EXHIBIT 10.14
LOAN AGREEMENT DATED AUGUST 19, 1997 BETWEEN THE COMPANY AND
XXXXXXX X. ST. XXXXXXX XX.
LOAN AGREEMENT
This Loan Agreement is made and entered into this 19th day of August,
1997, by and between Vitech America, Inc., a Florida corporation (the
"Borrower"), and Xxxxxxx X. St. Xxxxxxx Xx., residing at 0000 Xxxxxx Xxxxx,
Xxxxxxxxx, XX 00000 (the "Lender"). The Borrower has requested the Lender to
provide a loan facility in the principal amount of $10,000,000. The loan will be
evidenced by senior convertible notes issued by the Borrower in favor of the
Lender with the following terms and conditions:
ISSUER: Vitech America, Inc. (the "Company")
SECURITIES: Senior Convertible Note (the "Note")
PRINCIPAL AMOUNT: $10 million in two tranches of $5 million.
The Company shall have the option to draw
the second tranche after 45 days from the
first tranche.
COUPON RATE: 10%
COUPON PAYMENTS: Payable monthly in cash
MATURITY: 2 years
PRINCIPAL PAYMENTS: Outstanding principal balance at maturity
USE OF PROCEEDS: General corporate and working capital
purposes
CONVERSION TERMS: The Note shall be convertible in whole or in
part at the option of the holder with no
less than 90 days notice to the Company.
CONVERSION: (a) INITIAL CONVERSION PRICE: The Note shall
be convertible at the rate of one share of
common stock for each $16.10 of principal
converted.
(b) CONVERSION PRICE RESET FEATURE: If the
put feature described below is exercised by
the Note holder, and the Company does not
pay the full redemption price when due, then
the conversion price shall be reset to equal
the lesser of (i) the Initial Conversion
Price, or (ii) 85% of the average closing
bid price for the 45 trading days prior to
conversion. The note holder will agree to
not short the Company's stock while this
feature is available.
HOLDER PUT RIGHT: Commencing one year after the date of
issuance, the holder shall have the right to
cause the Company to repurchase the
outstanding principal at a price equal to
110% of the principal thereof plus accrued
and unpaid interest. The put shall increase
at 1% per month until maturity of the note,
i.e. 110% plus 1% for each additional month
after the twelfth month. The put right must
be exercised on at least 60 days prior
written notice to the Company. After
notification of the note holder's desire to
exercise the put option, anti-dilution
provisions will be null, unless the put is
not successful, whereupon the anti-dilution
rights shall return to full force. If the
note holder has informed the Company of his
desire to put the note back to the Company,
and in the event that the Company arranges
new investors in a structure that is
dilutive to the note holder, the note holder
shall have the right to invest or
restructure the note at the same terms as
the new investor.
CALL PROVISION: The Company shall have the right to redeem
the Note at 100% of principal at any time
plus 1% per month for each month the note is
held, with a cap of 110%, subject always to
the conversion rights of the holder. Upon
notice of the holder's intent to convert,
the Company's right to call the Note shall
be surrendered
REGISTRATION RIGHTS: Upon notification of the Holder's intent to
convert, the Company will use its best
efforts to file a registration statement on
Form S-3 to register a sufficient number of
shares of common stock to satisfy the
conversion of the Note.
ANTI-DILUTION RIGHTS: The note holder shall be entitled to
anti-dilution rights. Upon notification of
the Holder's intent to convert, the
anti-dilution provisions will be null,
unless the put is not successful, whereupon
the anti-dilution rights shall return to
full force.
OTHER RIGHTS: If the Company consummates a structure more
favorable to investors after the date of
this note, then the note holder shall be
entitled to either adjustment in the terms
to meet the terms of the new investors, or
repayment of the principal amount plus
interest owing.
In witness whereof, the parties hereto have executed this Loan Agreement as of
the day and year first above written.
Vitech America, Inc. (the "Borrower") Xxxxxxx X. St. Xxxxxxx Xx.
(the "Lender")
By:/S/ XXXXXX X. XXXXX /S/ XXXXXXX X. ST. XXXXXXX XX.
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Xxxxxx X. Xxxxx Xxxxxxx X. St. Xxxxxxx Xx.
Its: Chief Financial Officer
