Exhibit 99.12
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR REGISTERED OR QUALIFIED UNDER ANY APPLICABLE STATE SECURITIES LAWS
AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED, HYPOTHECATED OR OTHERWISE ASSIGNED
EXCEPT IN COMPLIANCE WITH THE REGISTRATION REQUIREMENTS OF SUCH ACT AND THE
REGISTRATION OR QUALIFICATION REQUIREMENTS OF SUCH STATE SECURITIES LAWS OR
PURSUANT TO AN EXEMPTION FROM SUCH REGISTRATION AND QUALIFICATION.
PAYMENT OF THE INDEBTEDNESS EVIDENCED BY THIS SECURITY, INCLUDING PRINCIPAL,
PREMIUM, IF ANY, AND INTEREST, AND THE RIGHTS OF ANY HOLDER OF THIS SECURITY ARE
SUBJECT TO THE TERMS AND CONDITIONS OF AN AMENDED AND RESTATED INTERCREDITOR AND
SUBORDINATION AGREEMENT DATED AS OF OCTOBER 29, 2002, AS AMENDED, BETWEEN XXXXXX
XXXXXXXXX CAPITAL PARTNERS II, L.P., AS THE HOLDER OF THIS SECURITY, AND UNION
BANK OF CALIFORNIA, N.A. A COPY OF SUCH AMENDED AND RESTATED INTERCREDITOR AND
SUBORDINATION AGREEMENT MAY BE OBTAINED FROM THE ISSUER UPON REQUEST.
THIS SECURITY WAS ISSUED INITIALLY WITH ORIGINAL ISSUE DISCOUNT (OID). PURSUANT
TO TREASURY REGULATION (S)1.1275-3(b)(1), A REPRESENTATIVE OF THE ISSUER WILL,
BEGINNING TEN DAYS AFTER THE ORIGINAL ISSUE DATE OF THIS SECURITY, PROMPTLY MAKE
AVAILABLE TO THE HOLDER UPON REQUEST THE INFORMATION DESCRIBED IN TREASURY
REGULATION (S)1.1275-3(b)(1)(i). THE REPRESENTATIVE MAY BE REACHED AT TELEPHONE
NUMBER (000) 000-0000.
OVERHILL FARMS, INC.
SECURED SENIOR SUBORDINATED BRIDGE NOTE
$3,000,000.00 April 4, 2003
FOR VALUE RECEIVED, OVERHILL FARMS, INC., a Nevada corporation (the
"Borrower" or the "Company"), hereby promises to pay to the order of XXXXXX
XXXXXXXXX CAPITAL PARTNERS II, L.P., a California limited partnership (the
"Purchaser"), or its assigns (together with the Purchaser, the "Holder"), the
sum of THREE MILLION DOLLARS ($3,000,000.00) in immediately available funds and
in lawful money of the United States of America, all as provided below.
This Secured Senior Subordinated Bridge Note (this "Note") is being issued
by the Company pursuant to the terms of that certain First Amendment to
Securities Purchase Agreement dated as of April 4, 2003 (the "First Amendment")
which amends that certain Amended and Restated Securities Purchase Agreement
dated as of October 29, 2002 (as amended by the First Amendment and as further
amended from time to time, the "Securities Purchase Agreement"), by and among
the Company, the entities from time to time parties thereto as Guarantors and
the Purchaser. This Note is the "Bridge Note" referred to in the
Securities Purchase Agreement which provides for, among other things, the right
of the Holder to accelerate the outstanding principal balance of, premium, if
any, and accrued and unpaid interest on, and all other amounts owing under, this
Note upon the occurrence of an Event of Default.
1. Definitions. Unless otherwise indicated, all capitalized terms used
and not otherwise defined herein shall have the meanings ascribed to them in the
Securities Purchase Agreement.
2. Payment of Interest; Default Rate.
So long as no Default or Event of Default shall have occurred and be
continuing, the Borrower shall pay interest in cash on the unpaid principal
balance of this Note at a rate per annum (the "Base Rate") equal to fifteen
percent (15.0%) until this Note is fully paid. Interest shall be payable monthly
in arrears on the last Business Day of each calendar month (or portion thereof)
(each an "Interest Payment Date"), commencing on April 30, 2003. Interest shall
be computed on the basis of the actual number of days elapsed over a 360-day
year, including the first and the last day.
