Document:

EXHIBIT 10.6

THIRD AMENDMENT TO

REVOLVING CREDIT AND TERM LOAN AGREEMENT

THIS THIRD AMENDMENT TO REVOLVING CREDIT AND TERM LOAN
AGREEMENT dated as of March 31, 2003 (the “Amendment”), is entered into by
and between CAPITALSOURCE FINANCE LLC, a Delaware limited liability company, in
its capacity as administrative agent and collateral agent for the Lenders under
the Agreement referenced below (“Agent”), the Lenders party thereto, and
GARDENBURGER, INC., an Oregon corporation (“Borrower”).  Capitalized terms used and not otherwise
defined herein are used as defined in the Agreement (as defined below).

WHEREAS, the Agent, Lenders and Borrower have entered
into that certain Revolving Credit and Term Loan Agreement dated as of
January 10, 2002 (as amended, supplemented, modified and/or restated from
time to time, the “Agreement”), together with a First Amendment to the
Agreement dated as of September 30, 2002 and a Second Amendment to the
Agreement dated as of December 31, 2002;

WHEREAS, the Borrower has requested that Agent and
Lenders amend certain provisions of the Agreement, all as provided herein; and

WHEREAS, subject to
satisfaction of the conditions set forth herein, Agent and the Lenders are
willing to amend the Agreement as provided herein;

NOW, THEREFORE, in consideration of the premises and
the other mutual covenants contained herein, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as follows:

SECTION 1.           Amendment.  For purposes of the covenants set forth in
paragraph 3 of Annex I of the Agreement and for no other purpose, the
said paragraph shall be and hereby is amended and restated and replaced in its
entirety effective as of March 31, 2003, to read in full as follows:

“3)          Fixed
Charge Coverage Ratio

The Fixed Charge Coverage Ratio for each Quarterly
Test Period shall not be less than 1.25:1.00; provided, however, that
the Fixed Charge Coverage Ratio for the Quarterly Test Period ending on
March 31, 2003 shall not be less than 1.125:1.00.”

SECTION 2.           Conditions.  This Amendment shall be subject to
satisfaction of the following conditions precedent, after giving effect to this
Amendment:  (a) the representations
and warranties contained herein and in all other Loan Documents shall be true
and correct in all material respects as of the date hereof, except for such
representations and warranties limited by their terms to a specific date;
(b) no Default or Event of Default shall be in existence;
(c) Borrower shall have delivered to the Agent an executed original copy
of this Amendment and 

 

 

 

each other agreement,
document or instrument reasonably requested by the Agent in connection with
this Amendment; (d) (i) the holders of the Subordinated Debt and
Borrower shall have amended the relevant fixed charge coverage ratio covenant
contained in the Note Purchase Agreement to be identical to, or less
restrictive than, the terms of the Agreement as amended hereby, all in form and
substance satisfactory to Agent, or Borrower shall provide written evidence to
Agent that this condition is already satisfied pursuant to the Note Purchase
Agreement, and (ii) the holders of the Subordinated Debt shall have
consented in writing to this Amendment, in form and substance satisfactory to
Agent, and none of the provisions of this Amendment shall be a default or event
of default under the Note Purchase Agreement or with respect to the
Subordinated Debt; (e) Borrower shall have paid to Agent all fees, costs
and expenses owed to and/or incurred by the Agent and Lenders arising in
connection with the Loan Documents and/or this Amendment; and (f) all
proceedings taken in connection with the transactions contemplated by this
Amendment and all documentation and other legal matters incident thereto shall
be satisfactory to the Agent.

SECTION 3.           Agreement in Full Force and Effect
as Amended.  Except as specifically
amended hereby, the Agreement and other Loan Documents shall remain in full
force and effect and are hereby ratified and confirmed as so amended.  Except as expressly set forth herein, this Amendment
shall not be deemed to be a waiver, amendment or modification of any provisions
of the Agreement or any other Loan Document or any right, power or remedy of
Agent or Lenders, or constitute a waiver of any provision of the Agreement or
any other Loan Document, or any other document, instrument and/or agreement
executed or delivered in connection therewith or of any Default or Event of
Default under any of the foregoing, in each case whether arising before or
after the date hereof or as a result of performance hereunder or
thereunder.  This Amendment also shall
not preclude the future exercise of any right, remedy, power, or privilege
available to Agent and/or Lenders whether under the Agreement, the other Loan
Documents, at law or otherwise.  All references
to the Agreement shall be deemed to mean the Agreement as modified hereby.  This Amendment shall not constitute a
novation or satisfaction and accord of the Agreement and/or other Loan
Documents, but shall constitute an amendment thereof.  The parties hereto agree to be bound by the terms and conditions
of the Agreement and Loan Documents as amended by this Amendment, as though
such terms and conditions were set forth herein.  Each reference in the Agreement to “this Agreement,” “hereunder,”
“hereof,” “herein” or words of similar import shall mean and be a reference to
the Agreement as amended by this Amendment, and each reference herein or in any
other Loan Documents to the “Loan Agreement” or “Credit Agreement” shall mean
and be a reference to the Agreement as amended and modified by this Amendment.

