Exhibit 10.45

 

AUTOBORROW AGREEMENT

 

BANK OF AMERICA

AUTOBORROW SERVICE AGREEMENT

Bank of America, N.A.

 

 

This Autoborrow Agreement (the “Agreement”) is made as of this 6th day of
September, 2017, by and between Vitamin Cottage Natural Food Markets, Inc.
(“Client”) and Bank of America, N.A. (“Bank”).

 

Client has requested that Bank provide to Client the AutoBorrow service and Bank
is willing to provide such service to Client.

 

For and in consideration of the promises contained herein and the performance of
obligations specified herein, it is agreed as follows:

 

Definitions.

 

As used herein, the following terms shall have the meaning defined below. All
capitalized terms used herein, including within the following definitions, but
not otherwise defined herein shall have the respective meanings given thereto in
the Credit Agreement dated as of January 28, 2016 by and among Client, the
Guarantors party thereto, the Lenders from time to time party thereto and Bank
of America, N.A., as Administrative Agent (in such capacity, the “Administrative
Agent”), L/C Issuer, and Swing Line Lender, as such agreement may be amended,
modified, extended, restated, replaced or supplemented from time to time (the
“Credit Agreement”).

 

1.

Account: Client’s demand deposit account number 8670107098 at Bank.

 

2.

Borrowing Increment Amount: Specified whole dollar amount in which Swing Line
Loans shall be made from the swing line facility under the Credit Agreement (the
“Swing Line Facility”) and deposited in the Account. For purposes of this
Agreement, the Borrowing Increment Amount shall be $100,000.00.

 

3.

Borrowing Target: The minimum amount of collected funds Client wishes to
maintain in the Account; any balance less than the Borrowing Target shall
trigger an incremental advance from the Swing Line Facility if sufficient credit
under the Swing Line Facility is available, as provided in Step 3, below under
“Operation of AutoBorrow.” For the purposes of this Agreement, the Borrowing
Target shall be $0.00.

 

4.

Swing Line Facility: The Swing Line Loans extended to Client by Bank, as Swing
Line Lender, under Section 2.04 of the Credit Agreement, in the maximum
principal amount equal to the Swing Line Sublimit.

 

5.

Repaying Increment Amount: Specified whole dollar amount in which funds
transfers shall be made from the Account to the Swing Line Facility. For
purposes of this Agreement, the Repaying Increment Amount shall be $100,000.00.

 

6.

Repaying Target: The maximum amount of collected funds Client wishes to maintain
in the Account; any whole dollar incremental balance in excess of the Repaying
Target shall be transferred from the Account to pay down the Swing Line Facility
if there exists an outstanding principal balance on the Swing Line Facility, as
provided in Step 2 below under “Operation of AutoBorrow.” For purposes of this
Agreement, the Repaying Target shall be $0.00.

 

7.

Swing Line Sublimit: $48,000,000, or such other amount constituting the “Swing
Line Sublimit” (as defined in the Credit Agreement) as Bank may be advised by
Administrative Agent.

 

Operation of AutoBorrow.

 

 

Step 1.

At the end of each Banking Day, Bank will determine the collected funds in the
Account and the aggregate outstanding amount of all Swing Line Loans. For
purposes of this Agreement, “Banking Day” means each day that is not a Saturday,
Sunday or U.S. federal holiday.

 

 

Step 2.

If the collected funds in the Account are in excess of the Repaying Target in an
amount at least equal to the Repaying Increment Amount, Bank shall transfer
collected funds in excess of the Repaying Target from the Account in multiples
of the Repaying Increment Amount as a payment on any then outstanding Swing Line
Loans in an amount equal to the lesser of (i) the principal balance outstanding
under the Swing Line Facility, or (ii) the amount of collected funds in the
Account in excess of the Repaying Target.

 

 

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Step 3.

