Exhibit 10.2
Amendment One To Revolving (Grid) Promissory Note
And Loan Agreement
This Amendment One is dated as of April 3, 2007 and is made by and
between INTEGRATED BIOPHARMA, INC. (the "Borrower") and AMALGAMATED BANK, a New
York banking corporation (the "Bank").
Statement of the Premises.
Borrower previously issued to Bank a Revolving (Grid) Promissory Note
dated as of September 1, 2006 in the maximum principal amount of $15,000,000.00
(the "Note"). Borrower and Bank desire to revise the amount and maturity date of
the Note.
Borrower and Bank also entered into a letter agreement dated as of
September 1, 2006 in connection with the Note (the "Loan Agreement"). Borrower
and Bank also desire to amend the Loan Agreement to reflect the revised amount
and maturity date and to make certain other changes thereto.
Statement of Consideration
Accordingly, in consideration of the premises, and under the authority
of Section 5-1103 of the New York General Obligations Law, the parties hereto
agree as follows.
Agreement
1. Defined Terms. The terms "this Note", "hereunder" and similar references in
the Note shall be deemed to refer to the Note as amended hereby. The terms "this
Loan Agreement", "hereunder" and similar references in the Loan Agreement shall
be deemed to refer to the Loan Agreement as amended hereby. Capitalized terms
used and not otherwise defined herein shall have the meanings ascribed to such
terms in the Note.
2. Note Amendment. Effective as of the date hereof, references in the Note to
"August 31, 2007" are hereby amended to read "October 31, 2007."
3. Effect on the Note. Except as specifically amended above, the Note shall
remain in full force and effect and is hereby ratified and confirmed. This
Amendment One shall be annexed to the Note as an allonge thereto, shall be
effective even if not so annexed, and shall be deemed to be part of the Note.
4. Loan Agreement Amendment. Effective as of the date hereof, the Loan Agreement
is modified as follows:
a. References in the Loan Agreement (including the Schedules thereto)
to "Loan Document" or "Loan Documents" are hereby amended to read "Revolving
Loan Document" or "Revolving Loan Documents," as appropriate.
b. References in the Loan Agreement to "the first anniversary of the
date hereof" are hereby amended to read "October 31, 2007."
c. The first paragraph of the Loan Agreement is hereby amended and
restated to read in its entirety as follows:
"You have requested that Amalgamated Bank (the "Bank") provide to Integrated
BioPharma, Inc., a Delaware corporation (the "Borrower"), a revolving credit
facility in the aggregate principal amount not to exceed $15,000,000 at any time
(the "Revolving Credit Facility"). The proceeds of the Revolving Credit Facility
will be used for the working capital and general corporate purposes of the
Borrower and its subsidiaries."
d. The definitions of "Consolidated EBITDA" and "Consolidated
Indebtedness" are hereby amended and restated in their entirety to read as
follows:
"'Consolidated EBITDA' shall mean, for any period, Consolidated Net
Income for such period, adjusted by (x) adding thereto:
(a) Consolidated Interest Expense for such period,
(b) Consolidated Amortization Expense for such period,
(c) Consolidated Depreciation Expense for such period,
(d) Consolidated Tax Expense for such period, and
(y) subtracting therefrom the aggregate amount of all non-cash items increasing
Consolidated Net Income (other than the accrual of revenue or recording of
receivables in the ordinary course of business) for such period and (z) adding
thereto the aggregate amount of all non-cash items decreasing Consolidated Net
Income for such period.
`Consolidated Indebtedness' shall mean, as at any date of
determination, the aggregate amount of all Indebtedness of Borrower and its
Subsidiaries, determined on a consolidated basis in accordance with GAAP."
e. Section 5(f) of the Loan Agreement is hereby amended to add the
following row at the end of, and as part of, the table therein:
Each successive Quarterly Test Period thereafter 4.50 to 1.00
f. Section 5(g) of the Loan Agreement is hereby amended to add the
following row at the end of, and as part of, the table therein:
Each successive Quarterly Test Period thereafter $5,500,000
g. Section 5(h) of the Loan Agreement is hereby amended to add the
following row at the end of, and as part of, the table therein:
Each successive Quarterly Test Period 1.75 to 1.00
thereafter
h. Section 5(i) of the Loan Agreement is hereby amended and restated to
read in its entirety as follows:
"(i) Required Balances. For as long as the Credit Facility
remains in effect, unless otherwise agreed by the Bank, the Borrower
shall maintain all operating accounts under its taxpayer identification
number (EIN: 00-0000000) with the Bank. Commencing on the date hereof,
Borrower shall maintain Two Million Dollars ($2,000,000) in a six month
time deposit with Bank and shall not have the option for early
withdrawal unless (i) aggregate combined borrowings on the Revolving
Credit Facility and Term Loan are less than or equal to $10 million and
(ii) the ratio of Borrower's consolidated total liabilities to
stockholders' equity is 0.5 or less (collectively, the "Withdrawal
Requirements"). Borrower and Bank agree that, upon expiration of such
certificate of deposit, it shall be renewed by Bank for another six
month term unless the Borrower meets the Withdrawal Requirements set
forth above. If such Withdrawal Requirements are met prior to the
maturity of the deposit and the Borrower exercises its right to early
withdrawal, such withdrawal shall be subject to an early withdrawal
penalty. If the Borrower meets the Withdrawal Requirements and does not
withdraw the time deposit prior to its maturity, the Borrower shall not
be obligated to continue maintaining a $2 million time deposit."
