Document:

Exhibit 10.40

 

FIRST AMENDMENT TO MASTER LOAN AGREEMENT

 

THIS FIRST AMENDMENT TO MASTER
LOAN AGREEMENT (the “Amendment”), is entered into as of April 1, 2008, by
and between OTTER TAIL AG ENTERPRISES, LLC, a
Minnesota limited liability company (the “Borrower”), and
AGSTAR FINANCIAL SERVICES, PCA (the “Lender”).

 

RECITALS

 

A.                                   The Borrower and the Lender entered into a
Master Loan Agreement dated as of March 28, 2007 (the “Loan Agreement”) under which the Lender agreed to extend
certain financial accommodations to the Borrower.

 

B.                                     The Borrower has requested certain amendments
to the Loan Agreement.

 

C.                                     The Lender has agreed to make such amendments
pursuant to the terms and conditions of this Amendment.

 

AMENDMENT

 

NOW
THEREFORE, in consideration of the foregoing Recitals and the covenants and
promises contained herein, the parties hereby agree as follows:

 

1.                                       Defined Terms. Except as amended by this Amendment, all
terms used and not otherwise defined herein shall have the meanings assigned to
them in the Loan Agreement.

 

a.                                       Effective as of and retroactive to March 28,
2007, the term “Interest
Period” as used in the Loan
Documents is amended and restated to read as follows:

 

“Interest
Period” means (for
each Loan) (a) initially, the period beginning on (and including) the date
on which the Loan is made and ending on (but excluding) the first day of the
next calendar month thereafter; and (b) thereafter, each period commencing
on the first day of each succeeding calendar month thereafter and ending on the
last day of such month. Notwithstanding the foregoing: (a) any Interest
Period which would otherwise extend beyond the Maturity Date shall end on the
Maturity Date, and (b) other than the initial Interest Period and the
final Interest Period, no Interest Period shall have a duration of less than
one (1) month.

 

c.                                       Effective as of and retroactive to March 28,
2007, the term “LIBOR Rate” as used in the Loan Documents is amended and
restated to read as follows:

 

“LIBOR
Rate” (London
Interbank Offered Rate) means the One Month London Interbank Offered Rate (“One
Month LIBOR”), rounded upward to the nearest ten thousandth of one percent,
reported on the tenth day of the month preceding each Interest Period by the Wall Street Journal in its daily listing of money rates, defined
therein as the average of interbank offered rates for dollar deposits in the
London market. If a One Month LIBOR rate is not reported on the tenth day of a
month, the One Month LIBOR rate reported on the first business day preceding
the tenth day of the month will be used. If this index is no longer available,
Lender will select a new index which is based upon comparable information.

 

 

2.                                       Section 2.04  Section 2.04 of the Loan Agreement is amended
and restated to read as follows:

 

Section 2.04
  Revolving Line of Credit Loan. Subject to the terms and conditions of this Agreement and in reliance
upon the representations and warranties set forth herein, the Lender has agreed
to lend to Borrower and Borrower has agreed to borrow from Lender, as of April 1,
2008, and from time to time thereafter on a revolving basis, an amount not to
exceed $4,000,000.00. Such amount shall be loaned by Lender pursuant to the terms and conditions set forth in this Agreement and the Amended
and Restated Third Supplement dated April 1, 2008. Pursuant to the terms
and conditions in this Agreement, the Lender may extend additional Revolving
Loans to the Borrower. Any such future Revolving Loans shall be provided by
Lender pursuant to the terms and conditions of a future Revolving Loan
Supplement.

 

3.                                       Section 2.07. Section 2.07 shall be amended and
restated to read as follows:

 

Section 2.07.
  Adjustments to Interest Rate. Notwithstanding any other provision of this
Agreement, the Supplements, the Notes, or the Related Documents, after the
Conversion Date, the rate of interest under any Loan which bears interest on a
variable rate, shall be adjusted according to the following schedule should the
Tangible Owner’s Equity of the Borrower, achieve the levels set forth below:

 

	
  Tangible Owner’s Equity

  	
   

  	
  Interest Rate

  
	
   

  	
   

  	
   

  
	
  Less than or equal to
  60.00%

  	
   

  	
  Applicable LIBOR Rate plus
  295

  
	
   

  	
   

