Attached files
| file | filename |
|---|---|
| EX-10.1 - SECURITIES PURCHASE AGREEMENT - JAVO BEVERAGE CO INC | javo_8k-ex1001.htm |
| EX-10.3 - FORM OF SENIOR SUBORDINATED 12% NOTE (ADDITIONAL NOTE) - JAVO BEVERAGE CO INC | javo_8k-ex1003.htm |
| EX-10.2 - FORM OF SENIOR SUBORDINATED 12% NOTE (INITIAL NOTE) - JAVO BEVERAGE CO INC | javo_8k-ex1002.htm |
| EX-4.1 - AMENDMENT NO. 1 TO RIGHTS AGREEMENT - JAVO BEVERAGE CO INC | javo_8k-ex0401.htm |
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date
of Report (Date of Earliest Event Reported): November 17,
2009
JAVO
BEVERAGE COMPANY, INC.
(Exact
name of registrant as specified in its charter)
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Delaware
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000-26897
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48-1264292
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(State
or other jurisdiction
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(Commission
File Number)
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I.R.S.
Employer
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of
incorporation)
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Identification
Number
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1311
Specialty Drive, Vista, CA
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92081
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(Address
of principal executive office)
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(Zip
Code)
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(760)
560-5286
Registrant’s
telephone number, including area code
Not
Applicable
(Former
name or former address, if changed since last report.)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
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o
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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o
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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o
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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o
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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Item
1.01.
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Entry
into a Material Definitive
Agreement.
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Note
and Stock Unit Financing
On
November 17, 2009, Javo Beverage Company, Inc. (the “Company”)
entered into a Securities Purchase Agreement (the “Purchase
Agreement”) with Coffee Holdings LLC (the “Investor”),
a Delaware limited liability company and an investment entity affiliated with
Falconhead Capital, LLC, a Delaware limited liability company (“Falconhead”),
pursuant to which the Company issued and sold to the Investor in a private
placement (the “Financing”)
(i) senior subordinated promissory notes in the aggregate original principal
amount of $4,000,000 (the “Initial
Notes”) and (ii) an aggregate of 15,000,000 shares (the “Initial
Shares,” and, collectively with the Initial Notes, the “Initial
Securities”) of the Company’s common stock, par value $0.001 per share
(the “Common
Stock”). The aggregate consideration paid for the Initial
Securities by the Investor was $4,100,000. Under, and subject to, the
terms of the Purchase Agreement, the Company may, at a future date, also sell to
the Investor: (A) senior subordinated promissory notes in the aggregate original
principal amount of up to $3,500,000 (the “Additional
Notes” and, collectively with the Initial Notes, the “Notes”)
and (B) an aggregate of up to 13,125,000 shares of Common Stock (the “Additional
Shares” and, collectively with the Additional Notes, the “Additional
Securities”), for an aggregate purchase price not to exceed
$3,500,000. The Investor is an “accredited investor” within
the meaning of Rule 501 of Regulation D under the Securities Act of 1933, as
amended (the “Securities
Act”) and both the Initial Notes and the Initial Shares have been issued
without registration under the Securities Act or state securities laws in
reliance on the exemptions provided by Section 4(2) of the Securities Act and
Rule 506 of Regulation D promulgated thereunder.
The Notes
bear interest at the rate of 12% per annum with accrued interest and principal
due and payable on the maturity date of April 17, 2015. The Notes may be prepaid
in whole or in part from time to time and at any time prior to maturity without
penalty or premium. Upon the occurrence of any event of default or
certain fundamental corporate transactions, the Company would be required to
redeem the Notes at a price equal to the then outstanding principal amount plus
all accrued but unpaid interest on the Notes. The obligations
represented by the Notes are unsecured. The Company and the Investor
have also agreed that the Notes are to be deemed (i) “Permitted Senior
Indebtedness” under and as defined in the promissory notes issued in the 2009
Notes (as defined in the Note), and (ii) “Senior Debt” under the 2008 Notes (as
defined in the Note).
The
Company will use the proceeds from the sale of the Securities, net of
transaction expenses, for general corporate purposes, including working capital
and capital expenditures for dispensing equipment and other capital items, to
satisfy existing indebtedness and for the payment of fees and expenses under the
Notes and the Purchase Agreement. If the Company issues any of the
Additional Securities, the proceeds from those sales will be used exclusively to
pay any accrued interest and principal amounts when due under the notes issued
in April 2009 to the Investor in the aggregate principal sum of
$12,000,000.
The
Purchase Agreement and the Notes provide that the Company may not take certain
corporate actions without the prior written consent of the
Investor. These negative covenants include, without limitation,
restrictions on the payment of dividends, the incurrence of indebtedness (other
than permitted indebtedness), the entry into certain fundamental corporate
transactions and other matters, including relating to changes in the Company’s
senior management. The Company is also required under the Notes to
have at least 7,500 beverage dispensers installed and operating in customer
locations on behalf of the Company, whether or not owned by the Company, as of
July 1, 2010 and each January 1st and July 1st of each calendar year thereafter,
unless and until the first date on which the Company’s Consolidated EBITDA (as
defined in the Notes) is equal to or greater than $15,000,000 or the Notes are
repaid in full.
