EXHIBIT 10.4
SHORT TERM LOAN AGREEMENT
Loan Agreement dated October 3, 1995, among The Fresh Juice Company of
Florida, Inc. a Florida corporation (having its principal place of business)
(residing at) 1000 American Superior Blv. Winterhaven, Florida ("Borrower") and
guarantor(s) identified by their execution below ("Borrower" and "Guarantor(s)"
collectively referred to hereafter as "the Obligors") and Chemical Bank, a New
York banking corporation ("the Bank"). Borrower has applied to the Bank for a
loan in the principal amount of $1,100,000 the proceeds of which shall be used
for the purpose as outlined in the preamble to the Rider ("the Loan"). The Bank
has made the Loan upon the following terms and conditions: attached hereto.
(1) The Note: Rate of Interest Manner of Repayment.*
*Refer to Rider attached hereto.
(2) Representations and Warranties.
In order to induce the Bank to enter into this Agreement and
to make the Loan, each Obligor represents and warrants to the
Bank that:
a. (As to each Obligor that is not an individual) it:
(i) is duly organized, validly existing and in good
standing under the laws of the jurisdiction of
its incorporation or formation;
(ii) is duly qualified and in good standing in every
jurisdiction in which it presently engages in
business and in which such qualification is
required;
(iii) has the power, authority and legal right to
own, or lease and enjoy undisturbed, the
assets of the business and engage in business
as now conducted;
(iv) has the power, authority and legal right to
enter into and execute this Agreement, the
Note, the Guaranty and any Security Agreement,
Pledge Agreememt, General Loan and Collateral
Agreement or other agreements furnished in
connection with the Loan; and
(v) such Obligor has no subsidiaries or affiliates
except those listed on Exhibit B hereof and in
each instance it owns all of the outstanding
stock of such subsidiaries.
Financial Statements b. All financial statements of such Obligor previously
Accurate No Change delivered to the Bank, whether or not in connection
with this Loan, are complete, correct, present fairly
the financial condition of that entity, reflect every
liability (whether direct or contingent) and there has
been no material adverse change in the financial
condition of such Obligor since financial statements
dated 8/1/95 (as to Borrower) and 5/31/95 (as to
Guarantor);
Other Agreements c. This Agreement will not violate any other indenture or
other agreement nor any law, order, rule or regulation
of any government instrumentality applicable to such
Obligor or by which its property is bound nor will it
result in the creation or imposition of any other
lien, except for those being created by any Security
Agreement related hereto;
First Lien d. Any security interests created as Collateral for the
Loan constitute valid, first and prior perfected
liens in favor of the Bank;
Litigation e. There are no suits or proceedings pending or
threatened against such Obligor or affecting any of
its properties (of which such Obligor has any
knowledge) except those disclosed and explained by
letter of counsel annexed hereto as Exhibit C; whether
or not a letter of Borrower's counsel is required for
this purpose, the Bank shall have received, on or
immediately prior to the date of tis Agreement, the
favorable written opinion of Borrower's counsel
addressed to the Bank confirming the accuracy of the
representations and warranties set forth in Sections
2(a), (c) and (d) hereof;
Taxes f. Federal Income Tax returns of such Obligor have been
audited through N/A (as to
_________________________ Borrower)
and 11/30/92 (as to Guarantor) and deficiencies (if
any) resulting from such examinations have been
reserved against or discharged. Additionally, such
Obligor has filed all required Federal, state and
local returns, including those for corporate franchise
taxes, and has paid all taxes or assessments due
thereon;
ERISA g. Such Obligor, if required, is in compliance in every
material respect with the applicable provisions of the
Employee Retirement Income Security Act of 1974
("ERISA") and regulations or published interpretations
thereof and has not had a Reportable Event occur with
respect to any Plan as defined in ERISA; and
Federal Reserve h. Such Obligor is not engaged principally in nor has an
Regulations important activity in the business of extending credit
for the purpose of purchasing or carrying "margin
stock" (as defined in Regulation U of the Board of
Governors of the Federal Reserve System) nor will any
part of the proceeds of this Loan be used, now or
ultimately, to purchase or carry such stock or extend
such credit or violate in any way Regulations G, T, U
or X of such Board of Governors.
*Refer to Rider attached hereto for Additional
Representations and Warranties.
(3) Affirmative Covenants.
Each Corporate Obligor (that is not an individual) covenants
and agrees that, from the date hereof until the full
satisfaction of the obligations under this Agreement and
the Note:
Corporate a. It shall preserve, protect, renew and keep in full
Existence force and effect its existence, rights, licenses,
and Properties permits, patents, trademarks, trade names and
franchises; comply with all laws and regulations
applicable to it; not materially alter the nature or
scope of business as presently conducted by it and
preserve, repair and maintain all property utilized
in the conduct of its business;
Insurance b. Maintain insurance with financially sound insurers on
its properties against such risks as fire, public
liability, lack of fidelity by its employees all as
is customary with companies in similar businesses or
as reasonably required by the Bank and name the Bank.
Financial Statements c. Furnish to the Bank the following financial
information: *"loss payee" with respect to any
. insurance covering the Collateral.
*Refer to Rider attached hereto.
