EXHIBIT 10.15
FIRST AMENDMENT TO
SECOND AMENDED AND RESTATED
SECURITIES PURCHASE AGREEMENT
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THIS FIRST AMENDMENT TO SECOND AMENDED AND RESTATED SECURITIES PURCHASE
AGREEMENT is entered into as of May 16, 2003 (this "AMENDMENT"), by and among
OVERHILL FARMS, INC., a Nevada corporation (the "Company"), the entities from
time to time parties thereto as Guarantors, and XXXXXX XXXXXXXXX CAPITAL
PARTNERS II, L.P., a California limited partnership (the "PURCHASER").
R E C I T A L S
A. The Company, the entities from time to time parties thereto as
Guarantors (including Overhill Ventures) and the Purchaser are parties to that
certain Second Amended and Restated Securities Purchase Agreement dated as of
April 16, 2003 (the "SECURITIES PURCHASE AGREEMENT"), pursuant to which, among
other things, on and as of the Effective Date, the parties amended and restated
the Existing Securities Purchase Agreement, all on the terms and subject to the
conditions set forth therein and in the other Investment Documents. Unless
otherwise indicated, capitalized terms used and not otherwise defined herein
have the meanings ascribed to them in the Securities Purchase Agreement.
B. Pursuant to Section 8.28 of the Securities Purchase Agreement, not
later than the close of business on April 24, 2003, the Company was obligated to
issue and sell to the Purchaser the April 2003 Shares and to deliver to the
Purchaser a certificate representing the April 2003 Shares against delivery of
the April 2003 Share Purchase Price. (The First Amendment to Amended and
Restated Securities Purchase Agreement required the Company to issue and sell
the April 2003 Shares to the Purchaser on or before April 16, 2003.) Since the
First Amendment to Amended and Restated Securities Purchase Agreement Effective
Date, the Purchaser has been ready, willing and able to deliver the April 2003
Share Purchase Price to the Company in exchange for the April 2003 Shares. The
Company failed to issue and sell the April 2003 Shares to the Purchaser on or
before April 24, 2003.
C. On or about April 4, 2003, the Company filed with the AMEX the
Listing Application (as defined in the First Amendment to Amended and Restated
Securities Purchase Agreement) to obtain the approval of the listing of the
April 2003 Shares with the AMEX. The Company has advised the Purchaser that the
AMEX has conditioned its approval of the Listing Application on the Company
obtaining the vote required by the AMEX of the holders of the capital stock of
the Company to the issuance and sale to the Purchaser of the April 2003 Shares.
Accordingly, the Company has requested that the Purchaser amend Section 8.28 of
the Securities Purchase Agreement, effective April 24, 2003, to, among other
things, extend the date upon which the Company is obligated to issue and sell to
the Purchaser the April 2003 Shares to June 30, 2003, so that the Company may
obtain the requisite vote of its stockholders to such issuance and sale.
D. The Purchaser is willing to grant the Company's request to amend the
Securities Purchase Agreement as provided for herein, but only on the terms and
subject to the conditions set forth herein.
A G R E E M E N T
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants, conditions and provisions contained herein, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:
1. AMENDMENTS TO SECURITIES PURCHASE AGREEMENT. Effective as of April
24, 2003, pursuant to Section 12.3 of the Securities Purchase Agreement, the
Securities Purchase Agreement shall be amended as follows:
(a) Section 1.1 of the Securities Purchase Agreement shall be
amended by adding the following new definitions to Section 1.1 in alphabetical
order:
"'FIRST AMENDMENT' shall mean that certain First
Amendment to Second Amended and Restated Securities Purchase
Agreement dated as of May 16, 2003."
"'FIRST AMENDMENT EFFECTIVE DATE' shall have the
meaning set forth in the First Amendment."
"'MAY 2003 FIRST AMENDMENT FEE' shall have the
meaning set forth in Section 2(c) of the First Amendment."
