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EXHIBIT 10.21
THIRTEENTH AMENDMENT TO
RESTATED BUSINESS LOAN AGREEMENT
THIS THIRTEENTH AMENDMENT TO RESTATED BUSINESS LOAN AGREEMENT (the
"Amendment") is entered into as of September 5, 2001, between FRESH AMERICA
CORP., a Texas corporation ("BORROWER"), the "Subsidiary/Debtors" (herein so
called) named on the signature pages of this Amendment, and BANK OF AMERICA,
N.A., formerly Bank of America NT & SA, successor in interest by merger with
Bank of America, N.A., formerly NationsBank, N.A. ("BANK").
Borrower and Bank entered into the Restated Business Loan Agreement
dated February 2, 1998 (as amended, extended, renewed, or restated, the "LOAN
AGREEMENT"), providing Borrower with a revolving line of credit. Borrower has
requested Bank to amend certain provisions of the Loan Agreement as provided in
PARAGRAPH 2 below and the other Loan Documents as provided herein, including
without limitation a restructure and conversion of the line of credit into a
term loan, and Bank has, upon and subject to the terms of this Amendment,
agreed. Accordingly, for adequate and sufficient consideration, Bank, Borrower,
and Subsidiary/Debtors hereby agree as follows:
1. DEFINITIONS. Capitalized terms used herein and defined in the Loan
Agreement shall have the meanings set forth in the Loan Agreement except as
otherwise provided herein.
2. AMENDMENTS. The Loan Documents are amended as follows:
(A) The definitions of Affiliate and Confidentiality Agreement in
SECTION 1 are entirely amended as follows:
"Affiliate" of a Person means any other individual or entity
who directly or indirectly controls, is controlled by or is
under common control with that Person. For the purposes of
this definition (a) "control," "controlled by," and "under
common control with" means possession, directly or indirectly,
of power to direct or cause the direction of management or
policies (whether through ownership of voting securities or
other interests, by contract, or otherwise), (b) with respect
to the Bank, any individual or entity in which the Bank holds,
directly or indirectly, as least 25% of the equity thereof is
an "Affiliate" of the Bank, and (c) the Companies are
"Affiliates" of each other.
"Confidentiality Agreement" means, as between the Borrower and
the Bank, the agreements set forth in SECTION 13.22 of this
Agreement, and as between other Persons shall mean a
Confidentiality Agreement upon terms similar to the provisions
of SECTION 13.22 of this Agreement.
(B) SECTION 2.1(a) is entirely amended as follows:
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During the availability period described below, the Bank will
provide a term loan (the "Term Loan") to the Borrower. The
amount of the term loan (the "TERM LOAN COMMITMENT") equals
$5,134,604.21 as of August 29, 2001. All Term Loan Commitment
reductions provided for elsewhere in this Agreement shall be
in addition to the Term Loan Commitment reductions
contemplated by SECTION 2.4(c).
(C) Each of SECTION 2.1(b), SECTION 2.1(d) and SECTION 2.4(e) is
entirely amended to read as follows: Intentionally Omitted.
(D) SECTION 2.2 of the Loan Agreement is amended to delete therefrom
the date "August 29, 2001" and substitute in lieu thereof the date "January 2,
2002".
(E) SECTIONS 2.4(c) is entirely amended to read as follows:
(c) The Borrower will pay on each of September 15, 2001
and December 15, 2001, installments of principal
outstanding under the Term Note in the amount of
$350,000, with a final installment in the amount of
the remaining principal balance thereof to be due and
payable on January 2, 2002, unless otherwise
accelerated pursuant to the terms hereof.
(F) The first sentence of SECTION 4.1 of the Loan Agreement is
entirely amended as follows:
The interest rate on the outstanding principal amounts under
the Term Loan Commitment is equal to the lesser of either (a)
the maximum lawful rate of interest permitted under applicable
usury laws, now or hereafter enacted (the "Maximum Rate") or
(b) the rate that is equal to the sum of the Bank's Reference
Rate plus three and one-half percent (3.50%).