SECTION 4.           Representations.  Borrower hereby represents and warrants to
Agent and Lenders as follows: 
(i) it is duly incorporated or organized, validly existing and in
good standing under the laws of its jurisdiction of organization; (ii) the
execution, delivery and performance by it of this Amendment and all other Loan
Documents executed and/or delivered in connection herewith are within its
powers, have been duly authorized, and do not contravene (A) its articles
of organization, operating agreement, or other organizational documents, or
(B) any applicable law; (iii) no consent, license, permit, approval
or authorization of, or registration, filing or declaration with any
Governmental Authority or other Person, is required in connection with the

 

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execution, delivery,
performance, validity or enforceability of this Amendment or any other Loan
Documents executed and/or delivered in connection herewith by or against it;
(iv) this Amendment and all other Loan Documents executed and/or delivered
in connection herewith has been duly executed and delivered by it;
(v) this Amendment and all other Loan Documents executed and/or delivered
in connection herewith constitute its legal, valid and binding obligation
enforceable against it in accordance with its terms, except as enforceability
may be limited by applicable bankruptcy, insolvency, reorganization, moratorium
or similar laws affecting the enforcement of creditors’ rights generally or by
general principles of equity; (vi) after giving effect to this Amendment,
it is not in default under the Loan Documents and no Default or Event of
Default exists, has occurred and is continuing or would result by the execution,
delivery or performance of this Amendment; and (vii) the representations
and warranties contained in the Loan Documents are true and correct in all
material respects as of the date hereof as if made on the date hereof, except
for such representations and warranties limited by their terms to a specific
date.

SECTION 5.           Miscellaneous.

(a)   This Amendment may be executed in any number
of counterparts (including by facsimile), and by the different parties hereto
on the same or separate counterparts, each of which shall be deemed to be an
original instrument but all of which together shall constitute one and the same
agreement.  Each party agrees that it
will be bound by its own facsimile signature and that it accepts the facsimile
signature of each other party.  The
descriptive headings of the various sections of this Amendment are inserted for
convenience of reference only and shall not be deemed to affect the meaning or
construction of any of the provisions hereof or thereof.  Whenever the context and construction so
require, all words herein in the singular number herein shall be deemed to have
been used in the plural, and vice versa, and the masculine gender shall include
the feminine and neuter and the neuter shall include the masculine and
feminine.

(b)   This Amendment may not be changed, amended,
restated, waived, supplemented, discharged, canceled, terminated or otherwise
modified orally or by any course of dealing or in any manner other than as
provided in the Agreement.  This
Amendment shall be considered part of the Agreement and shall be a Loan
Document for all purposes under the Agreement and other Loan Documents.

(c)   This Amendment, the Agreement and the Loan
Documents constitute the final, entire agreement and understanding between the
parties with respect to the subject matter hereof and thereof and may not be
contradicted by evidence of prior, contemporaneous or subsequent oral
agreements between the parties, and shall be binding upon and inure to the
benefit of the successors and assigns of the parties hereto and thereto.  There are no unwritten oral agreements
between the parties with respect to the subject matter hereof and thereof.

(d)   THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS
OF THE PARTIES UNDER THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH THE CHOICE OF LAW PROVISIONS SET FORTH IN THE
AGREEMENT AND SHALL BE SUBJECT TO THE WAIVER OF JURY TRIAL AND NOTICE
PROVISIONS OF THE AGREEMENT.