(b) Section 1.1 of the Securities Purchase Agreement shall be
further amended by amending the following existing definitions to read in their
entirety as follows, respectively:
"'ADJUSTED CURRENT ASSETS' shall mean, collectively,
(i) cash, (ii) accounts receivable, net, (iii) inventory, net,
and (iv) prepaid expenses (including, for purposes of this
calculation, any prepaid expenses attributable to that certain
operating lease dated January 24, 2001, between the Company
and General Electric Capital Corporation, under which the
Company leased four Frigoscandia spiral freezers (serial
numbers 10651, 10652, 10653 and 10654) and related equipment,
whether such prepaid expenses are classified as long-term or
short-term), in each case determined in accordance with GAAP."
"'NET INCOME (LOSS)' shall mean, for any period, net
income (loss) after Taxes of the Company and its Subsidiaries
on a consolidated basis for such period taken as a single
accounting period, all computed in accordance with GAAP;
PROVIDED, HOWEVER, that, for purposes of calculating minimum
EBITDA under Section 9.14(a), minimum Fixed Charge Coverage
Ratio under Section 9.14(b) and maximum Leverage Ratio under
Section 9.14(c), the following shall be excluded from the
calculation of Net Income (Loss):
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(i) the costs incurred by the Company in
connection with the restoration required to be made
at the manufacturing facilities located at 0000
Xxxxxxx Xxxxx xx Xxx Xxxxx, Xxxxxxxxxx, up to a
maximum of $250,000;
(ii) the aggregate non-cash losses recorded
as a direct result of a write-down of the value of
American Airlines inventory or of Accounts owed by
American Airlines, in each case due to a bankruptcy
filing by or against American Airlines, in an amount
not to exceed (A) $1,500,000 if the filing occurs
during the period commencing on the Effective Date
and ending on April 30, 2003; (B) $1,300,000 if the
filing occurs during the period commencing on May 1,
2003 and ending on May 31, 2003; (C) $1,100,000 if
the filing occurs during the period commencing on
June 1, 2003 and ending on June 30, 2003; (D)
$1,000,000 if the filing occurs during the period
commencing on July 1, 2003 and ending on July 31,
2003; (E) $900,000 if the filing occurs during the
period commencing on August 1, 2003 and ending on
August 31, 2003; and (F) $800,000 if the filing
occurs on or after September 1, 2003; and
(iii) the May 2003 First Amendment Fee.
Any accounting gains associated with the recovery of
any of the costs or write-offs described in clauses (i) and
(ii) above shall also be excluded from Net Income (Loss)."
"'NET WORKING CAPITAL' shall mean, at any time, (i)
Adjusted Current Assets at such time, MINUS (ii) Adjusted
Current Liabilities at such time; PROVIDED, however, that, for
purposes of calculating minimum Net Working Capital under
Section 9.14(g), the May 2003 First Amendment Fee shall be
excluded from the calculation of Adjusted Current Assets."
"'OVERHILL VENTURES' shall have the meaning set forth
in the recitals."
(c) Section 8.28 (Issuance of April 2003 Shares) of the
Securities Purchase Agreement shall be amended to read in its entirety as
follows:
"8.28 ISSUANCE OF APRIL 2003 SHARES; SPECIAL
STOCKHOLDERS MEETING.
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(a) As soon as practicable following the
First Amendment Effective Date, but not later than
June 30, 2003 (subject to Section 8.28(d)), the
Company shall issue and sell to the Purchaser the
April 2003 Shares in exchange for the April 2003
Share Purchase Price (as defined in the First
Amendment to Amended and Restated Securities Purchase
Agreement). Upon delivery of an original stock
certificate representing the April 2003 Shares, duly
executed by the Company, the Purchaser shall pay to
the Company the April 2003 Share Purchase Price. (The
parties acknowledge that the Company's obligation to
issue and sell to the Purchaser the April 2003 Shares
as provided for in this Section 8.28(a) is
substantially the same obligation of the Company set
forth in Section 9(b) of the First Amendment to
Amended and Restated Securities Purchase Agreement.)
