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EXHIBIT 10.29
LOAN MODIFICATION AGREEMENT
This Loan Modification Agreement is entered into as of November 27, 1996,
by and between Fresh Choice, Inc. ("Borrower") whose address is 0000 Xxxxxx
Xxxxx, Xxxxx 000, Xxxxx Xxxxx, XX 00000, and Silicon Valley Bank ("Bank") whose
address is 0000 Xxxxxx Xxxxx, Xxxxx Xxxxx, XX 00000.
1. DESCRIPTION OF EXISTING INDEBTEDNESS: Among other indebtedness which may be
owing by Borrower to Bank, Borrower is indebted to Bank pursuant to, among other
documents, a Loan and Security Agreement, dated December 20, 1995, together with
all supplements thereto, as such agreement may be amended from time to time (the
"Loan Agreement"). The Loan Agreement provided for, among other things, a
Committed Line in the original principal amount of Five Million Dollars
($5,000,000.00) (the "Revolving Facility"). Defined terms used but not otherwise
defined herein shall have the same meanings as in the Loan Agreement.
Hereinafter, all indebtedness owing by Borrower to Bank shall be referred to as
the "Indebtedness."
2. DESCRIPTION OF COLLATERAL AND GUARANTIES. Repayment of the Indebtedness is
secured by the Collateral as described in the Loan Agreement and a Third Party
Security Agreement dated December 20, 1995 (the "Security Agreement"), executed
by Xxxxxxx Design Corporation ("Pledgor"). Additionally, repayment of the
Indebtedness is secured by a Leasehold Deed of Trust and Assignment of Leases
and Rents, dated January 25, 1996, recorded as Document Number 199602260709 in
the Official Records of Sacramento County, California, a Leasehold Deed of Trust
and Assignment of Leases and Rents, dated January 25, 1996, recorded as Document
Number 199602260710 in the Official Records of Sacramento County, California, a
Leasehold Deed of Trust and Assignment of Leases and Rents, dated January 25,
1996, recorded as Document Number 199600158091 in the Official Records of Sonoma
County, California, a Leasehold Deed of Trust and Assignment of Leases and
Rents, dated January 25, 1996, recorded as Document Number 13210795, on Page
0410 of Book P226 in the Official Records of Santa Xxxxx County, California, and
two (2) Deeds of Trust (with Security Agreement and Assignment of Rents and
Leases), each dated December 20, 1995.
Hereinafter, the above-described security documents and guaranties, together
with all other documents securing repayment of the Indebtedness shall be
referred to as the "Security Documents". Hereinafter, the Security Documents,
together with all other documents evidencing or securing the Indebtedness shall
be referred to as the "Existing Loan Documents".
3. DESCRIPTION OF CHANGE IN TERMS.
A. Modification(s) to Loan Agreement.
1. The defined term Maturity Date is hereby modified to mean May
27, 1997.
2. The defined term Committed Line is hereby modified to mean
Three Million Dollars ($3,000,000.00).
3. Section 2.3(a) entitled "Interest Rate" is hereby amended, in
its entirety, to read as follows:
Except as set forth in Section 2.3(b), any Advances shall bear
interest, on the average Daily Balance, at a rate equal to one
(1) percentage point above the Prime Rate.
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4. The second paragraph in Section 6.3 entitled "Financial
Statements, Reports, Certificates" is hereby amended, in its
entirety, to read as follows:
Within twenty-five (25) days after the last day of each fiscal
quarter (rather than financial period), Borrower shall deliver
to Bank a Borrowing Base Certificate signed by a Responsible
Officer in substantially the form of Exhibit C hereto, as may
be amended.
5. Section 6.9 is hereby amended in its entirety to read as
follows:
6.9 Minimum Tangible Net Worth. Borrower shall maintain, as of
the last day of each fiscal quarter, a Tangible Net Worth of
not less than $24,000,000.00.
6. Section 7.11 entitled "Fixed Asset Acquisition" is hereby
amended, in part, to increase the amount referenced therein to
Two Million Dollars ($2,000,000.00) from December 1, 1996
through the Maturity Date.
7. Section 7.12 entitled "Expansion" is hereby deleted.
B. Modification(s) to Supplement to Loan and Security Agreement.
1. The Quarterly Achievement of Projections covenant, the EBITDA
Requirements covenant, and the Quarterly Fixed Charge Coverage
covenant are hereby deleted.
4. CONSISTENT CHANGES. The Existing Loan Documents are hereby amended wherever
necessary to reflect the changes described above.
5. PAYMENT OF OUT OF POCKET EXPENSES. Borrower shall pay to Bank all
out-of-pocket expenses.
6. NO DEFENSES OF BORROWER. Borrower (and each guarantor and pledgor signing
below) agrees that it has no defenses against the obligations to pay any amounts
under the Indebtedness.
7. CONTINUING VALIDITY. Borrower (and each guarantor and pledgor signing below)
understands and agrees that in modifying the existing Indebtedness, Bank is
relying upon Borrower's representations, warranties, and agreements, as set
forth in the Existing Loan Documents. Except as expressly modified pursuant to
this Loan Modification Agreement, the terms of the Existing Loan Documents
remain unchanged and in full force and effect. Bank's agreement to modifications
to the existing Indebtedness pursuant to this Loan Modification Agreement in no
way shall obligate Bank to make any future modifications to the Indebtedness.
Nothing in this Loan Modification Agreement shall constitute a satisfaction of
the Indebtedness. It is the intention of Bank and Borrower to retain as liable
parties all makers and endorsers of Existing Loan Documents, unless the party is
expressly released by Bank in writing. No maker, endorser, or guarantor will be
released by virtue of this Loan Modification Agreement. The terms of this
paragraph apply not only to this Loan Modification Agreement, but also to all
subsequent loan modification agreements.
8. CONDITIONS. The effectiveness of this Loan Modification Agreement is
conditioned upon Borrower's payment of Out of Pocket Expenses.
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This Loan Modification Agreement is executed as of the date first written
above.
BORROWER: BANK:
FRESH CHOICE, INC. SILICON VALLEY BANK
By: /s/ Xxxxx X. Xxxxxxxx By: /s/ Xxxxx Xxxxxxxxx
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Name: Xxxxx X. Xxxxxxxx Name: Xxxxx Xxxxxxxxx
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Title: V.P. & C.F.O. Title: A.V.P.
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The undersigned hereby consents to the modifications to the Indebtedness
pursuant to this Loan Modification Agreement, hereby ratifies all the provisions
of the Loan Modification Agreement and confirms that all provisions of that
document are in full force and effect.
PLEDGOR:
XXXXXXX DESIGN CORPORATION Date: 12/10/96
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By: /s/ Xxxxx X. Xxxxxxxx
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Name: Xxxxx X. Xxxxxxxx
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Title: Chief Financial Officer
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