(G) SECTION 10.4 of the Loan Agreement is entirely amended to read
as follows:
10.4 Adjusted Borrowing Base Mandatory Prepayment. If at any
time the principal outstanding under the Term Note plus the outstanding
amounts of any letters of credit on such date (including the face
amount of all undrawn and uncancelled letters of credit and amounts
drawn on letters of credit and not yet reimbursed) exceeds the Adjusted
Borrowing Base (calculated as of the end of the most recently preceding
calendar month) , the Company shall immediately pay to the Bank any
such excess.
"Subordinated Debt" means, at any time, (a) Debt of any
Company incurred in connection with Borrower's 12% Senior Subordinated
Notes Due May 1, 2003, in the principal amount of $20,000,000, and any
notes given by Borrower in exchange for those notes if the notes so
given are subject to the same terms as the original notes
(collectively, the "SUBORDINATED NOTES"), and (b) any other Debt of any
Company (i) incurred at a time when no Potential Default or
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Default has occurred and is continuing under this Agreement, (ii) the
incurrence of which shall not cause a Potential Default or Default
under this Agreement (iii) for which no scheduled or mandatory
principal payment or sinking fund payment is due on or before the
Expiration Date, (iv) whose covenants are no more restrictive than
those set forth in this Agreement, and (v) the payment of which is
subordinated to Debt owed by the Companies to the Bank in a manner
acceptable to the Bank.
(H) SECTION 10.11 is entirely amended as follows:
Capital Expenditures. No Company shall make Capital
Expenditures other than Permitted Capital Expenditures.
"Permitted Capital Expenditures" means commencing with the
period beginning July 31, 2001, a total amount of Capital
Expenditures that does not exceed $750,000 in the aggregate
through the Expiration Date. Additionally, the Borrower shall
provide to the Bank within thirty (30) days after the end of
each month a report of the Capital Expenditures for the prior
month and a comparison of such Capital Expenditures actually
incurred to Capital Expenditures budgeted to occur in such
calendar month and for such period of time, commencing with
the month ending August 31, 2001.
(I) SECTION 10.12 is hereby amended to read as follows:
10.12 Dividends. The Borrower shall not declare or pay any
dividends on any of its shares except dividends payable in
capital stock of the Borrower, and the Borrower shall not
purchase, redeem or otherwise acquire for value any of its
shares, or create any sinking fund in relation thereto.
(J) SECTION 10.25(d), SECTION 10.25(n) and SECTION 10.25(o) are
entirely amended to read as follows:
(d) Sell, assign, lease, transfer, or otherwise dispose
of any of its assets (including, without limitation,
equity interests in any Reporting Company) except,
without duplication (i) sales and dispositions of
inventory in the ordinary course of business, (ii)
sales of assets which are obsolete or are no longer
in use and which are not significant to the
continuation of that Company's business, (iii) sales
of assets (A) obtained as the result of mergers and
consolidations permitted under this Agreement and
Permitted Acquisitions and (B) which are unnecessary
to that Company's business operations, (iv) sales and
dispositions from any Company to any other Company,
(v) dispositions of assets where substantially
similar assets have been or are simultaneously being
acquired, (vi) arms-length sales and dispositions
from any Company to any Unrestricted Subsidiary in
the ordinary course of business on customary trade
terms, and (vii) dispositions of assets
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on or prior to November 15, 1999, the net proceeds of
which do not exceed $500,000 in any fiscal year.