 

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(e)   Borrower may not assign, delegate or transfer
this Amendment or any of its rights or obligations hereunder.  No rights are intended to be created under
this Amendment for the benefit of any third party donee, creditor or incidental
beneficiary of Borrower or any Guarantor. 
Nothing contained in this Amendment shall be construed as a delegation
to Agent or Lenders of Borrower’s or any Guarantor’s duty of performance,
including, without limitation, any duties under any account or contract in
which Agent has or Lenders have a security interest or Lien.  This Amendment shall be binding upon the
Borrower and its respective successors and assigns.

(f)    The Borrower shall pay all costs and
expenses incurred by Agent and Lenders or any of their affiliates, including,
without limitation, documentation and diligence fees and expenses, all search,
audit, appraisal, recording, professional and filing fees and expenses and all
other out-of-pocket charges and expenses (including, without limitation, UCC
and judgment and tax lien searches and UCC filings and fees for post-Closing
UCC and judgment and tax lien searches) and reasonable attorneys’ fees and
expenses, in connection with entering into, negotiating, preparing, reviewing
and executing this Amendment and the documents, agreements and instruments
contemplated hereby and all related agreements, documents and instruments, and
all of the same shall be part of the Obligations.  If Agent, any Lender or any of their affiliates uses in-house
counsel for any of the purposes set forth above the Borrower expressly agrees
that its Obligations include reasonable charges for such work commensurate with
the fees that would otherwise be charged by outside legal counsel selected by
such Person in its sole discretion for the work performed.

(g)   Borrower hereby (i) agrees that this
Amendment shall not limit or diminish the obligations of Borrower under the
Loan Documents, (ii) reaffirms its obligations under each of the Loan Documents
to which it is a party, and (iii) agrees that each of such Loan Documents
remains in full force and effect and is hereby ratified and confirmed.

(h)   All representations and warranties made in
this Amendment shall survive the execution and delivery of this Amendment and
no investigation by Agent or Lenders shall affect such representations or
warranties or the right of Agent or Lenders to rely upon them.

[SIGNATURES APPEAR ON FOLLOWING PAGE]

 

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IN
WITNESS WHEREOF, the parties have caused this Third Amendment to Revolving
Credit and Term Loan Agreement to be executed by their respective officers
thereunto duly authorized, as of the date first above written.

 

LENDER/AGENT:

 

CAPITALSOURCE
FINANCE LLC

 

By:  /s/Steven A. Museles

Name:     Steven A. Museles

Title:       Senior Vice President

 

BORROWER:

 

GARDENBURGER,
INC.

 

By:  /s/Lorraine Crawford                   

Name:     Lorraine Crawford

Title:       Vice President,
Finance and Corporate Controller

 

 

5EXHIBIT 10.7

CONSENT

 

This Consent is given by
Dresdner Kleinwort Benson Private Equity Partners LP, a Delaware limited
partnership (“Dresdner”), to and for the benefit of Gardenburger, Inc., an
Oregon corporation (“Gardenburger”), as of March 31, 2003. Capitalized terms
used and not otherwise defined herein have the meaning given them in the
Revolving Credit and Term Loan Agreement dated as of January 10, 2002, as
amended, between Gardenburger and CapitalSource Finance LLC, a Delaware limited
liability company (“CapitalSource”).

 

WHEREAS, Gardenburger and
CapitalSource desire to enter into a Third Amendment to Revolving Credit and
Term Loan Agreement (the “Amendment”); and

 

WHEREAS, as a condition to
the Amendment, Dresdner must consent in writing to the Amendment, as set forth
in Section 2(d)(ii) of the Amendment;

 

NOW, THEREFORE, Dresdner
hereby agrees as follows:

 

1. Dresdner has reviewed the
Amendment in its entirety and finds its terms to be satisfactory in all
material respects.

 

2.  Dresdner consents to the Amendment and represents and warrants
that none of the provisions of the Amendment constitute a default or event of
default under the Note Purchase Agreement or with respect to the Subordinated
Debt.

 

IN WITNESS WHEREOF, the
undersigned, being duly authorized, has executed this Consent on behalf of
Dresdner as of the date first written above.

 

	
  Dresdner
  KIeinwort Benson Private Equity Partners LP

  
	
   

  
	
  By:
  Dresdner KIeinwort Capital LLC, its General Partner

  
	
   

  
	
  By:  Private Equity Employees LLC, its General Partner

  
	
   

  

 

	
   

  	
   

  
	
  By:

  	
  /s/Alexander P. Coleman

  
	
   

  	
  Alexander P. Coleman

  
	
   

  	
   

  
	
  Its:

  	
  Managing Investment
  Partner

  

 

 

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