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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
___
_X_ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended February 25, 1995
OR
___
___ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ___________________ to ______________________
Commission file number 1-6403
WINNEBAGO INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
IOWA 42-0802678
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
P. O. Box 152, Forest City, Iowa 50436
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (515) 582-3535
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes _X_ No ____.
There were 25,309,536 shares of $.50 par value common stock outstanding on April
6, 1995.
WINNEBAGO INDUSTRIES, INC. AND SUBSIDIARIES
INDEX TO REPORT ON FORM 10-Q
FIRST AMENDMENT TO
CREDIT AGREEMENT
(REVOLVING LINE OF CREDIT FACILITY)
This First Amendment to Credit Agreement ("First Amendment") is dated
as of January 31, 1995 and is by and between Cycle Sat, Inc., a corporation duly
organized and validly existing under the laws of the State of Iowa, (the
"Borrower") and Firstar Bank Cedar Rapids, N.A. (the "Bank");
WHEREAS, the Borrower and the Bank have previously entered into a
Credit Agreement (the "Agreement") dated as February 24, 1994; and
WHEREAS, the Borrower has requested and the Bank has approved certain
further credit consideration which require amendments to the Agreement;
NOW, THEREFORE, do the parties agree to amend the Agreement as follows:
1. LINE OF CREDIT. Section 1 of the Agreement shall be deleted in its
entirety and replaced with the following:
"The Borrower has requested that the Bank provide the Borrower with a
line of credit in an aggregate principal amount at any time not to
exceed $4,500,000 for working capital purposes including repayment of
intercompany indebtedness. The line of credit is evidenced by a
promissory note (together with any renewals or substitutions the
"Promissory Note")."
2. REVOLVING LINE OF CREDIT BORROWING LIMIT. Section 3 of the Agreement
shall be amended in part to read as follows:
"...provided that the aggregate principal amount advance is limited to
the lesser of $4,500,000 or the sum of the following borrowing base:
80% of "Eligible Accounts Receivable"; and
50% of "Inventory"."
3. AFFIRMATIVE COVENANTS.
1. The first sentence of Section 7.e.(i) shall be deleted in its
entirety and replaced with the following "...The Borrower will maintain as of
fiscal year end 1996 a tangible net worth of not less than $1,500,000 and not
less than $7,500,000 as of fiscal year end 1997. This ratio will not be
applicable during fiscal 1995..."
2. Section 7.e. shall be amended to include the following subsections:
(ii) Current Ratio. The Borrower will maintain at all times a ratio of
current assets to current liabilities of not less than 1.0 to 1.
(iii) Leverage Ratio. The Borrower will maintain at all times a ratio
of total liabilities to Tangible Net Worth of not greater than 8.5 to
1 for fiscal year-end 1996 and 2.5 to 1 for fiscal year-end 1997 and
thereafter. This ratio will not be applicable during fiscal 1995.
(iv) Cash Flow/Debt. The Borrower will maintain at all times a ratio
of Operating Cash Flow to Total Debt Service of not less than 1.05 to
1. "Operating Cash Flow" means the net income of the Borrower plus
income taxes, interest expense, depreciation, non-cash amortization
and other non-cash items, and adjusted to eliminate extraordinary
items and adjusted on a consistent basis to reflect increases or
decreases that result from acquisition, sales or exchanges of
property. "Total Debt Service" means all principal and interest due
and payable during any period of computation arising from all of the
Borrower's indebtedness."
3. The following shall be added as Section 7.e. (v):
"(v) In the event that the Borrower realizes a leverage ratio of 3.0
to 1 and maintains a collateral coverage equal to or in excess of
total outstanding obligation to the Bank,, then the guarantee of
Winnebago Industries, Inc. will be returned to the Guarantor, with the
specific understanding that if these levels are not maintained a new
guaranty will be immediately executed. Collateral coverage shall be
computed as 80% of accounts receivabe, 50% of inventory and 50% of net
book value of equipment."
4. TERM LOAN AND PAYMENT PROVISIONS. The following section shall be
added as Section 8 and all subsequent sections shall be renumbered.
"8. TERM LOAN AND PAYMENT PROVISIONS.
a. Term Loan Definitions.
(i) "Term Loan" shall have the meaning ascribed hereto in the
following subsections 8.a. through 8.f.
(ii) "Term Loan Interest Rate" means the rate of interest to be
charged by the Bank to the Borrower hereunder, which is the 90
day LIBOR rate, plus 2.5 percent, as adjusted in accordance with
the Term Loan Promissory Note.
(iii) "Term Loan Promissory Note" means the promissory note and
all of its terms and provisions, in substantially the form of
Exhibit A attached hereto, to be delivered by the Borrower to the
Bank pursuant hereto.
(iv) "Term Loan Termination Date" means September 28, 1999, or
earlier upon the occuraence of an Event of Default or otherwise
as provided herein.
b. Borrowing. Subject to the terms and conditions of the Agreement,
the Bank shall lend to the Borrower the principal sum of
$4,400,000.
c. Term Loan Promissory Note. The Borrower shall execute and deliver
to the Bank the Term Loan Promissory Note with this Amendment.
The Term Loan Promissory Note, together with this Amendment and
the other documents referred to herein, shall evidence the
Borrower's indebtedness to the Bank under the Term Loan.
d. Interest. In accordance with the Term Loan Promissory Note, the
Borrower shall pay interest to the Bank upon the outstanding
daily principal balance of the Term Loan, which interest shall be
computed at the close of each day, at the Term Loan Interest Rate
(on the basis of actual days elapsed in the yea of 360 days).
Until the Term Loan Termination Date, such interest shall be paid
monthly in arrears, commencing on the first day of the next
succeeding month following the month in which this Amendment is
executed, and continuing on the first day of each successive
month thereafter. At the Term Loan Termination Date, all sums due
hereunder shall be due and payable. All payments shall be made to
the Bank on or before the required due dates in immediately
available funds.
e. Repayment. The Borrower shall pay principal, interest and charges
that are "directly attributable" to the Term Loan in accordance
with the provisions of the Term Loan Promissory Note.
f. Determination of Balances. The records of the Bank shall be prima
facia evidence as to the amount of advances, outstanding
principal balance, and accrued interest and charges.
