the Note, then (i) the Base Guaranty
shall mean and include the full and complete guaranty of payment of the entire
Indebtedness and the performance of all Borrower’s obligations under the Loan
Documents; and (ii) for so long as the Base Guaranty remains in effect
(there being no limit to the duration of the Base Guaranty unless otherwise
expressly provided in this Guaranty), the obligations guaranteed pursuant to
Sections 2(a)(i)(B), 2(a)(i)(C) and Section 3 shall be part of, and
not in addition to or in limitation of, the Base Guaranty.

 

                 
If the Base Guaranty stated in Section 2(a)(i)(A) is less than 100 percent
of the original principal balance of the Note, then this Section 2(b) shall
be completely inapplicable and shall be treated as if not a part of this
Guaranty.       

 

           
(c)  If Guarantor is not liable for the entire Indebtedness, then all
payments made by Borrower with respect to the Indebtedness and all amounts
received by Lender from the enforcement of its rights under the Security
Instrument and the other Loan Documents (except this Guaranty) shall be applied
first to the portion of the Indebtedness for which neither Borrower nor
Guarantor has personal liability. 

 

    3.     Additional Guaranty Relating
to Bankruptcy.  

 

           
(a)  Notwithstanding any limitation on liability provided for elsewhere in
this Guaranty, Guarantor hereby absolutely, unconditionally and irrevocably
guarantees to Lender the full and prompt payment when due, whether at the
Maturity Date or earlier, by reason of acceleration or otherwise, and at all
times thereafter, the entire Indebtedness, in the
event that:

 

                 
(i)      Borrower voluntarily files for bankruptcy
protection under the United States Bankruptcy Code; or 

                 
(ii)     Borrower voluntarily becomes subject to any
reorganization, receivership, insolvency proceeding, or other similar proceeding
pursuant to any other federal or state law affecting debtor and creditor rights;
or 

                 
(iii) an order of relief is entered against Borrower pursuant to the United
States Bankruptcy Code or other federal or state law affecting debtor and
creditor rights in any involuntary bankruptcy proceeding initiated or joined in
by a "Related Party."  

 

           
(b)  For purposes of this Section, the term "Related Party"
means:

 

                 
(i)      Borrower or Guarantor; and

                 
(ii)     any person or entity that holds, directly or
indirectly, any ownership interest in or right to manage Borrower or Guarantor,
including without limitation, any shareholder, member or partner of Borrower or
Guarantor; and

                 
(iii) any person or entity in which any ownership interest (direct or indirect)
or right to manage is held by Borrower, Guarantor or any partner, shareholder or
member of, or any other person or entity holding an interest in, Borrower or
Guarantor; and

                 
(iv)    any other creditor of Borrower that is related by blood,
marriage or adoption to Borrower, Guarantor or any partner, shareholder or
member of, or any other person or entity holding an interest in, Borrower or
Guarantor.  

 

           
(c)  If Borrower, Guarantor or any Related Party has solicited creditors to
initiate or participate in any proceeding referred to in this Section,
regardless of whether any of the creditors solicited actually initiates or
participates in the proceeding, then such proceeding shall be considered as
having been initiated by a Related Party.

 

    4.    
Guarantor's Obligations Survive Foreclosure.  The obligations of Guarantor under this Guaranty shall
survive any foreclosure proceeding, any foreclosure sale, any delivery of any
deed in lieu of foreclosure, and any release of record of the Security
Instrument, and, in addition, the obligations of Guarantor relating to
Borrower's obligations under Section 18 of the Security Instrument shall
survive any repayment or discharge of the Indebtedness.  Notwithstanding
the foregoing, if Lender has never been a mortgagee-in-possession of or held
title to the Mortgaged Property, Guarantor shall have no obligation under this
Guaranty relating to Borrower's obligations under Section 18 of the
Security Instrument after the date of the release of record of the lien of the
Security Instrument as a result of the payment in full of the Indebtedness on
the Maturity Date or by voluntary prepayment in full.

