Document:

exhibit_10-2.htm

EXHIBIT 10.2

 

Emerson Healthcare LLC

Account Services Agreement

This Account Services Agreement (this “Agreement”) dated as of this 27th day of August, is between Emerson Healthcare LLC, a Pennsylvania limited liability company located at 407 E. Lancaster Avenue, Wayne, PA 19087 (“Emerson”), and SCOLR Pharma, Inc., a Delaware corporation located at 19204 North Creek Pkwy #100, Bothell, WA (“SCOLR”).

WHEREAS, SCOLR and an affiliate of Emerson (the “Sales Affiliate”) have entered into a Sales Agency Agreement effective as of August 1, 2010 (the “Sales Agreement”) pursuant to which the Sales Affiliate will act as a non-exclusive sales agent for SCOLR’s nutritional product line; and

WHEREAS, Emerson provides logistic, distribution and account related services; and

WHEREAS, SCOLR wishes to appoint Emerson as its agent solely for purposes of the services described herein, and Emerson wishes to accept such appointment and provide such services to SCOLR; and

NOW THEREFORE, in consideration of the foregoing recitals and other good and valuable consideration, the receipt of which is hereby acknowledged, the parties agree as follows:

AGREEMENT

1.           Defined Terms.  Capitalized terms used herein but not defined shall have the meanings given to them in the Sales Agreement.

2.           Appointment.  SCOLR hereby appoints Emerson as its agent solely for purposes of performing the logistics, distribution and account management services described herein (the “Services”).  Emerson hereby accepts such appointment and agrees to perform the Services in accordance with the terms of this Agreement.

3.            Duties of Emerson.

(a)           Emerson shall diligently perform the services of a logistics, account and collections manager according to procedures established by Emerson and SCOLR from time to time, as contemplated by Section 3(b).  The Services shall include the following:

	
  

	
(i)

	
Emerson shall process and ensure timely fulfillment of orders received from the Sales Affiliate, including the arrangement of warehousing, freight and remittance services with respect to such orders.

	
  

	
(ii)

	
Emerson shall keep accurate and updated records of the locations of all Products distributed to SCOLR’s customers, and current levels of retail inventory stock at each such customer.  Emerson shall monitor customer sell-through and keep accurate records of returns, damages, promotional charges and similar items.

	
  

	
(iii)

	
Emerson shall arrange notification procedures, warehousing, freight and/or destruction of returned or recalled Products, and shall arrange and settle the accounts of customers in respect of returns, damages, promotional charges and similar items.

  

  

  

	
  

	
(iv)

	
Emerson shall maintain accurate records of customer accounts, accounts payable in respect of sales of Products and related logistics expense, accounts receivable and aging and collected accounts.

	
  

	
(v)

	
Emerson shall manage collections of SCOLR’s accounts, and shall use all commercially reasonable efforts to collect accounts as promptly as possible.  Emerson shall deposit and hold all monies collected by or which otherwise come under the control of Emerson (the “Received Accounts”) in a separate and segregated account pursuant to Section 7 hereof (the “Deposit Account”).

	
  

	
(vi)

	
At least once weekly, on a day to be agreed upon by SCOLR and Emerson, Emerson shall disburse from the Deposit Account to SCOLR all amounts deposited therein, except that Emerson shall be entitled to retain such amounts as are necessary, using cash management procedures established by SCOLR and Emerson, to pay sales commissions (including those of the Sales Affiliate), promotional charges and other third party expenses, and apply or withhold any additional funds in the amount chargeable to SCOLR, with respect to freight, warehousing (storage and labor) and other charges associated with the distribution of the Products using Emerson’s warehouse, logistics terminal and shipping facility (the “Distribution Facility”).  Notwithstanding the foregoing, Emerson shall be entitled to withhold, and maintain in the Deposit Account additional amounts as follows:

(A) if excess or unusual commitments related to sales promotional obligations are reasonably likely to interfere with Emerson’s normal cash flow patterns associated with SCOLR’s account, and withholdings are reasonably necessary for Emerson to perform its duties as a paying agent hereunder, Emerson shall be permitted to withhold additional amounts in proportion to such condition, and for such time as such condition persists, except that the amount of any such withholding shall not exceed the financial liability associated with the excess promotional obligation;

(B)  to the extent any Product is reasonably likely to be discontinued by a Customer, Emerson shall be permitted to withhold such amount as is reasonably necessary to cover obligations associated with any reasonably expected increase in Product returns.