(b) If the Company is required to obtain the
approval of the AMEX to the Listing Application (as
defined in the First Amendment to Amended and
Restated Securities Purchase Agreement) and/or the
AMEX conditions its approval of the Listing
Application on the Company obtaining the approval of
its stockholders to the issuance and sale of the
April 2003 Shares, then, promptly following the First
Amendment Effective Date, the Company take all such
actions as are necessary under Applicable Laws or
otherwise to call, give notice of and hold a special
meeting of the stockholders of the Company (the
"SPECIAL STOCKHOLDER MEETING") to vote upon the
issuance and sale to the Purchaser of the April 2003
Shares in accordance with the requirements of the
AMEX so that the Company may issue and sell to the
Purchaser the April 2003 Shares on or prior to June
30, 2003 (subject to Section 8.28(d)). The Company
shall, through its Board of Directors, recommend to
its stockholders approval of the issuance and sale to
the Purchaser of the April 2003 Shares, shall use its
best efforts to solicit such approval by its
stockholders and shall not withdraw or modify, or
propose to withdraw or modify, such recommendation.
The Company shall ensure that all proxies solicited
in connection with the Special Stockholder Meeting
are solicited in compliance with all Applicable Laws.
(c) Without limiting the generality of the
foregoing, the Company shall immediately commence the
preparation of, and promptly thereafter file with the
SEC, a proxy statement to be sent to the Company's
stockholders in connection with the Special
Stockholder Meeting and shall use its best efforts to
respond to any comments of the SEC and to cause such
proxy statement to be mailed to the Company's
stockholders as promptly as practicable. The Company
and its counsel shall notify the Purchaser within one
(1) day of the receipt of any comments from the SEC
and of any request by the SEC for any amendments or
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supplements to such proxy statement or for additional
information and will supply the Purchaser with copies
of all correspondence between the Company and any of
its representatives, on the one hand, and the SEC, on
the other. The Company shall give the Purchaser an
opportunity to comment on any correspondence with the
SEC and shall not transmit any such material to which
the Purchaser reasonably objects. If at any time
prior to the Special Stockholder Meeting there shall
occur any event that should be set forth in an
amendment or supplement to such proxy statement, the
Company shall promptly prepare such amendment or
supplement and after obtaining the consent of the
Purchaser to such amendment or supplement, shall
promptly transmit such amendment or supplement to the
Company's stockholders.
(d) The Company Parties acknowledge and
agree that the failure of the Company to issue and
sell to the Purchaser the April 2003 Shares on or
before June 30, 2003, shall constitute an Event of
Default as of such date; PROVIDED, HOWEVER, that if
the Company has not obtained on or prior to June 30,
2003, the requisite vote of its stockholders to the
issuance and sale to the Purchaser of the April 2003
Shares, then, upon receipt by the Purchaser, on or
prior to June 30, 2003, of a written notice from the
Company notifying the Purchaser that it has not yet
obtained the requisite vote of its stockholders to
the issuance and sale to the Purchaser of the April
2003 Shares, the date upon which the Company shall be
obligated to issue and sell to the Purchaser the
April 2003 Shares shall be automatically extended to
July 20, 2003, and no Event of Default shall be
deemed to have occurred as of June 30, 2003;
PROVIDED, HOWEVER, that the Company Parties
acknowledge and agree that Company's subsequent
failure to issue and sell to the Purchaser the April
2003 Shares on or before July 20, 2003, shall
constitute an Event of Default as of July 20, 2003
(and such Event of Default shall not be deemed
curable)."
2. CONDITIONS PRECEDENT TO AMENDMENTS. The effectiveness of the
amendments set forth in Section 1 as of April 24, 2003, shall be subject to the
satisfaction, in the Purchaser's sole discretion, of each of the following
conditions precedent (the date upon which the last of such conditions precedent
to be so satisfied shall be referred to herein as the "FIRST AMENDMENT EFFECTIVE
DATE"):
(a) FIRST AMENDMENT EFFECTIVE DATE. All of the conditions
precedent set forth in this Section 2 shall be satisfied on or before May 16,
2003.