 

    5.     Guaranty of Payment and
Performance.  Guarantor’s obligations under this Guaranty constitute an
unconditional guaranty of payment and performance and not merely a guaranty of
collection.

 

    6.     No Demand
by Lender Necessary; Waivers by Guarantor.  The obligations of Guarantor under this Guaranty shall
be performed without demand by Lender and shall be unconditional regardless of
the genuineness, validity, regularity or enforceability of the Note, the
Security Instrument, or any other Loan Document, and without regard to any other
circumstance which might otherwise constitute a legal or equitable discharge of
a surety, a guarantor, a borrower or a mortgagor. 
Guarantor hereby waives, to the fullest extent permitted by applicable
law:

 

           
(a)  the benefit of all principles or provisions of law, statutory or
otherwise, which are or might be in conflict with the terms of this Guaranty and
agrees that Guarantor's obligations shall not be affected by any circumstances,
whether or not referred to in this Guaranty, which might otherwise constitute a
legal or equitable discharge of a surety, a guarantor, a borrower or a
mortgagor;

 

           
(b)  the benefits of any right of discharge under any and all statutes or
other laws relating to a guarantor, a surety, a borrower or a mortgagor, and any
other rights of a surety, a guarantor, a borrower or a mortgagor under such
statutes or laws;

 

           
(c)  diligence in collecting the Indebtedness, presentment, demand for
payment, protest, all notices with respect to the Note and this Guaranty which
may be required by statute, rule of law or otherwise to preserve Lender's
rights against Guarantor under this Guaranty, including, but not limited to,
notice of acceptance, notice of any amendment of the Loan Documents, notice of
the occurrence of any default or Event of Default, notice of intent to
accelerate, notice of acceleration, notice of dishonor, notice of foreclosure,
notice of protest, and notice of the incurring by Borrower of any obligation or
indebtedness;

 

           
(d)  all rights to cause a marshalling of the Borrower's assets or to
require Lender to:

 

                 
(i)      proceed against Borrower or any other
guarantor of Borrower’s payment or performance under the Loan Documents (an
"Other Guarantor");

                 
(ii)     proceed against any general partner of Borrower or
any Other Guarantor if Borrower or any Other Guarantor is a
partnership;

                 
(iii)    proceed against or exhaust any collateral held by Lender
to secure the repayment of the Indebtedness; or

                 
(iv)    pursue any other remedy it may now or hereafter have
against Borrower, or, if Borrower is a partnership, any general partner of
Borrower; 

 

           
(e)  any right to object to the timing, manner or conduct of Lender's
enforcement of its rights under any of the Loan Documents; and

 

           
(f)   any right to revoke this Guaranty as to any future advances by
Lender under the terms of the Security Instrument to protect Lender’s interest
in the Mortgaged Property.

 

    7.    
Modification of Loan Documents.  At any time or from time to time
and any number of times, without notice to Guarantor and without affecting the
liability of Guarantor, Lender may:

 

           
(a)  extend the time for payment of the principal of or interest on the
Indebtedness or renew the Indebtedness in whole or in part;

 

           
(b)  extend the time for Borrower's performance of or compliance with any
covenant or agreement contained in the Note, the Security Instrument or any
other Loan Document, whether presently existing or hereinafter entered into, or
waive such performance or compliance; 

 

           
(c)  accelerate the Maturity Date of the Indebtedness as provided in the
Note, the Security Instrument, or any other Loan Document;

 

           
(d)  with Borrower, modify or amend the Note, the Security Instrument, or
any other Loan Document in any respect, including, but not limited to, an
increase in the principal amount; and/or

 

           
(e)  modify, exchange, surrender or otherwise deal with any security for
the Indebtedness or accept additional security that is pledged or mortgaged for
the Indebtedness.