i. Clause (d) of Section 5(k) of the Loan Agreement is hereby amended
and restated to read in its entirety as follows:
"(d) net proceeds received from the issuance of common equity
(including, but not limited to, upon the exercise of warrants and options) by
Borrower in an amount equal to the minimum of $5,000,000 or, if less, the amount
of net proceeds actually received by Borrower from such issuance,"
j. Section 7 of the Loan Agreement is hereby amended (i) to add,
immediately following the caption thereof, "Each of the following shall be an
"Event of Default":" and (ii) to add the following at the end thereof:
"(c) Any Event of Default as defined in the Note or any other
Revolving Loan Document.
(d) Any Event of Default (i) as defined in the Term Promissory
Note given by Borrower to Bank and dated on or about April 2, 2007 in the
original principal amount of $10,000,000.00, as the same may be amended,
supplemented or restated from time to time or (ii) as defined in the letter
agreement executed by Borrower and Bank in connection with such Term Promissory
Note, as the same may be amended, supplemented or restated from time to time, or
(iii) as defined in any Term Loan Document, as defined in such letter
agreement."
k. Schedule 4(l) to the Loan Agreement is hereby amended and restated
to read in its entirety as Schedule 4(l) attached hereto.
5. Effect on the Loan Agreement. Except as specifically amended above, the Loan
Agreement shall remain in full force and effect and is hereby ratified and
confirmed.
6. Representations and Warranties. Borrower makes the following representations
and warranties which shall be deemed to be continuing representations and
warranties so long as any Liabilities remain unpaid:
6.1 Authorization. Borrower has the power and authority to
borrow under the Note and the Loan Agreement, as amended by this Amendment One,
and to execute, deliver and perform this Amendment One and any documents
delivered in connection with it, all of which have been duly authorized by all
proper and necessary corporate action.
6.2 Binding Effect. This Amendment One has been duly executed
and delivered by Borrower and the Note and Loan Agreement, each as amended by
this Amendment One, constitute the legal, valid and binding obligation of
Borrower, enforceable in accordance with their terms, except as the
enforceability thereof may be limited by bankruptcy, insolvency or other similar
laws of general application affecting the enforcement of creditors' rights.
6.3 Consents; Governmental Approvals. No consent or
authorization of, filing with, notice to or other act by or in respect of, any
Governmental Authority or any other Person is required in connection with the
execution or delivery of this Amendment One or any other document executed and
delivered by Borrower herewith, the consummation by Borrower of the transactions
herein contemplated or the performance of or compliance by the Borrower with the
terms and conditions hereof or thereof.
6.4 Representations and Warranties. Except as disclosed to the
Bank in writing, the representations and warranties contained in the Loan
Agreement, as amended by this Amendment One, are true on and as of the date
hereof with the same force and effect as if made on and as of the date hereof.
6.5 Absence of Conflicts. Neither the execution and delivery
of this Amendment One by Borrower or any other document executed and delivered
by Borrower herewith, nor the consummation by Borrower of the transactions
herein or therein contemplated, nor performance of or compliance by the Borrower
with the terms and conditions hereof or thereof, as the case may be, does or
will
(a) violate or conflict with any Law, or
(b) violate, conflict with or result in a breach of any term or
condition of, or constitute a default under, or result in (or give rise to any
right, contingent or otherwise, of any Person to cause) any termination,
cancellation, prepayment or acceleration of performance of, or result in the
creation or imposition of (or give rise to any obligation, contingent or
otherwise, to create or impose) any Security Interest upon the assets of
Borrower (except for any Security Interest in favor of Bank securing the
Liabilities) pursuant to, or otherwise result in (or give rise to any right,
contingent or otherwise, of any Person to cause) any change in any right, power,
privilege, duty or obligation of Borrower under or in connection with,
(i) the governing documents of Borrower,
(ii) any contractual obligations creating, evidencing or
securing any Debt to which Borrower is a party or by which it or any of
its properties (now owned or hereafter acquired) may be subject or
bound, or
(iii) any other contractual obligation of Borrower, where the
violation, conflict, breach or default, or result, is, has or would be
reasonably likely to be or have a material adverse effect on Borrower's
business or financial condition or results, or
(c) require the consent of, or notice to, any Person pursuant to any of
the items referenced in clauses (i), (ii) or (iii) of Section 6.5 above, which
consent has not been obtained or which notice has not been given.
6.6 No Events of Default. No Default and no Event of Default
has occurred or is continuing, except any Default or Event of Default that has
been waived by the Bank in writing.