If any Default or Event of Default shall have occurred and be
continuing, then, in addition to the rights, powers and remedies available to
the Holder under the Securities Purchase Agreement, this Note, the other
Investment Documents and Applicable Law, the Borrower shall pay interest on the
unpaid principal balance of, premium, if any, and accrued and unpaid interest
on, and other amounts owing under, this Note at a rate per annum (the "Default
Rate") equal to seventeen percent (17.0%) for the first sixty (60) days during
which such Default or Event of Default shall remain uncured or unwaived and,
thereafter, such rate shall increase by one percent (1.0%) per annum over the
rate applicable to the thirty (30) days prior thereto for each additional thirty
(30) days that such Default or Event of Default remains uncured or unwaived;
provided, however, that the Default Rate shall not exceed twenty percent (20%).
The Default Rate shall begin to accrue on the date on which such Default or
Event of Default shall be deemed to have occurred (determined as provided in the
last paragraph of Section 11.1 of the Securities Purchase Agreement) and shall
continue until such Default or Event of Default shall have been cured or waived.
3. Payment of Principal. The Borrower shall pay in full the entire
outstanding principal balance of this Note, together with all premium, if any,
accrued and unpaid interest and other amounts owing under this Note, on January
30, 2004 (the "Maturity Date").
4. Optional Prepayments.
(a) The Borrower may voluntarily prepay the principal balance of
this Note, in whole or in part, without premium or penalty in accordance with
the provisions of Section Error! Reference source not found.Error! Reference
source not found.. Any prepayment of this Note made under this Section Error!
Reference source not found. shall also include all accrued and unpaid interest
on the then-outstanding principal balance of this Note through the date of
prepayment.
(b) If the Borrower elects to prepay all or any portion of the
principal balance of this Note, the Borrower shall furnish written notice to the
Holder with respect to each voluntary prepayment not less than thirty (30) days
prior to the date of prepayment.
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Such notice shall set forth the specific date of prepayment and the principal
amount of this Note to be prepaid on such date and shall be irrevocable. Notice
of prepayment having been given as aforesaid, the Borrower shall make a
prepayment to the Holder on such prepayment date in an amount equal to the
principal amount of this Note set forth in such prepayment notice to be prepaid,
together with all accrued and unpaid interest on the then-outstanding principal
balance of this Note through the date of prepayment.
5. [Intentionally Omitted.]
6. Change in Control. If a Change in Control shall occur at any time,
the Holder may, at its sole election, require the Borrower to prepay this Note,
in whole or in part, at any time during the one hundred and eighty (180) day
period following the occurrence of the Change in Control, at 104.0% of the
principal balance of this Note, plus all accrued and unpaid interest on, and
other amounts owing under, this Note through the date of prepayment. The
Borrower shall notify the Holder in writing, if possible, of any Change in
Control at least ten (10) days prior to the date that such Change in Control is
scheduled to occur. The Borrower shall also notify the Holder of the date on
which any Change in Control shall have actually occurred within one (1) Business
Day after such date and shall inform the Holder, in such notification, of the
Holder's right to require the Borrower to prepay this Note as provided in this
Section 6 and of the date on which such right shall terminate. If the Holder
elects to require the Borrower to prepay this Note pursuant to this Section 6,
it shall furnish a written notice to the Borrower advising the Borrower of such
election and the outstanding principal balance hereof, premium, accrued and
unpaid interest and all other amounts to be prepaid. The Borrower shall prepay
this Note in accordance with this Section 6 and such written notice within one
(1) Business Day after its receipt of such written notice.
7. Holder Entitled to Certain Benefits. Payment and performance of this
Note are secured by the security interests and liens granted under the
Collateral Documents and are guarantied under the Guaranty.
8. Manner of Payment. Payments of principal, interest and other amounts
due under this Note shall be made no later than 12:00 p.m. (noon) (Los Angeles
time) on the date when due and in lawful money of the United States of America
and (by wire transfer in funds immediately available at the place of payment) to
such account as the Holder may designate in writing to the Borrower and, if to
the Purchaser, to: Bank of America, Century City, Private Banking, 0000 Xxxxxxx
Xxxx Xxxx, Xxx Xxxxxxx, Xxxxxxxxxx 00000; ABA No. 000000000; Account No.