If the collected funds in the Account are less than the Borrowing Target and the
aggregate amount of outstanding Swing Line Loans is less than the Swing Line
Sublimit, Bank, as Swing Line Lender, shall make Swing Line Loans from the Swing
Line Facility for deposit in the Account in multiples of the Borrowing Increment
Amount in such amounts as may be required to bring the Account balance up to the
Borrowing Target; provided that the Bank, as Swing Line Lender, shall not be
obligated to make Swing Line Loans if all other conditions for funding Swing
Line Loans as set forth in the Credit Agreement are not satisfied (unless the
Bank waives such conditions in its sole and absolute discretion) and provided
further that, after giving effect to any such Swing Line Loans, the aggregate
outstanding amount of all Swing Line Loans shall not exceed the Swing Line
Sublimit. If at any time the amount available for advance under the Swing Line
Facility is less than the Borrowing Increment Amount, Bank shall make Swing Line
Loans in such amount up to the Swing Line Sublimit, without regard to the
Borrowing Increment Amount.

 

notwithstanding anything to the contrary in this agreement, the BANK, as Swing
Line lender, shall not be under any obligation to make any Swing Line Loan if it
shall determine in good faith that there exists, or after giving effect to such
Swing Line Loan there would exist, Fronting Exposure in respect of Swing Line
Loans.

 

Prepayments.

 

Client acknowledges and agrees that, if at any time any Swing Line Loans made
for deposit in the Account under this Agreement exceed the amount permitted to
be borrowed under the Credit Agreement, the Client shall immediately prepay
Revolving Loans, Swing Line Loans and L/C Borrowings and/or Cash Collateralize
the L/C Obligations in an aggregate amount equal to such excess as required by
the terms of the Credit Agreement.

 

Confirmations and Statements.

 

After each funds transfer, Bank will provide to Client a written confirmation
noting the date and amount of each transfer. Client will also receive a monthly
AutoBorrow statement reflecting activity in the Account.

 

Related Documents.

 

This Agreement incorporates by reference the terms and conditions set forth in
the Credit Agreement, the other Loan Documents, the Deposit Agreement and
Disclosures, Signature Cards and Corporate Resolutions relating to the Account.
To the extent that any terms and conditions in any such document or in any
document conflict with this Agreement, the terms and conditions of this
Agreement shall control with respect to any borrowings from or repayments to the
Swing Line Facility made pursuant to this Agreement (including, without
limitation, the provisions relating to Term and Termination and Suspension).

 

Term and Termination.

 

This Agreement shall remain in effect until terminated as set forth below,
subject, however, to Bank’s right to suspend the AutoBorrow service as set forth
below. This Agreement shall terminate immediately upon the earlier to occur of
(a) expiration or termination of the Swing Line Facility, or (b) at any time
Bank is no longer the Swing Line Lender; it being expressly agreed that Bank is
under no obligation to provide Client prior written notice of such termination.
In addition, Bank shall have the right to terminate this Agreement upon the
occurrence and during the continuance of any Default or Event of Default under
the Credit Agreement. Unless terminated earlier under the foregoing provisions,
either party may terminate this Agreement upon thirty (30) days’ prior written
notice to the other party.

 

Suspension.

 

Notwithstanding anything to the contrary in this Agreement, in the event of (a)
the occurrence and during the continuance of any Default or Event of Default
under the Credit Agreement, (b) if Bank, in its sole judgment, believes that its
continued provision of the AutoBorrow service may create a risk of financial
loss to it or (c) there is a Defaulting Lender under the Credit Agreement, Bank
may suspend its provision of such service for such period of time as Bank
determines, and during such period Bank shall have no obligation, as Swing Line
Lender, to make Swing Line Loans hereunder. Bank shall promptly notify Client
after any such suspension, other than any suspension resulting from a Default or
Event of Default under the Credit Agreement, provided that the failure to give
such notice shall not affect the validity of such suspension. Any election by
Bank to suspend the AutoBorrow service shall not constitute a waiver by Bank of
any Default or Event of Default and shall not limit or impair any of Bank’s
rights or remedies under this Agreement or otherwise available to Bank,
including, without limitation, Bank’s right to terminate this Agreement as set
forth above. The AutoBorrow service shall also be suspended by Bank immediately
following notice from the Administrative Agent that the conditions for advance
of a Swing Line Loan under the Credit Agreement have not been satisfied, and
such suspension shall continue until Administrative Agent gives notice to the
Bank that such conditions have been satisfied and Client shall thereafter be
entitled to advances of Swing Line Loans hereunder.

 

 

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No Waiver; Cumulative Remedies.

