Security Agreement - Green Mountain Coffee Roasters Inc. and Fleet Bank - NH
FIRST RESTATEMENT OF
SECURITY AGREEMENT
THIS FIRST RESTATEMENT OF SECURITY AGREEMENT (the
"Agreement"), made this 12th day of April, 1996, by and between
GREEN MOUNTAIN COFFEE ROASTERS, INC. (f/k/a Green Mountain Coffee,
Inc.), a Vermont corporation with a principal place of business at
33 Coffee Lane, Waterbury, Vermont 05676 (the "Debtor"), and FLEET
BANK - NH, a bank organized under the laws of the State of New
Hampshire with an address of NHNA E02A, 1155 Elm Street,
Manchester, New Hampshire 03101 (the "Secured Party").
RECITALS:
The Debtor and the Secured Party are parties to a certain
Commercial Loan Agreement dated October 22, 1992, said loan
agreement having been amended by a certain letter agreement dated
November 13, 1992, by a certain Amendment to Commercial Loan
Agreement and Loan Documents dated August 11, 1993, by a certain
Third Amendment to Loan Agreement and Loan Documents dated August
31, 1993, by a certain Fourth Amendment to Commercial Loan
Agreement and Loan Documents dated April 7, 1994, by a certain
Fifth Amendment to Commercial Loan Agreement and Loan Documents
dated August 15, 1994, by a certain Sixth Amendment to
Commercial Loan Agreement and Loan Documents dated March 31,
1995, and as further amended and restated pursuant to a certain
Seventh Amendment and First Restatement of Commercial Loan
Agreement of even date herewith (collectively, as amended and
restated to date, the "Loan Agreement") and certain Loan
Documents (as defined in the Loan Agreement and as amended
through the date hereof), including, but not limited to, a
certain Security Agreement dated October 22, 1992, as amended
to date, of the Debtor (the "Security Agreement"). Pursuant to
the Loan Agreement, the Secured Party has extended to the
Debtor certain credit facilities; and the Debtor has requested,
and the Secured Party has agreed, to extend this day a new term
loan in the maximum principal of up to One Million Five Hundred
Thousand Dollars ($1,500,000.00) and, in connection therewith,
to make certain amendments affecting the other credit
facilities extended by the Secured Party to the Debtor under
the Loan Agreement. The Secured Party and the Debtor have
agreed that it is necessary and appropriate, in connection with
the extension of the new term loan and making such amendments,
to amend and restate the Security Agreement in its entirety.
Capitalized terms not otherwise defined herein shall have the
meanings ascribed to them in the Loan Agreement.
NOW, THEREFORE, in consideration of the willingness of the
Secured Party to make the new term loan to the Debtor, to amend
the Loan Agreement, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties agree that the Security Agreement
shall be and hereby is amended and restated in its entirety as
follows:
1. Security Interest. As security for the Secured Obligations
described in Section 2 hereof, the Debtor hereby grants to the
Secured Party a first priority security interest in and lien on
all of the property described below (hereinafter referred to
collectively as the "Collateral"):
(a) All equipment, including machinery, motor vehicles, office
equipment, furniture, fixtures, along with all other parts,
tools, trade-ins, repairs, accessories, accessions,
modifications, and replacements, whether now owned or
subsequently acquired, constructed, or attached or added to, or
placed in, the foregoing (collectively, the "Equipment");
(b) All inventory, wherever located, including goods,
merchandise and other personal property, held for sale or lease
or furnished or to be furnished under a contract of service, or
constituting raw materials, work in process or materials used
or consumed in the Debtor's business, or consigned to others or
held by others for return to the Debtor, whether now owned or
subsequently acquired or manufactured and wherever located
(collectively, the "Inventory");
(c) All accounts receivable, including, without limitation,
accounts, contracts, contract rights, chattel paper,
instruments, rents, deposits, general intangibles, and any
other obligations of any kind whether now existing or hereafter
arising out of or in connection with the sale or lease of goods
or the rendering of services, and all rights now or hereafter
existing in and to all security agreements, notes, leases,
licenses, franchises, supply agreements, and other contracts
securing or otherwise relating to any such accounts, contracts,
contract rights, chattel paper, instruments, rents, deposits,
general intangibles, or obligations (any and all such accounts,
contracts, contract rights, chattel paper, instruments, rents,