(C)  to the extent reasonably necessary as a reserve against forecasted returns, damages and allowances, Emerson shall be permitted to withhold and reserve such amount as is customary in the over-the-counter pharmaceutical and nutritional supplement industry.

	
  

	
(vii)

	
Emerson shall be permitted to make withholdings in accordance with Section 3(a)(vi) only during such time and in such amounts as such withholdings are reasonably necessary under accounting reserve practices common in the over-the-counter pharmaceutical and nutritional supplement industry.  Further, with respect to withholdings proposed to be made by Emerson under Section 3(a)(vi)(C) in connection with initial shipments of a Product, Emerson shall inform SCOLR of its intended withholding pattern prior to fulfilling any such order.

  

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(b)           As promptly as practicable after execution of this Agreement SCOLR and Emerson shall jointly develop written policies and procedures detailing the operational responsibilities of each party with respect to the Services and the activities and transactions contemplated by this Agreement (the “Standard Operating Procedures”).  The Standard Operating Procedures may be updated and modified from time to time by agreement of SCOLR and Emerson. Without limitation, the Standard Operating Procedures shall address procedures related to deposit account management, cash management, collections and disbursement procedures and criteria, procedures related to product events (such as recalls, returns and delayed shipments),  inventory reporting, expense forecasting, schedules of tariffs, rates and other charges applicable to SCOLR for logistics, distribution and warehousing services available or to be performed at the Distribution Facility and the manner in which such charges are calculated and applied, and such other matters as the parties shall agree should be included in the Standard Operating Procedures.  The parties shall perform their respective duties and obligations in material compliance with the Standard Operating Procedures.

4.  Duties of SCOLR.

	
(a)  

	
SCOLR shall maintain inventory of the Products in amounts consistent with the Sales Forecast (as such term is defined in the Sales Agreement) delivered by the Sales Affiliate on December 1 of each year pursuant to the Sales Agreement.

	
(b)  

	
If, SCOLR’s account with Emerson incurs a debit balance, SCOLR shall promptly pay, or shall promptly pay Emerson the amount of such debit balance.

5. Reporting.

(a)           Emerson shall provide and permit SCOLR to electronically access collections, aging, sales, expense and other financial and accounting reports as reasonably requested by SCOLR.

(b)           In furtherance and not in limitation of Section 5(a) above, Emerson or the Sales Affiliate shall provide accurate reporting of its sales and account service activities in such form and with such frequency as SCOLR shall reasonably request, including without limitation the provision of daily sales and collections reports.  Notwithstanding the foregoing, such reports shall include Net Sales by product, customer and date, any promotional activity or charges and any returned or damaged goods, along with collections by customer. Additionally, on or before the fifth day of each month, Emerson or the Sales Affiliate shall promptly provide SCOLR with a collections report showing all amounts collected, outstanding and aged as of the last day of the previous month.

6.  Compensation.  In consideration of the Services provided hereunder (and exclusive of charges for services rendered at the Distribution Facility) SCOLR shall pay to Emerson, via a monthly debit from the Separate Account, * percent (*%) of gross sales of the Products.

 

 * Certain information on this page has been omitted and filed separately with the Commission.  Confidential treatment has been requested with respect to the omitted portions.

  

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7.  Separate Account; Disclaimer of Ownership by Emerson.

(a)           Emerson hereby agrees to track all accounts receivable attributable to SCOLR separately from any other accounts receivable of Emerson and shall employ sound accounting and financial reporting procedures and internal controls that ensure such separate tracking and the accurate compilation and reporting of such amounts.  Emerson acknowledges and agrees that it is managing SCOLR’s accounts receivable and collections as a service, and that any cash received on such accounts is for the benefit of SCOLR only, and that Emerson acts merely as an account services provider and collections agent on the SCOLR’s behalf.  Emerson expressly and specifically disclaims any interest in such accounts, and any cash or other proceeds thereof, including without limitation any interest in the nature of ownership, or as security for obligations of SCOLR to Emerson, the Sales Affiliate or any affiliate of thereof, and agrees not to assert any contrary position at any time.