Provided, however, with respect to any sales other
than sales of inventory in the ordinary course of
business the Bank shall receive at least five (5)
Banking Days prior written notice, and with respect
to subsections (ii), (iii), and (vi), the proceeds of
all such sales (other than the sale of certain assets
in Louisiana for approximately $350,000 and the sale
of certain assets in Austin, Texas, for approximately
$400,000 which sales closed in November 1999),
exclusive of reasonable expenses of selling, shall be
immediately applied towards the repayment of the
outstanding principal balance of the Term Note. All
payments required pursuant to the foregoing sentence
shall be credited to the scheduled reductions in the
Term Loan in the inverse order of maturity.
(n) Additionally, the outstanding principal balance of
the Term Note shall be reduced from time to time by
the amount of one hundred percent (100%) of any all
tax refunds received by the Borrower, net of any
penalties required to be paid in connection therewith
and any repatriation costs if such amount is paid by
a non-U.S. taxing authority, all of which shall be
applied to the principal owing to the Bank
immediately upon receipt thereof by the Borrower.
(o) Additionally, the outstanding principal balance of
the Term Note shall be reduced by the greater of (i)
fifty percent (50%) of the cash proceeds, net of
reasonable expenses of issuance, of any equity issued
by any Company (other than the $5,000,000 in
preferred stock to be issued by the Borrower on April
30, 2000, as described in the Tenth Amendment to
Restated Business Loan Agreement and Waiver dated as
of March 31, 2000, and the shares issued pursuant to
that certain Securities Exchange and Purchase
Agreement (the "Securities Agreement") dated as of
August 14, 2001, among North Texas Opportunity Fund
LP, Xxxx Xxxxxxx Life Insurance Company, Xxxx Xxxxxxx
Variable Life Insurance Company, Signature 1A
(Cayman), Ltd., Signature 3 Limited, Investors
Partner Life Insurance Company, and the Borrower, the
terms of which shall not be amended without the prior
written consent of the Bank) or (ii) the amount of
such net proceeds required to reduce the outstanding
principal balance of the Term Note to an amount not
in excess of the Adjusted Borrowing Base most
recently reported to the Bank.
(K) SECTIONS 10.32 AND 10.33 are hereby added to the Agreement to
read as follows:
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10.32 AGREEMENTS WITH XXXXX XXXXXX. Borrower shall not
enter into any amendments to the Promissory Note
dated September 5, 2001, executed by Borrower and
payable to the order of Xxxxx Xxxxxx in the original
principal amount of $1,239,223.00, or that certain
Stock Purchase Agreement dated as of December 12,
1997, among Borrower, Xxxxx Xxxxxx and Hereford
Haven, Inc., without the prior written consent of
Bank.
10.33 PROJECTIONS. On or prior to September 17, 2001,
Borrower shall deliver to the Bank financial
projections for the Borrower and its Subsidiaries
including liquidity projections on a weekly basis
through December 31, 2001, in form and substance
satisfactory to the Bank and its financial advisor,
PricewaterhouseCoopers LLP.