deposits, general intangibles, and obligations being the
"Receivables", and any and all such security agreements, notes,
leases, licenses, franchises, supply agreements, and other
contracts being the "Related Contracts");
(d) All general intangibles, including, but not limited to,
corporate names, trade names, trademarks, trade secrets, books
and records, customer lists, blue prints and plans, computer
programs, tapes and related electronic data, processing
software, and all corporate ledgers;
(e) Any and all additions, accessions, substitutions or
replacements to or for any of the foregoing;
(f) Any and all products and proceeds of any or all of the
foregoing, including, without limitation, cash, cash
equivalents, tax refunds and the proceeds of insurance policies
providing coverage against the loss or destruction of or damage
to any of the Collateral, or any indemnity, warranty, or
guarantee payable by reason of loss or damage to or otherwise
with respect to any of the Collateral (whether or not the
Secured Party is the loss payee thereof);
(g) All of the Debtor's after-acquired property of the kinds
and types described in paragraphs (a) - (f) herein;
(h) All records and data relating to any of the property
described above, whether in the form of a writing, photograph,
microfilm, microfiche, or electronic media, together with all
of the Debtor's right, title, and interest in and to all
computer software required to utilize, create, maintain and
process any of such records or data or electronic media; and
also in (1) all checks, money, securities, bank accounts,
deposit accounts, and other accounts in the possession of or
held by the Secured Party whether in the name of the Debtor or
in the name of the Secured Party, and (2) all other property
given by the Debtor to the Secured Party pursuant to this
Agreement. The property described in (1) and (2) above are
held in the possession of the Secured Party by agreement of
Debtor and Secured Party. All of the said Collateral (which
throughout this Agreement includes after-acquired Collateral)
is to secure the payment and performance of all of the Secured
Obligations. For purposes of the application of any proceeds
or income resulting from or arising in connection with the
exercise of the Secured Party's rights hereunder with respect
to the Collateral, and after payment from such income or
proceeds of the Secured Obligation described in Section 2(c)
below and all costs and expenses incurred in connection with
the exercise of Secured Party's rights hereunder, the Secured
Party and the Debtor agree as follows: (i) The Revolving Line
of Credit Loan, the Equipment Line of Credit Loan, and the New
Term Loan shall be secured by (A) first priority security
interests in all existing and subsequently acquired Collateral
hereunder other than the "Project Equipment" as defined and
described in the Amendment to Commercial Loan Agreement and
Loan Documents dated August 11, 1993, (B) a third priority
perfected security interest in the Project Equipment, (C) a
third leasehold mortgage of the "Improvements" as defined and
described in the Amendment to Commercial Loan Agreement and
Loan Documents dated August 11, 1993 and leasehold interest in
the "Premises" as defined and described in the Amendment to
Commercial Loan Agreement and Loan Documents dated August 11,
1993, and (D) a third position collateral assignment of
Borrower's leasehold interest in the Premises; and (ii) the
Improvements Term Loan is secured by (A) a first priority
perfected security interest in the Project Equipment, (B) a
first leasehold mortgage of the Improvements and of the
Borrower's leasehold interest in the Premises, (C) a first
position collateral assignment of the Borrower's leasehold
interests in the Premises, and (D) a first priority security
interest in all existing and subsequently acquired Collateral
under the Loan Documents. To the extent that any proceeds or
income remain with respect to any Collateral after satisfaction
of the Secured Obligations entitled to the priorities as to the
application of such proceeds or income with respect to such
Collateral as provided hereinabove, such remaining proceeds or
income may be applied to the other Secured Obligations
hereunder in such order of priority as the Secured Party deems
appropriate. The Secured Party and Debtor acknowledge and agree
that the Project Equipment, Improvements, and Premises are
subject to second priority security interests of the Vermont
Economic Development Authority and the Central Vermont Economic
Development Corporation as more particularly described in
certain intercreditors agreements included among the Loan
Documents.