6. SAVINGS. All terms and conditions of the Agreement not specifically
modified herein shall remain in full force and effect.
IMPORTANT: READ BEFORE SIGNING. THE TERMS OF THIS AGREEMENT SHOULD BE READ
CAREFULLY BECAUSE ONLY THOSE TERMS IN WRITING ARE ENFORCEABLE. NO OTHER TERMS OR
ORAL PROMISES NOT CONTAINED IN THIS WRITTEN CONTRACT MAY BE LEGALLY ENFORCED.
YOU MAY CHANGE THE TERMS OF THIS AGREEMENT ONLY BY ANOTHER WRITTEN AGREEEMENT.
Cycle-Sat, Inc.
By: /s/ Loren A. Swenson
Loren A. Swenson, CEO/President
By: /s/ William B. Grandy
William B. Grandy, CFO/Vice Pres.
Firststar Bank Cedar Rapids, N.A.
By: /s/ Dirk A Thierer
Dirk A Thierer, Vice President
Guarantor
Winnebago Industries,
By: /s/ Fred G. Dohrmann
VARIABLE BALANCE PROMISSORY NOTE Br 2030
(Not a Consumer Credit Transaction)
DAT
INCR.$1,500,000.00
Maker Cycle-Sat, Inc. _ _ Note No. 1247441--9001
Note Date JANUARY 31 , 1995 Maturity Date FEBRUARY 1, 1996
MAXIMUM CREDIT AMOUNT: FOUR MILLION FIVE THOUSAND AND NO/100
(S 4,500,000.00)
Purpose Working capital
FOR VALUE RECEIVED, the undersigned, jointly and severally,
as principals, promise to pay to the order of FIRSTAR BANK CEDAR RAPIDS, NA,
Cedar Rapids, Iowa, (hereinafter refered to as "Bank") its successors and
assigns; the Maximum Credit Amount; or so much of the Maximum Credit Amount as
may be advanced under this Note by any holder of this Note.
with interest thereon to be adjusted daily beginning 01/31/95 to be
equal to 1.500 percentage points above the 90 day LIBOR to adjust every
90 days, as the same may be on the dates of adjustment;
per annum; said principal and interest to be paid as follows:
Interest sha1l be due month1y beginning 03/01/95, and thereafter on the
lST of each month with the principal ba1ance and any remaining interest
due at maturity.
Each such payment shall be applied first in payment of interest due on
the unpaid balance and the remainder in reduction of the principal. All interest
shall be computed for the actual number of days elapsed upon the actual
principal balance from time to time outstanding on the basis of a year of 360
days.
The Maximum Credit Amount set forth above represents the total amount
which Bank has agreed to advance from time to time to the undersigned. Except as
otherwise provided below, the undersigned may, up to the Maximum Credit Amount,
at any time, and from time to time prior to the Maturity Date of this note,
borrow, repay, and reborrow from Bank and the liability of the undersigned
hereunder shall be the principal amount from time to time outstanding pursuant
to this note plus interest as provided above.
Bank's determination as to the outstanding balance owed by the
undersigned hereunder shall be conclusive and Bank's documentation to support
said outstanding balance will be sufficient to establish and sustain the
undersigneds' obligation hereunder. Advances may be made by credit by Bank to
the undersigneds' depository account. Requests for advances may be made to Bank
at the request of any one of the undersigned and such requests may be in
writing, orally, or by telephone. The undersigned agree to assume full
responsibility for preserving evidence of payments until this note has been
presented to the undersigned, marked paid.
Bank may require any and all documentation and additional confirmation
as to authorization for any requested advance. Upon the failure of the
undersigned to provide said data in a form satisfactory to Bank, or upon the
occurrence of an Event of Default (has hereinafter defined), or upon the
occurrence of any event which would constitute an Event of Default but for the
requirement that notice be given or time elapse or both, Bank may, at its
option, refuse to honor any request for an advance of funds.
If referred to or used herein, the term "Prime Rate" (or any similar
reference) shall mean that rate of interest described as the "Prime Rate" of
Bank announced from time to time by Bank and determined at the sole discretion
of Bank management as part of its internal procedures. No representation is made
by Bank to the undersigned that the "Prime Rate" is the lowest, the best, or a
favored rate.
This note is secured by all existing and future liens and security
interests created by security agreements, mortgages, or any other collateral
documents now or hereafter between Bank and the undersigned or now or hereafter
between Bank and any endorsers, sureties, or guarantors of this note and payment
may be accelerated according to any of said agreements and documents. The
undersigned and all endorsers, sureties, and guarantors of this note are
hereinafter collectively referred to as the "Obligors." In addition to Bank's
common law rights of set off, the undersigned hereby grant to Bank a security
interest and lien in any credit balance or other money now or hereafter owed
them by Bank, and, in addition, the undersigned agree that Bank may, without
notice or demand, set off against any such credit balance or other asset(s) any
amount unpaid under this note, whether due or not.
The undersigned represent and warrant that the extension of credit
evidenced by this note is for business, commercial, or agricultural purposes, or
is to an organization.
OTHER PROVlSlONS:Continuation of obligation represented by Note # 9001
dated 02/24/94.
The security document(s) by which is note is secured include, but not
limited to:
Security Agreement dated 2-24-94;
Credit Agreement dated 2-24-94 as amended.
THE ADDITIONAL TERMS AND CONDITIONS SET FORTH ON PAGE TWO OF THIS NOTE ARE A
PART OF THIS NOTE. THE UNDERSIGNED HEREBY ACKNOWLEDGE THE RECEIPT OF A COPY OF
THIS NOTE
119 John K. Hanson Drive
Forest City, IA 50436
Cycle - Sat, Inc .