(L) SECTION 13.5 is entirely amended to read as follows:
13.5 ASSIGNMENTS. The Bank may assign to one or more
assignees (each an "Assignee") all or any part of its
Rights and obligations under the Loan Documents so
long as (a) the Bank and Assignee obtain (unless the
Assignee is an Affiliate of the Bank or a Default has
occurred and is continuing at the time of such
assignment) Borrower's consent to such assignment
(which may not be unreasonably withheld or delayed in
any instance and is not required if the Assignee is
an Affiliate of the Bank or if a Default has occurred
and is continuing); (b) the assignment is for an
identical percentage of the Bank's Rights and
obligations under each of the Revolving Facility
Commitment and the Bridge Loan Commitment; (c) the
assignment must be for a minimum total amount of
$5,000,000 or, if less, the balance of the
Commitments then outstanding hereunder; (d) any
potential Assignee (other than an Affiliate of the
Bank) shall execute a confidentiality agreement
substantially in the form of the Confidentiality
Agreement prior to receiving any information
regarding the Companies; and (e) in connection with
the initial assignment hereunder (other than an
initial assignment of all of the Commitments then
outstanding hereunder), the Bank, the Assignee, and
Borrower will execute any appropriate amendments to
the Loan Documents to effect a proper syndication of
the credit facilities and to make the Assignee a
party to this Agreement. Unless otherwise provided
herein, any amendment, waiver, or consent under this
Agreement shall require the written consent of
lenders that in the aggregate hold at least 51% of
the Bridge Loan Commitment and the Revolving Loan
Commitment (collectively, the "Commitments"), and
after the expiry or termination of the Commitments,
hold at least 51% of the aggregate unpaid principal
amount of the Commitments; provided, however, that no
amendment, waiver, or consent shall, unless it is in
writing and is signed by all the lenders, do any of
the following:
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(i) waive any of the conditions specified in SECTIONS
8.1 or 8.2, (ii) increase the Commitments of the
lenders or subject the lenders to any additional
obligations, (iii) reduce the principal of, or
interest on, any amounts outstanding hereunder, or
any fees or other amounts payable hereunder, (iv)
postpone any date fixed for any payment of principal
of, or interest on, any amounts payable hereunder,
(v) make any change which would alter the percentage
of the Commitments or of the aggregate unpaid
principal amount of the amounts payable hereunder, or
the number of lenders, which shall otherwise be
required for the lenders or any of them to take any
action hereunder, or (vi) amend this SECTION 13.5.
Once the assignment is effected and accepted, when
necessary, by Borrower and the amendments described
in CLAUSE (e) above are executed and delivered (if
applicable), then, on and after the date of such
assignment and amendments (if applicable), (a) the
Assignee automatically becomes a party to this
Agreement and, to the extent provided in the
assignment and in the Loan Documents, as so amended,
has the same Rights and obligations of the Bank under
the Loan Documents with respect to its assigned
interest, (b) the Bank, to the extent of the assigned
interest and as otherwise provided in the assignment
and in the Loan Documents, as so amended, is released
from its obligations to make advances under this
Agreement, (c) upon request, Borrower shall execute
and deliver to the Bank and the Assignee the
appropriate Revolving Notes and Bridge Notes
reflecting the transfer of the assigned interest, and
(d) upon delivery of the notes under CLAUSE (c)
preceding, the Bank shall return to Borrower all
notes previously delivered to the Bank by Borrower
under this agreement.
(M) A new SECTION 13.22 is hereby added to the Agreement to read as
follows:
13.22 CONFIDENTIALITY. The Bank agrees to maintain the
confidentiality of the Information (as defined
below), except that Information may be disclosed (a)
to its and its Affiliates' directors, officers,
employees and agents, including accountants, legal
counsel and other advisors (it being understood that
the Persons to whom such disclosure is made will be
informed of the confidential nature of such
Information and instructed to keep such Information
confidential); (b) to the extent requested by any
regulatory authority; (c) to the extent required by
applicable laws or regulations or by any subpoena or
similar legal process; (d) to any other party to this
Agreement; (e) in connection with the exercise of any
remedies hereunder or any suit, action or proceeding
relating to this Agreement or the enforcement of
rights hereunder; (f) subject to an agreement
containing provisions substantially the same as those
of this Section, to (i) any Assignee of or
Participant in, or any prospective Assignee of or
Participant in, any of its
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rights or obligations under this Agreement or (ii)
any direct or indirect contractual counterparty or
prospective counterparty (or such contractual
counter-party's or prospective counter-party's
professional advisor) to any credit derivative
transaction relating to obligations of the Borrower;
(g) with the consent of the Borrower; (h) to the
extent such Information (i) becomes publicly
available other than as a result of a breach of this
Section or (ii) becomes available to the Bank on a
non-confidential basis from a source other than the
Borrower; or (i) to the National Association of
Insurance Commissioners or any other similar
organization or any nationally recognized rating
agency that requires access to information about
Bank's or its Affiliates' investment portfolio in
connection with ratings issued with respect to Bank
or its Affiliates. For the purposes of this Section,
"Information" means all information received from the
Borrower relating to the Borrower or its business,
other than any such information that is available to
the Bank on a non-confidential basis prior to
disclosure by the Borrower; provided that, in the
case of information received from the Borrower after
the date hereof, such information is clearly
identified in writing at the time of delivery as
confidential. Any Person required to maintain the
confidentiality of Information as provided in this
Section shall be considered to have complied with its
obligation to do so if such Person has exercised the
same degree of care to maintain the confidentiality
of such Information as such Person would accord to
its own confidential information.