Access to d. Upon written request, the Bank's representatives shall
Premises and Records be permitted access to any or all of such Obligor's
properties and financial records, to make extracts
from such records and to discuss the business,
finances and affairs with its officers;
Notices e. It shall promptly give written notice to the Bank of:
ERISA (i) the details of any Reportable Event as defined
in ERISA which has occurred;
Events of Default (ii) the occurrence of any event which alone or with
notice, the passage of time or both, would
constitute an Event of Default;
Litigation (iii) the commencement of any proceeding or litigation
which, if adversely determined, would adversely
affect its financial condition or ability to
conduct business; or
Additional (iv) Refer to Rider attached hereto.
Guarantors
*Refer to Rider attached hereto for Additional
Affirmative Covenants.
(4) Negative Covenants.
Each Obligor that is not an individual covenants and agrees
that, from the date hereof until the full satisfaction of
obligations under this Agreement and the Note, it will not
without the Bank's prior written consent:
Indebtedness a. Create, incur or assume any indebtedness for borrowed
money other than:
(i) that provided under this Agreement or otherwise
consented to by the Bank;
(ii) that owing on the date hereof and scheduled on
Exhibit D; and
(iii) *that which is subordinated to indebtedness due
the Bank on terms satisfactory to the Bank
("Approved Subordinated Debt").
*Refer to Rider attached hereto.
Liens b. Create, incur or permit to exist against any of its
properties or assets, real or personal, tangible or
intangible, now owned or hereafter acquired, any
mortgage or other lien or encumberance, except:
(i) deposits or pledges relating to the payment of
Xxxxxxx'x Compensation, Unemployment Insurance,
old age pension or other Social Security;
(ii) deposits or pledges relating to the performance
of bids, tenders, contracts or leases;
(iii) deposits or pledges relating to statutory
obligations and surety or appeal bonds
necessary to the continuance of the business
in the ordinary course;
(iv) liens for taxes not delinquent or being
contested in good faith and by appropriate
proceedings; and
*Refer to Rider attached hereto.
Contingent c. Assume, guarantee, endorse or otherwise become
Obligations directly or contingently liable for the obligations of
any other person execept for the Guaranty in
connection with this Agreement and the endorsement of
negotiable instruments for deposit or collection in
the ordinary course of business;
Leases d. Create, incur or assume any obligations for the
rental, hire or lease of real or personal property if
the aggregate of such, payable in any one fiscal year,
would exceed $250,000;
Capital Expenditures e. Refer to Rider attached hereto.
f. Intentionally omitted.
Asset Sale g. Refer to Rider attached hereto.
Merger h. Refer to Rider attached hereto.
Notes/Accounts i. Sell, assign, discount or otherwise dispose of any of
Sale its notes or accounts receivable except for collection
in the ordinary course of business;
Loans j. Make loans or advances to any other Person (except a
Guarantor);
Investments k. Purchase or make any investment in the stock,
securities or evidences of indebtedness of any other
Person except:
(i) a Guarantor;
(ii) the United States Government and its agencies;
and
(iii) Certificates of Deposit of domestic banks having
capital and surplus in excess of $100,000,000.00
*Refer to Rider attached hereto.
Dividends l. Refer to Rider attached hereto.
*Refer to Rider attached hereto for Additional
Negative Covenants.
(5) Intentionally omitted.
(6) Events of Default.
In case of the happening of any of the following events
("Events of Default");
a. any representation or warranty made herein, in any
Security Agreement, Pledge Agreement or General Loan
and Collateral Agreement or in any other instrument,
agreement or certificate furnished in connection with
any of the foregoing shall prove false or misleading
in any material respect;
b. any occurrence delineated in the Note as an Event of
Default;
c. any occurrence delineated in the Security Agreement;
or any other Loan Document as an Event of Default;
d. Any Obligor shall default in the due observance or
performance of any negative covenant contained in
this Agreement or any Security Agreement or any
other Loan Document;
e. Any Obligor shall default in the due observance or
performance of any covenant, condition or agreement
(other than those referred to in sections (b) and
(d) immediately above) contained in this Agreement
or any Security Agreement to which it is a party and
such default shall continue unremedied for 10 days
after notice from the Bank of such default demanding
that it be cured;
f. A Reportable Event shall have occurred with respect
to any Plan as defined in ERISA and (i) the Bank has
notified the affected Obligor in writing that it has
determined that such Reportable Event constitutes
reasonable grounds for termination of such Plan by
the Pension Benefit Guaranty Corporation or the
appointment of a trustee, to administer the Plan, by
an appropriate U.S. District Court or (ii) such
termination proceedings are commenced or such
appointment occurs;
then, the Note shall be immediately due and payable in
full, both as to principal and interest, without
presentment, demand, protest or notice of any kind, all
of which are hereby expressly waived, anything contained
herein, in the Note, in the Security Agreement or
elsewhere to the contrary notwithstanding.
*Refer to Rider attached hereto for Additional Events
of Default.
(7) Miscellaneous
Expenses a. The Borrower will pay all out of pocket losses, costs
and expenses incurred by the Bank in connection with the
Loan hereunder, the enforcement of any provision of this
Agreement, or any Note or the collection of any amount
due hereunder or thereunder including but not limited
to, the reasonable fees and disbursements of counsel to
the Bank incurred in the course of so enforcing such
rights.
