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EXHIBIT 10.33
AMENDMENT
TO
LOAN AND SECURITY AGREEMENT
This Amendment to Loan and Security Agreement (this "Amendment") is made as
of May 27, 1998, by and between Fresh Choice, Inc. ("Borrower") and Silicon
Valley Bank ("Bank").
RECITALS
Borrower and Bank are parties to, among other documents, that certain Loan
and Security Agreement dated as of December 20, 1995, as amended (the
"Agreement"). Borrower and Bank desire to modify the Agreement, in accordance
with the terms of this Amendment.
NOW THEREFORE, Borrower and Bank agree as follows:
1. The following definitions under Section 1.1 are hereby amended to read
as follows:
"Maturity Date" is May 27, 1999.
"Committed Line" is Three Million Eight Hundred Fifty Thousand Dollars
($3,850,000); provided, however, Advances are limited to Two Million Eight
Hundred Fifty Thousand Dollars ($2,850,000) (the "Cap Amount") through September
30, 1998, provided, that any Advance in excess of the Cap Amount is conditioned
upon Borrower's compliance with all financial covenants (including Section 6.16)
set forth in Section 6 of the Agreement.
2. Section 2.1.2 entitled "Term Out Option" is hereby deleted in its
entirety.
3. The first sentence of Section 2.1 entitled "Revolving Advances" is
hereby amended to read, in its entirety, as follows:
Subject to and upon the terms and conditions of this Agreement, Bank
agrees to makes Advances to Borrower in an aggregate amount not to exceed the
lesser of (a) Committed Line minus the Cash Management Services Sublimit or (b)
the Borrowing Base.
4. Section 2.3 (a) entitled "Interest Rates, Payments and Calculations"
is hereby amended to read, in its entirety, as follows:
Except as set forth in Section 2.3 (b), an Advances shall bear
interest, on an average Daily Balance, at a rate equal to one and one-quarter
(1.25) percentage points above the Prime Rate.
5. Section 6.3 entitled "Financial Statements, Reports, Certificates"
is hereby amended as follows:
Borrower's interim balance sheet and income statement shall now be due
to Bank within thirty (30) days after the end of each monthly period.
Borrower's compliance certificate in the form of Exhibit D, shall now
be due to Bank within thirty (30) days after the end of each monthly period.
6. Section 6.9 entitled "Tangible Net Worth" is hereby amended to read,
in its entirety, as follows:
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6.9 Tangible Net Worth. Borrower shall maintain, as of the last day of
each monthly period, a minimum Tangible Net Worth of $24,400,000.
7. The following Sections are hereby incorporated into the Agreement:
Section 2.1.2 Cash Management Services Sublimit. Borrower may use up
to $350,000 for Bank's Cash Management Services, specifically, controlled
disbursements as such services are identified in the cash management services
agreement related to such service (the "Cash Management Services"). Bank may, in
its sole discretion, charge as an Advance, any amounts that may become due or
owing to Bank in connection with the Cash Management Services furnished to
Borrower by or through Bank. Borrower agrees to execute any and all standard
form applications and agreements in connection with the Cash Management
Services. The Cash Management Services Sublimit shall terminate on the Cash
Management Maturity Date.
6.15 Profitability. Borrower shall achieve profitability on a
quarterly basis, except that Borrower may incur losses for (a) its first and
fourth quarters, and (b) its second quarter, not to exceed $506,000 and for its
fiscal year ending 1998, not to exceed $250,000. Additionally, Borrower shall
achieve net profits of not less than $700,000 for Borrower's third quarter.
6.16 Clean Up Period. Borrower shall maintain a zero balance on the
Committed Line for a period of not less than thirty (30) consecutive days
through the Maturity Date.
8. Unless otherwise defined, all capitalized terms in this Amendment
shall have the meanings assigned in the Agreement. Except as amended, the
Agreement remains in full force and effect.
9. Borrower represents and warrants that the Representations and
Warranties contained in the Agreement are true and correct as of the date of
this Amendment, and that no Event of Default has occurred and is continuing.
10. This Amendment may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one instrument.
11. Borrower shall pay to Bank a fee in the amount of Twenty Five
Thousand Dollars ($25,000) (the "Loan Fee") plus all out of pocket expenses.
12. This Amendment amends certain terms of the Agreement. Except as
amended hereby, the Agreement remains in full force and effect. This Amendment,
together with the Agreement and any documents executed in connection with the
Agreement, constitute the entire agreement of the parties with respect to the
subject matter hereof, and supersede all prior agreements and negotiations.
13. The effectiveness of this Amendment is conditioned upon payment of
the Loan Fee.
IN WITNESS WHEREOF, the undersigned have executed this Amendment as of
the first date above written.
Borrower: Bank:
FRESH CHOICE, INC. SILICON VALLEY BANK
By: /s/ XXXXX X. XXXXX By: /s/ XXXXX XXXXX
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Xxxxx X. Xxxxx Xxxxx Xxxxx
Name: Xxxxx X. Xxxxx Name: Xxxxx Xxxxx
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Title: Vice President and Chief Financial Officer Title: Vice President
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