(N) Effective as of the date hereof, all references in the Loan
Documents to the Revolving Facility Commitment are hereby amended to be
references to the Term Loan Commitment, all references to the Revolving Note are
hereby amended to be references to the Term Note, and all references to the
"line of credit" shall be amended to be references to the "term loan." Effective
as of the date hereof, Borrower may not borrow, repay, and reborrow hereunder,
and Bank shall have no obligation to make advances to or issue letters of credit
for the account of Borrower or its Subsidiaries.
3. CONDITIONS PRECEDENT. This Amendment will not become effective until
all corporate actions of Borrower and each of the Subsidiary/Debtors taken in
connection herewith and the transactions contemplated hereby shall be
satisfactory in form and substance to the Bank, and each of the following
conditions precedent shall have been satisfied, all of which must occur on or
before September 5, 2001:
(a) Bank has received counterparts of this Amendment duly executed
and duly delivered by Bank, Borrower, and each other party
named on the signature page below, and the Term Note.
(b) All fees and expenses, including reasonable legal and other
professional fees and expenses incurred on or prior to the
date of this Amendment by
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the Bank, including without limitation the fees and expenses
of legal counsel and financial advisors to the Bank, shall
have been paid to the extent that same have been billed.
(c) The Bank shall have received a certificate of the Borrower
certifying as to the accuracy, after giving effect to this
Amendment, of the representations and warranties set forth in
the Loan Agreement, the other Loan Documents and this
Amendment, that there exists no Default or Potential Default
after giving effect to this Amendment, and that the execution,
delivery and performance of this Amendment will not cause a
Default or Potential Default.
(d) The Bank shall have received such other documents, instruments
and certificates, in form and substance reasonably
satisfactory to the Bank, as the Bank shall deem necessary or
appropriate in connection with this Amendment and the
transactions contemplated hereby, including without limitation
copies of resolutions of the boards of directors of each of
Borrower and each Subsidiary/Debtor which is a party to the
documents contemplated by this Amendment.
(e) The Bank shall have received true and correct copies of the
Securities Agreement and all documents executed pursuant
thereto or in connection therewith, all conditions precedent
to the effectiveness thereof shall have been satisfied other
than the effectiveness of this Amendment, and such documents
shall become effective simultaneous with the effectiveness of
this Amendment.
(f) The Bank shall have received a payment on the Term Loan in the
principal amount of $200,000, plus all accrued and unpaid
interest due under the Term Loan through August 31, 2001.
(g) The Bank shall have received a true and correct copy of any
and all agreements between the Borrower and Xxxxx Xxxxxx upon
terms and conditions satisfactory to the Bank addressing
payment of amounts due to Xxxxx Xxxxxx pursuant to that
certain Stock Purchase Agreement dated December 19, 1997,
between the Borrower, Xxxxx Xxxxxx and Hereford Haven, Inc.