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(b) REPRESENTATIONS AND WARRANTIES. The Purchaser shall have
received from the Company an Officers' Certificate, in form and substance
satisfactory to the Purchaser, dated as of the First Amendment Effective Date
and duly executed by the President and Chief Executive Officer and the Chief
Financial Officer of the Company, to the effect that (i) after giving effect to
this Amendment, each of the representations and warranties of the Company
contained in the Securities Purchase Agreement was true and correct on and as of
the date made and was true and correct on and as of the First Amendment
Effective Date, with the same effect as if made on and as of the First Amendment
Effective Date; and (ii) no Default or Event of Default has occurred and is
continuing or will result from the execution, delivery or performance of this
Amendment and (iii) since September 29, 2002, no Material Adverse Change has
occurred other than as previously disclosed to the Purchaser in writing or as
previously disclosed in the Company's SEC Documents.
(c) MAY 2003 FIRST AMENDMENT FEE. The Purchaser shall have
received from the Company, by wire transfer in immediately available funds, a
non-refundable amendment fee (the "MAY 2003 FIRST AMENDMENT FEE") with respect
to the Purchaser's agreement to amend the Securities Purchase Agreement as
provided in Section 1 in the amount of $125,000.
(d) CONSENTS. The Company shall have obtained all Consents
required to be obtained from all Governmental Authorities and other Persons in
connection with the execution, delivery and performance of this Amendment, and
the Purchaser shall have approved the terms and conditions thereof.
(e) CERTIFIED BOARD RESOLUTIONS. The Purchaser shall have
received a Secretary's Certificate from each of the Company and Overhill
Ventures, in form and substance satisfactory to the Purchaser, duly executed by
the Secretary of the Company or Overhill Ventures, as the case may be,
certifying as to the resolutions of the Board of Directors of the Company or
Overhill Ventures, as the case may be, approving the execution, delivery and
performance of this Amendment and the consummation of the transactions
contemplated hereby.
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. In order to induce
the Purchaser to enter into this Amendment, the Company represents and warrants
to the Purchaser as follows:
(a) AUTHORIZATION; BINDING EFFECT. Each of the Company and the
Guarantor has the full power and authority to enter into, deliver and perform
its obligations under this Amendment. The execution, delivery and performance by
the Company and the Guarantor of this Amendment and the consummation of the
other transactions contemplated hereby and thereby have been duly and validly
authorized by all necessary action on the part of the Company and the Guarantor,
respectively. This Amendment has been duly executed and delivered by the Company
and the Guarantor and constitutes the legal, valid and binding obligations of
the Company and the Guarantor, enforceable against the Company and Overhill
Ventures in accordance with its terms, except as enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer or
conveyance or similar laws relating to or limiting creditors' rights generally
or by equitable principles relating to enforceability and except as rights of
indemnity or contribution may be limited by federal or state securities or other
laws or the public policy underlying such laws.
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(b) NO CONFLICT. The execution, delivery and performance by
the Company and the Guarantor of this Amendment and the consummation of the
transactions contemplated hereby do not and will not violate or conflict with,
or cause a default under, or give rise to a right of termination under, (i) the
charter or bylaws of the Company or any of its Subsidiaries, as in effect on the
date hereof; (ii) any Applicable Laws; or (iii) any term of any Material
Contract, indenture, note, mortgage, instrument or other agreement to which the
Company or any of its Subsidiaries is a party or by which any of its or their
properties or assets are bound.
4. CONFIRMATION; FULL FORCE AND EFFECT. The amendments set forth in
Section 1 above shall amend the Securities Purchase Agreement on and as of the
First Amendment Effective Date, and the Securities Purchase Agreement shall
otherwise remain in full force and effect, as amended thereby, from and after
the First Amendment Effective Date in accordance with its terms. The Company
hereby ratifies, approves and affirms in all respects each of the Securities
Purchase Agreement, as amended hereby, the Note, the Collateral Documents
(including the Liens granted in favor of the Purchaser under the Collateral
Documents) and each of the other Investment Documents, the terms and other
provisions hereof and thereof and the Obligations hereunder and thereunder.