No Waiver b. No failure or delay by the Bank in exercising any right,
power or remedy hereunder upon a breach hereof shall
constitute a waiver of any such term, condition,
covenant, agreement, right, power of Bank from
exercising any such rights, power or remedy at any later
time or times.
Additional c. The Rider annexed hereto shall constitute an integral
Provisions part of this Short Form Term Loan Agreement.
Conditions of d. Refer to Exhibit F attached hereto and made a part hereof.
Closing
Amendments e. The Bank shall not be deemed to have waived any of the
terms, agreements, conditions and covenants hereof,
except by a writing signed by an officer of the Bank and
delivered to the Borrower. This Agreement may be amended
by a supplemental Agreement setting forth such amendment
or amendments when properly executed by all the parties
to this Agreement.
GAAP f. All accounting terms used herein shall have the meaning
assigned to them by generally accepted accounting
principles, unless otherwise defined.
Law Governing g. This Agreement and all rights hereunder, shall be
governed by the laws of the State of New York and
applicable laws of the United States and shall be
binding upon the Obligors, their heirs, executors,
administrators, successors and assigns and shall inure
to the benefit of the Bank, its successors and assigns.
The obligations and conditions of this Agreement shall
continue until all indebtedness and liability of the
Obligors to the Bank hereunder has been paid and
satisfied in full.
The Fresh Juice Company, Inc. (as Guarantor) The Fresh Juice Company of
Florida, Inc.
By: /s/ Xxxxxx Xxxxx By: /s/ Xxxxxx Xxxxx
---------------------- -------------------------
Name: Xxxxxx Xxxxx Name: Xxxxxx Xxxxx
Title: President Title: Secretary
Accepted:
Chemical Bank
By: /s/
---------------------------
THE RIDER DATED OCTOBER 3, 1995 TO SHORT FORM TERM LOAN AGREEMENT (the
"Loan Agreement") dated October 3, 1995 among THE FRESH JUICE COMPANY OF
FLORIDA, INC., a Florida corporation, having its principal place of business at
1000 American Superior Blvd., Winterhaven, Florida (the "Borrower") and THE
FRESH JUICE COMPANY, INC., a Delaware corporation, having its principal place
of business at 000 Xxxxxxxx Xxxx., Xxxxx Xxxx, Xxx Xxxx, (individually, a
"Guarantor" and collectively with any future guarantors, the "Guarantors") (the
Borrower and the Guarantor(s) collectively, the "Obligors") and CHEMICAL BANK,
a New York banking corporation, having an office at 00 Xxxxxxx Xxxxxxxxx Xxxx.,
Xxxxxxxxx, Xxx Xxxx 00000 (the "Bank"). The Borrower has applied to the Bank
for a $1,100,000 secured term loan (the "Loan" or the "Term Loan"), the
proceeds of which shall be used for the purpose of (i) partially financing
leasehold improvements of $250,000 (the "Leasehold Improvements") to be made to
the Borrower's 68,000 square foot leased facility located at 1000 American
Superior Blvd., Winterhaven, Florida (the "Leased Facility") in connection with
developing a citrus juice processing plant (the "Processing Plant") in the
Leased Facility and (ii) financing the purchase of machinery and equipment of
$850,000 (the "Capital Equipment") to be used in the Processing Plant.
I. THE NOTES: RATE OF INTEREST AND MANNER OF REPAYMENT.
SECTION A. THE TERM LOAN; TERM NOTE; INTEREST ON TERM LOAN.
(1) The Loan shall be in an aggregate principal amount of $1,100,000.
Principal amounts outstanding pursuant to the Term Loan shall
bear interest at either the Fixed Rate (the "Fixed Rate Loan") or
the Prime Rate plus 1/2 of 1% (the "Prime Rate Loan") at the
Borrower's election on October 3, 1995 (the "Closing Date"), or
in the case of the Fixed Rate Loan, three (3) business days prior
to the Closing Date, in accordance with the following provisions.
The interest rate that is selected shall be for the period from
the Closing Date to and including the Maturity Date (as defined
in (2) below).
(2) The Prime Rate Loan shall be in the principal amount of
$1,100,000 and shall bear interest for the duration of the Term
Loan on the unpaid principal amount from the date of such Loan,
until the Maturity Date, at the Prime Rate plus 1/2 of 1% per
annum, such interest to be payable on the last business day of
each month, in arrears, commencing October 31, 1995 and on the
Maturity Date. The Fixed Rate Loan shall be in the principal
amount of $1,100,000 and shall bear interest for the duration of
the Term Loan on the unpaid principal amount from the date of
such Loan, until the Maturity Date, at the Fixed Rate, such
interest to be payable on the last business day of each month,
in arrears, commencing on October 31, 1995 and on the Maturity
Date. The Maturity Date shall be September 30, 2000.
(3) The Term Loan shall be evidenced by a promissory note duly
executed by the Borrower in substantially the same form of
Exhibit A attached hereto (the "Note" or the "Term Note").