 

(b)           Emerson shall maintain all funds received by it on SCOLR’s behalf in a segregated Account established by Emerson at an FDIC insured deposit bank, which names Emerson as the account holder for the benefit of SCOLR (the “Deposit Account”).  Only Emerson has or will have access to the funds deposited in the Deposit Account from time to time.  All Received Accounts or other monies received by Emerson on SCOLR’s behalf shall be deposited only in the Deposit Account.  The Deposit Account names Emerson as the holder solely to permit Emerson to transact business on the Deposit Account as agent in accordance with the terms of this Agreement and the Services Agreement.  Emerson expressly and specifically disclaims any interest in such accounts, and any cash or other proceeds thereof, including without limitation any interest in the nature of ownership, or as security for obligations of SCOLR to Emerson, the Sales Affiliate or any affiliate of thereof, and agrees not to assert any contrary position at any time.  Emerson expressly acknowledges that neither it nor the Sales Affiliate shall have any right of set-off against the Deposit Account for any claims, including claims for payment, made by Emerson, the Sales Affiliate or any affiliate thereof.

 

(c)           Emerson shall be entitled to withdraw from the Deposit Account any fees or other amounts owing to Emerson pursuant to the Services Agreement, only when due, and absent any notice from SCOLR disputing the amount.

 

8.           Term. Except as provided otherwise herein, this Agreement shall remain in effect for a term of twelve (12) months from the date hereof (the “Initial Term”) unless earlier terminated in accordance with this Agreement.  Thereafter, this Agreement shall automatically extend for successive additional twelve (12) month terms (each a “Renewal Term”).

 

9.           Termination; Effect of Termination.

 

	
  

	
(a)

	
Termination, Notices.  This Agreement may be terminated by either party at any time for any or no reason by delivering a written notice (a “Termination Notice”) to the other party setting forth the effective date of the termination (the “Termination Date”), which must be a date at least twelve (12) months after delivery of the Termination Notice.  Notwithstanding the foregoing, either party may terminate this Agreement for Good Cause by providing a Termination Notice setting forth in reasonable detail the circumstances that constitute Good Cause for termination, and identifying the Termination Date, which must be a date at least ten (10) days from the date of the Termination Notice.

  

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(b)

	
Termination for Good Cause. For purposes of this Agreement a party shall have “Good Cause” to terminate this Agreement if  (a) the other party or any affiliate or agent of the other party commits a felony, or a crime involving theft, embezzlement, material dishonesty or moral turpitude in relation to the matters contemplated hereby or by the Services Agreement; (b) the other party or any affiliate or agent of such party makes any material intentional misrepresentation or material prejudicial non-disclosure to the terminating party in connection with the performance of such party’s duties and obligations under this Agreement or the Services Agreement; (c) the other party or any affiliate or agent of the other party commits any material breach of this Agreement or the Sales Agreement, or fails to perform its material duties under this Agreement or Sales Agreement, which failure or breach shall not be cured to the other party’s reasonable satisfaction within 30 days after notice thereof, or (d)  the other party fails to perform its material duties under this Agreement, which failure shall not be cured to the other party’s reasonable satisfaction within 30 days after notice thereof, or (e) the other party seeks protection under bankruptcy laws or any receivership, trustee, creditors’ arrangement or comparable proceeding, or any comparable proceeding is instituted (including an involuntary bankruptcy petition) and is not dismissed within forty-five (45) days.

	
  

	
(c)

	
Effect of Expiration or Termination.  On and as of the Termination Date, and except as expressly provided Section 21, (a) all rights and obligations of Emerson and SCOLR shall terminate, (b) any and all sums owed by one party to another shall become immediately due and payable (c) and all property of one party in the possession of the other shall be returned.  For the avoidance of doubt, each of SCOLR and Emerson shall not be relieved of their duties and obligations under this Agreement until the Termination Date, notwithstanding the delivery of a Termination Notice.  All payments due from one party to the other pursuant to the terms of this Agreement for the period beginning on the date of a Termination Notice and ending on the Termination Date shall be calculated and paid in accordance with the provisions hereof, as may be modified or amended from time to time.