By:
Loren A. Swenson, CE0/President
By:
William B. Grandy, CFO/Vicc Pres.
S.S. or Fed l D. 42-1246889
ORIGINAL Page 1 of 2
ADDITIONAL TERMS AND CONDITIONS
1. The Obligors, jointly and severally: (i) waive presentment, demand,
notice of demand, protest, notice of protest, notice of nonpayment, and any
other notice required to be given under the law to any of the Obligors in
connection with the delivery, acceptance, performance, default, or enforcement
of this note, of any endorsement, surety agreement or guaranty of this note, or
of any document or instrument evidencing any security for payment of this note;
(ii) consent to any and all acceptances of partial payments, delays, extensions,
renewals, or other modifications of this note or waivers of any term hereof, any
release or discharge by Bank of any of the Obligors, any agreement by Bank not
to sue any Obligor, the release, substitution, or exchange of any security for
the payrnent hereof, the failure to act on the part of Bank and any indulgence
shown by Bank from time to time and in one or more instances (without notice to
or consent of any of the Obligors), and agree that no such act, failure to act,
or failure to exercise any right or remedy on the pan of the Bank shall in any
way affect or impair the obligations of any of the Obligors or be construed as a
waiver by Bank of, or otherwise affect, any of Bank's rights under this note,
under any endorsement, surety agreement or guaranty of this note, or under any
document or instrument evidencing any security for payment of this note; (iii)
agree that Bank is not required to first resort to any collateral for payment
before bringing an action hereon (or on any endorsement, surety agreement or
guaranty of this note) against the Obligors or any one or more of them; and (iv)
agree to pay, on demand, all costs and expenses of collection of this note or of
any endorsement or any guaranty hereof and/or the enforcement of Bank's rights
with respect to, or the administration, supervision, preservation, protection
of, or realization upon, any property securing payment hereof, including, but
not limited to, attorneys' fees and court costs, wrth such fees and expenses
being advances hereunder.
2. The occurrence of any one or more of the following shall constitute
an event of default under this note ("Event of Default"): (i) the failure of the
Obligors to timely pay and discharge any obligations, liabilities, or
indebtedness of any of the Obligors to Bank, whether under this note or any
other agreement, note or instrument now or hereafter existing, as and when due
(whether at maturity or by acceleration and no prior demand therefor by Bank
being necessary); (ii) death of any of the Obligors (if an individual), or a
proceeding being filed or commenced (voluntarily or involuntarily) for the
dissolution or liquidation of any of the Obligors; (iii) the failure by the
Obligors to timely pay any installment of principal or interest or the failure
to perform any of the convenants, agreements or conditions of any other note,
the collateral for which is also collateral for this note; (iv) the insolvency
or business failure of any of the Obligors, or the appointment of a custodian,
trustee, liquidator or receiver for any of the Obligors or for any of the
property of the Obligors; (v) any assignment for the benefit of creditors by or
against any of the Obligors, or the filing of a petition (whether voluntarily or
involuntarily) by or against the Obligors under any bankruptcy, insolvency, or
debtor's relief law; (vi) the occurrence of any readjustment of indebtedness,
composition or extension of any indebtedness of any of the Obligors; (vii) any
attachments, liens or additional security interest being placed upon any of the
collateral for this note; (viii) acquisition at any time or from time totime of
title to the whole of or any part of the collateral for this note by any person
or entity other than any of the Obligors; (ix) Bank determining that any
representation or warranty made by any of the Obligors to Bank is, or was when
made, untrue ro materially misleading; (x) the occurrence of any default as
defined in any security document which secures this note; (xi) Bank deeming
itself insecure; or (xii) the occurrence of a default in the due observance or
performance of or breach of any agreement of this note regarding these
obligations between the Obligors and Bank. (xiii) any change in the stock
ownership of Obligor.
3. Upon the occurrence of an Event of Default, the entire principal
balance plus accrued interest outstanding hereunder and any or all other
liabilities, indebtedness and obligations of the Obligors to Bank (however
acquired or evidenced) shall, at the option of Bank, become irnmediately due and
payable, without presentment, notice, protest or demand of any kind (all of
which are expressly waived by the Obligors), and to the extent permitted by law,
the rate of interest on the unpaid principal and accrued interest shall, at the
option of Bank, be increased to four percent (4%) over the interest rate (as
shown on the face of this note), compounded monthly, or four percent (4%) over
the Prime Rate of Bank ("Bank Default Rate"). The Bank Default Rate will change
each time and as of the date that the Prime Rate of Bank changes. Failure at any
time to exercise any of the aforesaid options or any other rights of Bank
hereunder shall not constitute a waiver by Bank thereof, nor shall it prevent
Bank from exercising any of the aforesaid options or rights at a later date. If
this note is payable on demand, the acceptance by Bank of any partial payment
hereof, from any of the Obligors, shall not affect the demand tenor of this
note.
4. This note is delivered in and shall be construed in accordance with
the laws of the State of Iowa, and all litigation arising out of this note or of
any endorsement or guaranty of this note or any security given for payment
hereof shall be brought only in the courts of the State of Iowa or the courts of
the United States which are situated in the State of Iowa and the Obligors,
jointly and severally, consent to and confer personal jurisidiction upon the
courts of the State of Iowa or the courts of the United States which are
situated in the State of Iowa, and expressly waive any objections as to venue in
any of such courts, and agree that service of process may be made on the
Obligors by mailing a copy of the summons to their respective addresses.
5. In the event any one or more of the provisions of this note shall
for any reason be held to be invalid, illegal, or unenforceable, in whole or in
part or in any respect, or in the event that any one or more of the provisions
of this note operate or would prospectively operate to invalidate this note,
then and in either of those events, such provision or provisions only shall be
deemed null and void and shall not affect any other provision of this note and
the remaining provisions of this note shall remain operative and in full force
and effect and shall in no way be affected, prejudiced, or disturbed thereby.