1154603239; Attention: Xxxxxx Xxxxxxx (or such other place of payment as the
Purchaser may designate in writing). All such payments shall be made without any
deduction whatsoever, including any deduction for set-off, recoupment,
counterclaim or taxes. Any payments received after 12:00 p.m. (noon) (Los
Angeles time) shall be deemed to have been received on the next succeeding
Business Day. Any payments due hereunder which are due on a day which is not a
Business Day shall be payable on the immediately preceding Business Day,
together with all accrued and unpaid interest through the actual due date of
payment.
9. Maximum Lawful Rate of Interest. The rate of interest payable under
this Note shall in no event exceed the maximum rate permissible under Applicable
Law. If the
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rate of interest payable on this Note is ever reduced as a result of this
Section 9 and at any time thereafter the maximum rate permitted under Applicable
Law exceeds the rate of interest provided for in this Note, then the rate
provided for in this Note shall be increased to the maximum rate provided for
under Applicable Law for such period as is required so that the total amount of
interest received by the Holder is that which would have been received by the
Holder but for the operation of the first sentence of this Section 9.
10. Xxxxxxxx's Waivers. The Borrower hereby waives presentment for
payment, demand, protest, notice of protest and notice of dishonor, and all
other notices of any kind whatsoever to which it may be entitled under
Applicable Law or otherwise, except for notices to which the Borrower is
expressly entitled under this Note.
11. Registration of Notes. The Company shall maintain at its principal
executive office a register in which it shall register this Note, any
Assignments of this Note or any other notes and any other notes issued upon
surrender hereof and thereof. Upon surrender at the Company's principal
executive office of this Note for registration of any Assignment, the Company
shall, at its expense and within three (3) Business Days of such surrender,
execute and deliver one or more new notes of like tenor in the requested
principal denominations and register such new note or notes in the register to
be maintained by the Company. At the option of the Holder, this Note may be
exchanged for one or more new notes of like tenor in the requested principal
denominations, and the Borrower shall deliver such new notes not later than
three (3) Business Days after the Holder's request.
12. Persons Deemed Owners; Participations. Prior to due presentment for
registration of any Assignment, the Company may treat the Person in whose name
any Note is registered as the owner and Holder of such Note for all purposes
whatsoever, and the Company shall not be affected by notice to the contrary.
Subject to the preceding sentence, the Purchaser may grant to any Person
participations from time to time in all or any part of this Note on such terms
and conditions as may be determined by the Purchaser in its sole and absolute
discretion. Notwithstanding anything to the contrary herein or otherwise (other
than as provided in Section 12.6 of the Securities Purchase Agreement), nothing
contained in this Note or any other Investment Document shall confer upon the
participant any rights in the Securities Purchase Agreement or any other
Investment Document, and the Purchaser shall retain all rights with respect to
the administration, waiver, amendment, collection and enforcement of, compliance
with and consent to the terms and provisions of this Note, the Securities
Purchase Agreement and any other Investment Document. In addition, the Purchaser
may, without the consent of the participant, give or withhold its consent or
agreement to any amendments to or modifications of this Note, the Securities
Purchase Agreement or any other Investment Document, waive any of the provisions
hereof or thereof or exercise or refrain from exercising any other rights or
remedies which the Purchaser may have under this Note, the Securities Purchase
Agreement, any other Investment Document or otherwise. Notwithstanding the
foregoing, the Purchaser will not agree with the Company, without the prior
written consent of the participant (which consent shall be given or
affirmatively withheld not later than three (3) Business Days after the
Purchaser's request therefor): (a) to reduce the principal of or rate of
interest on this Note or (b) to postpone the date fixed for payment of principal
of or interest on the Indebtedness evidenced by this Note. If the participant
does not timely reply to the Purchaser's request for such consent, the
participant shall be deemed to have consented to such agreement and the
Purchaser may take
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such action in such manner as the Purchaser determines in the exercise of its
independent business judgment.