 

No failure by Bank to exercise, and no delay by Bank in exercising, any right,
remedy, power or privilege under this Agreement shall operate as a waiver
thereof or of any Default or Event of Default under the Credit Agreement or any
other Loan Document; nor shall any single or partial exercise by Bank of any
right, remedy, power or privilege under this Agreement preclude any other or
further exercise by Bank thereof or the exercise by Bank of any other right,
remedy, power or privilege under this Agreement, the Credit Agreement, the Loan
Documents or any other document evidencing, securing or relating to the Swing
Line Facility or otherwise available to Bank. The rights, remedies, powers and
privileges herein provided are cumulative and not exclusive of any rights,
remedies, powers and privileges provided by law or otherwise available to Bank.

 

Fees.

 

Client agrees to compensate Bank for providing the AutoBorrow service in
accordance with the Bank’s fee schedule applicable to AutoBorrow service, which
is subject to change from time to time.

 

Limitation of Liability.

 

The Bank shall not be liable to Client for failure to perform as contemplated or
required by this Agreement unless such failure is the result of the gross
negligence or willful misconduct of Bank, its employees, or agents as determined
by a final and nonappealable judgment entered by a court of competent
jurisdiction. Bank shall not be liable under any circumstances to Client or any
third party for any failure to perform if the failure is due to conditions
beyond the control of Bank, including, but not limited to, strikes, riots, war,
military or national emergencies, acts of God, natural disasters, fire, outages
of computers or associated equipment, or failure of transportation or
communication methods or power supplies. In no event shall Bank be liable for
special, indirect, or consequential damages, even if advised of the possibility
of such damages.

 

Amendments.

 

This Agreement constitutes the complete understanding of Client and Bank as to
the AutoBorrow service, and specifically supersedes all previous written or oral
agreements or representations. No amendments to this Agreement shall be
effective to bind Client or Bank unless set forth in writing and executed by
both Client and Bank.

 

Notices.

 

All written notices shall be provided to Bank at:

 

Bank of America, N.A.

370 17th Street, Suite 5195

Denver, CO 80202

 

All written notices shall be provided to Client at:

 

Vitamin Cottage Natural Food Markets, Inc.

12612 West Alameda Parkway

Lakewood, CO 80228

 

 

All notices required to be in writing shall be hand-delivered or sent by
certified mail, return receipt requested, to the applicable party at its
respective address set forth above or as otherwise designated in writing by such
party.

 

Acknowledgment of Authority.

 

Client acknowledges that the operation of the AutoBorrow service will permit any
person conducting transactions on the Account to have the ability to access the
Swing Line Facility. Client hereby confirms the authority of each person
designated as an authorized signer in resolutions provided to Bank or otherwise
authorized, permitted or allowed by Client to conduct transactions on the
Account, to also access and conduct transactions on the Swing Line Facility
through the AutoBorrow service.

 

Client also acknowledges that presentation for payment of lost or stolen checks
can result in an advance from the Swing Line Facility in accordance with the
terms hereof. Client agrees to take all appropriate precautions against such
risk, to notify Bank in the event checks are lost or stolen, and to hold Bank
harmless and indemnify it immediately upon demand if such an event occurs.

 

 

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Governing Law.

 

This Agreement shall be governed by and construed in accordance with the laws of
the State of New York.

 

Assignment.

 

This Agreement may not be assigned by Client.

 

[REMAINDER INTENTIONALLY LEFT BLANK.]

 

 

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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed
effective as of the date set forth above.

 

Client’s name:

 

 

VITAMIN COTTAGE NATURAL FOOD MARKETS, INC.,

a Colorado corporation

 

 

By:        /s/ Kemper Isely                  

Name:   Kemper Isely                      

Title:     Co-President                       

 

Bank:

 

BANK OF AMERICA, N.A.,

in its capacity as the Bank

 

 

By:         /s/ Anthony Roman          

Name:   Anthony Roman               

Title:     SVP                                   

 

 

This form is acknowledged and agreed by:

 

BANK OF AMERICA, N.A., in its capacity as

Administrative Agent

 

 

By:        /s/ Anthony Roman           

Name:   Anthony Roman                

Title:     SVP