Additionally,
the Company has agreed under the Purchase Agreement that if the Company
consummates any debt or equity financings subsequent to the closing of the
Financing and grants the lenders, investors or other parties to any such
financings any specified rights more favorable in any material respect than
those aggregate held by the Investor or not then held by the Investor, then the
Investor will be granted equivalent rights (on a pari passu or pro rata basis,
as applicable) concurrently with the closing of such financing. Under
the Purchase Agreement, the Company also has granted the Investor a right to
participate in future issuances by the Company of its debt or equity securities,
subject to certain exceptions.
2
The
Company also agreed to appoint an additional representative named by the
Investor to the Company’s board of directors prior to the first meeting of the
board of directors following the closing of the Financing, to the extent the
Investor has identified a board nominee prior to such meeting. The
Company has agreed to nominate the Investor’s representative to serve on the
Company’s board of directors so long as the Investor continues to hold certain
agreed amounts of outstanding Shares and outstanding principal under the Notes,
but not beyond the date upon which repayment has been made in full of all
amounts outstanding under the Notes, including all principal and any accrued and
unpaid interest thereon.
Also in
connection with the Financing, the Company entered into a letter agreement,
dated as of November 17, 2009 with Falconhead. Pursuant to this
agreement, the Company agreed to pay Falconhead, upon closing of the Financing,
a one-time fee of $100,000 for financial and management consulting services
provided by Falconhead prior to the closing of the Financing.
After
giving effect to the issuance of the Initial Shares, the Company has
approximately 298.8 million shares of Common Stock outstanding as of November
17, 2009.
The
foregoing descriptions of the Purchase Agreement and the Notes are summaries of
the material terms of such agreements, do not purport to be complete and are qualified in their entirety by reference to such agreements and
instruments, which are filed herewith and incorporated herein by this
reference.
Amendment
to Rights Agreement
On
November 17, 2009, the Company and Corporate Stock Transfer, Inc. (“CST”) entered
into an amendment (the “Amendment”)
to the Rights Agreement, dated as of July 1, 2002 (the “Rights
Agreement”), in connection with the previously announced offering and
sale by the Company of the Shares to the Investor.
Prior to
the effectiveness of the Amendment, the Rights Agreement provided that certain
persons who become the beneficial owner of 20% or more of the then outstanding
shares of common stock of the Company shall be deemed an “Acquiring
Person.” The Investor purchased in the Financing a number of shares
of common stock that caused the Investor to beneficially own more than 20% of
the Company’s outstanding common stock immediately following the
Financing. Accordingly, the Company and CST entered into the
Amendment for the purpose of amending the Rights Agreement, effective
immediately prior to the completion of the Financing, to (i) provide that
the Investor be excluded from the definition of “Acquiring Person” to the extent
that the Investor becomes the beneficial owner of 20% or more of the shares of
common stock of the Company then outstanding solely due to the Investor’s
beneficial ownership of the Initial Shares and any Additional Shares, and
(ii) provide for other modifications to the Rights Agreement consistent
with the foregoing.
The
Amendment is filed as Exhibit 4.1 to this report and incorporated herein by
reference. The above description of the material terms of the Amendment as they
relate to the Rights Agreement is qualified in its entirety by reference to such
exhibit.
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Item
2.03.
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Creation
of a Direct Financial Obligation or an Obligation under an Off-Balance
Sheet Arrangement of a Registrant.
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The
information set forth above in Item 1.01 with respect to the issuance of the
Initial Notes is incorporated by reference into this Item 2.03.
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Item
3.02.
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Unregistered
Sales of Equity Securities.
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The
information set forth above in Item 1.01 with respect to the issuance of the
Initial Shares is incorporated by reference into this Item 3.02.
3
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Item
3.03.
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Material
Modification to Rights of Security
Holders.
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As
indicated under Item 1.01 of this Form 8-K, the Company and CST have
entered into the Amendment. The Amendment modifies certain rights of holders of
the Rights (as defined in the Rights Agreement) issued under the Rights
Agreement. The description of such modifications contained in Item 1.01 of
this Form 8-K is incorporated by reference into this
Item 3.03.
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Item
9.01.
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Financial
Statements and Exhibits
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Exhibit
No.
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Description
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4.1
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Amendment
No. 1 to Rights Agreement, dated as of November 17, 2009, by and between
the Company and Corporate Stock Transfer, Inc.
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10.1
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Securities
Purchase Agreement, dated as of November 17, 2009, by and between the
Company and Coffee Holdings LLC
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10.2
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Form
of Senior Subordinated 12% Note (Initial Note)
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10.3
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Form
of Senior Subordinated 12% Note (Additional
Note)
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4
Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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November
19, 2009
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JAVO
BEVERAGE COMPANY, INC.
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By:
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/s/ William E. Marshall | |
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William
E. Marshall
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General
Counsel, Sr. Executive Vice President and Secretary
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