13. Assignment and Transfer. Subject to Applicable Law, the Holder may,
at any time and from time to time and without the consent of the Company, assign
or transfer to one or more Persons all or any portion of this Note or any
portion thereof (but not less than $500,000 in principal amount in any single
assignment (unless such lesser amount represents the entire outstanding
principal balance hereof)). Upon surrender of this Note at the Company's
principal executive office for registration of any such assignment or transfer,
accompanied by a duly executed instrument of transfer, the Company shall, at its
expense and within three (3) Business Days of such surrender, execute and
deliver one or more new notes of like tenor in the requested principal
denominations and in the name of the assignee or assignees and bearing the
legends set forth on the face of this Note, and this Note shall promptly be
canceled. Each assignment or transfer of this Note, in whole or in part, shall
be registered on the register maintained by the Borrower pursuant to Section 11
immediately following the surrender of this Note. If the entire outstanding
principal balance of this Note is not being assigned, the Borrower shall issue
to the Holder hereof, within three (3) Business Days of the date of surrender
hereof, a new note of like tenor which evidences the portion of such outstanding
principal balance not being assigned. If this Note is divided into one or more
Notes and is held at any time by more than one Holder, any payments of principal
of, premium, if any, and interest or other amounts on this Note which are not
sufficient to pay all interest or other amounts due thereunder, shall be made
pro rata with respect to all such Notes in accordance with the outstanding
principal amounts thereof, respectively.
14. Loss, Theft, Destruction or Mutilation of this Note. Upon receipt of
evidence reasonably satisfactory to the Borrower of the loss, theft, destruction
or mutilation of this Note and, in the case of any such loss, theft or
destruction, upon receipt of an indemnity agreement or other indemnity
reasonably satisfactory to the Borrower or, in the case of any such mutilation,
upon surrender and cancellation of such mutilated Note, the Borrower shall make
and deliver within three (3) Business Days a new Note, of like tenor, in lieu of
the lost, stolen, destroyed or mutilated Note.
15. Costs of Collection. The Borrower agrees to pay all costs and
expenses, including the fees and expenses of all attorneys, accountants and
other experts retained by the Holder, which are expended or incurred by or on
behalf of the Holder in connection with (a) the collection and enforcement of
this Note, whether or not any action, suit or other proceeding is commenced; (b)
any actions for declaratory relief in any way related to this Note or the
Indebtedness evidenced hereby; (c) the protection or preservation of any rights
or remedies of the Holder under this Note; (d) the negotiation, preparation,
execution and delivery of any amendment, waiver, consent or release relating to
or under this Note; (e) any actions taken in reviewing the business or financial
affairs of the Company or any of its Subsidiaries if any Event of Default has
occurred or the Holder has determined in good faith that an Event of Default may
likely occur, which actions include the following: (i) inspect the facilities of
the Borrower or any of its Subsidiaries or conduct audits or appraisals of the
financial condition of the Borrower and any of its Subsidiaries; (ii) have an
accounting or other firm selected by the Holder review the books and records of
the Borrower and any of its Subsidiaries and perform a thorough and complete
examination thereof; (iii) interview
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the Borrower's and each of its Subsidiaries' employees, attorneys, accountants,
customers and any other Persons related to the Borrower or such Subsidiaries;
and (iv) undertake any other action which the Holder believes is necessary to
assess accurately the financial condition and prospects of the Borrower and any
of its Subsidiaries; (f) any refinancing, restructuring (whether in the nature
of a "work out" or otherwise), bankruptcy or insolvency proceeding involving the
Borrower, any of its Subsidiaries or any other Affiliate of the Borrower
securing the payment and performance of this Note; (g) any actions taken to
verify, maintain, perfect and protect any Lien granted to the Holder; or (h) any
effort by the Holder to protect, assemble, complete, collect, sell, liquidate or
otherwise dispose of any Collateral, including in connection with any case under
Bankruptcy Law. The Borrower hereby consents to the taking of the foregoing
actions by the Holder (provided, however, that, with respect to clause (e)(iii)
above, the Borrower will not be required to produce any document or disclose
material to the Holder which would otherwise be expressly protected from
production or disclosure by any attorney-client or accountant-client privilege
existing under Applicable Law, unless waived by the Borrower).
16. Extension of Time. The Holder may, at its sole option, extend the
time for payment of this Note, postpone the enforcement hereof, or grant any
other indulgence without affecting or diminishing the Holder's right to full
recourse against the Borrower hereunder, which right is expressly reserved.
17. Notations. Before disposing of this Note or any portion thereof, the
Purchaser may make a notation thereon (or on a schedule attached thereto) of the
amount of all principal payments previously made by the Company with respect
thereto.
