Exhibit 10.14
SECOND AMENDMENT TO
SECURITIES PURCHASE AGREEMENT
THIS SECOND AMENDMENT TO SECURITIES PURCHASE AGREEMENT is dated as of
January 11, 2002 (this "Amendment"), by and among OVERHILL FARMS, INC., a Nevada
corporation (the "Company"), OVERHILL CORPORATION (formerly known as Polyphase
Corporation), a Nevada corporation ("Parent"), OVERHILL L.C. VENTURES, INC., a
California corporation ("Overhill Ventures" and, together with the Company and
Parent, the "Company Parties"), and XXXXXX XXXXXXXXX CAPITAL PARTNERS II, L.P.
("LLCP").
R E C I T A L S
A. The Company Parties and LLCP are parties to that certain Securities
Purchase Agreement dated as of November 24, 1999, as amended by a Consent and
First Amendment to Securities Purchase Agreement dated as of August 23, 2000 (as
so amended, the "Securities Purchase Agreement"). Unless otherwise indicated,
capitalized terms used and not otherwise defined in this Amendment have the
meanings ascribed to them in the Securities Purchase Agreement.
B. The Company has advised LLCP that an Event of Default has occurred
and is continuing under Section 10.1(b)(ii)(x) of the Securities Purchase
Agreement by virtue of the fact that the Company failed to achieve the minimum
Fixed Charge Coverage Ratio set forth in Column (C) of Section 3.2A (Minimum
Fixed Charge Coverage Ratio) of Annex A to the Securities Purchase Agreement for
the four consecutive Fiscal Quarter period ended September 30, 2001 (the
"Specified Default"). Pursuant to Section 10.2 of the Securities Purchase
Agreement, if any Event of Default under Section 10.1(b) of the Securities
Purchase Agreement occurs and is continuing, LLCP may, by written notice to the
Company, declare all amounts under the Note, and all other Obligations to
Purchaser, to be due and payable, as well as exercise all other rights, remedies
and powers provided for under the Securities Purchase Agreement, the other
Investment Documents, Applicable Law or otherwise.
C. The Company has requested that LLCP agree not to exercise its
rights, remedies or powers with respect to the Specified Default (including,
without limitation, receiving interest on the Note at the Default Rate (as
defined in the Note)) or waive the Specified Default but, rather, agree to amend
all of the existing financial covenants set forth in Section 3.A of Annex A to
the Securities Purchase Agreement (including, without limitation, Section 3.2A)
on the terms provided in Exhibit A attached hereto, effective as of September
30, 2001. The existing financial covenants set forth in Section 3.A of Annex A
to the Securities Purchase Agreement are referred to herein as the "Existing
Financial Covenants." At the request of the Company, LLCP is willing to amend
the Existing Financial Covenants effective on and as of the Second Amendment
Effective Date (as defined below), 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. Amendment to Section 3.A (Financial Covenants) of Annex A. Effective
on and as of the Second Amendment Effective Date, and pursuant to Section 12.2
of the Securities Purchase Agreement, Section 3.A (Financial Covenants) of Annex
A to the Securities Purchase Agreement shall be amended by deleting such Section
in its entirety and replacing it with the financial covenants set forth in
Exhibit A hereto (the "Amended Financial Covenants"), effective as of September
30, 2001.
2. Conditions Precedent. The effectiveness of the Amended Financial
Covenants shall be subject to the satisfaction of each of the following
conditions precedent (the date upon which the last of such conditions precedent
to be satisfied shall be referred to herein as the "Second Amendment Effective
Date"):
(a) The Second Amendment Effective Date shall have occurred on or
prior to January 11, 2002;
(b) LLCP shall have received a Second Amendment to Investor Rights
Agreement, in substantially the form of Exhibit B hereto (the "Second Amendment
to Investor Rights Agreement"), dated as of the Second Amendment Effective Date
and duly executed by the Company, Parent and Overhill Ventures;
(c) LLCP shall have received true, correct and complete copies of
resolutions duly adopted by the Board of Directors of each of the Company and
Overhill Ventures, certified by the Secretary of the Company and Overhill
Ventures, respectively, duly authorizing and approving this Amendment, the
Second Amendment to Investor Rights Agreement and the transactions contemplated
hereby and thereby;
(d) LLCP shall have received true, correct and complete copies of
all consents, authorizations and approvals necessary or required to be obtained
in connection with this Amendment and the transactions contemplated hereby,
including, without limitation, the written consent of the Senior Lender;
(e) LLCP shall have received true, correct and complete copies of
all amendments and other documents entered into between the Company Parties (or
any of them), on the one hand, and the Senior Lender, on the other, with respect
to the matters addressed herein or such other matters as LLCP may request, all
in form and substance reasonably satisfactory to LLCP; and
(f) LLCP shall have received an officers' certificate, in form and
substance satisfactory to LLCP, dated as of the Second 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, among other things, (i)
the representations and warranties of the
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Company contained in Section 3 hereof are true and correct in all material
respects as of the date hereof and are true and correct on and as of the Second
Amendment Effective Date, with the same effect as if made on and as of the
Second Amendment Effective Date, and (ii) the Company has satisfied each of the
conditions set forth in this Section 2.