2. Secured Obligations. The security interest hereby granted
shall secure the following (the "Secured Obligations"):
(a) The Debtor's repayment of the principal amount of all of
the Loans as described and defined in the Loan Agreement,
together with interest, late charges, and any other applicable
charges thereon, to the Secured Party pursuant to and in
accordance with the Loan Documents;
(b) The Debtor's payment or performance of its obligations
under the Loan Agreement and under the other Loan Documents (as
defined, described and identified in the Loan Agreement,
hereinafter the "Loan Documents"), as the same may be amended,
modified, extended, renewed, replaced or restated;
(c) The payment of all other sums with interest and charges
thereon advanced in accordance herewith to protect the
validity, security, and priority of this Agreement, the Loan
Agreement, or the Loan Documents; and (d) Any and all other
indebtedness of Debtor to Secured Party of every kind and
description, direct or indirect, absolute or contingent, due or
to become due, regardless of how they arose or were acquired,
now existing or hereafter arising.
3. Warranties and Representations of the Debtor. Debtor
hereby makes the following representations and warranties which
shall survive the execution and delivery of this Agreement and
shall be continuing representations and warranties as long as
any Secured Obligation remains outstanding:
(a) All representations and warranties made in the Loan
Agreement and the Loan Documents relating to the Debtor and the
Collateral are true, accurate and complete in all material
respects;
(b) The Debtor's principal place of business is located at the
address first set forth above; the Debtor's executive offices
and the office where its books and records are kept and are to
be kept concerning the Receivables, Related Contracts other
Collateral are at the aforesaid address; and the Debtor has no
other places of business except those set forth on Schedule I
hereto;
(c) The Debtor conducts business only under and through the
corporate, business and trade names "Green Mountain Coffee" and
"Green Mountain Coffee Roasters, Inc.".
(d) No material authorization, approval or other action by,
and no notice to or filing with, any governmental authority or
other person is required either (i) for the grant by the Debtor
of the security interests granted hereby or for the execution,
delivery or performance of this Agreement by the Debtor, or
(ii) for the perfection of or the exercise by the Secured Party
of its respective rights and remedies hereunder, except the
filing of financing statements;
(e) The Debtor has good and marketable title to all of the
Collateral pledged by it hereunder, free and clear of any
liens, security interests, encumbrances or interests or claims
of any other person or entity, except those set forth on
Schedule II hereto, and there are no sums owed with respect to
the Collateral other than as disclosed on the Debtor's
financial statements delivered to the Secured Party;
(f) The Secured Party has a valid, perfected first security
interest in all of the Collateral which may be perfected by
filing of financing statements.;
(g) The Debtor has not performed any acts which might prevent
the Secured Party from enforcing any of the material terms and
conditions of this Agreement or which would limit any of them
in any such enforcement;
(h) Schedule III attached hereto sets forth the description
and location of all Collateral not located at the Debtor's
principal place of business, together with a list of the record
owners of and record holders of liens against the real estate
on which such Collateral is located; and
(i) No effective financing statements or other similar
instrument in effect covering all or any part of the Collateral
is on file in any recording office, except as may have been
filed in favor of Secured Party relating to this Agreement.