10.           Inspection of Books and Records.  Emerson or the Sales Affiliate shall keep and preserve at its principal place of business accurate and complete copies of all books and records relating to the subject of this Agreement and the Sales Agreement during the term of such agreements, and for a period of two (2) years thereafter.  During such period SCOLR shall be permitted without notice, at its expense, to inspect, copy and take extracts from such books and records for any purpose.  In furtherance and not in limitation of the foregoing, such records shall include, at a minimum, records of: (i) all sales slips and invoices, (ii) all sales expenses include freight, logistics, remittance and other information and records concerning the business, (iii) all collections and account information and (iv) banks statements showing all inflows and outflows of cash in connection with the transactions and procedures contemplated by the terms of this Agreement.  At the conclusion of such inspection Emerson shall pay to SCOLR any amounts shown to be due to SCOLR as a result of an overpayment by SCOLR or underpayment by Emerson in connection with the Sales Agreement or the Services Agreement.  Further, to the extent that the inspection reveals an amount owing to SCOLR that is greater than $25,000, then Emerson shall reimburse SCOLR for the costs and expenses associated with its inspection of the Books and Records and any action to collect such amounts, including without limitation, attorney’s fees, costs and expenses.

11.           Expenses. Except as specifically contemplated by this Agreement, Emerson shall be solely responsible to pay for all costs and expenses associated with its normal operation and the performance of the Services.

  

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12.           Business Practices.  Emerson will at all times deal honestly, fairly and equitably with customers, and will not engage in any deceptive, misleading or unethical trade, billing or collections practice, or any other conduct or activity which tends to mislead, deceive or defraud the public, or to adversely affect the good name or reputation of SCOLR, its affiliates, or the Products.  Emerson shall at all times conduct its collections procedures in accordance with applicable law.

13.           Indemnification. SCOLR shall indemnify, defend, release and hold Emerson and its agents and employees harmless from and against any and all claims, suits, damages, liabilities, judgments, costs and expenses (including but not limited to legal fees, settlements and judgments) (collectively “Damages”) arising out of or related to any bodily injury, death, damage to property or other damage attributable, or alleged to be attributable to, any of SCOLR’s products, including but not limited to any products liability claims attributable, or alleged to be attributable to, any of SCOLR’s products, except to the extent that such Damages are the result of negligence, contributory or otherwise, of Emerson or its assignee in the performance or delegation of the Services.  Emerson shall indemnify, defend, release and hold SCOLR and its agents and employees harmless from and against any obligations or Damages arising out of or related to any action by Emerson which constitutes a breach of this Agreement, except to the extent that such obligations or Damages are the result of negligence, contributory or otherwise, of SCOLR.

14.            Confidentiality.  Emerson agrees to keep confidential the term of this Agreement, and for thirty-six (36) months after the later of (i) the expiration or earlier termination of this Agreement or (ii) the expiration or earlier termination of the Sales Agreement, all information (the “Information”) provided to it by SCOLR that is (i) material and non-public or (ii) confidential and proprietary.  Notwithstanding any provision herein to the contrary, Emerson may disclose nonpublic information to its affiliates, agents and advisors whenever Emerson determines that such disclosure is necessary to provide the services contemplated hereunder or for internal control or compliance purposes.  For purposes of this Section 11, the Information shall include, without limitation, non-public information, whether disclosed orally or in writing by SCOLR, or generated internally by Emerson, concerning: (i) sales, revenue, orders, inventory, collections and similar financial information related to sales by SCOLR of nutritional products; (ii) plans and forecasts, whether relating specifically to SCOLR’s nutritional business or to SCOLR’ other businesses; (iii) the existence of and information concerning actual or potential Acquisitions or other transactions contemplated by this Agreement; (iv) information regarding SCOLR’s proprietary drug-delivery technology to the extent identified by SCOLR orally or in writing as confidential, or if no such designation is made, to the extent that the confidential nature of such information is reasonably apparent from the circumstances of disclosure.

15.             Securities Laws.  Emerson hereby acknowledges that it is aware, and that it will advise its affiliates, agents and assignees who are informed of the matters that are the subject of this letter agreement, that the United States securities laws prohibit any person who has received from the issuer of such securities material, nonpublic information from purchasing or selling securities of such issuer or from communicating such information to any other person when it is reasonably foreseeable that such other person is likely to purchase or sell such securities in reliance upon such information.  Further, Emerson hereby acknowledges and consents to any public or other disclosure concerning this Agreement made by SCOLR pursuant to regulatory or legal obligations, including without limitation disclosure by SCOLR of the material terms of this Agreement, and the filing by SCOLR of a copy of this Agreement pursuant to applicable requirements of the U.S. Securities and Exchange Commission or any securities exchange on SCOLR’s securities are listed.