Principal on the Note shall be payable in forty-eight (48)
substantially equal consecutive monthly installments. Principal
payments on the Note shall be payable on the last business day of
each month, commencing on October 31, 1996, and ending on the
Maturity Date.
(4) Interest shall be payable on any overdue principal and/or
interest on the Term Loan (whether at the due date or as a
result of acceleration or otherwise) at a fluctuating rate per
annum of 2% in excess of the rate in effect from time to time on
such Term Loan, but in no event higher than the maximum rate
permitted under applicable law. The Borrower irrevocably and
unconditionally authorizes the Bank to charge any account of the
Borrower maintained with the Bank for interest and principal due
and payable on the Term Loan.
SECTION B. DEFINITIONS OF INTEREST RATES ON LOANS.
(1) The "Prime Rate" is such rate of interest as is publicly
announced from time to time by the Bank at its principal office
as its prime rate calculated on a 360-day basis for the actual
number of days elapsed. Each change in the Prime Rate shall be
effective on the date such change is announced; and
(2) The "Fixed Rate" is a fixed rate of interest to be determined by
the Bank at its sole discretion (subject to availability) by
reference to such factors and considerations as the Bank shall
deem relevant and offered by the Bank to the Borrower, and
calculated on a 360-day basis.
SECTION C. PREPAYMENT OF LOANS.
(1) The Borrower shall have the right at any time from time to time
to prepay the Prime Rate Loan, in whole or in part, without
premium or penalty, upon at least one business day's prior
written, telephonic (immediately confirmed in writing) or
facsimile notice to the Bank; provided, however, that each such
partial prepayment shall be in the minimum principal amount of
$100,000. All partial prepayments of the Prime Rate Loan shall
be applied to installments of principal thereof in the inverse
order of maturity and accompanied by accrued interest on the
amount of such prepayment to the date thereof. Each notice of
prepayment shall specify the prepayment date and the principal
amount of the Loan to be prepaid, shall be irrevocable and shall
commit the Borrower to prepay such Loan by the amount stated
therein on the date stated therein. Each prepayment of the Prime
Rate Loan shall be permanent.
(2) The Fixed Rate Loan may be prepaid at the Borrower's option in
whole or in part in minimum amounts of $100,000 upon not less
than three (3) business days' prior irrevocable written,
telephonic (immediately confirmed in writing) or facsimile
notice to the Bank accompanied by payment of a prepayment
premium equal to the difference between the rate on the Fixed
Rate Loan and, if lower than the rate on said Loan, the rate
equal to the average yield on United States Treasury Securities
maturing nearest to the Maturity Date for such Fixed Rate Loan
(each rate computed per annum on the basis of a year of 360 days)
multiplied by the product of the remaining number of years, or
fraction thereof, until the Maturity Date with respect to such
Fixed Rate Loan and the principal amount being prepaid. Each
prepayment of the Fixed Rate Loan shall be applied to the
installments thereof in the inverse order of maturity and
accompanied by accrued interest on the amount of such prepayment
to the date thereof. If the rate based on such United States
Treasury Securities shall be higher than the rate on the Fixed
Rate Loan, no prepayment premium shall be assessed. Each notice
of prepayment shall specify the prepayment date and the
principal amount of the Loan to be prepaid, shall be irrevocable
and shall commit the Borrower to prepay such Loan by the amount
stated therein on the date stated therein. Each prepayment of the
Fixed Rate Loan shall be permanent.
SECTION D. Increased Costs. If either (i) the introduction of or any
change in or in the interpretation of any law or regulation or (ii) the
compliance by the Bank with any other guideline or request from any central
bank or other governmental authority shall result in any increase in the cost to
the Bank of making, funding or maintaining the Fixed Rate Loan, then the
Borrower shall from time to time, upon demand by the Bank, pay to the Bank
additional amounts sufficient to indemnify the Bank against such increased cost.
A certificate as to the amount of such increased cost shall be submitted to the
Borrower by the Bank and shall be conclusive absent manifest error.
SECTION E. Exhibits. The Term Note is attached hereto as Exhibit A,
and its definitions, terms and conditions are expressly incorporated herein by
reference.
SECTION F. Funds; Manner of Payment. Unless otherwise specified
herein, each payment and prepayment of principal of and interest on the Term
Note shall be made by the Borrower not later than 12:00 noon, New York City
time, on the date on which it is payable, in Federal or other immediately
available funds.
II. ADDITIONAL REPRESENTATIONS AND WARRANTIES
Fresh Pik't
Natural Foods, Inc. (2)i. All of the operating assets (other than the
accounts receivable and the machinery and
equipment of Fresh Pik't Natural Foods, Inc.
which were transferred to Fresh Juice) shown
on the financial statement of Fresh Pik't
Natural Foods, Inc. for the fiscal period
ended May 31, 1995 have been sold to Corganics
Inc. pursuant to an asset purchase agreement
dated August 21, 1995 between Fresh Pik't
Natural Foods, Inc. and Corganics Inc. (the
"Asset Purchase Agreement").
(2)j. Fresh Pik't Natural Foods, Inc. ("Fresh Pik't")
is a Maryland corporation with nominal assets
and is in the process of being dissolved.