4. Affirmative Covenants of the Debtor.
(a) The Debtor shall promptly notify and provide the Secured
Party with a complete description of the opening of any new
places of business, the closing of any existing places of
business, the conduct of business under any names or through
any entities other than those set forth herein, the relocation
of any of the Collateral to any new place of business or any
other act which would affect the financing statements filed by
the Secured Party;
(b) The Debtor shall continuously take all steps that are
necessary or prudent to protect the security interests of the
Secured Party in the Collateral;
(c) The Debtor shall defend the Collateral against the claims
and demands of all persons;
(d) The Debtor shall deliver and pledge to the Secured Party,
endorsed or accompanied by instruments of assignment or
transfer satisfactory to the Secured Party, any instruments,
documents, and chattel paper which the Secured Party may
reasonably specify;
(e) The Debtor shall comply, in all material respects, with
all governmental regulations applicable to the Collateral or
any part thereof or to the operation of the Debtor's business;
provided, however, that the Debtor may contest any governmental
regulation in any reasonable manner which shall not in the
reasonable opinion of the Secured Party adversely affect the
Secured Party's rights or the first priority of its security
interest in the Collateral;
(f) The Debtor shall pay promptly when due, all taxes,
assessments and governmental charges or levies imposed upon the
Collateral or in respect of its income or profits therefrom, as
well as all claims of any kind, except that no such charge need
be paid if (i) the validity thereof is being contested in good
faith by appropriate proceedings, (ii) such proceedings do not
involve any danger of the sale, forfeiture or loss of any of
the Collateral or any interest therein; and (iii) such charge
is adequately reserved against in accordance with the generally
accepted accounting principles;
(g) The Debtor shall cause the Equipment to be maintained and
preserved in good condition, repair and working order, and
shall make all repairs, replacements, additions, and other
improvements necessary to maintain the Equipment in such good
condition;
(h) The Debtor shall maintain Inventory sufficient to meet the
needs of its business;
(i) The Debtor shall preserve all beneficial Related Contracts
not otherwise terminated in the ordinary course of Debtor's
business;
(j) The Debtor shall take all commercially reasonable steps
necessary to collect the Receivables;
(k) The Debtor shall assure that (i) no Receivable is or shall
be subject to any defense, offset, counterclaim, discount
(other than ordinary and customary payment discounts), or
allowance, (ii) no agreement under which any deduction,
discount, credit or allowance of any kind may be granted or
allowed shall have been or shall thereafter be made by Debtor
with any account party without the consent of Secured Party,
(iii) all statements made and all unpaid balances appearing in
the invoices, documents, agreements relating to each Receivable
are and shall be true, genuine, and correct in all respects,
and (iv) no Receivable shall be converted to a note or other
instrument unless the same shall be delivered to the possession
of the Secured Party within ten (10) days of the date of
execution of such note or instrument;
(l) The Debtor shall, with respect to any Collateral which
consists of trucks, automobiles, or other motor vehicles, or
any other Collateral required to be titled, upon an Advance
being made under the Equipment Loan with respect to such
Collateral deliver all titles thereto to the Secured Party to
be held by the Secured Party and Debtor shall make, execute,
and deliver any and all applications, and take such other
action to assure that the Secured Party is listed of record as
the first priority and sole lienholder on all title
certificates;
(m) Debtor shall keep accurate and complete records listing
and describing the Collateral, and when requested by Secured
Party, Debtor shall give Secured Party a certificate listing
and describing the Collateral and setting forth the total value
of the Inventory, the total value of the Equipment, the amount
of the Receivables designating how many days the Receivables
are from the date of invoice, the face value of any
instruments, and any other information Secured Party may
request. Secured Party shall have the right at any time to
inspect the Collateral and to audit and make copies of any
records or other writings which relate to the Collateral or the
general financial condition of Debtor. Secured Party may
remove such records and writings for the purpose of having
copies made thereof;
(n) The Debtor shall advise the Secured Party promptly, in
reasonable detail, (i) of any lien, security interest,
encumbrance, or claim made or asserted against any of the
Collateral, (ii) of any material change, substantial loss or
depreciation in the composition of the Collateral, and (iii) of
the occurrence of any other material adverse effect on the
aggregate value, enforceability or collectibility of the
Collateral or on the security interests created hereunder;
(o) The Debtor shall give, execute, deliver and file or record
in the proper governmental offices, any instrument, paper or
document, including, but not limited to, one or more financing
statements under the Uniform Commercial Code, reasonably
satisfactory to the Secured Party, or take any action which the
Secured Party may deem necessary or desirable in order to
create, preserve, perfect, extend, continue, modify, terminate
or otherwise effect any security interest granted pursuant
hereto, or to enable the Secured Party to exercise or enforce
any of its rights hereunder; and
(p) The Debtor shall keep, and stamp or otherwise mark, any of
its documents, instruments and chattel paper and its books and
records relating to any of the Collateral in such manner as the
Secured Party may reasonably require.
5. Negative Covenants of the Debtor. Except as otherwise
provided in the Loan Agreement or in this Agreement, without
the prior written consent of the Secured Party, the Debtor
shall not:
(a) Transfer, sell or assign any of the Collateral other than
in the ordinary course of business;
(b) Allow or permit any other security interest or lien to
attach to any of the Collateral;
(c) File, authorize, or permit to be filed in any jurisdiction
any financing statement relating to any of the Collateral
unless the Secured Party is named as sole secured party;
(d) Permit any of the Collateral to be levied upon under any
legal process;
(e) Permit anything to be done that may materially impair the
value of any of the Collateral or the security therein intended
to be afforded hereby; or
(f) Use the Collateral in violation of any law or in any
manner inconsistent with any policy of insurance thereon.