  

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16.             Attorneys’ Fees.  If any action or suit in law or equity or any arbitration proceeding is initiated to enforce or interpret the provisions of this Agreement, the prevailing party shall be entitled to recover its costs and expenses incurred in connection with such action or suit, including without limitation, reasonable attorneys’ fees incurred at all levels and proceedings, including settlement and appeal, in addition to any other relief to which it may be entitled.

17.            Entire Agreement.  This Agreement contains the entire agreement of the parties and there are no oral or written representations, understandings or agreements between the parties respecting the subject matter of this Agreement that are not fully expressed herein.

18.            Assignment.  Emerson may assign its rights and delegate its duties under this Agreement with the consent of SCOLR, which consent shall not be unreasonably withheld.  SCOLR may assign its rights and delegate its duties under this Agreement to any acquirer of substantially all of SCOLR’s business assets, or substantially all the assets of its nutritional products business upon 30 days prior written notice to Emerson.

19.            Notices.  All notices permitted or required to be given under this Agreement shall be in writing and shall be deemed duly given upon personal delivery by mail or courier, evidenced by receipt; upon transmittal by telephone facsimile (fax) to a fax number specified in writing by the party to be notified; or upon transmittal by electronic mail (e-mail) to the party at the email address specified in writing by the party to be notified.  All notices shall be delivered or sent to the other party at the address(es) set forth in the introductory paragraph of this Agreement or to such other addresses, fax numbers or e-mail addresses as a party may hereafter specify from time to time by notice to the other.

20.            Force Majeure.  Neither party will be considered in default in the performance of any obligation hereunder, and Good Cause for termination shall not exist, to the extent that the performance of an obligation under this Agreement is prevented or delayed by fire, flood, explosion, strike, war, insurrection, embargo, government requirement, civil or military authority, act of terrorism, act of God, or any other event, occurrence of condition which is not caused, in whole or in part, by that party, and which is beyond the reasonable control of that party.

21.           Survival of Rights and Obligations.  Sections 7 through 17, 19 21, 22, and 23 shall survive expiration or termination of this Agreement and shall remain effective in accordance with their terms.

22.           Independent Contractor; Limited Agency.  Emerson is an independent contractor.  The parties do not intend to create, and this Agreement shall not be interpreted to create, any other relationship between the parties.  This Agreement shall not be construed to create a partnership or joint venture between the parties.  Nothing in this Agreement shall be construed, and Emerson shall not indicate, or use words or actions which would tend to indicate that its appointment as SCOLR’s agent pursuant to the terms hereof extends beyond the express scope of the agency granted by SCOLR pursuant to this Agreement.

23.  Arbitration; Governing Law.  Notwithstanding anything to the contrary contained in this Agreement, any controversy or claim arising out of or in connection with this Agreement, its construction, interpretation, effect, performance, non-performance, termination, or consequences thereof, or any transaction contemplated hereby, however characterized as a matter of law (whether in contract, tort or otherwise), including, without limitation, all claims under any federal, state, or local statute, ordinance, regulation or other law, will be settled by arbitration in King County, Washington, in accordance with the Commercial Arbitration Rules of the American Arbitration Association, and judgment on the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof.  If it becomes necessary to file suit to compel arbitration hereunder and arbitration is subsequently ordered by the court, the party instituting such suit will be entitled to recover its actual costs and expenses, including, without limitation, attorney's fees, incurred in such action.  This Agreement will be governed by and construed in accordance with the laws of the State of Washington, without regard to its conflicts of law principles, and such laws will be applied and controlling in any arbitration conducted pursuant to this Section 23.

 

  

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IN WITNESS WHEREOF, the parties hereto have executed this Account Services Agreement on the day and year first set forth above.

SCOLR PHARMA, INC.