Minalba Foods, Inc. (2)k. Minalba Foods, Inc. ("Minalba") is a New York
corporation with nominal assets.
III. ADDITIONAL AFFIRMATIVE COVENANTS
Financial Statements: (3)c. Furnish to the Bank the following financial
information:
(i) as soon as available, but in any event not
later than ninety (90) days after the end of
each fiscal year of The Fresh Juice Company,
Inc. ("Fresh Juice"), (y) the audited
consolidated financial statements of Fresh
Juice and its subsidiaries, including balance
sheets, income statements and statements of
cash flow, prepared in accordance with generally
accepted accounting principles ("GAAP")
consistently applied by independent certified
public accountants acceptable to the Bank
accompanied by the unqualified opinion of such
independent certified public accountants and (z)
the unaudited consolidating financial statements
of Fresh Juice and its subsidiaries, including
balance sheets, income statements and statements
of cash flow, prepared in accordance with GAAP
consistently applied by the chief financial
officer of Fresh Juice;
(ii) as soon as available, but in any event not
later than forty-five (45) days after the end of
the second fiscal quarter of each fiscal year of
Fresh Juice, the management prepared
consolidated and consolidating financial
statements of Fresh Juice and its subsidiaries,
including balance sheets, income statements and
statements of cash flow, their accuracy
certified in a manner satisfactory to the Bank
by the chief financial officer of Fresh Juice;
(iii) as soon as available, but in any event not
later than forty-five (45) days after the end of
each of the first and third fiscal quarters of
each fiscal year of Fresh Juice, the
management prepared consolidated financial
statements of Fresh Juice and its subsidiaries,
including balance sheets, income statements and
statements of cash flow, their accuracy
certified in a manner satisfactory to the Bank
by the chief financial officer of Fresh Juice;
(iv) with each delivery of financial statements
required by (i), (ii) and (iii) above, a
certificate signed by the chief financial
officer of the Borrower and the Guarantor(s) as
to whether or not, as of the close of such
preceding period and at all times during such
preceding period, the Borrower and the
Guarantor(s) were and currently are, to his
knowledge, in compliance with all the provisions
of the Loan Agreement, showing computation of
the financial covenants and, if the chief
financial officer shall have obtained knowledge
of any default or Event of Default, he shall
disclose in such certificate such defaults or
Events of Default or notice thereof and the
nature thereof;
(v) promptly, from time to time, such other
information regarding the operations, business
affairs and financial condition of the Borrower
and the Guarantor(s) as the Bank may reasonably
request;
Additional Guarantors; (3)c. (iv) the formation of any subsidiary or
affiliate (other than any affiliate of the
Borrower or any Guarantor which does not have
any transactions with the Borrower or such
Guarantor (except transactions in the ordinary
course of business and so long as such
transactions are not less favorable to the
Borrower or such Guarantor than would be
obtained in a comparable arm's length
transaction with a person that is not an
affiliate)) of the Borrower or any Guarantor
after the date of this Loan Agreement, which
notice shall be accompanied by the resolution of
the Board of Directors of such subsidiary or
affiliate authorizing such entity to execute
this Loan Agreement as an additional Guarantor
together with such execution by Amendment and
such Guaranty.
Notwithstanding the foregoing, (a) if Fresh
Pik't is not dissolved within one hundred eighty
(180) days after the Closing Date, Fresh Juice
shall cause Fresh Pik't to become a Guarantor of
all indebtedness and other obligations of the
Borrower under this Loan Agreement and (b) if
(i) the total assets of Minalba represent more
than 10% of Consolidated Total Assets or (ii)
the net income of Minalba represents more than
10% of Consolidated Net Income, Fresh Juice
shall cause Minalba to become a Guarantor of
all indebtedness and other obligations of the
Borrower under this Loan Agreement.
"Consolidated Total Assets" shall mean, at a
particular date, the aggregate amount which
would, in conformity with generally accepted
accounting principles, be included under total
assets on a consolidated balance sheet of Fresh
Juice and its subsidiaries as at such date.
"Consolidated Net Income" shall mean, at a
particular date, the aggregate amount which
would, in accordance with generally accepted
accounting principles, be classified as
consolidated net income, after taxes, in a
consolidated income statement of Fresh Juice
and its subsidiaries as at such date.
Dissolution: (3)f. Within one hundred twenty (120) days after
filing, a copy of the certificate of dissolution
for Fresh Pik't Natural Foods, Inc.
Notwithstanding the above, such certificate of
dissolution shall not be required if Fresh Pik't
shall become a Guarantor pursuant to the section
herein entitled "Additional Guarantors".
Taxes: (3)g. It shall promptly (i) pay all indebtedness and
obligations as and when due and payable (other
than trade payables incurred in the ordinary
course of business which are contested in good
faith) and (ii) pay and discharge all taxes,
assessments and government charges which, if
unpaid, might become a lien or charge upon any
of its properties.
IV. ADDITIONAL NEGATIVE COVENANTS
Indebtedness: (4)a. (iv) indebtedness owing to the Bank;
(v) trade payables incurred in the ordinary
course of business; and
(vi) indebtedness owing from the Borrower to any
Guarantor or from any Guarantor to the Borrower
or another Guarantor.