  	
   

  
	
  Greater than 60.00%

  	
   

  	
  Applicable LIBOR Rate plus
  265 basis points

  

 

Upon delivery of the fiscal
year end audited financial statements pursuant to Section 5.01(c)(i) beginning
with the first fiscal year end after the Conversion Date, the rate of interest
shall automatically be adjusted in accordance with the Tangible Owner’s Equity set forth therein and the rates set forth above. Such automatic
adjustment to the rate of interest shall take effect as of the first Business
Day of the month following the month in which the Lender received the fiscal
year end audited financial
statements and related
Compliance Certificate. If the Borrower fails to deliver such Compliance Certificate which so sets forth the Tangible
Owner’s Equity within the period
of time required by Section 5.01(c)(iii) hereof
or if any Event of Default occurs, the rate of interest shall automatically be
adjusted to a rate equal to the applicable LIBOR Rate plus 295 basis points,
such automatic adjustments: (a) to take effect as of the first Business
Day after the last day on which the Borrower was required to deliver the
applicable Compliance Certificate in accordance with Section 5.01(c)(iii) hereof
or in the case of an Event of Default, on the date the written notice is given
to the Borrower; and (b) to remain in effect until subsequently adjusted
in accordance herewith upon the delivery of such Compliance Certificate or, in
the case of an Event of Default, when such Event of Default has been cured to the satisfaction of the Lender.

 

 

4.                                       Effect on Loan Agreement. Except as expressly amended by this
Amendment, all of the terms of the Loan Agreement shall be unaffected by this
Amendment and shall remain in full force and effect. Nothing contained in this
Amendment shall be deemed to constitute a waiver of any rights of the Lender or
to affect, modify, or impair any of the rights of the Lender as provided in the
Loan Agreement. Except as otherwise expressly stated in this Amendment, all
amendments provided herein shall be effective as of the date of this Amendment.

 

5.                                       Representations and Warranties of Borrower. The Borrower hereby agrees with, reaffirms,
and acknowledges as follows:

 

A.                                   The representations, warranties and covenants
contained in the Loan Agreement, the Loan Documents and the Related Documents
are true, correct and in full force and effect.

 

B.                                     Borrower has the power and authority to
execute, deliver, and perform this Amendment and any document required under
this Amendment and that all documents contemplated herein when executed and
delivered to Lender will constitute the valid, binding and legally enforceable
obligations of Borrower in accordance with their respective terms and conditions,
except as enforceability may be limited by any applicable bankruptcy or
insolvency laws.

 

6.                                       Counterparts. It is understood and agreed that this Amendment may be executed in several counterparts,
each of which shall, for all purposes, be deemed an original, and all of such
counterparts, taken together, shall constitute one and the same agreement, even
though all of the parties hereto may not have executed the same counterpart of this Amendment.

 

{SIGNATURE PAGE TO FOLLOW THIS PAGE}

 

 

SIGNATURE PAGE TO

FIRST AMENDMENT TO MASTER LOAN AGREEMENT

BY AND BETWEEN

OTTER TAIL AG ENTERPRISES, LLC.

AND

AGSTAR FINANCIAL SERVICES, PCA

DATED: April 1, 2008

 

IN
WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed
by their respective officers and duly authorized, as of the date first above
written.

 

	
   

  	
  BORROWER:

  
	
   

  	
   

  
	
   

  	
  OTTER
  TAIL AG ENTERPRISES, LLC

  
	
   

  	
  a Minnesota limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Jerry
  Larson

  
	
   

  	
  By:

  	
  Jerry Larson

  
	
   

  	
    Its:

  	
  President

  
	
   

  	
   

  
	
   

  	
  LENDER:

  
	
   

  	
  AGSTAR
  FINANCIAL SERVICES, PCA,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Ron Monson

  
	
   

  	
  By:

  	
  Ron Monson

  	
   

  
	
   

  	
    Its:

  	
  Vice PresidentExhibit 10.41

 

ALLONGE

 

to Revolving Line of Credit Note Dated March 28, 2007

 

THIS
ALLONGE is made and entered into as of the 1st day of April 2008, by and between OTTER TAIL
AG ENTERPRISES, LLC, a Minnesota limited liability company (the “Borrower”) and
AGSTAR FINANCIAL SERVICES, PCA (the “Lender”).