 

    8.     Joint and
Several Liability.  The
obligations of Guarantor (and each party named as a Guarantor in this Guaranty)
and any Other Guarantor shall be joint and several.  Lender, in its sole
and absolute discretion, may:

 

           
(a)  bring suit against Guarantor, or any one or more of the parties named
as a Guarantor in this Guaranty, and any Other Guarantor, jointly and severally,
or against any one or more of them;

 

           
(b)  compromise or settle with Guarantor, any one or more of the parties
named as a Guarantor in this Guaranty, or any Other Guarantor, for such
consideration as Lender may deem proper;

 

           
(c)  release one or more of the parties named as a Guarantor in this
Guaranty, or any Other Guarantor, from liability; and

 

           
(d)  otherwise deal with Guarantor and any Other Guarantor, or any one or
more of them, in any manner, and no such action shall impair the rights of
Lender to collect from Guarantor any amount guaranteed by Guarantor under this
Guaranty.  

 

    9.    
Subordination of Borrower's Indebtedness to Guarantor.  Any indebtedness of Borrower held by Guarantor now or in
the future is and shall be subordinated to the Indebtedness and Guarantor shall
collect, enforce and receive any such indebtedness of Borrower as trustee for
Lender, but without reducing or affecting in any manner the liability of
Guarantor under the other provisions of this Guaranty.

 

  10.     Waiver of
Subrogation.  Guarantor shall have
no right of, and hereby waives any claim for, subrogation or reimbursement
against Borrower or any general partner of Borrower by reason of any payment by
Guarantor under this Guaranty, whether such right or claim arises at law or in
equity or under any contract or statute, until the Indebtedness has been paid in
full and there has expired the maximum possible period thereafter during which
any payment made by Borrower to Lender with respect to the
Indebtedness could be deemed a preference under the United States Bankruptcy
Code. 

 

  11.     Preference.  If any
payment by Borrower is held to constitute a preference under any applicable
bankruptcy, insolvency, or similar laws, or if for any other reason Lender is
required to refund any sums to Borrower, such refund shall not constitute a
release of any liability of Guarantor under this Guaranty.  It is the
intention of Lender and Guarantor that Guarantor's obligations under this
Guaranty shall not be discharged except by Guarantor's performance of such
obligations and then only to the extent of such performance.

 

  12.     Financial Statements. 
Guarantor, from time to time upon written request by Lender, shall deliver
to Lender such financial statements as Lender may reasonably require. 

 

  13.     Assignment. 
Lender may assign its rights under this
Guaranty in whole or in part and upon any such assignment, all the terms and
provisions of this Guaranty shall inure to the benefit of such assignee to the
extent so assigned.  The terms used to designate any of the parties herein
shall be deemed to include the heirs, legal representatives, successors and
assigns of such parties, and the term "Lender" shall also include any
lawful owner, holder or pledgee of the Note.  Reference in this Guaranty to
"person" or "persons" shall be deemed to include individuals and
entities.   

 

  14.     Complete and Final
Agreement.  This Guaranty and the
other Loan Documents represent the final agreement between the parties and may
not be contradicted by evidence of prior, contemporaneous or subsequent oral
agreements. There are no unwritten oral agreements between the parties. 
All prior or contemporaneous agreements, understandings, representations, and
statements, oral or written, are merged into this Guaranty and the other Loan
Documents.  Guarantor acknowledges that Guarantor has received a copy of
the Note and all other Loan Documents.  Neither this Guaranty nor any of
its provisions may be waived, modified, amended, discharged, or terminated
except by a writing signed by the party against which the enforcement of the
waiver, modification, amendment, discharge, or termination is sought, and then
only to the extent set forth in that writing.

 

   15.    Governing Law.
 This Guaranty shall be governed by and enforced in accordance with the
laws of the Property Jurisdiction, without giving effect to the choice of law
principles of the Property Jurisdiction that would require the application of
the laws of a jurisdiction other than the Property Jurisdiction. 

  16.     Jurisdiction;
Venue.  Guarantor agrees that any controversy arising under or in
relation to this Guaranty may be litigated in the Property Jurisdiction, and
that the state and federal courts and authorities with jurisdiction in the
Property Jurisdiction shall have jurisdiction over all controversies which shall
arise under or in relation to this Guaranty.  Guarantor irrevocably
consents to service, jurisdiction and venue of such courts for any such
litigation and waives any other venue to which it might be entitled by virtue of
domicile, habitual residence or otherwise.  However, nothing herein is
intended to limit Lender's right to bring any suit, action or proceeding relating to matters arising under this Guaranty against
Guarantor or any of Guarantor's assets in any court of any other jurisdiction.