6. Fixtures. It is the intention of the parties hereto that
none of the Collateral shall become fixtures. Without limiting
the generality of the foregoing, the Debtor will, if requested
by the Secured Party, obtain waivers of lien, in form
satisfactory to the Secured Party, from each mortgagee or
lessor of real property (other than the Secured Party) on which
any of the Collateral is or is to be located.
7. Insurance. Debtor shall, at its own expense, maintain
insurance covering the Collateral against such risks, with such
insurers, in such form, and in such amounts as shall from time
to time be required by Secured Party, but in any event, in such
amounts and with such coverage as is customary in Debtor's type
of business. All insurance policies shall be written so as to
be payable in the event of loss to Secured Party and shall
provide for thirty (30) days' written notice to Secured Party
of cancellation or modification. At the request of Secured
Party, all insurance policies shall be furnished to and held by
Secured Party. Secured Party is hereby appointed as attorney
irrevocable to collect the proceeds of such insurance, to
settle any claims with the insurers in the event of loss or
damage, to endorse settlement drafts and, upon the occurrence
of an Event of Default (as defined hereinbelow), to cancel,
assign, or surrender any insurance policies. If, while any
Secured Obligations are outstanding, any proceeds are paid to
Secured Party under such policies, Secured Party may, at
Secured Party's option, take either or both of the following
actions: (i) apply such proceeds in whole or in part to the
payment or satisfaction of any of the Secured Obligations in
whatever order Secured Party determines; or (ii) pay over such
proceeds in whole or in part to Debtor for the purpose of
repairing or replacing the Collateral destroyed or damaged, any
proceeds so paid over by Secured Party to be secured by this
Agreement.
8. Receivables. Debtor agrees that Secured Party may
communicate with account debtors in order to verify the
existence, amount, and terms of any Receivables. Upon an Event
of Default, Secured Party may notify account debtors of the
security interests established herein and require that payments
on Receivables be made directly to Secured Party, and upon the
request of Secured Party, Debtor shall notify account debtors
and indicate on all billings that payments and returns are to
be made directly to Secured Party. In furtherance of the foregoing,
Debtor hereby appoints Secured Party attorney irrevocable with
full power upon an Event of Default to collect, compromise,
endorse, sell, or otherwise deal with the Receivables or
proceeds thereof and to perform the terms of any contract in
order to create Receivables in Secured Party's name may be, but
need not be, supplemented by separate assignments of
Receivables and contract rights and, if such assignments are
given, the rights and security interests given thereby shall be
in addition to and not in limitation of the rights and security
interests granted by this Agreement.
9. Registered Trademarks. Debtor shall deliver to Secured
Party assignment(s) of all United States registered
trademark(s) of Debtor now or hereafter obtained. Upon an
Event of Default hereunder and in connection with disposition
of the Collateral, the Secured Party or its assignee may file
such assignment(s) with the United States Patent and Trademark
Office, pursuant to an exercise of its security interest
hereunder, to effect a transfer of said trademark(s). Prior to
such time as Secured Party is entitled to exercise its rights
hereunder, the Secured Party shall hold all assignments of
trademarks hereunder in escrow.