4. RELEASE. In consideration of the Bank's agreements herein and
certain other good and valuable consideration, Borrower hereby expressly
acknowledges and agrees that as of the date hereof it has no setoffs,
counterclaims, adjustments, recoupments, defenses, claims or actions of any
character, whether contingent, non-contingent, liquidated, unliquidated, fixed,
matured, unmatured, disputed, undisputed, legal, equitable, secured or
unsecured, known or unknown, against the Bank or any grounds or cause for
reduction, modification or subordination of the obligations or owed to the Bank
or any liens or security interests of the Bank. To the extent Borrower may
possess any such setoffs, counterclaims, adjustments, recoupments, claims,
actions, grounds or causes, Borrower hereby waives, and hereby releases the Bank
from, any and
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all of such setoffs, counterclaims, adjustments, recoupments, claims, actions,
grounds and causes, such waiver and release being with full knowledge and
understanding of the circumstances and effects of such waiver and release and
after having consulted counsel with respect thereto.
5. CONTINUED EFFECT. Except to the extent provided herein, all terms,
provisions, and conditions of the Loan Agreement and the other Loan Documents
shall continue in full force and effect and are hereby ratified and confirmed,
and the Loan Agreement and the other Loan Documents shall remain enforceable and
binding in accordance with their respective terms. Borrower and each
Subsidiary/Debtor confirms and agrees that the other Loan Documents, and the
guaranties, liens, and security interests granted therein, shall continue to
assure and secure Borrower's obligations and indebtedness to Bank, direct or
indirect, arising pursuant to the Revolving Note and the Loan Agreement, whether
or not such other Loan Documents shall be expressly affected by this Amendment.
All references in the Loan Documents to the Loan Agreement shall hereafter be
deemed to be references to the Loan Agreement affected by this Amendment.
6. COUNTERPARTS. This Amendment may be executed in any number of
counterparts, all of which when taken together shall constitute one and the same
document, and each party hereto may execute this Amendment by signing any of
such counterparts. Telecopies of signatures shall be binding and effective as
originals.
7. SUCCESSORS AND ASSIGNS. This Amendment shall be binding upon, and
inure to be the benefit of, the parties hereto and their respective heirs,
administrators, successors and assigns.
8. NO ORAL AGREEMENTS. THIS WRITTEN DOCUMENT AND THE DOCUMENTS EXECUTED
IN CONNECTION HEREWITH REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES IN
RESPECT OF THE MATTERS COVERED HEREIN AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE
NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
9. GOVERNING LAW. This Amendment shall be governed by and construed in
accordance with the laws of the State of Texas.
10. LOAN DOCUMENT. This Amendment is a Loan Document and is subject to
all provisions of the Loan Agreement applicable to Loan Documents, all of which
are incorporated in this Amendment by reference the same as if set forth in this
Amendment verbatim.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed as of the date first written above.
BANK OF AMERICA, N.A. (formerly Bank of America NT & FRESH AMERICA CORP., as Borrower
SA, successor in interest by merger with Bank of
America, N.A., formerly NationsBank, N.A.), as Bank
By By
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Xxxxxxx X. Xxxxxxxxxxx, XX Name:
Managing Director ----------------------------
Title:
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CONSENT AND AGREEMENT
To induce Bank to enter into this Amendment the undersigned jointly and
severally (a) consent and agree to this Amendment's execution and delivery and
the terms hereof, including without limitation the amendments to the Security
Agreement and the Guaranty, (b) ratify and confirm that all guaranties,
assurances, liens, and subordinations granted, conveyed, or assigned to Bank
under the Loan Documents (as they may have been renewed, extended, and amended)
(i) are not released, diminished, impaired, reduced, or otherwise adversely
affected by this Amendment, and (ii) continue to guarantee, assure, secure, and
subordinate other debt to the full payment and performance of all present and
future obligations under the Loan Documents, and (c) waive notice of acceptance
of this consent and agreement, which consent and agreement binds the undersigned
and their successors and permitted assigns and inures to Bank and its successors
and permitted assigns.
FRESH AMERICA FLORIDA, INC.,
FRANCISCO ACQUISITION CORP.,
ALLIED-PERRICONE, INC., F/K/A XXX XXXXXXXXX CITRUS CO.,
each as a Subsidiary/Debtor
By:
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Name:
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Title:
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