 

  17.     Guarantor's Interest in
Borrower.  Guarantor represents to Lender that Guarantor has a direct
or indirect ownership or other financial interest in Borrower and/or will
otherwise derive a material financial benefit from the making of the Loan.

 

  18.     State-Specific
Provisions:  N/A

                       

  19.     Residence; Community
Property Provision. 

 

           
(a) Guarantor represents
and warrants that his/her state of residence is N/A.

 

           
(b)  Guarantor warrants and represents that s/he is:

           
[____] single 

           
[____] married  

 

           
(c)  Any one signing this Guaranty solely as the spouse
of a Guarantor will bind only his/her marital community property and community
assets and will not bind his/her sole and separate property and assets, if any,
to the payment and performance of obligations under this Guaranty.

 

 
20.     GUARANTOR AND LENDER EACH (A) AGREES NOT TO
ELECT A TRIAL BY JURY WITH RESPECT TO ANY ISSUE ARISING OUT OF THIS GUARANTY OR
THE RELATIONSHIP BETWEEN THE PARTIES AS GUARANTOR AND LENDER THAT IS TRIABLE OF
RIGHT BY A JURY AND (B) WAIVES ANY RIGHT TO TRIAL BY JURY WITH RESPECT TO
SUCH ISSUE TO THE EXTENT THAT ANY SUCH RIGHT EXISTS NOW OR IN THE FUTURE. 
THIS WAIVER OF RIGHT TO TRIAL BY JURY IS SEPARATELY GIVEN BY EACH PARTY,
KNOWINGLY AND VOLUNTARILY WITH THE BENEFIT OF COMPETENT LEGAL COUNSEL. 

 

      ATTACHED
EXHIBIT.  The following Exhibit is attached to this
Guaranty:

 

           
| X |        Exhibit
A          Modifications to
Guaranty

 

 

           
IN WITNESS WHEREOF, Guarantor has
signed and delivered this Guaranty under seal or has caused this Guaranty to be
signed and delivered under seal by its duly authorized representative. 

 

 

	
 
	
GUARANTOR: 

 

AIMCO PROPERTIES,
L.P.,

a Delaware limited
partnership

 

By:  AIMCO-GP, Inc.,
a Delaware corporation, 
its sole general partner

 

 

By:  /s/Patti K.
Fielding
Name:  Patti K.
Fielding
Title:     Executive Vice
President and Treasurer 

 

 

 

 

EXHIBIT
A

 

MODIFICATIONS TO GUARANTY

 

The following modifications are made to
the text of the Guaranty that precedes this Exhibit:

 

1.   Lender may assign its rights under this
Guaranty pursuant to Section 13 of this Guaranty only to a purchaser or other
transferee of the Loan.

 

2.   Section 2(a)(i)(A) of this Guaranty is deleted
in its entirety; and Section 2(a)(i)(B) of this Guaranty is modified to read as
follows:

 

(B)   All amounts for which Borrower is
personally liable under 

                       
Sections 9(c), 9(d) and 9(f) of the Note; and 

     
3.   Section 3 is deleted and replaced with the
following:

         3.   Additional Guaranty Relating to
Bankruptcy.  Notwithstanding any limitation on liability provided for
elsewhere in this Guaranty, Guarantor hereby absolutely, unconditionally and
irrevocably guarantees to Lender the full and prompt payment when due, whether
at the Maturity Date or earlier, by reason of acceleration or otherwise, and at
all times thereafter, the entire Indebtedness, in the event that (i) Borrower
voluntarily becomes subject to any bankruptcy,  reorganization,
receivership, insolvency or other similar proceeding pursuant to any federal or
state law affecting debtor and creditor rights, or (ii) an order for relief is
entered against Borrower in any such proceeding initiated or joined in by a
“Related Party.”  