5. CONFIRMATION OF GUARANTY. The Guarantor hereby acknowledges that it
has read this Amendment and consents to its terms. Further, the Guarantor hereby
(a) confirms that it is a party to the Guaranty and that, among other things,
the payment and performance of the Obligations is guarantied by it under the
Guaranty, (b) ratifies, approves and reaffirms in all respects the terms and
other provisions of, and its obligations under, the Guaranty, the Collateral
Documents and the other Investment Documents to which it is a party or which it
has consented to or acknowledged and (c) confirms that the Guaranty, the
Collateral Documents and the other Investment Documents to which it is a party
remain in full force and effect in accordance with their respective terms.
6. NO OTHER AMENDMENTS. This Amendment is being delivered without
prejudice to the rights, remedies or powers of the Purchaser under or in
connection with the Securities Purchase Agreement, the Note, the Collateral
Documents and the other Investment Documents, Applicable Laws or otherwise and,
except as expressly provided in Section 1 above, shall not constitute or be
deemed to constitute an amendment or other modification of, or a supplement to,
the Securities Purchase Agreement or any Investment Document or the obligations
of the Company Parties thereunder. In addition, nothing contained in this
Amendment is intended to constitute, or shall be construed as, a waiver of any
breach, violation, Default or Event of Default, whether past, present or future,
under the Securities Purchase Agreement, the Note, the Collateral Documents or
any other Investment Document, or a forbearance by the Purchaser of any of its
rights, remedies or powers against the Company Parties (or any of them) or the
Collateral. The Purchaser hereby expressly reserves all of its rights, powers
and remedies under or in connection with the Securities Purchase Agreement, the
Note, the Collateral Documents and the other Investment Documents, whether at
law or in equity, including, without limitation, the right to declare all
Obligations to be due and payable.
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7. MISCELLANEOUS PROVISIONS.
(a) ENTIRE AGREEMENT; SUCCESSORS AND ASSIGNS. This Amendment
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 Amendment shall
inure to the benefit of, and be binding upon, the parties and their respective
successors and permitted assigns.
(b) GOVERNING LAW. IN ALL RESPECTS, INCLUDING ALL MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF
CALIFORNIA APPLICABLE TO CONTRACTS MADE AND PERFORMED IN THAT STATE (WITHOUT
REGARD TO THE CHOICE OF LAW OR CONFLICTS OF LAW PROVISIONS THEREOF).
(c) COUNTERPARTS. This Amendment may be executed in any number
of counterparts and by facsimile transmission, each of which shall be deemed an
original and all of which taken together shall constitute one and the same
instrument.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed and delivered by their duly authorized representatives as of the date
first written above.
COMPANY
OVERHILL FARMS, INC., a Nevada corporation
By: /S/ XXXXX XXXXX
---------------------------------------
Xxxxx Xxxxx
President and Chief Executive Officer
By: /S/ XXXX STEINBRUN
---------------------------------------
Xxxx Steinbrun
Senior Vice President and Chief
Financial Officer
GUARANTOR
OVERHILL L.C. VENTURES, INC., a California
corporation
By: /S XXXXX XXXXX
----------------------------------------
Xxxxx Xxxxx
President
PURCHASER
XXXXXX XXXXXXXXX CAPITAL PARTNERS II, L.P.,
a California limited partnership
By: LLCP California Equity Partners II,
L.P., a California limited partnership, its
General Partner
By: Xxxxxx Xxxxxxxxx Capital Partners, Inc.,
a California corporation, its General Partner
By: /S/ XXXXXX X. XXXXXX
-----------------------------------------
Xxxxxx X. Xxxxxx
President
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