Liens: (4)b. (v) liens granted to the Bank; and
(vi) liens existing on the date hereof and
scheduled satisfactory to the Bank on Exhibit E,
such liens not be renewed or rescheduled.
Capital Expenditures: (4)e. Make any capital expenditures (excluding capital
expenditures related to equipping the Processing
Plant during the fiscal years ending November
30, 1995, and November 30, 1996, provided, that
such expenditures do not exceed $2,300,000 in
in the aggregate) if, after giving effect
thereto, the aggregate amount of such
expenditures by Fresh Juice and its subsidiaries
would exceed $200,000 during any fiscal year.
Asset Sale: (4)g. Sell, transfer,or otherwise dispose of its
assets, except in the normal course of business,
or sell and thereafter enter into an arrangement
with the buyer to rent or lease back all or any
substantial part of its properties or assets.
Merger: (4)h. Consolidate with or merge into any other
corporation, or permit another corporation to
merger into it or acquire all or substantially
all of the properties, shares or assets of any
other Person (defined below) provided, however
that Fresh Juice shall be permitted to acquire
all or substantially all of the capital stock or
assets of any other Person if: (i) the aggregate
Consideration (as hereinafter defined) for such
acquisition is not in excess of $500,000 per
acquisition transaction; (ii) the acquiree (or
the assets being acquired) is in (or are to be
used in, in the case of acquired assets)
substantially the same business as operated by
the Borrower or the Guarantor(s) as of the
Closing Date; (iii) such acquisition transaction
shall be "non-hostile" (i.e.: with the consent
of the Board of Directors of the acquiree);
(iv) there shall exist no default or Event of
Default hereunder either immediately preceding
or immediately succeeding such acquisition
transaction (an acquisition transaction which is
consummated in accordance with (i) through (iv)
above shall be defined as a "Permitted
Acquisition"); and (v) the aggregate
Consideration for all such Permitted
Acquisitions shall not exceed $750,000 during
the term hereof.
Notwithstanding the foregoing, the limitations
on Consideration set forth in Section 4(h)(i)
above shall not apply to acquisitions financed
(wholly or partially) by the issuance of capital
stock of Fresh Juice so long as (a) the Borrower
or any Guarantor does not contribute more than
$500,000 (in the aggregate) to "fund" such
acquisition (by means of cash, cash equivalents,
transaction costs, guarantees, assumed
liabilities, fees, any deferred portions of the
purchase price or any other costs paid in
connection with the acquisition) and (b) such
acquisition does not detrimentally impact the
Borrower or any Guarantor's financial condition
(determined in the Bank's reasonable judgment
upon review of contingent obligations,
litigation, environmental exposure or other
relevant issues with respect to the proposed
acquiree or the proposed assets being acquired).
"Person" shall mean any natural person,
corporation, business trust, joint venture,
association, company, partnership or government,
or any agency or political subdivision thereof.
"Consideration" shall mean, collectively, cash,
cash equivalents, transaction costs, guarantees
and other contingent obligations, assumed
liabilities, fees, any deferred portions of the
purchase price or any other costs paid in
connection with the acquisition.
Investments: (4)k. (iv) money market funds with assets of
$2,500,000,000 or more; and (v) Permitted
Acquisitions.
Dividends: (4)l. Declare or pay any dividends or make any other
distribution, whether in cash, property,
securities or any combination thereof, with
respect to any shares of capital stock or
redeem, purchase, or retire any shares of any
class of capital stock or set apart any sum for
such purposes if immediately prior to or
immediately following such proposed dividends,
distributions, purchases, redemption or
retirement, there shall exist a default or Event
of Default under this Loan Agreement.
Debt Service
Coverage Ratio: (4)m Permit the Consolidated Debt Service Coverage
Ratio of Fresh Juice and its subsidiaries to be
less than 1.25 to 1.00 at any time.
"Consolidated Debt Service Coverage Ratio" shall
be defined as the ratio of (i) net income
(excluding extraordinary gains) plus
depreciation, plus amortization of intangibles,
plus interest expense, minus unfunded capital
expenditures minus cash dividends, distributions
and withdrawals to (ii) interest expense plus
the current portion of long term indebtedness of
Fresh Juice and its subsidiaries. All categories
of the Consolidated Debt Service Coverage Ratio
shall be measured over the prior four (4) fiscal
quarters with the exception of the current
portion of long term indebtedness which shall be
measured over the future four (4) fiscal
quarters, and all such categories shall be
measured on a consolidated basis incorporating
Fresh Juice and its subsidiaries.
Leverage: (4)n Permit the ratio of (i) Consolidated Total
Unsubordinated Liabilities to (ii) Consolidated
Tangible Net Worth plus Subordinated Debt to be
greater than 1.0 to 1.0 at any time.
"Total Unsubordinated Liabilities" shall be
defined as all of the liabilities of Fresh Juice
and its subsidiaries on a consolidated basis
which would properly appear on the liability
side of the consolidated balance sheet of Fresh
Juice and its subsidiaries, other than capital
stock, capital surplus, treasury stock, retained
earnings and Subordinated Debt, under generally
accepted accounting principles.