6. The Obligors shall from time to time, upon request by Bank, permit a
representative of Bank to inspect and make copies of the Obligors' books and
records at all reasonable times. The Obligors shall furnish Bank such financial
information in a form acceptable to Bank as Bank may from time to time request.
7. Bank may, at its option, sell participations in or assign all or
part of this note to another bank or entity. Bank may furnish any information
concerning Borrower in the possession of Bank from time to time to such assignee
or participant.
8. IMPORTANT: READ BEFORE SIGNING. THE TERMS OF THIS AGREEMENT SHOULD
BE READ CAREFULLY BECAUSE ONLY THOSE TERMS IN WRITING ARE ENFORCEABLE. NO OTHER
TERMS OR ORAL PROMISES NOT CONTAINED IN THIS WRITTEN CONTRACT MAY BE LEGALLY
ENFORCED. YOU MAY CHANGE THE TERMS OF THIS AGREEMENT ONLY BY ANOTHER WRITTEN
AGREEMENT.
ORIGINAL Obligor Page 2 of 2
JANUARY 3l, l995
FIRSTAR BANK CEDAR RAPIDS, N.A.
Firstar Bank Cedar Rapids, N.A.
222 Second Avenue SE
Cedar Rapids. IA 52401
RE: Account Name: Cycle-Sat, Inc.
Loan Dated: JANUARY 31, 1995
Loan Number: 1247441--9001
Principal Amount: $4,500,000.00
ID #42-1246889
To Whom It May Concern:
The following named individuals are authorized to make oral or written
requests for advances under the above-referenced note, and all future renewals:
Name Title
Loren A. Swenson CEO/President
William B. Grandy CFO/Vice President
Firstar Bank Cedar Rapids, N.A. is entitled to rely upon the oral or
written requests for advances of any one of the named individuals until the
authority granted herein is revoked in writing.
Each of the undersigned acknowledges that a request made by any one of
the above-named individuals shall be binding upon and consented to by remaining
signators.
Each of the undersigned acknowledge receipt of a copy of this document.
JANUARY 31, 1995
Date
Cycle-Sat, Inc.
BY:
Loren A. Swenson, CEO/President
BY:
William B. Grandy, CFO/Vice Pres.
ADDITIONAL TERMS AND CONDITIONS
1. The Obligors, jointly and severally: (i) waive presentment, demand,
notice of demand, protest, notice of protest, notice of nonpayment, and any
other notice required to be given under the law to any of the Obligors in
connection with the delivery, acceptance, performance, default, or enforcement
of this note, of any endorsement, surety agreement or guaranty of this note, or
of any document or instrument evidencing any security for payment of this note;
(ii) consent to any and all acceptances of partial payments, delays, extensions,
renewals, or other modifications of this note or waivers of any term hereof, any
release or discharge by Bank of any of the Obligors, any agreement by Bank not
to sue any Obligor, the release, substitution, or exchange of any security for
the payrnent hereof, the failure to act on the part of Bank and any indulgence
shown by Bank from time to time and in one or more instances (without notice to
or consent of any of the Obligors), and agree that no such act, failure to act,
or failure to exercise any right or remedy on the pan of the Bank shall in any
way affect or impair the obligations of any of the Obligors or be construed as a
waiver by Bank of, or otherwise affect, any of Bank's rights under this note,
under any endorsement, surety agreement or guaranty of this note, or under any
document or instrument evidencing any security for payment of this note; (iii)
agree that Bank is not required to first resort to any collateral for payment
before bringing an action hereon (or on any endorsement, surety agreement or
guaranty of this note) against the Obligors or any one or more of them; and (iv)
agree to pay, on demand, all costs and expenses of collection of this note or of
any endorsement or any guaranty hereof and/or the enforcement of Bank's rights
with respect to, or the administration, supervision, preservation, protection
of, or realization upon, any property securing payment hereof, including, but
not limited to, attorneys' fees and court costs, wrth such fees and expenses
being advances hereunder.
2. The occurrence of any one or more of the following shall constitute
an event of default under this note ("Event of Default"): (i) the failure of the
Obligors to timely pay and discharge any obligations, liabilities, or
indebtedness of any of the Obligors to Bank, whether under this note or any
other agreement, note or instrument now or hereafter existing, as and when due
(whether at maturity or by acceleration and no prior demand therefor by Bank
being necessary); (ii) death of any of the Obligors (if an individual), or a
proceeding being filed or commenced (voluntarily or involuntarily) for the
dissolution or liquidation of any of the Obligors; (iii) the failure by the
Obligors to timely pay any installment of principal or interest or the failure
to perform any of the convenants, agreements or conditions of any other note,
the collateral for which is also collateral for this note; (iv) the insolvency
or business failure of any of the Obligors, or the appointment of a custodian,
trustee, liquidator or receiver for any of the Obligors or for any of the
property of the Obligors; (v) any assignment for the benefit of creditors by or
against any of the Obligors, or the filing of a petition (whether voluntarily or
involuntarily) by or against the Obligors under any bankruptcy, insolvency, or
debtor's relief law; (vi) the occurrence of any readjustment of indebtedness,
composition or extension of any indebtedness of any of the Obligors; (vii) any
attachments, liens or additional security interest being placed upon any of the
collateral for this note; (viii) acquisition at any time or from time totime of
title to the whole of or any part of the collateral for this note by any person
or entity other than any of the Obligors; (ix) Bank determining that any
representation or warranty made by any of the Obligors to Bank is, or was when
made, untrue ro materially misleading; (x) the occurrence of any default as
defined in any security document which secures this note; (xi) Bank deeming
itself insecure; or (xii) the occurrence of a default in the due observance or
performance of or breach of any agreement of this note regarding these
obligations between the Obligors and Bank. (xiii) any change in the stock
ownership of Obligor.