By: /s/ Richard M. Levy                                                                

Name: Richard M. Levy

Title: EVP & CFO

EMERSON HEALTHCARE LLC

By: /s/ Scott Emerson                                                                ­           

Name: Scott Emerson

Title: President

 

 

 

 

 

 

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Exhibit 10.1

AMENDMENT NO. 5 TO CREDIT AGREEMENT

     This Amendment No. 5 to Credit Agreement (this “Amendment”), dated as of November 9,
2010, is made by and among THE TORO COMPANY, a Delaware corporation (“ Toro”), TORO CREDIT
COMPANY, a Minnesota corporation, TORO MANUFACTURING LLC, a Delaware limited liability company,
EXMARK MANUFACTURING COMPANY INCORPORATED, a Nebraska corporation, TORO INTERNATIONAL COMPANY, a
Minnesota corporation, TOVER OVERSEAS B.V., a Netherlands company, and TORO FACTORING COMPANY
LIMITED, a Guernsey, Channel Islands company (all of the foregoing, collectively, the
“ Borrowers”), each lender from time to time party hereto (collectively the
“Lenders”), and BANK OF AMERICA, N.A., as Administrative Agent, Swing Line Lender and L/C
Issuer (the “Administrative Agent”).

     WHEREAS, the Borrowers, the Administrative Agent and the Lenders have entered into that
certain Credit Agreement dated as of September 8, 2004 (as amended by Amendment No. 1 to Credit
Agreement dated as of October 25, 2005, Amendment No. 2 to Credit Agreement dated as of January 10,
2007, Amendment No. 3 to Credit Agreement effective as of February 28, 2007, and Amendment No. 4 to
Credit Agreement effective as of February 29, 2008, as hereby amended and as from time to time
hereafter further amended, modified, supplemented, restated or amended and restated, the
” Credit Agreement” (capitalized terms used and not otherwise defined in this Amendment
shall have the respective meanings given thereto in the Credit Agreement)), pursuant to which the
Lenders have made available to the Borrowers a revolving credit facility (including a letter of
credit facility and a swing line facility); and

     WHEREAS, the Borrowers have requested that (i) the Aggregate Commitments be reduced from
$225,000,000 to $175,000,000 and (ii) the Administrative Agent and the Required Lenders amend
certain provisions of the Credit Agreement as set forth herein;

     WHEREAS, all conditions necessary to authorize the execution and delivery of this Amendment
and to make this Amendment valid and binding have been complied with or have been done or
performed;

     NOW, THEREFORE, in consideration of the foregoing and for other good and valuable
consideration, receipt of which is hereby acknowledged, the parties hereto hereby agree as follows:

     1. Reduction in Aggregate Commitments. Pursuant to Section 2.06 of the Credit
Agreement, the Borrowers have requested the Aggregate Commitments be reduced from $225,000,000 to
$175,000,000. The Lenders hereto hereby waive any prior notice requirement set forth in such
Section 2.06 of the Credit Agreement. As of the date hereof, the Commitments shall be
reduced on a pro rata basis, and the new Commitment and Applicable Percentage of each Lender shall
be as set forth on Schedule 2.01 attached hereto as Exhibit 1.

     2. Amendments. Subject to the terms and conditions set forth herein, the Credit
Agreement is hereby amended as follows:

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     (a) Section 7.04 of the Credit Agreement is amended by deleting “any Person” from
third and fifth lines and inserting “another Person” in lieu thereof.

     (b) Section 7.10 of the Credit Agreement is deleted in its entirety and the following
is inserted in lieu thereof:

     7.10 Maximum Total Indebtedness to Consolidated EBITDA. Toro, on a consolidated basis,
shall not, as of the end of any fiscal quarter, permit its consolidated ratio of (a) total
Indebtedness as of such date to (b) the sum Consolidated EBIT plus depreciation and
amortization expense for the period of four prior fiscal quarters ending on such date to be
more than 3.25 to 1.00.

     (c) Exhibit D to the Credit Agreement is amended by deleting Schedule 2
thereto and inserting Schedule 2 attached hereto as Exhibit 2.

     3. Conditions Precedent. The effectiveness of this Amendment is subject to the
satisfaction of the following conditions precedent:

     (a) the Administrative Agent shall have received each of the following documents or
instruments in form and substance reasonably acceptable to the Administrative Agent:

     (i) one or more counterparts of this Amendment, duly executed by the Borrowers, the
Administrative Agent and the Required Lenders, together with all schedules and exhibits
thereto duly completed;

     (ii) such other documents, instruments, opinions, certifications, undertakings, further
assurances and other matters as the Administrative Agent shall reasonably require;

     (b) the Borrowers shall have paid to each Lender that signs this Amendment on or before the
effective date hereof a fee in an amount equal to 0.025% times such Lender’s Commitment (after
giving effect to this Amendment), which fee shall be fully earned and due on the effective date
hereof and shall be nonrefundable; and

     (c) unless waived by the Administrative Agent, all fees and expenses of the Administrative
Agent and the Lenders (including the reasonable fees and expenses of counsel to the Administrative
Agent to the extent invoiced prior to the date hereof) in connection with this Amendment shall have
been paid in full (without prejudice to final settling of accounts for such fees and expenses).

