Execution Version

 

SECOND AMENDMENT TO CREDIT AGREEMENT

 

THIS SECOND AMENDMENT TO CREDIT AGREEMENT, dated as of July 22, 2013 (this
“Amendment”), is by and among JAMBA, INC., a Delaware corporation (the
“Parent”), JAMBA JUICE COMPANY, a California corporation (the “Borrower”), the
Subsidiary Guarantors party hereto, and WELLS FARGO BANK, NATIONAL ASSOCIATION
(the “Bank”).

 

RECITALS

 

A. Reference is made to the Credit Agreement, dated as of February 14, 2012, as
amended by the First Amendment to Credit Agreement, dated as of November 1, 2012
(as amended, modified or supplemented from time to time, the “Credit
Agreement”), among the Parent, the Borrower, and the Bank. Capitalized terms
used herein without definition shall have the meanings given to them in the
Credit Agreement.

 

B. The Borrower has requested certain amendments to the Credit Agreement,
including without limitation, an increase in the aggregate revolving commitment
thereunder to $15,000,000. The Bank has agreed to make such amendments on the
terms and conditions set forth herein.

 

STATEMENT OF AGREEMENT

 

NOW, THEREFORE, in consideration of the foregoing and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:

 

ARTICLE I

 

Amendments to CREDIT AGREEMENT

 

1.1 Amendments to Section 1.1 (Defined Terms) of the Credit Agreement. Section
1.1 of the Credit Agreement is amended as follows:

 

(a)The following defined terms are hereby added in appropriate alphabetical
order:

 

“Consolidated EBITDAR” means, for any period, the sum of Consolidated EBITDA
plus Consolidated Rent Expense, for such period.

 

“Consolidated Fixed Charges” means, as of any date of determination, the sum of
(a) the current portion of long term Indebtedness as of such date, in accordance
with GAAP, plus (b) the current portion of Capitalized Leases as of such date,
in accordance with GAAP, plus (c) consolidated interest expense for the period
of four fiscal quarters ending on such date, plus (d) income tax expense for the
period of four fiscal quarters ending on such date, plus (e) dividends paid on
preferred stock for the period of four fiscal quarters ending on such date.

 

“Consolidated Funded Indebtedness” means, as of any date of determination, all
Indebtedness of the Parent and its Subsidiaries, on a consolidated basis, as of
such date, other than Indebtedness described in clause (xi) of the definition
thereof.

 

 

 

 

“Consolidated Leverage Ratio” means, as of any date of determination, the ratio
of (a) the sum of (i) Consolidated Funded Indebtedness as of such date plus (ii)
the product of Consolidated Rent Expense for the period of four fiscal quarters
ending on such date multiplied by eight, to (b) Consolidated EBITDAR for the
period of four fiscal quarters ending on such date.

 

“Consolidated Rent Expense” means, for any period, the sum of all rent, common
area maintenance charges, property taxes, licenses and property insurance
incurred by the Parent and its Subsidiaries, on a consolidated basis, for such
period.

 

“Consolidated Tangible Net Worth” means, at any time, the aggregate of total
stockholders' equity less any intangible assets and less Investments in
Affiliates, in each case, for the Parent and its Subsidiaries on a consolidated
basis.

 

“Fixed Charge Coverage Ratio” means, as of any date of determination, the ratio
of (a) Consolidated EBITDA minus Capital Expenditures minus dividends and other
distributions (other than dividends paid on preferred stock), each for the
period of four fiscal quarters ending on such date, to (b) Consolidated Fixed
Charges as of such date.

 

“Second Amendment Effective Date” means July 22, 2013.

 

(b)The following defined terms are deleted in their entirety: “Cash Management
Products Exposure”, “Dedicated Deposit Account”, “Specified Amount”, and
“Unencumbered Liquidity”.

 

(c)The defined terms “Applicable Margin”, “Consolidated EBITDA”, “Revolving
Credit Exposure”, “Revolving Credit Termination Date”, and “Unutilized Revolving
Commitment” are deleted in their entirety and replaced with the following:

 

“Applicable Margin” means 2.50% per annum.

 

“Consolidated EBITDA” means, for the Parent and its Subsidiaries, on a
consolidated basis, for any period, the aggregate of (i) Consolidated Net Income
of the Parent and its Subsidiaries for such period, plus (ii) the sum of
depreciation, amortization of intangible assets, interest expense, and income
tax expense, plus (iii) non-cash share based compensation expense, plus (iv)
asset impairment losses, measured as the amount by which the carrying value of
an asset exceeds the fair value of the asset, plus (v) pre-store opening costs
for such period in an aggregate amount not to exceed $75,000 per store location
and $750,000 for all store locations in any period of four fiscal quarters,
minus (vi) interest income, all to the extent taken into account in the
calculation of Consolidated Net Income of the Parent and its Subsidiaries for
such period, minus, to the extent not already deducted in the calculation of
Consolidated Net Income for such period, all payments made pursuant to the
Talbott Teas Earnout for such period.