 

RECITALS

 

A.            The Borrower previously executed and
delivered to the Lender a Revolving Line of Credit Note in the original
principal amount of $4,000,000.00, dated March 28, 2007 (the “Note”) to
which this Allonge is attached.

 

B.            The Borrower and Lender have agreed to make
certain modifications to the Note, all in accordance with the terms and
conditions of this Allonge.

 

AGREEMENT

 

NOW,
THEREFORE, in consideration of the foregoing premises and the mutual covenants
contained in this Allonge
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged by the
Borrower and the Lender, the parties agree as follows:

 

1.             Modification of Note. Notwithstanding any of the provisions of
that certain Master Loan Agreement dated March 28, 2007, and that certain
Amended and Restated Third Supplement dated April 1, 2008 (collectively
the “Loan Agreement”), and the Note, the Note is amended as follows:

 

a.                                       Effective as of and retroactive to March 28,
2007, paragraph #3 of the Note is hereby amended and restated to read as follows:

 

The
“LIBOR
Rate” (London Interbank
Offered Rate) means the One Month London Interbank Offered Rate (“One Month
LIBOR”), rounded upward to the nearest ten thousandth of one percent, reported
on the tenth day of the month preceding each Interest Period by the Wall Street Journal in its daily listing of money rates, defined
therein as the average of interbank offered rates for dollar deposits in the
London market. If a One Month LIBOR
rate is not reported on the
tenth day of a month, the One Month LIBOR rate reported on the first business
day preceding the tenth day of the month will be used. If this index is no
longer available, Lender will select a new index which is based upon comparable information.

 

b.                                      Effective as of and retroactive to March 28, 2007, paragraph #4 of the Note
is hereby
amended and restated to read as follows:

 

 

The
rate of interest due hereunder shall initially be determined as of the date
hereof and, in addition to any other adjustments pursuant to the
provisions of the Loan Agreement and this Note, shall thereafter be adjusted,
as and when, the LIBOR Rate changes. All such adjustments to the rate of
interest shall be made and become effective as of the first day of each
Interest Period following the date of any change in the LIBOR Rate and shall
remain in effect until and including the last day of each Interest Period.
Interest on the outstanding principal balance of this Note shall be computed on
the basis of a year of three hundred sixty-five (365) days, but charged for
actual days principal is outstanding.

 

c.             Effective as of April 1, 2008, paragraph
#8 of the Note is hereby amended and restated to read as follows:

 

“The
outstanding principal balance hereof, together with all accrued interest, if
not paid sooner, shall be due and payable in full on March 30, 2009 (the “Revolving Line
of Credit Loan Maturity Date”).

 

2.             Remaining Terms.  It is further understood and agreed by and between the Borrower and the
Lender that all other terms and provisions of the Note shall remain in full force
and effect, enforceable by the Lender against the Borrower as though no
amendment had been made hereby, and this Allonge shall not be deemed to hinder,
compromise or lessen the enforceability of the Note, or any mortgage, security
interest, or guaranty securing repayment of the Note, in any way.

 

{SIGNATURE PAGE TO IMMEDIATELY FOLLOW THIS PAGE}

 

 

SIGNATURE PAGE TO

ALLONGE

TO

REVOLVING LINE OF CREDIT NOTE DATED MARCH 28, 2007

BY AND BETWEEN

OTTER TAIL AG ENTERPRISES, LLC

AND

AGSTAR FINANCIAL SERVICES, PCA

DATED: April 1, 2008

 

IN
WITNESS WHEREOF, the parties hereto have caused this Allonge to be duly
executed and delivered as of the date and year first above written.

 

BORROWER:

 

OTTER TAIL
AG ENTERPRISES, LLC, a
Minnesota

limited liability company

 

 

	
  /s/ Jerry
  Larson

  	
   

  
	
  By:

  	
  Jerry Larson

  	
   

  
	
  Its:

  	
  President

  	
   

  

 

 

LENDER:

 

AGSTAR
FINANCIAL SERVICES, PCA

 

 

	
  /s/ Ron
  Monson

  	
   

  
	
  By:  Ron
  Monson

  	
   

  
	
  Its:  Vice President

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00141-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00141-of-00352.parquet"}]]