3. Upon the occurrence of an Event of Default, the entire principal
balance plus accrued interest outstanding hereunder and any or all other
liabilities, indebtedness and obligations of the Obligors to Bank (however
acquired or evidenced) shall, at the option of Bank, become irnmediately due and
payable, without presentment, notice, protest or demand of any kind (all of
which are expressly waived by the Obligors), and to the extent permitted by law,
the rate of interest on the unpaid principal and accrued interest shall, at the
option of Bank, be increased to four percent (4%) over the interest rate (as
shown on the face of this note), compounded monthly, or four percent (4%) over
the Prime Rate of Bank ("Bank Default Rate"). The Bank Default Rate will change
each time and as of the date that the Prime Rate of Bank changes. Failure at any
time to exercise any of the aforesaid options or any other rights of Bank
hereunder shall not constitute a waiver by Bank thereof, nor shall it prevent
Bank from exercising any of the aforesaid options or rights at a later date. If
this note is payable on demand, the acceptance by Bank of any partial payment
hereof, from any of the Obligors, shall not affect the demand tenor of this
note.
4. This note is delivered in and shall be construed in accordance with
the laws of the State of Iowa, and all litigation arising out of this note or of
any endorsement or guaranty of this note or any security given for payment
hereof shall be brought only in the courts of the State of Iowa or the courts of
the United States which are situated in the State of Iowa and the Obligors,
jointly and severally, consent to and confer personal jurisidiction upon the
courts of the State of Iowa or the courts of the United States which are
situated in the State of Iowa, and expressly waive any objections as to venue in
any of such courts, and agree that service of process may be made on the
Obligors by mailing a copy of the summons to their respective addresses.
5. In the event any one or more of the provisions of this note shall
for any reason be held to be invalid, illegal, or unenforceable, in whole or in
part or in any respect, or in the event that any one or more of the provisions
of this note operate or would prospectively operate to invalidate this note,
then and in either of those events, such provision or provisions only shall be
deemed null and void and shall not affect any other provision of this note and
the remaining provisions of this note shall remain operative and in full force
and effect and shall in no way be affected, prejudiced, or disturbed thereby.
6. The Obligors shall from time to time, upon request by Bank, permit a
representative of Bank to inspect and make copies of the Obligors' books and
records at all reasonable times. The Obligors shall furnish Bank such financial
information in a form acceptable to Bank as Bank may from time to time request.
7. Bank may, at its option, sell participations in or assign all or
part of this note to another bank or entity. Bank may furnish any information
concerning Borrower in the possession of Bank from time to time to such assignee
or participant.
8. IMPORTANT: READ BEFORE SIGNING. THE TERMS OF THIS AGREEMENT SHOULD
BE READ CAREFULLY BECAUSE ONLY THOSE TERMS IN WRITING ARE ENFORCEABLE. NO OTHER
TERMS OR ORAL PROMISES NOT CONTAINED IN THIS WRITTEN CONTRACT MAY BE LEGALLY
ENFORCED. YOU MAY CHANGE THE TERMS OF THIS AGREEMENT ONLY BY ANOTHER WRITTEN
AGREEMENT.
ORIGINAL Obligor Page 2 of 2
G U A R A N T Y ID #42-1246889
UNLIMITED AND CONTINUING
THIS GUARANTY is given by the undersigned (hereinafter referred to as
the "Guarantors") to induce Firstar Bank Cedar Rapids. N.A., (hereinafter
referred to as "Lender") to extend credit to, or otherwise become the creditor
of Cvcle-Sat, Inc. (hereinafter referred to as "Borrower"). Guarantors
understand that the Lender is willing to become the creditor of Borrower only if
Guarantors guaranty the faithful performance of all the terms and conditions
upon which such credit is extended to borrower, and Guarantors are desirous of
having Lender extend such credit to Borrower upon such terms and conditions as
are agreed upon by Lender and Borrower.
In consideration of the foregoing, it is agreed:
1. Guarantors, jointly and severally, absolutely and unconditionally,
guaranty to Lender, its successors and assigns, the prompt payment to Lender,
its successors and assigns, of all loans, drafts. overdrafts, checks, notes and
any and all other debts, obligations and liabilities of every kind of Borrower
to Lender, including extensions, renewals or refundings thereof (including
extensions, renewals or refundings made after receipt by Lender of written
notice of termination or revocation hereof), whether as maker, co-maker, drawer,
guarantor, indorser, or otherwise, whether direct or indirect, liquidated or
unliquidated, absolute or contingent, joint or several, now existing or
hereafter arising, due or to become due, whether originally contracted with
Lender, and whether such indebtedness is from time to time reduced and
thereafter increased or entirely extinguished and thereafter reincurred,
including interest and charges and to the extend not prohibited by law, all
costs, expenses, fees and attorneys' fees at any time paid or incurred by
Lender, or its successors or assigns, in efforts to collect all or part of the
foregoing liabilities and obligations or to realize upon any collateral securing
the foregoing liabilities and obligations (the foregoing are hereinafter
collectively referred to as the "Liabilities"). All of the Liabilities shall
conclusively be presumed to have been created or accepted by Lender in reliance
on this Guaranty.
In addition to the foregoing obligations of Guarantors, to the extent
not prohibited by law, Guarantors shall be obligated to Lender for any and all
costs and expenses incurred by Lender to realize upon this Guaranty, including,
but not limited to, reasonable attorneys' fees, legal expenses and court costs.
2. This Guaranty is a continuing guaranty and shall remain in effect
until notice of termination in writing is given to Lender. Termination shall be
effective only upon receipt of such notice by Lender. Such termination will be
effective only with respect to those Liabilities incurred or contracted by
Borrower or acquired by Lender after the date on which such written notice is
received by Lender. Notwithstanding the giving of such termination notice and
notwithstanding any other provision contained in this Guaranty, this Guaranty
shall remain in full force and effect as to all of the following: (i) all of
those Liabilities existing on the date of receipt by Lender of the notice of
termination, (ii) all renewals and extensions thereof, (iii) all Liabilities
arising out of any loan commitments existing prior to the receipt by Lender of
the notice of termination, and (iv) all costs, expenses, fees and attorneys'
fees at any time paid or incurred by Lender, or its succsssors or assigns, in
efforts to collect the Liabilities, or to realize upon this Guaranty or any
collateral securing the Liabilities whether or not such costs, expenses or fees
are incurred by Lender before or after the delivery of the notice of termination
until full payment of the Liabilities and other obligations to Lender.
