EXHIBIT 10.8.3
SANTA XXXXXXX BANK & TRUST
PROMISSORY NOTE
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Principal Loan Date Maturity Loan No Call Collateral Account Officer Initials
$15,000,000.00 12-01-1998 04-01-2001 16450 4a 910 14492 JDL
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References in the shaded area are for Lender's use only and do not limit the applicability of this
document to any particular loan or item.
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Borrower: Balance Bar Company Lender: Santa Xxxxxxx Bank & Trust
0000 Xxxx Xxxxxx Xxxx Xxxxxx
Xxxxxxxxxxx, XX 00000 c/o Loan Services
P.O. Box 1173
Santa Barbara, CA 93102-1173
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Principal Amount $15,000,000.00 Initial Rate: 7.750% Date of Note: December 1, 1998
PROMISE TO PAY. Balance Bar Company ("Borrower") promises to pay to Santa
Xxxxxxx Bank & Trust ("Lender"), or order, in lawful money of the United States
of America, the principal amount of Fifteen Million & 00/100 Dollars
($15,000,000.00) or so much as may be outstanding, together with interest on the
unpaid outstanding principal balance of each advance. Interest shall be
calculated from the date of each advance until repayment of each advance.
PAYMENT. Borrower will pay this loan in one payment of all outstanding principal
plus all accrued unpaid interest on April 1, 2001. In addition, Xxxxxxxx will
pay regular monthly payments of accrued unpaid interest beginning January 1,
1999, and all subsequent interest payments are due on the same day of each month
after that. The annual interest rate for this Note is computed on a 365/360
basis; that is, by applying the ratio of the annual interest rate over a year of
360 days, multiplied by the outstanding principal balance, multiplied by the
actual number of days the principal balance is outstanding. Borrower will pay
Lender at Xxxxxx's address shown above or at such other place as Lender may
designate in writing. Unless otherwise agreed or required by applicable law,
payments will be applied first to accrued unpaid interest, then to principal,
and any remaining amount to unpaid collection costs and late charges.
VARIABLE INTEREST RATE. The interest rate on this Note is subject to change from
time to time based on changes in an independent index which is the Prime rate
as published in the Wall Street Journal. When a range of rates has been
published, the higher of the rates will be used (the "Index"). The Index is not
necessarily the lowest rate charged by Lender on its loans. If the Index becomes
unavailable during the term of this loan, Lender may designate a substitute
index after notice to Borrower. Lender will tell Borrower the current Index rate
upon Xxxxxxxx's request. Borrower understands that Lender may make loans based
on other rates as well. The interest rate change will not occur more often than
each day. The Index currently is 7.750%. The interest rate to be applied to the
unpaid principal balance of this Note will be at a rate equal to the Index,
resulting in an initial rate of 7.750%. NOTICE: Under no circumstances will the
interest rate on this Note be more than the maximum rate allowed by applicable
law.
PREPAYMENT; MINIMUM INTEREST CHARGE. In any event, even upon full prepayment of
this Not, Borrower, understands that Lender is entitled to a minimum interest
charge of $100.00. Other than Xxxxxxxx's obligation to pay any minimum interest
charge, Borrower may pay without penalty all or a portion of the amount owed
earlier than it is due. Early payments will not, unless agreed to by Xxxxxx in
writing, relieve Xxxxxxxx of Xxxxxxxx's obligation to continue to make payments
of accrued unpaid interest. Rather, they will reduce the principal balance due.
LATE CHARGE. If a payment is 15 days or more late, Borrower will be charged
5.000% of the regularly scheduled payment.
DEFAULT. Borrower will be in default if any of the following happens: (a)
Borrower fails to make any payment when due. (b) Borrower breaks any promise
Borrower has made to Lender, or Borrower fails to comply with or to perform when
due any other term, obligation, covenant, or condition contained in this Note or
any agreement related to this Note, or in any other agreement or loan Borrower
has with Lender. (c) Borrower defaults under any loan, extension of credit,
security agreement, purchase or sales agreement, or any other agreement, in
favor of any other creditor or person that may materially affect any of
Borrower's property or Borrower's ability to repay this Note or perform
Borrower's obligations under this Note or any of the Related Documents. (d) Any
representation or statement made or furnished to Lender by Borrower or on
Xxxxxxxx's behalf is false or misleading in any material respect either now or
at the time made or furnished. (e) Xxxxxxxx becomes insolvent, a receiver is
appointed for any part of Xxxxxxxx's property, Xxxxxxxx makes an assignment for
the benefit of creditors, or any proceeding is commenced either by Borrower or
against Borrower under any bankruptcy or insolvency laws. (f) Any creditor tries
to take any of Xxxxxxxx's property on or in which Xxxxxx has a lien or security
interest. This includes a garnishment of any of Xxxxxxxx's accounts with Xxxxxx.
(g) Any guarantor dies or any of the other events described in this default
section occurs with respect to any guarantor of this Note. (h) A material
adverse change occurs in Borrower's financial condition, or Xxxxxx believes the
prospect of payment or performance of the Indebtedness is impaired. (i) Lender
in good xxxxx xxxxx itself insecure.
If any default, other than a default in payment, is curable and if Borrower has
not been given a notice of a breach of the same provision of this Note within
the preceding twelve (12) months, it may be cured (and no event of default will
have occurred) if Borrower, after receiving written notice from Lender demanding
cure of such default: (a) cures the default within fifteen (15) days; or (b) if
the cure requires more than fifteen (15) days, immediately initiates steps which
Lender deems in Xxxxxx's sole discretion to be sufficient to cure the default
and thereafter continues and completes all reasonable and necessary steps
sufficient to produce compliance as soon as reasonably practical.