18. GOVERNING LAW. IN ALL RESPECTS, INCLUDING ALL MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS NOTE AND THE RIGHTS AND OBLIGATIONS
ARISING HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF CALIFORNIA APPLICABLE TO CONTRACTS MADE AND
PERFORMED IN SUCH STATE, WITHOUT REGARD TO CHOICE OF LAW OR CONFLICTS OF LAW
PRINCIPLES.
19. Construction and Interpretation. The rules of interpretation and
construction specified in Sections 1.2 through 1.6 of the Securities Purchase
Agreement shall likewise govern the interpretation and construction of this
Note.
20. Entire Agreement; Successors and Assigns. This Note constitutes the
entire understanding and agreement with respect to the subject matter hereof and
supersedes all prior oral and written, and all contemporaneous oral, agreements
and understandings with respect thereto. This Note shall inure to the benefit
of, and be binding upon, the Company, the Holder and their respective successors
and permitted assigns.
21. WAIVER OF JURY TRIAL. THE COMPANY AND THE HOLDER (BY ACCEPTANCE
HEREOF) EACH HEREBY KNOWINGLY, INTENTIONALLY AND VOLUNTARILY, WITH AND UPON THE
ADVICE OF COMPETENT COUNSEL, WAIVES, RELINQUISHES AND FOREVER FORGOES THE RIGHT
TO A TRIAL BY JURY IN ANY ACTION, SUIT OR OTHER PROCEEDING BASED UPON, ARISING
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OUT OF OR IN ANY WAY RELATING TO (a) THIS NOTE, THE SECURITIES PURCHASE
AGREEMENT OR ANY OTHER INVESTMENT DOCUMENTS, INCLUDING ANY PRESENT OR FUTURE
AMENDMENT THEREOF, OR ANY OF THE TRANSACTIONS CONTEMPLATED BY OR RELATED TO THIS
NOTE, THE SECURITIES PURCHASE AGREEMENT OR ANY OTHER INVESTMENT DOCUMENT, OR (b)
ANY CONDUCT, ACT OR OMISSION OF THE PARTIES OR THEIR AFFILIATES (OR ANY OF THEM)
WITH RESPECT TO THIS NOTE, THE SECURITIES PURCHASE AGREEMENT OR ANY OTHER
INVESTMENT DOCUMENTS, INCLUDING ANY PRESENT OR FUTURE AMENDMENT THEREOF, WHETHER
SOUNDING IN CONTRACT, TORT OR OTHERWISE, REGARDLESS OF WHICH PARTY INITIATES
SUCH ACTION, SUIT OR OTHER PROCEEDING; AND THE COMPANY AND THE HOLDER EACH
HEREBY AGREES AND CONSENTS THAT ANY SUCH ACTION, SUIT OR OTHER PROCEEDING SHALL
BE DECIDED BY A COURT TRIAL WITHOUT A JURY, AND THAT EITHER THE COMPANY OR THE
HOLDER MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT
AS WRITTEN EVIDENCE OF THE CONSENT OF THE OTHER TO THE WAIVER OF ANY RIGHT IT OR
THEY MIGHT OTHERWISE HAVE TO TRIAL BY JURY.
[REST OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the Borrower has caused this Note to be executed and
delivered by its duly authorized representatives on the date first above
written.
OVERHILL FARMS, INC., a Nevada corporation
By: /s/ Xxxxx Xxxxx
---------------------------------------
Xxxxx Xxxxx
President and Chief Executive Officer
By: /s/ Xxxx Xxxxxxxxx
---------------------------------------
Xxxx Xxxxxxxxx
Senior Vice President and Chief
Financial Officer
ACKNOWLEDGMENT AND CONSENT OF GUARANTOR
The undersigned hereby acknowledges that it has read the foregoing Secured
Senior Subordinated Bridge Note and consents to the terms thereof. The
undersigned further acknowledges and agrees that the Secured Senior Subordinated
Bridge Note constitutes a Guarantied Obligation and reaffirms its obligations
under the Securities Purchase Agreement (including, without limitation, the
Guaranty) and the other Investment Documents to which it is a party, all of
which remains in full force and effect.
GUARANTOR
OVERHILL L.C. VENTURES, INC., a California
corporation
By: /s/ Xxxxx Xxxxx
---------------------------------------
Xxxxx Xxxxx
President and Chief Executive Officer
By: /s/ Xxxxxxx X. Xxxxxxx
---------------------------------------
Xxxxxxx X. Xxxxxxx
Chief Financial Officer
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