Termination of this Guaranty by notice or by operation of law shall affect the
Liabilities in such order as Lender may elect and without any obligation to
account to any of the Guarantors for the manner or order of application. Any
termination of this Guaranty by a Guarantor shall only be effective as to the
Guarantor who has given written notice and shall not be effective as to any of
the other Guarantors.
3. This Guaranty shall be construed as an absolute, continuing and
unlimited guaranty of payment and to the extent permitted by law shall be valid
and enforceable against Guarantors without regard to the regularity, validity or
enforceability of any of the Liabilities. This Guaranty shall be both in
supplement of and in addition to any other guaranty or guaranties, indemnity or
indemnities which shall be furnished to Lender by Guarantors or by any other
person or persons to secure the Liabilities The failure of any person or entity
to sign this Guaranty shall not release or affect the liability of any signator
hereto.
4. Guarantors, jointly and severally, agree, without affecting
Guarantors' liability to Lender hereunder, that Lender may, without notice to or
consent of Guarantors, upon such terms as Lender may deem advisable: (a) from
time to time, extend credit to or otherwise become the creditor of Borrower, (b)
renew, extend, modify, or amend the terms of any of the Liabilities or any
agreement pursuant to which any of the Liabilities were created or security
therefor is held, including, but not limited to, extending the time of payment
of any of the Liabilities, (c) release, surrender, exchange, modify, substitute,
impair, realize upon or deal with any collateral securing any of the
Liabilities, (d) settle or compromise any claim of Lender against Borrower, or
against any other person, firm, or corporation, whose obligation is held by
Lender as collateral security for any of the Liabilities, (e) exercise or
refrain from exercising any rights against Borrower, Guarantors. other
guarantors, or any collateral securing the Liabilities, (f) settle, release or
otherwise enter into agreements regarding the Liabilities with any party
primarily or secondarily liable on the Liabilities, and (g) apply any collateral
for the Liabilities in such order as it may elect and without any ob1igation to
account to Guarantors for the manner or order of application Guarantors hereby
waive all defenses, counterclaims, and offsets which Guarantors, jointly and
severally, might have by reason of Lender taking any of the foregoing actions
and all such actions shall be binding upon Guarantors, jointly and severally.
5. Guarantors, jointly and severally, waive: (a) notice of Borrowers
incurring any of the Liabilities, (b) notice of acceptance of this Guaranty by
Lender, (c) notice of presentment, demand for payment, protest or dishonor of
any of the Liabilities, or the obligation of any person, firm, or corporation,
held by Lender as collateral security for the Borrower's obligation, (d) notice
of the failure of any person, firm, or corporation to pay to Lender any
indebtedness held by Lender as collateral security for any of the Liabilities,
(e) all defenses, offsets and counterclaims which Guarantors may at any time
have to any claim of Lender against Borrower, and (f) notice of any default on
the part of Borrower and any demand for the payment of the Liabilities; provided
however, if this Guaranty is for a "Consumer Credit Transaction", as defined in
the Iowa Consumer Credit Code, Lender shall give such notices, if any as may be
required by law.
6. Guarantors, jointly and severally, represent and warrant that, at
the time of the execution and delivery of this Guaranty, there are no conditions
to the effectiveness of this Guaranty and nothing exists to impair the
effectiveness of the liability of Guarantors to Lender hereunder, or to prevent
this Guaranty from taking immediate effect with respect to the guaranty by
Guarantors of the Borrower's obligations to Lender under the Liabilities.
7. Actions to enforce this Guaranty may be brought successively against
one or more of Guarantors, jointly or severally, and against less than all of
Guarantors without impairing or affecting the rights of Lender against the
others. Guarantors may, however, agree among themselves that no release or
settlement shall impair their rights as among themselves. Any claim, including a
claim for contribution, which any of the Guarantors may have against a
co-guarantor indebted or under liability to Lender, either direct or indirect,
or against Borrower, shall not be enforced or payment made until the
indebtedness or liability of the co-guarantor or Borrower to Lender is paid in
full. The collateral given to secure this Guaranty by a co-guarantor indebted or
under liability to Lender shall be applied in payment of the indebtedness or
liability of the co-guarantor to Lender before any part is applied on a claim of
Borrower or a co-guarantor, including, but not limited to, a claim for
contribution of one or more of the Guarantors against a co-guarantor. Lender
may, at its option, proceed in the first instance against Guarantors, jointly
and severally, to collect any obligation covered by this Guaranty, without first
proceeding against Borrower, or any other person, firm, or corporation, and
without first resorting to any property at any time held by Lender as collateral
or security for the payment of the Liabilities or for the performance of
Guarantors' obligations under this Guaranty.
THIS GUARANTY SPECIFICALLY INCLUDES ALL THE ADDITIONAL PROVISIONS SET FORTH ON
PAGE 2 HEREOF, THE SAME BEING INCORPORATED BY REFERENCE
CUSTOMER COPY Page 1 of 2
8. The obligations of Guarantors hereunder shall not in any manner
be affected by any of the following: (i) the failure on the part of the Lender
to realize upon, perfect any interest in, or protect any of the Liabilities or
security therefore or take any action with respect thereto, (ii) any impairment,
modification, change, release or limitation of any of the Liabilities resulting
from the operation of any present or future provision of the Bankruptcy Code or
similar statute, or from the decision of any court, (iii) any act or omission by
Lender arising out of Lender's administration of the Liabilities or which in any
way alters the scope of the Guarantors' risk, or (iv) any change, exchange or
alteration of any collateral or other security held by Lender for payment of the
Liabilities or the surrender or release of any such collateral or security.
9. This Guaranty shall not be discharged or in any way affected by the
death of Guarantors.