LENDER'S RIGHTS. Upon defaults, Xxxxxx may declare the entire unpaid principal
balance on this Note and all accrued unpaid interest immediately due, without
notice, and then Borrower will pay that amount. Lender may hire or pay someone
else to help collect this Note if Borrower does not pay. Xxxxxxxx also will pay
Lender that amount. This includes, subject to any limits under applicable law,
Xxxxxx's attorneys' fees and Xxxxxx's legal expenses whether or not there is a
lawsuit, including attorneys' fees and legal expenses for bankruptcy proceedings
(including efforts to modify or vacate any automatic stay or injunction),
appeals, and any anticipated post-judgment collection services. Xxxxxxxx also
will pay and court costs, in addition to all other sums provided by law. This
Note has been delivered to Lender and accepted by Lender in the State of
California. If there is a lawsuit, Xxxxxxxx agrees upon Xxxxxx's request to
submit to the jurisdiction of the courts of Santa Xxxxxxx County, the State of
California. This Note shall be governed by and construed in accordance with the
laws of the State of California.
COLLATERAL. This Note is secured by a Security Agreement dated December 1, 1998,
a UCC-1 Financing Statement dated February 10, 1997, which filed March 3, 1997
as File No. 9706660259, and a UCC-2 Amendment dated March 23, 1998, which filed
April 17, 1998 as File No. 98110C0384.
LINE OF CREDIT. This Note evidences a revolving line of credit. Advances under
this Note, as well as directions for payment from Xxxxxxxx's accounts, may be
requested orally or in writing by Borrower or by an authorized person. Lender
may, but need not, require that all oral requests be confirmed in writing. The
following party or parties are authorized to request advances under the line of
credit until Xxxxxx receives from Borrower at Xxxxxx's address shown above
written notice of revocation of their authority: Xxxxx X. Xxxxx, Xxxxxx X.
Xxxxxx, Xxxxxxx Xxxx and Xxxxxxxx X. Xxxxxxx. Xxxxxxxx agrees to be liable for
all sums either: (a) advanced in accordance with the instructions of an
authorized person or (b) credited to any of Xxxxxxxx's accounts with Xxxxxx. The
unpaid principal balance owing on this Note at any time may be evidenced by
endorsements on this Note or by Xxxxxx's internal records, including daily
computer print-outs. Lender will have no obligation to advance funds under this
Note if: (a) Borrower or any guarantor is in default under the terms of this
Note or any agreement that Borrower or any guarantor has with Lender, including
any
12-01-1998 PROMISSORY NOTE Page 2
LOAN NO 16450 (Continued)
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agreement made in connection with the signing of this Note; (b) Borrower or any
guarantor ceases doing business or is insolvent; (c) any guarantor seeks, claims
or otherwise attempts to limit, modify or revoke such guarantor's guarantee of
this Note or any other loan with Lender; (d) Borrower has applied funds provided
pursuant to this Note for purposes other than those authorized by Lender; or (e)
Lender in good xxxxx xxxxx itself insecure under this Note or any other
agreement between Lender and Borrower.
ADDITIONAL PROVISIONS. I represent and warrant to Lender that the verbal or
written financial information given is true and correct and that there has been
no adverse change in the financial information. I also waive the provisions of
section 1801.21 of the California Vehicle Code relating to accessibility to
Department of Motor Vehicle information.
PREPAYMENT PENALTY. Privilege is reserved to make additional payments on the
principal of this loan without penalty except as to prepayments that are tied to
the Libor based funding option. Xxxxxxxx agrees to pay for acceptance of the
prepayment calculated at 1/2% per annum, prorated on the amount prepaid for the
remaining term of the rate lock. Regular scheduled principal and interest
payments will not be subject to prepayment penalty.
FIXED RATE OPTION. Borrower has the option to fix the current outstanding
principal balance of the term loan for periods of 30-180 days at the then
current life maturity Libor Rate plus 2.00% on minimum advances of $500,000.00.
The interest rate on this fixed rate option is available to borrower in an
independent index which is the Libor Rate as published in the Wall Street
Journal. Lender will tell the borrower the current index rate upon Borrower's
request.
GENERAL PROVISIONS. Lender may delay or forgo enforcing any of its rights or
remedies under this Note without losing them. Borrower and any other person who
signs, guarantees or endorses this Note, to the extent allowed by law, waive any
applicable statute of limitations, presentment, demand for payment, protest and
notice of dishonor. Upon any change in the terms of his Note, and unless
otherwise expressly stated in writing, no party who signs this Note, whether as
maker, guarantor, accommodation maker or endorser, shall be released from
liability. All such parties agree that Lender may renew or extend (repeatedly
and for any length of time) this loan, or release any party or guarantor or
collateral; or impair, fail to realize upon or perfect Xxxxxx's security
interest in the collateral; and take any other action deemed necessary by Lender
without the consent of or notice to anyone. All such parties also agree that
Xxxxxx may modify this loan without the consent of or notice to anyone other
than the party with whom the modification is made.
PRIOR TO SIGNING THIS NOTE, XXXXXXXX READ AND UNDERSTOOD ALL THE PROVISIONS OF
THIS NOTE, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS. XXXXXXXX AGREES TO
THE TERMS OF THE NOTE AND ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THE NOTE.
BORROWER:
Balance Bar Company
By: /s/ Xxxxx X Xxxxx
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Xxxxx X. Xxxxx, Chief Executive Officer
By: /s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx, Senior Vice President, Finance & Administration
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