10. Events of Default. The following events shall be deemed
"Events of Default" hereunder:
(a) An Event of Default under the Loan Agreement or any of the
Loan Documents;
(b) Any representation or warranty or statement of fact made
to Secured Party at any time by Debtor is false or misleading
or becomes false or misleading in any material respect;
(c) Debtor fails to observe or perform any covenant, warranty,
or agreement required to be observed or performed by it under
this Agreement;
(d) Debtor shall be in default under any obligation undertaken
by Debtor which default has a material adverse effect on the
financial condition of Debtor or on the value of the Collateral;
(e) Uninsured loss, theft, damage, or destruction of any
substantial portion of any of the Collateral; or
(f) Debtor or any guarantor of any of the Secured Obligations
is or becomes insolvent or is involved in any financial
difficulty as evidenced by (i) an assignment, composition, or
similar device for the benefit of creditors, (ii) general
failure to pay debts when due, (iii) attachment or receivership
of assets not dissolved within thirty (30) days, (iv) the
appointment of a custodian, trustee, or receiver for a
substantial portion of any of their respective properties, (v)
the liquidation or sale of all or substantially all of their
respective properties, (vi) the filing by Debtor or any
guarantor of a petition under any Chapter of the United States
Bankruptcy Code or the institution of any other proceeding
under any law relating to bankruptcy, bankruptcy
reorganization, insolvency or relief of Debtors, or (vii) the
filing against Debtor or any guarantor of an involuntary
petition under any Chapter of the United States Bankruptcy Code
or the institution of any other proceeding under any law
relating to bankruptcy, bankruptcy reorganization, insolvency
or relief of debtors where such proceeding is not dismissed
within sixty (60) days from the date on which it is filed or
instituted.
11. Rights and Remedies of Secured Party on Default. Upon the
occurrence of any Event of Default, Secured Party shall have,
by way of example and not of limitation, the following rights and
remedies:
(a) Secured Party may declare the Secured Obligations, or any
of them, to be immediately due and payable without presentment,
demand, protest or notice of any kind, all of which are hereby
expressly waived;
(b) In addition to all other rights and remedies contained in
this Agreement, the Loan Agreement, and in the Loan Documents,
Secured Party may exercise the rights and remedies accorded
Secured Party by the Uniform Commercial Code or by any other
applicable law, all of which rights and remedies shall be
cumulative and non-exclusive to the extent permitted by law;
(c) Secured Party shall have the right to enter and/or remain
upon the Premises of Debtor, or any other place or places where
any of the Collateral is located and kept, without any
obligation to pay rent to Debtor or others, and remove
Collateral therefrom to the premises of the Secured Party or
any agent of Secured Party for such time as Secured Party may
desire in order to maintain, collect, sell and/or prepare the
Collateral for sale, liquidation or collection;
(d) Secured Party may require the Debtor at Debtor's cost to
assemble the Collateral and make it available to Secured Party
at a place designated by Secured Party;
(e) Secured Party may take possession of and use and operate
the Collateral in the manner and for the purposes as set forth
in Section 12 hereinbelow;
(f) Secured Party may sell, lease, or otherwise dispose of the
Collateral as set forth in Section 13 hereinbelow;
(g) Secured Party shall have the right to set-off, without
notice to the Debtor, any and all deposits or other sums at any
time or times credited or due from Secured Party to Debtor,
whether in a special account or other account or represented by
a certificate of deposit (whether or not matured); which
deposit and other sums shall at all times constitute additional
security for the Secured Obligations;
(h) Secured Party may perform any warranty, covenant or
agreement which Debtor has failed to perform under this
Agreement; and
(i) Secured Party may take any other action which Secured
Party deems necessary or desirable to protect the Collateral or
the security interests granted herein.
12. Rights of Secured Party to Use and Operate Collateral.
Upon the occurrence of any Event of Default, but subject to the
provisions of the Uniform Commercial Code or
other applicable law, the Secured Party shall have the right
and power to take possession of all or any part of the
Collateral, and to exclude the Debtor and all persons claiming
under the Debtor wholly or partly therefrom, and thereafter to
hold, store, and/or use, operate, manage and control the same.