 

             
For purposes of this Section, the term “Related Party” means:

 

(A)      
Borrower or any guarantor; and

(B)      
any Person that holds, directly or indirectly, any ownership interest in or
right to manage Borrower or any guarantor, including without limitation, any
shareholder, member or partner of Borrower or any guarantor; and

(C)      
any Person in which any ownership interest (direct or indirect) or right to
manage is held by Borrower or any guarantor or any partner, shareholder or
member of, or any other Person holding an interest in, Borrower or any
guarantor; and

(D)      
any creditor of Borrower that is a member
of the immediate family (which for purposes hereof shall mean solely a parent,
sibling, child or spouse), by blood, marriage or adoption, of Borrower or any
guarantor or any partner, shareholder or member of, or any other Person holding
an interest in, Borrower or any guarantor. 

 

For purposes of the preceding clauses (B) or (C), no
Person shall be considered a Related Party on the basis of the provisions
thereof unless such Person holds a Controlling Interest or
has more than a 11% equity interest in the applicable entity.  If Borrower or any other Related Party has solicited
creditors to initiate or participate in support of initiating or not dismissing
any proceeding referred to in this Section 3, regardless of whether any of the
creditors solicited actually initiates or participates in support of initiating
or not dismissing the proceeding, then such proceeding shall be considered as
having been initiated by a Related Party.

 

4.  Section 8 is amended by adding a new last
sentence:

Nothing contained in the Section shall in any way
affect or impair the rights or remedies that Guarantor has, or may have, against
any Other Guarantor.

 

5.   Paragraph 12 is amended in its entirety
to read as follows:

12.       Financial
Statements; Accountants’ Reports; Other Information.  The Guarantor shall keep and maintain at all
times complete and accurate books of accounts and records in sufficient detail
to correctly reflect all of the Guarantor’s financial transactions and
assets.  In addition, the Guarantor shall furnish, or cause to be
furnished, to the Lender the following:

             
(i)       So long as Guarantor is a reporting
company under the Securities and Exchange Act of 1934 (the “’34 Act”), promptly
upon their becoming available, copies of (A) all 10K’s, 10Q’s, 8K’s, annual
reports and proxy statements, and all replacement, substitute or similar filings
or reports required to be filed after the date of this Guaranty by the SEC or
other Governmental Authority exercising similar functions, and (B) all press
releases and other statements made available generally by Guarantor to the
public concerning material developments in the business of Guarantor.

              
(ii)     In the event Guarantor is not a reporting company
under the ‘34 Act,

           
(A)       Annual Financial
Statements.  As soon as available, and in any event within 90 days
after the close of its fiscal year, as long as the Indebtedness is outstanding,
the audited balance sheet of Guarantor as of the end of such fiscal year, the
audited statement of income, equity and retained earnings of Guarantor for such
fiscal year and the audited statement of cash flows of Guarantor for such fiscal
year, all in reasonable detail and stating in comparative form the respective
figures for the corresponding date and period in the prior fiscal year, prepared
in accordance with GAAP, consistently applied, and accompanied by a certificate
of Guarantor’s independent certified public accountants to the effect that such financial statements have been prepared in
accordance with GAAP, consistently applied and that such financial statements
fairly present the results of its operations and financial conditions for the
periods and dates indicated with such certification to be free of exceptions and
qualifications as to the scope of the audit or as to the going concern nature of
the business.

(B)       Quarterly
Financial Statements.  As soon as available, and in any event within 45
days after each of the first three fiscal quarters of each fiscal year as long
as the Indebtedness is outstanding, the unaudited balance sheet of Guarantor as
of the end of such fiscal quarter, the unaudited statement of income and
retained earnings of Guarantor and the unaudited statement of cash flows of
Guarantor for the portion of the fiscal year ended with the last day of such
quarter, all in reasonable detail and stating in comparative form the respective
figures for the corresponding date and period in the previous fiscal year,
accompanied by a certificate of a member of senior management acceptable to
Lender (which certificate shall be without personal liability to such officer)
stating that such financial statements have been prepared in accordance with
GAAP, consistently applied, and fairly present the results of its operations and
financial condition for the periods and dates indicated subject to year end
adjustments in accordance with GAAP.