"Subordinated Debt" shall be defined as
indebtedness of the Borrower and its
subsidiaries on a consolidated basis which is
subordinated, on terms satisfactory to the Bank,
to indebtedness of the Borrower owing to the
Bank.
"Tangible Net Worth" shall be defined as (i) the
aggregate amount at which all assets of Fresh
Juice and its subsidiaries on a consolidated
basis would be shown on the consolidated balance
sheet of Fresh Juice and its subsidiaries after
deducting capitalized research and development
costs, capitalized interest, debt discount and
expense, goodwill, patents, trademarks,
copyrights, franchises, licenses and such other
assets as are properly classified as "intangible
assets" minus (ii) Total Liabilities (meaning,
Total Unsubordinated Liabilities plus
Subordinated Debt).
Tangible Net Worth: (4)o. Permit Consolidated Tangible Net Worth of Fresh
Juice and its subsidiaries ("TNW") at any time
to be less than:
Period Amount
------ ------
From the date hereof
through 11/29/96 $4,000,000
11/30/96 through 11/29/97 $4,100,000
11/30/97 through 11/29/98 $4,300,000
11/30/98 through 11/29/99 $4,600,000
11/30/96 and thereafter $4,900,000
Fiscal Year End: (4)p. Change its fiscal year end from
November 30th.
Prepayment of
Outstanding Debt: (4)q. Pay, in whole or in part, any outstanding debt
(other than debt owing to the Bank and trade
payables incurred in the ordinary course of
business) of the Borrower or any Guarantor
which, by its terms, is not yet due and payable.
Modification to Other
Credit Agreements: (4)r. Modify or amend the terms, convenants,
conditions and provisions of (i) the purchase
money mortgage entered into on August 1, 1995
by The Fresh Juice Company, Inc. (as mortgagor)
in favor of Fantasy-BlankeBaer Corporation (as
mortgagee) (the "Purchase Money Mortgage") as
evidenced by a promissory note dated August 1,
1995 made by The Fresh Juice Company, Inc. in
favor of Fantasy-BlankeBaer Corporation in the
original principal amount of $475,000 (the
"Promissory Note") or (ii) any other credit
agreement or other indebtedness for borrowed
money of the Borrower or any Guarantor.
Transactions with
Affiliates: (4)s. Enter into any transaction, including, without
limitation, the purchase, sale or exchange of
any property or the rendering of any service
with any affiliate, except in the ordinary
course of business and so long as such
transactions are not less favorable to the
Borrower or any Guarantor than would be obtained
in a comparable arm's length transaction with a
person that is not an affiliate.
V. ADDITIONAL EVENTS OF DEFAULT
(6)g. The Borrower or any other Obligor or any
subsidiary thereof shall (i) voluntarily
commence any proceeding or file any petition
seeking relief under Title 11 of the United
States Internal Revenue Code of 1986 (the
"Code") or any other Federal, state or foreign
bankruptcy, insolvency liquidation or similar
law, (ii) consent to the institution of, or
fail to contravene in a timely and appropriate
manner, any such proceeding or the filing of any
such petition, (iii) apply for or consent to the
appointment of a receiver, trustee, custodian,
sequestrator or similar official for the
Borrower or such Obligor or such subsidiary
thereof or for a substantial part of its
property or assets, (iv) file an answer
admitting the material allegations of a petition
filed against it in any such proceeding, (v)
make a general assignment for the benefit of
creditors, (vi) become unable, admit in writing
its inability or fail generally to pay its debts
as they become due or (vii) take corporate
action for the purpose of effecting any of the
foregoing;
(6)h. An involuntary proceeding shall be commenced or
any involuntary petition shall be filed in a
court of competent jurisdiction seeking (i)
relief in respect of the Borrower or any other
Obligor or any subsidiary thereof, or of a
substantial part of the property or assets of
the Borrower or any other Obligor or any
subsidiary thereof, under Title 11 of the Code
or any other Federal, state or foreign
bankruptcy, insolvency, receivership or similar
law; (ii) the appointment of a receiver,
trustee, custodian, sequestrator or similar
official for the Borrower or any other Obligor
or any subsidiary thereof or for a substantial
part of the property of the Borrower or any
other Obligor or any subsidiary thereof or (iii)
the winding-up or liquidation of the Borrower or
any other Obligor or any subsidiary thereof and
such proceeding or petition shall continue
undismissed for 60 days or any order or decree
approving or ordering any of the foregoing shall
continue unstayed and if effect for 60 days;
(6)i. Default with respect to any indebtedness for
borrowed money or capitalized leases (other than
the Term Note) of the Borrower or any Guarantor
in excess of $10,000 in the aggregate or default
with respect to the performance of any other
obligation of the Borrower or any Guarantor
incurred in connection with any indebtedness
for borrowed money or capitalized leases if the
effect of such default is to accelerate the
maturity of such indebtedness or capitalized
lease, or to permit the holder thereof to cause
such indebtedness or capitalized leases to
become due prior to its stated maturity (with or
without the passage of time, giving of notice,
or both), or any such indebtedness or
capitalized leases shall not be paid when due
(Cross Default);
(6)j. The Loan Agreement, the Note or any other Loan
Document shall for any reason cease to be, or
shall be asserted by the Borrower or any
Guarantor not to be, a legal, valid and binding
obligation of the Borrower or such Guarantor,
as applicable, enforceable in accordance with
its terms, or the security interest or lien
purported to be created by any Loan Document
shall for any reason cease to be, or be asserted
by the Borrower or such Guarantor not to be, a
valid, first priority perfected security
interest in any of the collateral covered
thereby;
(6)k. Mr. Xxxxx Xxxxx (y) shall cease in the Bank's
opinion to manage or operate or be actively
involved in the day to day operations of the
Borrower, Fresh Juice or any other Guarantor or
(z) shall cease to be chairman and chief
executive officer of Fresh Juice;
(6)l. Any Person or two or more Persons, other than
any officer of Fresh Juice on the date hereof,
acting in concert, shall own directly or
indirectly, beneficially (within the meaning of
Rule 13d-3 of the Securities and Exchange
Commission under the Securities and Exchange Act
of 1934, as amended) or of record, a majority of
such classes of voting stock of Fresh Juice such
as would enable the holder(s) thereof to elect a
majority of the members of the Board of
Directors of Fresh Juice; or
(6)m. Fresh Juice shall cease to own 100% of the
outstanding voting stock of the Borrower.