6.7 No Material Misstatements. Neither this Amendment One nor
any document delivered to Bank by or on behalf of Borrower to induce Bank to
enter into this Amendment One contains any untrue statement of a material fact
or omits to state a material fact necessary to make the statements herein or
therein not misleading in light of the circumstances in which they were made.
7. Conditions of Amendment. The Bank shall have no obligation to execute or
deliver this Amendment One until each of the following conditions shall have
been satisfied:
7.1 Borrower shall have duly executed this Amendment One.
7.2 Borrower shall have taken all appropriate corporate action
to authorize the execution and delivery of this Amendment One and the taking of
all other action contemplated by this Amendment One, and the Bank shall have
been furnished with copies of all such corporate action, certified by a duly
authorized representative of Borrower as being true and correct and in full
force and effect without amendment on the date hereof, and such other corporate
documents as Bank may request.
7.3 Borrower shall have delivered to Bank any and all consents
necessary to permit the transactions contemplated by this Amendment One.
7.4 Borrower shall have executed and delivered to Bank a term
note in the original principal amount of $10,000,000. and such other
documentation relating to the loan evidenced thereby, and the collateral
security therefor, as Bank may require.
7.5 Borrower shall have paid the fees and disbursements of
Bank's counsel in connection with this Amendment One.
7.6 Borrower shall have delivered to Bank such additional
documentation, consents, authorizations, insurance certificates, opinions of
counsel and other instruments and agreements as Bank or its counsel may
reasonably require. All such documentation, instruments and other legal matters
in connection with this Amendment One shall be satisfactory in form and
substance to the Bank and its counsel.
8. Miscellaneous.
8.1 Effect on Loan Documents. The Borrower hereby ratifies and
confirms the terms of the Loan Documents and agrees that, except as specifically
amended hereby, the Loan Documents remain in full force and effect.
8.2 Entire Agreement; Binding Effect. The Loan Agreement, as
amended by this Amendment One, represents the entire understanding and agreement
between the parties hereto with respect to the subject matter hereof. This
Amendment One supersedes all prior negotiations and any course of dealing
between the parties with respect to the subject matter hereof. This Amendment
One shall be binding upon Borrower and its successors and assigns, and shall
inure to the benefit of, and be enforceable by Bank and its successors and
assigns.
8.3 Severability. If any provision of this Amendment One shall
be determined by a court to be invalid, such provision shall be deemed modified
to conform to the minimum requirements of applicable law.
8.4 Headings. The section headings inserted in this Amendment
One are provided for convenience of reference only and shall not be used in the
construction or interpretation of this Amendment One.
9. Execution in Counterparts. This Amendment One may be executed in any number
of counterparts, each of which when so executed and delivered shall be deemed to
be an original and all or which taken together shall constitute but one and the
same instrument. Delivery of an executed counterpart of a signature page to this
Amendment One by telecopier shall be effective as delivery of a manually
executed counterpart of this Amendment One.
10. Governing Law. Pursuant to Section 5-1401 of the New York General
Obligations Law, the whole of this Amendment One and the rights and obligations
of the parties hereto shall be governed, construed and interpreted in accordance
with, the laws of the State of New York without regard to any conflicts-of-laws
rules which would require the application of the laws of any other jurisdiction.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment One
to be duly executed and delivered by their proper and duly authorized
representatives as of the day and year first above written.
INTEGRATED BIOPHARMA, INC.
By: /s/ E.Xxxxxx Xxx
--------------------
Name: E. Xxxxxx Xxx
Title: CEO
AMALGAMATED BANK
By: /s/ Xxxx Xxxxxxx
---------------------
Name: Xxxx Xxxxxxx
Title: Vice President
Schedule 4(l)
Subsidiaries
A Delaware Corporation
Schedule of Subsidiaries
Parent State of
Subsidiary Name Company Incorporation
InB: Manhattan Drug Company, Inc. ("MDC") INB New York
Xxxx Industries, Inc. - Inactive INB New Jersey
Scientific Sports Nutrition, Inc. (f/k/a Media Consultants, Inc.) MDC Delaware
Vitamin Factory, Inc. INB Delaware
Connaught Press, Inc. - Inactive INB New Jersey
Designer Nutrition Labs, Inc. - Inactive MDC New Jersey
AgroLabs, Inc. MDC New Jersey
The Organic Beverage Company (f/k/a Bioscience Technologies, Inc.) INB New Jersey
IHT Health Products, Inc. INB Delaware
IHT Properties Corp. INB Delaware
InB: Biotechnologies, Inc. (f/k/a NuCycle Therapy, Inc.) INB New Jersey
InB: Paxis Pharmaceuticals, Inc. (f/k/a Paxis Pharmaceuticals, Inc.) INB Delaware
InB: Xxxxxx Pharmaceutical Services, Inc. (f/k/a Xxxxxx Technical Services, Inc.) INB Delaware
Liquifill, Inc. - Inactive INB Delaware