Upon any such taking of possession, the Secured Party may, from
time to time, at the expense of the Debtor, make all such
repairs, replacements, alterations, additions and improvements
to and of the Collateral as the Secured Party may reasonably
deem proper. In any such case, subject as aforesaid, the
Secured Party shall have the right to manage and control the
Collateral and to carry on the business and to exercise all
rights and powers of the Debtor in respect thereto as the Secured
Party shall deem best, including the right to enter into any and
all such agreements with respect to the leasing and/or operation
of the Collateral or any part thereof as the Secured Party may
see fit; and the Secured Party shall be entitled to collect and
receive all rents, issues, profits, fees, revenues and other
income of the same and every part thereof. Such rents, issues,
profits, fees, revenues and other income shall be applied to pay
the expenses of holding and operating the Collateral and of
conducting the business thereof, and of all maintenance, repairs,
replacements, alterations, additions and repairs, replacements,
alterations, additions and improvements, and to make all
payments which the Secured Party may be required or may elect
to make, if any, for taxes, assessments, insurance and other
charges upon the Collateral or any part thereof, and all other
payments which the Secured Party may be required or authorized
to make under any provision of this Agreement (including
reasonable legal costs and attorneys' fees). The remainder of
such rents, issues, profits, fees, revenues and other income
shall be applied to the payment of the Secured Obligations in
such order of priority as the Secured Party in accordance with
the provisions of this Agreement and any surplus shall be
returned to the Debtor. Without limiting the generality of the
foregoing, the Secured Party shall have the right to apply for
and have a receiver appointed by a court of competent
jurisdiction in any action taken by the Secured Party to
enforce their rights and remedies hereunder in order to manage,
protect and preserve the Collateral and continue the operation
of the business of the Debtor and to collect all revenues and
profits thereof and apply the same to the payment of all
expenses and other charges of such receivership including the
compensation of the receiver and to the payment of the Secured
Obligations as aforesaid until a sale or other disposition of
such Collateral shall be finally made and consummated.
13. Rights of Secured Party to Sell Collateral. Upon (10)
days prior written notice by registered or certified mail by
Secured Party to Debtor at the address of the Debtor set forth
above (or at such other address or addresses as the Debtor
shall specify in writing by like notice to the Secured Party)
of the time and place of any intended disposition of
Collateral, then Secured Party shall have the right and power
to sell, assign, lease, or otherwise dispose of the Collateral
from any business premises of the Debtor, either at public
auction or private sale, by liquidation sale or other
disposition, or as if the sale was being made in the ordinary
course of Debtor's business, with or without notice to the
public that the said sale or disposition is for the benefit of
the Secured Party; provided, however, that if the Collateral is
perishable or threatens to decline speedily in value or is of a
type customarily sold on a recognized market, then Secured
Party shall have the right and power to dispose of the
Collateral without prior notice to Debtor and Debtor expressly
waives any rights to notice under such circumstances. The
notices described above shall be deemed to meet any requirement
hereunder or under any applicable law (including the Uniform
Commercial Code) that reasonable notification be given of the
time and place of such sale or other disposition. After
deducting all costs and expenses of collection, storage,
custody, sale or other disposition and delivery (including
reasonable legal costs and attorneys' fees) and all other
charges against the Collateral, the residue of the proceeds of
any such sale or disposition shall be applied to the payment of
the Secured Obligations in accordance with the provisions of
this Agreement and any surplus shall be returned to the Debtor.
In the event the proceeds of any sale, lease or other
disposition of the Collateral hereunder are insufficient to pay
all of the Secured Obligations in full, the Debtor will be liable
for the deficiency, together with interest thereon at the maximum rate
provided in the Loan Agreement and the cost and expenses of
collection of such deficiency, including, without limitation,
reasonable fees of attorneys, experts, and agents, expenses and
disbursements.
14. Attorney-in-Fact. The Secured Party is hereby appointed
the attorney-in-fact, with full power of substitution, of the
Debtor for the purpose of carrying out the provisions of this
Agreement and taking any action and executing any instruments
(including, without limitation, financing or continuation
statements, conveyances, assignments, and transfers) which the
Secured Party may deem necessary or advisable to accomplish the
purposes hereof, which appointment as attorney-in-fact is
coupled with an interest and is irrevocable. The Debtor shall
indemnify and hold harmless the Secured Party from and against
any liability or damage which it may incur in the exercise and
performance, in good faith, of the Secured Party's powers and
duties as such attorney-in-fact.
15. Waiver, etc. The Debtor hereby waives presentment, demand,
notice, protest and, except as is otherwise provided herein,
all other demands and notices in connection with this Agreement
or the enforcement of the Secured Party's rights hereunder or
in connection with any Secured Obligations or any Collateral.
The Debtor further consents to and waives notice of the
granting of renewals, extensions of time for payment or other
indulgences to the Debtor or to any account debtor in respect
of any Receivable, substitution, release or surrender of any
Collateral, addition or release of persons primarily or
secondarily liable on any Secured Obligation or on any
Receivable or other Collateral, or the acceptance of partial
payments on any Secured Obligation or on any account receivable
or other Collateral and/or the settlement or compromise
thereof. No delay or omission on the part of the Secured Party
in exercising any right hereunder shall operate as a waiver of
such right or of any other right hereunder. Any waiver of any
such right on any one occasion shall not be construed as a bar
to or waiver of any such right on any such future occasion.