10. This Guaranty is secured by all of the following: (a) all
collateral previously, now or hereafter pledged to Lender by any of the
Guarantors, (b) all security interests previously, now or hereafter granted to
Lender by any of the Guarantors and (c) all real estate mortgages previously,
now or hereafter granted to Lender by any of Guarantors (whether such pledge,
security interest or real estate mortgage specifically relates to the
Liabilities or not); provided, however, this Guaranty shall not be secured by
any such pledge, security interest or real estate mortgage given in a "Consumer
Credit Transaction", as defined in the lowa Consumer Credit Code, unless
specifically provided for therein. Guarantors hereby grant to Lender a security
interest in all accounts, deposits and property of Guarantors in the possession
of Lender, and Lender shall have the right to set off, at any time without
notice to Guarantors, any and all deposits and other sums due from Lender to
Guarantor(s).
11. Guarantors, jointly and severally, agree that in the event any
payment made by or on behalf of Borrower respecting any of the Liabilities, or
any portion of any such payment, shall at any time be repaid by the recipient in
compliance with an order (whether or not final) by a court of competent
jurisdiction pursuant to any provision of the Bankruptcy Code, as now existing
or hereafter amended, or any provision of applicable state law, the Liabilities
shall not be deemed to have been paid to the extent of the repayment so made and
the obligations of each Guarantor shall continue in full force and effect, and
Lender and Lender's successors and assigns will continue to be entitled to the
full benefits of this Guaranty.
12. All payments received by Lender from Guarantors shall be deemed to
have been made by all Guarantors together with any other guarantors who may be
obligated to Lender on account of the Liabilities, unless Lender is otherwise
advised in writing by all Guarantors and all such other parties. Upon payment,
in full, by Guarantors of the Liabilities, Lender will assign and transfer all
of Lender's rights, if any, in and to the Liabilities (without recourse or any
express or implied warranties) to Guarantors and any other guarantors who may be
obligated to Lender on account of the Liabilities, any such transfer to be in
common (regardless of the source or sources of payment of the Liabilities)
unless Lender is otherwise instructed in writing by all of Guarantors and all
such other parties. Guarantors waive all rights of subrogation to any collateral
and remedies of Lender against Borrower, and other persons or entities, until
all of the Liabilities have been paid in full and discharged.
13. Guarantors hereby release Lender from any duty it may have to
disclose to Guarantors, or any one of them, facts which Lender might now have or
in the future have concerning the financial condition of Borrower, even though
such facts might materially increase the risk of Guarantors.
14. In the event any portion of this Guaranty shall, for any reason, be
held to be invalid, illegal or unenforceable in whole or in part, the remaining
provisions shall not be affected thereby and shall continue to be valid and
enforceable and if, for any reason, a court finds that any provision of this
Guaranty is invalid, illegal or unenforceable as written, but that by limiting
such provision it would become valid, legal and enforceable then such provision
shall be deemed to be written, construed and enforced as so limited.
15. This Guaranty constitutes the entire agreement of Guarantors with
respect to the subject matter of this Guaranty, and supersedes all negotiations,
preliminary agreements and all prior and contemporaneous discussions between
Guarantors and Lender in connection with the subject matter of this Guaranty. No
course of dealing, course of performance or trade useage, and no parol evidence
of any nature shall be used to supplement or modify any terms of this Guaranty.
16. This Guaranty is delivered and made in, and shall be construed
pursuant to the laws of, the State of Iowa, and is binding, jointly and
severally, upon Guarantors and their heirs, legal representatives, sucesssors
and assigns, and shall inure to the benefit of Lender, its successors and
assigns. This Guaranty may be enforced by any party to whom all or any part of
the Liabilities may be sold, transferred or assigned. If less than all of the
Liabilities are sold, transferrsd or assigned, Lender shall have the right to
enforce this Guaranty as to the remainder of the Liabilities. Words and phrases
herein shall be construed as in the singular or plural number, and as masculine,
feminine or neuter gender according to the context.
17. Guarantors hereby acknowledge that they have (i) each received a
copy of this Guaranty, (ii) read and understand this Guaranty, and (iii) been
advised by Lender to consult with legal counsel before signing this Guaranty.
In Witness Whereof Guarantors have signed this Guaranty on this 31ST day of
JANUARY, 1995
IMPORTANT: READ BEFORE SIGNING. THE TERMS OF THIS AGREEMENT SHOULD BE READ
CAREFULLY BECAUSE ONLY THOSE TERMS IN WRITING ARE ENFORCEABLE. NO OTHER TERMS OR
ORAL PROMISES NOT CONTAINED IN THIS WRITTEN CONTRACT MAY BE LEGALLY ENFORCED.
YOU MAY CHANGE THE TERMS OF THIS AGREEMENT ONLY BY ANOTHER WRITTEN AGREEMENT.
Winnebago Industries, Inc., Guarantor
BY /s/ Fred G. Dohrmann
Fred G. Dohrmann, President & CEO
BY /s/ Raymond M. Beebe
Raymond M. Beebe, V.P., Sec., & General Counsel
STATE OF IOWA, County of HANCOCK, ss.
On this 31ST day of JANUARY A.D., 1995, before me, a Notary Public in and for
said County State of Iowa, personally appeared: Fred G. Dohrmann and Raymond M.
Beebe to me personally known, who being by me duly sworn did say respectively,
that they are President and Vice President, General Counsel and Secretary of
said corporation executing the within and foregoing instrument to which this is
attached, that (the seal affixed thereto is the seal of said) corporation, that
said instrument was signed (and sealed) on behalf of said corporation by
authority of its Board of Directors; and that each of them as such officers
acknowledged the execution of said instrument to be the voluntary act and deed
of said corporation, by it and by them voluntarily executed.