3. Representations and Warranties. In order to induce LLCP to agree to
amend the Existing Financial Covenants as set forth in Section 1 above, the
Company represents and warrants to LLCP that:
(a) The Company Parties have each duly authorized, executed and
delivered this Amendment and the Second Amendment to Investor Rights Agreement,
and each of this Amendment and the Second Amendment to Investor Rights Agreement
is the legal, valid and binding obligation of the parties thereto (other than
LLCP), enforceable against each such party in accordance with its terms;
(b) The Company Parties have each obtained all consents,
authorizations and approvals necessary or required to enter into this Amendment
and the Second Amendment to Investor Rights Agreement and perform its or their
obligations hereunder and thereunder, including, without limitation, the written
consent of the Senior Lender; and
(c) Except for the Specified Default, no Defaults or Events of
Default have occurred and are continuing (or will occur as a result of the
transactions contemplated hereby).
4. Parent Board Resolutions. As soon as practicable, but not later than
Wednesday, January 16, 2002, the Company shall deliver to LLCP copies of
resolutions duly adopted by the Board of Directors of Parent, certified by the
Secretary of Parent, duly authorizing and approving this Amendment, the Second
Amendment to Investor Rights Agreement and the transactions contemplated hereby
and thereby.
5. Confirmation; Full Force and Effect. Section 1 of this Amendment
shall amend the Securities Purchase Agreement effective on and as of Second
Amendment Effective Date, and the Securities Purchase Agreement shall remain in
full force and effect as amended thereby from and after the Second Amendment
Effective Date in accordance with its terms. The Securities Purchase Agreement
and the other Investment Documents are hereby ratified, approved and affirmed by
the Company Parties in all respects.
6. No Other Amendments. This Amendment is being delivered without
prejudice to the rights, remedies or powers of LLCP under or in connection with
the Securities Purchase Agreement, the other Investment Documents, Applicable
Laws or otherwise and, except as set forth 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 other Investment
Document. In addition, nothing contained in this Amendment is intended to or
shall be construed as a waiver of any breach, violation, Default or Events of
Default, whether past, present or future, under the Securities Purchase
Agreement or any other Investment Document, or a forbearance by LLCP of any of
its rights, remedies or powers against the Company Parties (or any of them), or
the Collateral,
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and LLCP hereby expressly reserves all of its rights, powers and remedies
under or in connection with the Securities Purchase Agreement and the other
Investment Documents, whether at law or in equity, including, without
limitation, the right to declare all Obligations to Purchaser to be due and
payable.
7. 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.
8. 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).
9. Successors and Assigns. This Amendment shall inure to the benefit
of, and be binding upon, the parties hereto and their respective successors and
permitted assigns.
10. Further Assurances. The parties shall, at any time and from time
to time, execute and deliver all such further instruments and other documents
and take all such further actions as may be necessary or appropriate to carry
out the provisions of this Amendment.
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IN WITNESS WHEREOF, the parties have caused this Amendment to be
executed and delivered by their duly authorized representatives as of the first
date written above.
COMPANY
OVERHILL FARMS, INC., a Nevada
corporation
/s/ Xxxxx Xxxxx
By:______________________________________
Xxxxx Xxxxx
President and Chief Executive
Officer
PARENT
OVERHILL CORPORATION(formerly known
as Polyphase Corporation), a Nevada
corporation
/s/ Xxxxx Xxxxx
By:______________________________________
Xxxxx Xxxxx
President and Chief Executive
Officer
OVERHILL VENTURES
OVERHILL L.C. VENTURES, INC., a
California corporation
/s/ Xxxxx Xxxxx
By:______________________________________
Xxxxx Xxxxx
President and Chief Executive
Officer
LLCP
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
/s/ Xxxxxx X. Xxxxxxxxx
By:________________________
Xxxxxx X. Xxxxxxxxx
Chief Executive Officer
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ACKNOWLEDGMENT AND REAFFIRMATION OF GUARANTY
The undersigned Guarantors hereby acknowledge that they have read the
foregoing Second Amendment to Securities Purchase Agreement. The undersigned
hereby consent to the Second Amendment to Securities Purchase Agreement, ratify
and reaffirm the Guaranty as set forth in Section 9 of the Securities Purchase
Agreement, as amended by the Second Amendment to Securities Purchase Agreement,
and acknowledge that the same shall remain in full force and effect in
accordance with it terms.
GUARANTORS
OVERHILL CORPORATION(formerly known as
Polyphase Corporation), a Nevada corporation
/s/ Xxxxx Xxxxx
By: _________________________________
Xxxxx Xxxxx
President and Chief Executive Officer
OVERHILL L.C. VENTURES, INC., a
California corporation
/s/ Xxxxx Xxxxx
By: _________________________________
Xxxxx Xxxxx
President
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