16. Termination; Assignments, etc. This Agreement and the
security interest in the Collateral created hereby shall
terminate when all of the Secured Obligations have been paid,
performed, and finally discharged in full. In the event of a
sale or assignment by the Secured Party of all or any of the
Secured Obligations held by it, such Secured Party may assign
or transfer its rights and interests under this Agreement in
whole or in part to the purchaser or purchasers of such Secured
Obligations, whereupon such purchaser or purchasers shall
become vested with all of the powers and rights of such Secured
Party hereunder, and such Secured Party shall thereafter be
forever released and fully discharged from any liability or
responsibility hereunder, with respect to the rights and
interests so assigned.
17. Notices. All notices, requests, demands and other
communications provided for hereunder shall be in writing
(including telegraphic communication) and shall be either
mailed by certified mail, return receipt requested, or
delivered by overnight courier service, to the applicable party
at the addresses first set forth above, or, as to each party,
at such other address as shall be designated by such parties in
a written notice to the other party complying as to delivery
with the terms of this Section. All such notices, requests,
demands and other communication shall be effective on the date
of first attempted delivery.
18. Miscellaneous.
(a) The powers conferred on the Secured Party hereunder are
solely to protect its interest in the Collateral and shall not
impose any duty upon it to exercise any such powers. Except
for the safe custody of any Collateral in its possession and
the accounting for monies actually received by it hereunder,
the Secured Party shall not have any duty as to any Collateral
or as to the taking of any necessary steps to preserve any
right of it or of the Debtor against other parties pertaining
to any Collateral;
(b) No provision hereof shall be amended except by a writing
signed by the Secured Party and the Debtor;
(c) Any provision of this Agreement which is prohibited or
unenforceable shall be ineffective to the extent of such
prohibition or unenforceability without invalidating the
remaining provisions hereof;
(d) This Agreement shall be binding upon and shall inure to
the benefit of the successors and assigns of the Secured Party
and the Debtor;
(e) No delay, failure to enforce, or single or partial
exercise on the part of the Secured Party in connection with
any of its rights hereunder shall constitute an estoppel or
waiver thereof, or preclude other or further exercises or
enforcement thereof and no waiver of any default hereunder
shall be a waiver of any subsequent default; and
(f) This Agreement shall be governed as to its validity,
interpretation and effect in accordance with the laws of the
State of New Hampshire.
IN WITNESS WHEREOF, the undersigned have set their hands
and seals to this Agreement all as of the day and year first
above written.
GREEN MOUNTAIN COFFEE ROASTERS, INC.
/s/ Betty Omansky By: /s/ Robert D. Britt
----------------- ---------------------------------
Witness Robert D. Britt,
Chief Financial Officer
FLEET BANK - NH
/s/ Catherine Consentino By: /s/ Andre P. Pelletier
------------------------ ---------------------------------
Witness Andre P. Pelletier, Vice President
STATE OF Vermont
COUNTY OF Washington
On this the 12th day of April, 1996, before me, the
undersigned notary or justice, personally appeared Robert D.
Britt, who acknowledged himself to be the Chief Financial
Officer of Green Mountain Coffee Roasters, Inc, a corporation,
and that he, as such authorized officer, being authorized so to do,
executed the foregoing instrument for the purposes therein contained,
by signing the name of the corporation by himself as such
authorized officer.
/s/ Betty Omansky
-----------------
Notary Public
STATE OF New Hampshire
COUNTY OF Hillsborough
On this the 12th day of April, 1996, before me, the undersigned
notary or justice, personally appeared Andre P. Pelletier, who
acknowledged himself to be a Vice President of Fleet Bank - NH,
a bank, and that he, as such authorized officer, being
authorized so to do, executed the foregoing instrument for the
purposes therein contained, by signing the name of the
corporation by himself as such authorized officer.
/s/ Catherine A. Consentino
--------------------------
Justice of the Peace