 

“Revolving Credit Exposure” means, at any time, the sum of (i) the aggregate
principal amount of all Revolving Loans that are outstanding at such time, (ii)
the Stated Amount of each outstanding Letter of Credit and, without duplication
of clause (i), all obligations to reimburse the Bank for drawing under any
Letter of Credit, in each case, at such time, and (iii) the Commercial Credit
Card Exposure at such time.

 

“Revolving Credit Termination Date” means the date of the earliest to occur of
the following: (i) July 22, 2016; and (ii) such earlier date of termination of
the Revolving Credit Commitment pursuant to Section 2.7 or 8.2(a).

 

 

 

 

“Unutilized Revolving Commitment” means, at any time, the Revolving Credit
Commitment at such time less the sum of (i) the aggregate principal amount of
all Revolving Loans outstanding at such time, (ii) the Stated Amount of each
outstanding Letter of Credit and, without duplication of clause (i), all
obligations to reimburse the Bank for drawing under any Letter of Credit, in
each case, at such time, and (iii) the Commercial Credit Card Exposure at such
time.

 

1.2 Amendments to Section 2.1 (Commitments) of the Credit Agreement. Section 2.1
of the Credit Agreement is amended and restated in its entirety as follows:

 

2.1 Commitments. (a) The Bank agrees, on the terms and conditions set forth
herein, to make loans (each, a “Revolving Loan,” and collectively, the
“Revolving Loans”) to the Borrower, from time to time before the Revolving
Credit Termination Date; provided that, immediately after each Revolving Loan is
made, the Revolving Credit Exposure shall not exceed $15,000,000.00 (as such
figure may be reduced from time to time as provided in this Agreement, the
“Revolving Credit Commitment”). Subject to Section 3.2, the Borrower may borrow
under this Section 2.1(a), repay or prepay Revolving Loans and reborrow under
this Section 2.1(a) at any time before the Revolving Credit Termination Date.

 

1.3 Amendments to Section 2.3 (Principal Payments; Maturity of Loans) of the
Credit Agreement. Section 2.3(iii) of the Credit Agreement is amended and
restated in its entirety as follows:

 

(iii) In part, immediately in the event that the Revolving Credit Exposure
exceeds the Revolving Credit Commitment, in the amount of such excess; provided
that, to the extent such excess amount is greater than the aggregate principal
amount of the Revolving Loans outstanding immediately prior to the application
of such repayment, the amount so repaid shall be retained by the Bank and held
as cash collateral for outstanding Letters of Credit and Commercial Credit Card
Exposure, and thereupon such cash shall be deemed to reduce the aggregate
Revolving Credit Exposure by an equivalent amount.

 

1.4 Amendments to Section 2.6 (Fees) of the Credit Agreement.

 

(a)Section 2.6(b) of the Credit Agreement is amended and restated in its
entirety as follows:

 

(b) The Borrower agrees to pay to the Bank, an unused fee for each calendar
quarter (or portion thereof) for the period from the date of this Agreement to
the Revolving Credit Termination Date, at a per annum rate of (i) 0.25%, or (ii)
at any time the Borrower is not utilizing a corporate card program with the
Bank, 0.375%, in each case on the average daily aggregate Unutilized Revolving
Commitment, excluding clause (iii) of the definition of Unutilized Revolving
Commitment for purposes of this Section 2.6(b) only, payable in arrears (x) on
the last Business Day of each calendar quarter, beginning with the first such
day to occur after the Closing Date, and (y) on the Revolving Termination Date.

 

 

 

 

(b)Section 2.6(c) of the Credit Agreement is amended and restated in its
entirety as follows:

 

(c) The Borrower agrees to pay to the Bank a letter of credit fee for each
calendar quarter (or portion thereof) in respect of all Letters of Credit
outstanding during such quarter, at a per annum rate equal to 2.50% on the daily
average aggregate Stated Amount of such Letters of Credit, payable in arrears
(i) on the last Business Day of each calendar quarter, beginning with the first
such day to occur after the Closing Date, and (ii) on the later of the Revolving
Credit Termination Date and the date of termination of the last outstanding
Letter of Credit.

 

(c)A new Section 2.6(e) of the Credit Agreement is hereby added as follows:

 

(e) The Borrower agrees to pay to the Bank a non-refundable second amendment
upfront fee, in an aggregate amount equal to $45,000, which fee shall be due and
payable in the amount of $15,000 on each of the Second Amendment Effective Date
and the first two anniversaries of the Second Amendment Effective Date; provided
that, if the Borrower has established and its utilizing a purchase card program
with the Bank on terms acceptable to the Bank on the date any installment of the
foregoing fee is due and payable, such installment due on such date shall be
waived by the Bank and shall not be payable by the Borrower hereunder.