(iii)       Other
Reports.  Promptly upon receipt thereof, all schedules, financial
statements or other similar reports delivered by the Guarantor pursuant to the
Loan Documents or reasonably requested by the Lender with respect to the
Guarantor’s business affairs or condition (financial or otherwise).

           
After the providing by the Guarantor of any statement, report or other
information on a collective basis to Standard & Poor’s, Moody’s Investors
Service, Fitch and/or any other rating agency, and/or after providing any
statement, report or other information on a collective basis to the banks or
other institutions providing unsecured lines of credit and loans to Guarantor,
Guarantor shall promptly furnish such statement, report or other information to
Lender.

           
As used in this Paragraph (iii) the phrase “on a collective basis” means as
provided to a group as a whole as opposed to an individual basis, e.g.,
providing information to a rating agency or to a bank to respond to a particular
request of such rating agency or bank.

           
The Lender agrees to treat all
Information received by it (I) under this Paragraph (iii) as confidential and
(II) which Guarantor requests in writing to the Persons at the Lender who
receive any Information regarding Guarantor that such information by treated as
confidential; provided, however, that such Information may be disclosed (A) as
required by law, (B) to officers, directors, employees, agents, partners,
attorneys, auditors, accountants, engineers and other consultants of the Lender,
or its successors or assigns, who need to know such Information, provided such
Persons are instructed to treat such Information confidentially, (C) by the
Lender to any successor or assign of such Person, (D) to any federal or state
regulatory authority having jurisdiction over the Lender, or its successors or
assigns, (E) to any other Person to which such delivery or disclosure may be
necessary or appropriate (w) in compliance with any law, rule, regulation or
order applicable to the Lender, or its successors or assigns, (x) in response to
any subpoena or other legal process or information investigative demand, or (y)
in connection with any litigation to which the Lender, or its successors or
assigns, is a party; provided, however, in that event the disclosing Person
shall reasonably endeavor to notify Guarantor thereof as soon as possible to
enable Guarantor to seek protective orders, or such other confidential treatment
of such Information as Guarantor may deem reasonable.  Guarantor agrees
that Information subject to this Paragraph (iii) does not include information
which (I) was publicly known, or otherwise known to the Lender, or its
successors or assigns, at the time of disclosure, (II) subsequently becomes
publicly known through no act of or omission by the Lender or its successors or
assigns.  Guarantor acknowledges that this provision relates solely to
Lender and nothing in this provision shall make Lender responsible or liable for
any actions relating to, or disclosures of, any Information by any loan servicer
of Lender’s or other party. 

 

6.   Section 16 of this Guaranty is deleted
and replaced with the following:

           
16.       Jurisdiction; Venue. 
Guarantor agrees that any controversy arising under or in relation to this
Guaranty shall be litigated exclusively in the jurisdiction where the Land is
located (the "Property Jurisdiction").  The state and federal courts
and authorities with jurisdiction in the Property Jurisdiction shall have
exclusive jurisdiction over all controversies which shall arise under or in
relation to this Guaranty, the Note, the Security Instrument or any other Loan
Document.  Guarantor irrevocably consents to service, jurisdiction, and
venue of such courts for any such litigation and waives any other venue to which
it might be entitled by virtue of domicile, habitual residence or
otherwise.ex10_1.htm

Exhibit 10.1

PILGRIM’S PRIDE CORPORATION

 

FY2009 PERFORMANCE BONUS PLAN

 

Pilgrim’s Pride Corporation (the “Company”) hereby establishes the Pilgrim’s Pride Corporation FY2009 Performance Bonus Plan (the “Plan”).  The purpose of the Plan is to advance the interests of Pilgrim’s Pride Corporation and its stockholders by establishing a direct relationship between
the payment of cash bonuses to certain of the Company’s officers and other key employees and the performance of the Company.

 

	
1.  
	