     4. Reaffirmation by each of the Borrowers. Each of the Borrowers hereby consents,
acknowledges and agrees to the amendments of the Credit Agreement set forth herein.

     5. Representations and Warranties. In order to induce the Administrative Agent and
the Lenders to enter into this Amendment, each of the Borrowers represents and warrants to the
Administrative Agent and the Lenders as follows:

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     (a) The representations and warranties of (i) the Borrowers contained in Article V and
(ii) each Loan Party contained in each other Loan Document or in any document furnished at any time
under or in connection herewith or therewith, shall be true and correct on and as of the date
hereof, except to the extent that such representations and warranties specifically refer to an
earlier date, in which case they shall be true and correct as of such earlier date, and except that
for purposes of this Amendment, the representations and warranties contained in subsections
(a) and (b) of Section 5.05 shall be deemed to refer to the most recent
statements furnished pursuant to clauses (a) and (b), respectively, of Section
6.01.

     (b) There does not exist any pending or threatened action, suit, investigation or proceeding
in any court or before any arbitrator or Government Authority that purports to affect any
transaction contemplated under this Amendment or the ability of any Borrower to perform its
respective obligations under this Amendment.

     (c) There has not occurred since October 31, 2009 any event or circumstance that has resulted
or could reasonably be expected to result in a Material Adverse Effect or a material adverse change
in or a material adverse effect upon the business, assets, liabilities (actual or contingent),
operations, condition (financial or otherwise), or prospects of Toro and its Subsidiaries taken as
a whole; and

     (d) No Default or Event of Default has occurred and is continuing.

     6. Entire Agreement. This Amendment, together with all the Loan Documents
(collectively, the “ Relevant Documents”), sets forth the entire understanding and agreement
of the parties hereto in relation to the subject matter hereof and supersedes any prior
negotiations and agreements among the parties relative to such subject matter. No promise,
condition, representation or warranty, express or implied, not herein set forth, shall bind any
party hereto and not one of them has relied on any such promise, condition, representation or
warranty. Each of the parties hereto acknowledges that, except as otherwise expressly stated in
the Relevant Documents, no representations, warranties or commitments, express or implied, have
been made by any party to the other. None of the terms or conditions of this Amendment may be
changed, modified, waived or canceled orally or otherwise, except as permitted pursuant to
Section 11.01 of the Credit Agreement.

     7. Full Force and Effect of Amendment. Except as hereby specifically amended,
modified or supplemented, the Credit Agreement and all other Loan Documents are hereby confirmed
and ratified in all respects by each party hereto and shall be and remain in full force and effect
according to their respective terms.

     8. Counterparts. This Amendment may be executed in any number of counterparts, each
of which shall be deemed an original as against any party whose signature appears thereon, and all
of which shall together constitute one and the same instrument. Delivery of an executed
counterpart of a signature page of this Amendment by telecopy, facsimile or other electronic
transmission (including .PDF) shall be effective as delivery of a manually executed counterpart of
this Amendment.

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     9. Governing Law. This Amendment shall in all respects be governed by, and construed
in accordance with the laws of the State of New York.

     10. Enforceability. Should any one or more of the provisions of this Amendment be
determined to be illegal or unenforceable as to one or more of the parties hereto, all other
provisions nevertheless shall remain effective and binding on the parties hereto.

     11. References. All references in any of the Loan Documents to the “Credit Agreement”
shall mean the Credit Agreement as amended hereby.

     12. Successors and Assigns. This Amendment shall be binding upon and inure to the
benefit of the Borrowers, the Administrative Agent and each of the Lenders, and their respective
successors, assigns and legal representatives; provided, however, that no Borrower, without
the prior consent of the Required Lenders, may assign any rights, powers, duties or obligations
hereunder.