 

1.5 Article VI (Financial Covenants) of the Credit Agreement. Article VI of the
Credit Agreement is amended and restated in its entirety as follows:

 

ARTICLE VI
FINANCIAL COVENANTS

 

Until payment in full of all Obligations of the Borrower to the Bank and the
termination of the Revolving Credit Commitment, each of the Parent and the
Borrower covenants and agrees that it will not:

 

6.1 Maximum Consolidated Leverage Ratio. Permit the Consolidated Leverage Ratio
as of the last day of any fiscal quarter to be greater than the ratio set forth
below opposite such fiscal quarter (or opposite the period that includes such
fiscal quarter):

 

Period Maximum Consolidated
Leverage Ratio Fiscal quarter ending September 30, 2013 5.50 to 1.00 Fiscal
quarter ending December 31, 2013 through the fiscal quarter ending September 30,
2014 5.25 to 1.00 Fiscal quarter ending December 31, 2014 through the fiscal
quarter ending September 30, 2015 5.00 to 1.00 Each fiscal quarter thereafter
4.75 to 1.00

 

 

 

 

6.2 Minimum Fixed Charge Coverage Ratio. Permit the Fixed Charge Coverage Ratio
as of the last day of any fiscal quarter to be less than 1.50 to 1.00.

 

6.3 Minimum Consolidated Tangible Net Worth. Permit, at any time, Consolidated
Tangible Net Worth to be less than $14,000,000.

 

1.6 Amendments to Section 7.17 (Dedicated Deposit Account) of the Credit
Agreement. Section 7.17 of the Credit Agreement is hereby deleted in its
entirety and replaced with the following:

 

7.17 [Reserved]

 

1.7 Amendments to Section 8.2 (Remedies) of the Credit Agreement. Section 8.2(b)
of the Credit Agreement is hereby deleted in its entirety and replaced with the
following:

 

(b) Right of Set-off. The Bank may, and is hereby authorized by the Borrower, at
any time and from time to time, to the fullest extent permitted by applicable
laws, without advance notice to the Borrower (any such notice being expressly
waived by the Borrower), set off and apply any and all deposits (general or
special, time or demand, provisional or final) at any time held and any other
indebtedness at any time owing by the Bank or any of its Affiliates to or for
the credit or the account of the Borrower against any or all of the Obligations
of the Borrower under this Agreement or the other Credit Documents now or
hereafter existing, whether or not such obligations have matured. The Bank
agrees promptly to notify the Borrower after any such set-off or application;
provided, however, that the failure to give such notice shall not affect the
validity of such set-off and application.

 

1.8 Amendments to Section 9.3 (Notices) of the Credit Agreement. The notice
information for the Bank in Section 9.3 of the Credit Agreement is hereby
deleted in its entirety and replaced with the following:

 

  Bank Wells Fargo Bank, National Association     301 S. Tryon Street, 28th
Floor     Charlotte, NC 28288     Attention: Cavan J. Harris    
Telephone:  (704) 383-6423     Fax:  (704) 374-6483           with a copy to:  
        Moore & Van Allen PLLC     100 N. Tryon Street, Suite 4700     Attn: Mac
McBryde     Telecopy No.:  (704) 378-1944

 

 

 

 

1.9 Amendments to Exhibit B (Compliance Certificate) to the Credit Agreement.
Exhibit B to the Credit Agreement is hereby amended in its entirety as set forth
on Appendix I to this Amendment.

 

ARTICLE II

 

REPRESENTATIONS AND WARRANTIES

 

Each Credit Party hereby represents and warrants to the Bank as follows:

 

2.1 Representations and Warranties. After giving effect to this Amendment, each
of the representations and warranties of the Credit Parties contained in the
Credit Agreement and each other Credit Document is true and correct in all
material respects (except for such representations and warranties that are
qualified as to materiality, which shall be true and correct in all respects) on
and as of the date hereof with the same effect as if made on and as of the date
hereof (except to the extent any such representation or warranty is expressly
stated to have been made as of a specific date, in which case such
representation or warranty shall be true and correct, or true and correct in all
material respects, as applicable, as of such date).

 

2.2 No Default. After giving effect to this Amendment, no Default or Event of
Default has occurred and is continuing.

 

2.3 Authorization. The execution, delivery and performance of this Amendment and
the transactions contemplated hereby (i) are within the corporate authority of
each Credit Party, (ii) have been duly authorized by all necessary corporate
action of the each Credit Party, (iii) do not and will not violate any provision
of law, statute, rule or regulation to which any Credit Party is subject or any
judgment, order, writ, injunction, license or permit applicable to any Credit
Party, (iv) do not violate or breach any provision of the governing documents of
any Credit Party, and (v) do not violate or breach any agreement or other
instrument binding upon any Credit Party, in each case under this clause (v)
where such violation or breach, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.