ADMINISTRATION.

 

(a) The Plan shall be administered by the Company’s Compensation Committee (the “Committee”).

 

(b) The Committee shall have the authority, subject to the limitations set forth in the Plan, to interpret the Plan and to adopt, amend and rescind such rules and regulations as, in its opinion, are necessary for the administration of
the Plan and to make such other determinations deemed necessary or advisable for the administration of the Plan.  All decisions, determinations and interpretations of the Committee relating to the Plan shall be final and conclusive on the Company and all Participants under the Plan.

 

(c) The Committee may employ such accountants, legal counsel, consultants and agents as it may deem desirable for the administration of the Plan and may rely upon any opinion received from any counsel or consultant and any computation
received from any consultant or agent.  Expenses incurred by the Committee in the engagement of such counsel, consultants or agents shall be paid by the Company.  No member or former member of the Committee shall be liable for any action or determination made in good faith with respect to the Plan.

 

	
2.  
	
PARTICIPANTS AND BONUSES.

 

(a) The persons eligible to participate (“Participants”) for the fiscal year (“Fiscal Year”) of the Company ending September 26, 2009 shall be comprised of the Company’s Chief Executive Officer, Chief Financial
Officer, Executive Vice Presidents, Senior Vice Presidents, Vice Presidents and such other officers or positions of the Company or other key employees of the Company and any subsidiary of the Company as the Committee may specify.   Subsidiary means any “subsidiary corporation” as defined in Section 424(f) of the Internal Revenue Code of 1986, as amended (the “Code”) or any other entity of which a majority of the outstanding voting stock or voting power is beneficially owned
directly or indirectly by the Company.

 

(b)           For the Fiscal Year ending September 26, 2009, except as provided in Section 2(e) hereof, each Participant who is employed by the Company or one of its subsidiaries on the date immediately prior to the date of the Company’s emergence from Chapter 11 bankruptcy
(the “Vesting Date”) shall be entitled to receive a cash bonus with respect to such Fiscal Year.  The amount of the cash bonus shall be equal to (i) the amount of such Participant’s Bonus Factor (as described in  paragraph (c)), divided by (ii) the sum of the Bonus Factors for all of the Participants, multiplied by (iii) the sum of (A) $2.6 million if  the Company’s earnings before interest, taxes, depreciation, amortization and restructuring costs (“EBITDAR”)
for the third and fourth fiscal quarters combined equals $225 million, plus (B) an amount equal to 4% of the excess of EBITDAR greater than $225 million, excluding extraordinary charges (in each case, as set forth on the Company’s consolidated statements of income) for the third and fourth quarters of Fiscal Year 2009 with respect to which the bonus is being calculated, plus (C) the aggregate amount of the payments that
would become payable under the Key Employee Incentive Compensation Agreements (the “KEIC Agreements”) and under the Company Performance Improvement Plan (the “PIP”) assuming the performance criteria and conditions to payment were satisfied under such arrangements (the “Bonus Pool Amount”).  In no event, however, shall any cash bonus determined under this Section 2(b) be less than 100% of a Participant's Bonus Factor upon the Company achieving $325 million in EBITDAR
for the third and fourth fiscal quarters combined in Fiscal Year 2009.

(c) Except as provided in the following sentence, each Participant’s Bonus Factor is equal to (x) the target bonus percentage for a Participant established by the Board of Directors of the Company multiplied by (y) the amount of
a Participant’s base salary accrued with respect to Fiscal Year 2009.  Any Participant whose first day of employment or death occurred after the first day of the third quarter of Fiscal Year 2009 shall receive a prorated Bonus Factor based on the ratio of the number of days the Participant was employed by the Company or any subsidiary during the third and fourth fiscal quarters of Fiscal Year 2009 to the total number of days during the third and fourth fiscal quarters of Fiscal Year 2009.

 

(d) Notwithstanding the provisions of Sections 2(b) and 2(c) hereof, (i) the Committee shall retain the right, in its sole discretion, to reduce, increase or eliminate, prior to the payment thereof, the amount of any bonus that would
otherwise be due hereunder to a Participant or cause the aggregate amount of such bonuses to exceed the Bonus Pool Amount for such Fiscal Year.