     13. Expenses. Toro agrees to pay to the Administrative Agent all reasonable
out-of-pocket expenses incurred or arising in connection with the negotiation and preparation of
this Amendment.

[Remainder of page intentionally left blank.]

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     IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 5 to Credit Agreement to
be made, executed and delivered by their duly authorized officers or representatives as of the day
and year first above written.

	 	 	 	 	 
	 	THE TORO COMPANY

 	 
	 	By:  	/s/ Stephen P. Wolfe
 	 
	 	 	Name:  	Stephen P. Wolfe 	 
	 	 	Title:  	Vice President, Finance and Chief

Financial Officer 	 
	 	 	 
	 	By:  	                                              /s/ Thomas J. Larson
 	 
	 	 	Name:  	Thomas J. Larson 	 
	 	 	Title:  	Vice President, Treasurer 	 
	 
	 	TORO CREDIT COMPANY

 	 
	 	By:  	/s/ Thomas J. Larson
 	 
	 	 	Name:  	Thomas J. Larson 	 
	 	 	Title:  	Vice President and Treasurer 	 
	 
	 	TORO MANUFACTURING LLC

 	 
	 	By:  	/s/ Thomas J. Larson
 	 
	 	 	Name:  	Thomas J. Larson 	 
	 	 	Title:  	Vice President and Treasurer 	 
	 
	 	EXMARK MANUFACTURING COMPANY INCORPORATED

 	 
	 	By:  	/s/ Thomas J. Larson
 	 
	 	 	Name:  	Thomas J. Larson 	 
	 	 	Title:  	Treasurer 	 
	 
	 	TORO INTERNATIONAL COMPANY

 	 
	 	By:  	/s/ Stephen P. Wolfe
 	 
	 	 	Name:  	Stephen P. Wolfe 	 
	 	 	Title:  	Vice President 	 
	 

 

 

	 	 	 	 	 
	 	TOVER OVERSEAS B.V.

 	 
	 	By:  	/s/ Thomas J. Larson
 	 
	 	 	Name:  	Thomas J. Larson 	 
	 	 	Title:  	Authorized Signatory 	 
	 
	 	TORO FACTORING COMPANY LIMITED

 	 
	 	By:  	/s/ Thomas J. Larson
 	 
	 	 	Name:  	Thomas J. Larson 	 
	 	 	Title:  	Director 	 

 

 

	 	 	 	 	 
	 	BANK OF AMERICA, N.A., as Administrative Agent

 	 
	 	By:  	/s/ Maurice Washington
 	 
	 	 	Name:  	Maurice Washington  	 
	 	 	Title:  	Vice President 	 
	 
	 	BANK OF AMERICA, N.A., as a Lender, L/C 

Issuer and Swing Line Lender

 	 
	 	By:  	/s/ Brian Lukehart
 	 
	 	 	Name:  	Brian Lukehart  	 
	 	 	Title:  	Vice President 	 
	 
	 	SUNTRUST BANK, as a Lender and a 

Co-Syndication Agent

 	 
	 	By:  	/s/ David Simpson
 	 
	 	 	Name:  	David Simpson  	 
	 	 	Title:  	Vice President 	 
	 
	 	U.S. BANK NATIONAL ASSOCIATION, as a 

Lender and a Co-Syndication Agent

 	 
	 	By:  	/s/ Magnus McDowell
 	 
	 	 	Name:  	Magnus McDowell  	 
	 	 	Title:  	Vice President 	 
	 
	 	HARRIS NATIONAL ASSOCIATION, as a 

Lender and a Co-Documentation Agent

 	 
	 	By:  	/s/ Robert Wolohan
 	 
	 	 	Name:  	Robert Wolohan  	 
	 	 	Title:  	Vice President 	 

 

 

	 	 	 	 	 
	 	WELLS FARGO BANK, NATIONAL ASSOCIATION, as a Lender and a Co-Documentation Agent

 	 
	 	By:  	/s/ Brian Buck
 	 
	 	 	Name:  	Brian Buck  	 
	 	 	Title:  	Director 	 
	 
	 	THE BANK OF NEW YORK MELLON, as a Lender

 	 
	 	By:  	/s/  John T. Smathers
 	 
	 	 	Name:  	John T. Smathers  	 
	 	 	Title:  	First Vice President

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00180-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00180-of-00352.parquet"}]]