VI. MISCELLANEOUS/ADDITIONAL PROVISIONS
Miscellaneous: (a) The Borrower and each of the Guarantors covenant and
agree that, from the date hereof until the full satisfaction of the obligations
hereunder and under the Term Note: It shall comply with the requirements of all
Federal, state and local laws, ordinances, rules, regulations or policies
governing the use, storage, treatment, transportation, manufacture, refinement,
handling, production or disposal of hazardous materials, provide to the Bank all
documentation in connection with such compliance that the Bank may reasonably
request, and defend, indemnify, and hold harmless the Bank, its employees,
agents, officers, and directors, from and against any claims, demands,
penalties, fines, liabilities, settlements, damages, costs, or expenses of
whatever kind or nature, known or unknown, contingent or otherwise, arising out
of, or in any way related to, (i) the presence, disposal, release, or threatened
release of any hazardous materials on any property at any time owned or occupied
by the Borrower, its subsidiaries or any Guarantor; (ii) any personal injury
(including wrongful death) or property damage (real or personal) arising out of
or related to such hazardous materials; (iii) any lawsuit brought or threatened,
settlement reached, or governmental order relating to such hazardous materials,
and/or (iv) any violation of laws, orders, regulations, requirements, or demands
of government authorities, or any policies or requirements of the Bank, which
are based upon or in any way related to such hazardous materials including,
without limitation, attorney and consultant fees, investigation and laboratory
fees, court costs, and litigation expenses. (b) The Borrower and each of the
Guarantors represent and warrant that, as of the date hereof, each is in full
compliance with all of the above described laws, ordinances, rules, regulations
and policies.
Notices: Notices, consents and other communications provided for herein
shall be in writing and may be either mailed or delivered (which shall include
telex or facsimile communication). Any notice shall be conclusively deemed to
have been received by a party hereto and to be effective on the day on which
delivered (either by hand or by telex, telecopier or other telegraphic
communications equipment, with receipt confirmed) to such party at its address
set forth below (or at such other address as such party shall specify to the
other parties hereto in writing) or, if sent by registered mail, on the fifth
business day after the day on which mailed, addressed to such party at such
address: (i) if to the Borrower, at 000 Xxxxxxxx Xxxxxxxxx, Xxxxx Xxxx, Xxx Xxxx
00000, (ii) if to the Guarantor(s), at 000 Xxxxxxxx Xxxxxxxxx, Xxxxx Xxxx, Xxx
Xxxx 00000, and (iii) if to the Bank, at Chemical Bank, 00 Xxxxxxx Xxxxxxxxx
Xxxxxxxxx, Xxxxxxxxx, Xxx Xxxx 00000, Attention: The Fresh Juice Company of
Florida, Inc. Relationship Manager.
THE FRESH JUICE COMPANY OF FLORIDA, INC.
By: /s/ Xxxxxx Xxxxx Secy & CEO
----------------------------
Name: Xxxxxx Xxxxx
Title: Secretary & CEO
THE FRESH JUICE COMPANY, INC. (as a Guarantor)
By: /s/ Xxxxxx Xxxxx President
----------------------------
Name: Xxxxxx Xxxxx
Title: President
CHEMICAL BANK
By: /s/
----------------------------
Title: Vice President
EXHIBIT B
SUBSIDIARIES AND AFFILIATES
(to be completed by the Borrower and the Guarantor(s))
Minalba Foods of North America
Fresh Pik't Natural Foods
EXHIBIT C
LITIGATION
(to be completed by the Borrower and the Guarantor(s))
None
EXHIBIT D
INDEBTEDNESS
(to be completed by the Borrower and the Guarantor(s))
$475,000 Fantasy-BlankeBaer Corp. for Xxxx.
0000 Xxxxxxxx Xxxxxxxx Xxxx.
Xxxxxxxxxxx XXX.
EXHIBIT E
LIENS
(to be completed by the Borrower and the Guarantor(s))
None