 

(e) In the event of a Participant’s death prior to the Vesting Date, the Participant’s estate shall be entitled to a prorated bonus based on the calculation set forth in Section 2(c) hereof.  The Committee may, in
its sole discretion, provide for full or partial payment of the bonus upon a Participant’s termination of employment for other reasons, including, but not limited to, the Participant’s disability or retirement prior to the Vesting Date, provided the payment of the bonus is made in compliance with Section 409A of the Code.

 

	
3.  
	
PAYMENT OF BONUSES.

 

Each bonus awarded to a Participant hereunder shall be payable to a Participant no later than March 15 of the calendar year immediately following the date the Company emerges from Chapter 11 bankruptcy.  For clarity, it is the intent for this bonus payment to qualify as a short-term deferral under Section 409A of the Code.

 

	
4.  
	
PARTICIPATION IN OTHER PERFORMANCE BONUS OR INCENTIVE PLANS OR AGREEMENTS.

 

Anything in this Plan to the contrary notwithstanding, if a Participant also participates in the PIP or is a party to a KEIC Agreement, the Participant shall be eligible to receive a payment only under the plan or agreement (but not under more than one arrangement) that provides for the highest payment with respect to the Fiscal Year ended
September 26, 2009.

 

	
5.  
	
NON-TRANSFERABILITY.

 

No rights or benefits granted in the Plan may be transferred, assigned, pledged or hypothecated in any manner, by operation of law or otherwise, other than by will or by the laws of descent and distribution or pursuant to a qualified domestic relations order as defined by Section 414(p) of the Code, or Title I of the Employee Retirement
Income Security Act of 1974, as amended, or the rules thereunder, and shall not be subject to execution, attachment or similar process.

 

	
6.  
	
NO FIDUCIARY RELATIONSHIP.

 

The Board of Directors and the officers of the Company shall have no duty to manage or operate in order to maximize the benefits granted to the Participants hereunder, but rather shall have full discretionary power to make all management and operational decisions based on their determination of their respective best interests.  This
Plan shall not be construed to create a fiduciary relationship between such Board or the officers of the Company and the Participants.

 

	
7.  
	
GOVERNING LAW.

 

This Plan, and all controversies arising thereunder or related thereto, shall be governed by and construed in accordance with the laws of the State of Texas without regard to principles of conflict of laws that would apply any other law.

 

	
8.  
	
NO EMPLOYMENT GUARANTEE.

 

Nothing in this Plan shall be construed as an employment contract or a guarantee of continued employment.  The rights of any Participant shall only be those as are expressly set forth in this Plan.

 

	
9.  
	
TAXES.

 

The Company shall be entitled to deduct from amounts payable hereunder any sums required by federal, state or local tax law to be withheld with respect to such payments.

 

	
10.  
	
GENERAL CREDITOR STATUS.

 

The Participants shall, in no event, be regarded as standing in any position, if at all, other than as a general creditor of the Company with respect to any rights derived from the existence of the Plan and shall receive only the Company’s unfunded and unsecured promise to pay benefits under the Plan.

 

	
11.  
	
CAPTIONS.

 

The captions in the Plan are inserted for convenience of reference only and in no way define, describe or limit the scope or intent of this Plan or any of the provisions hereof.

 

*  *  *  *

 

I hereby certify that the foregoing Plan was duly adopted by the Board of Directors of Pilgrim’s Pride Corporation on May 27, 2009.

 

*  *  *  *  *

 

I hereby certify that the foregoing Plan was approved by the United States Bankruptcy Court for the Northern District of Texas, Fort Worth Division, pursuant to a joint Chapter 11 plan of reorganization pursuant to Section 1121(a) of the United States Code, on September 29, 2009.

 

The Plan is executed and effective as of this 12th day of October, 2009.

 

/s/ Richard A. Cogdill                                                                   

Corporate Secretary

 

GESDMS/6532640.13

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