Notary Public in and for the State of Iowa
CUSTOMER COPY Page 2 of 2
Has the subject property or adjoining properties ever been used for:
Industrial purposes YES / NO
wastetreament/storage/Disposal/Recycling YES / NO
Incineration YES / NO
Gasoline/Service Stations YES / NO
Printing Facility YES / NO
Dry Cleaners YES / NO
Analytical/Photo development laboratory YES / NO
Junkyard/Auto Salvage Yard YES / NO
Please provide a detailed explanation for any "YES" answer given above on
attached sheet
Please provide and attach a detailed listing of any wastewater discharges (other
than sanitary and stormwater to sewers).
The foregoing questionnaire consisting of sections 1, 2, 3, 4, 5, 6, 7, 8, 9,
10, 11, 12, 13 and 14 was completed by_______________________________________
(Print)
(include name and title) who by the signature below evidences the authority to
answer this questionnaire on behalf of ________________________________________
(Print )(Borrower)
By executing this questionnaire, Borrower acknowledges that the response given
in this questionnaire are material to the loans already made or to be made in
the future Borrower is under a continuing obligation to correct and update
responses given in this guestionnaire. A11 representations and responses given
here in survive any closing and Firstar Bank may continue to rely on the
responses as accurate and current until otherwise advised by the Borrower.
Cycle-Sat, Inc.
(Borrower)
By: /s/ William B. Grandy
Title: CFO
Date: 3-6-95
Firstar Bank Cedar Rapids, N.A.
February 3, 1995
William B. Grandy, CFO
Cycle Sat, Inc.
119 John K. Hanson Dr.
Forest City, IA 50436
Dear William B. Grandy:
The Commercial Division of Firstar Bank Cedar Rapids, N.A., is pleased to be
working with you in the financial planning for your business.
As a part of our commercial lending process, we are sending you the enclosed
term sheet. We make this proposal available to you to initiate discussion on
lending terms prior to loan negotiations and any final loan agreement and
documentation.
We value our commercial lending customers and look forward to discussing your
lending needs further. If you have any questions regarding the sheet, please
contact me. We appreciate your interest in banking Firststar Bank Cedar Rapids,
N.A.,.and look forward to working with you on your business lending needs.
Sincerely,
/s/ Dirk A. Thierer
Dirk A. Thierer
Commercial Lending Department
jms
Enclosure
TERM SHEET
Firstar Bank Cedar Rapids, N.A., (the "Bank") is pleased to present the
following proposal for your consideration:
Borrower: Cycle Sat, Inc.
Unlimited Guarantors: Winnebago Industries, Inc.
Working Capital Facility
A. Aggregate Amount and Purpose: The Working Capital facility shall
be on a revolving basis in amount up to $4,500,000 for general
working capital purposes.
B. Interest: The Working Capital Facility will be evidenced by a
promissory note which will bear interest at 90-day Libor Rate,
plus 150 basis points, rate to change every 90 days.
C. Borrowing Ability: Borrowings under the working Capital Facility
will be limited to the lessor of $4,500,000 or an amount equal to
the sum of the following Borrowing Base:
80% of (Eligible Accounts Receivable); and
50% of Inventory
"Eligible Accounts Receivable" means a receivable which is
acceptable to the Bank in its sole discretion.
D. Borrowing Base Certificate: The sum of the Borrowing Base will be
determined each month by submission of a Borrowing Base
Certificate by the 20th of each month, accurate to the first day
of such month.
E. Maturity: The working Capital Facility will mature 2/1/96.
Consideration will be given at that time to the renewal of this
facility.
Term Loan Facility
A. Facility Amount and Purpose: The Term Loan Facility will be in
the amount of $4,400,000 and will be used for acquisition of TFI.
B. Interest: The Term Loan Facility will be evidenced by a
promissory note which will bear interest at 90-day Libor Rate,
plus 250 basis points, rate to change every 90 days.
C. Payments and Maturity: Interest only for the first 18 months,
payable quarterly. Then principal and interest paymentss to
amortize balance over 36 months, payable quarterly. The Term Loan
Facility will mature 8/1/99 after the date of the promissory
note.
Security
All Facilities: All facilities will be cross collateralized by a first lien
on all the Borrower's assets, tangible and intangible, including
assignments of material leases and contracts.
Financial Ratios:
The loan documentation evidencing the transactions shall contain covenants
regarding financial ratios restricting the Borrower which will be
established by Bank prior to closing.
Conditions Precedent to Closing
A. Completion of loan documents detailing the terms and conditions of the
financing which will include, but not necessarily be limited to,
affirmative and negative covenants, events of default, dividend,
borrowing, lending, and expenditure restrictions, as well as various
representations and warranties, all to be in form and substance
satisfactory to the Bank.
B. Execution and delivery of documents creating a first perfected
security interest in favor of the Bank, as outlined in "Security,"
above.
C. Execution and delivery of all other collateral and closing
documentation as the Bank may require, in form and substance
satisfactory to the Bank and the resolution of any business and legal
issues that may arise.
D. Representation from the Borrower that there has not been a material
adverse change in either its financial position or any other matters
in which the Bank reviewed in its evaluation of the credit request.
Expenses
The Borrower shall reimburse the Bank for all costs and fees (including
legal expenses) incurred by the Bank in connection with the preparation,
negotiation, and execution of loan documentation.
Deposit Accounts
The Borrower will maintain all deposit accounts at the Bank so long as any
loans to Bank are outstanding.
Term Sheet
This Term Sheet sets forth the principal terms and conditions upon which
the Bank will make credit facilities described herein available to the
Borrower but does not constitute a binding commitment to do so. The Bank
shall not have any duty to make any advance under any of such credit
facilities until execution and delivery of loan documents described herein
and in form and substance satisfactory to the Bank and such satisfaction of
all conditions precedent set for in such loan documents.
Closing Date
The credit facilities described herein shall be fully documented and closed
on or before 4/1/95.
If you wish to proceed with negotiations based upon this Term Sheet, please
execute a copy of this Term Sheet and return it to me by 4/1/95.
Firstar Bank Cedar Rapids, N.A.
By: /s/ Dirk A. Thierer
Dirk A. Thierer, Vice President
Cycle Sat
By: /s/ William B. Grandy
William B. Grandy, CFO