 

2.4 Governmental Approvals. The execution, delivery and performance of this
Amendment by each Credit Party do not require the approval or consent of, or
filing with, any Governmental Authority, except such approvals or consents as
have been obtained and are in full force and effect and such filings as have
been made.

 

2.5 Enforceability. This Amendment has been duly executed and delivered by the
each Credit Party and constitutes each Credit Party’s legal, valid and binding
obligation, enforceable in accordance with its terms, except as such
enforceability may be limited by general principles of equity and conflicts of
laws or by bankruptcy, reorganization, insolvency, moratorium or other laws of
general application relating to or affecting the enforcement of creditors’
rights.

 

 

 

 

ARTICLE III

 

conditions OF EFFECTIVENESS

 

This Amendment shall become effective as of the date hereof (the “Second
Amendment Effective Date”) when, and only when, each of the following conditions
precedent shall have been satisfied:

 

(a) The Bank shall have received from each party hereto either (i) a counterpart
of this Amendment signed on behalf of each Credit Party and the Bank, or
(ii) written evidence satisfactory to the Bank (which may include facsimile or
other electronic image scan transmission of a signed signature page of this
Amendment) that each such party has signed a counterpart of this Amendment.

 

(b) The Bank shall have received a second amended and restated Revolving Note,
duly executed by the Borrower for the account of the Bank.

 

(c) The Bank shall have received an opinion of counsel to the Parent and its
Subsidiaries dated as of the Second Amendment Effective Date and addressed to
the Bank, in form and substance reasonably satisfactory to the Bank.

 

(d) The Bank shall have received a certificate of the secretary or an assistant
secretary of each of the Parent and each of its Subsidiaries as of the Second
Amendment Effective Date, dated as of the Second Amendment Effective Date and in
form and substance reasonably satisfactory to the Bank, certifying, in a form
acceptable to Bank, (i) the articles or certificate of incorporation,
certificate of formation or other organizational document and all amendments
thereto of such party, (ii) the bylaws, operating agreement or similar governing
document of such party, as then in effect and as in effect at all times from the
date on which the resolutions referred to in clause (iii) below were adopted to
and including the date of such certificate, (iii) a true and complete copy of
resolutions adopted by the board of directors (or similar governing body) of
such party, authorizing the execution, delivery and performance of this
Agreement and the other Credit Documents to which it is a party, and (iv) as to
the incumbency and genuineness of the signature of each officer of such party
executing this Amendment, and attaching all such copies of the documents
described above.

 

(e) The Bank shall have received a certificate as of a recent date of the good
standing of each of the Parent and each of its Subsidiaries as of the Second
Amendment Effective Date, under the laws of its jurisdiction of organization,
from the Secretary of State (or comparable Governmental Authority) of such
jurisdiction.

 

(f) The Bank shall have received certified reports from an independent search
service satisfactory to it listing any judgment or tax lien filing or Uniform
Commercial Code financing statement that names the Parent or the Borrower as
debtor in any of the jurisdictions listed beneath its name on Schedule I to the
Security Agreement, and the results thereof shall be reasonably satisfactory to
the Bank.

 

(g) The Bank shall have received updated certificates of insurance evidencing
the insurance coverages described on Schedule 4.16 and all other or additional
coverages required under the Security Documents and naming the Bank as loss
payee or additional insured, as its interests may appear.

 

(h) The Bank shall have received payment of (i) all fees due and payable on the
Second Amendment Effective Date, and (ii) all other fees and other amounts due
and payable on or prior to the Second Amendment Effective Date, including, to
the extent invoiced, reimbursement or payment of all out-of-pocket expenses
(including fees, charges and disbursements of counsel to the Bank) required to
be reimbursed or paid by the Borrower under the Credit Agreement, this Amendment
or any other Credit Document.

 

 

 

 

ARTICLE IV

 

AFFIRMATION OF OBLIGATIONS

 

4.1 Affirmation of Obligations. Each Credit Party hereby approves and consents
to the amendments contemplated by this Amendment and agrees that its obligations
under the Credit Documents to which it is a party shall not be diminished as a
result of the execution of this Amendment. This acknowledgement by each Credit
Party is made and delivered to induce the Bank to enter into this Amendment, and
each Credit Party acknowledges that the Bank would not enter into this Amendment
in the absence of the acknowledgements contained herein.

 

4.2 Liens. Each Credit Party hereby ratifies and confirms the grant of a
security interest in and Lien on the Collateral contained in the Security
Documents that were executed in connection with the Credit Agreement, which
security interest and Lien shall continue in full force and effect without
interruption.

 

ARTICLE V

 

MISCELLANEOUS

 

5.1 Release. In consideration of the Bank's willingness to enter into this
Amendment, the Credit Parties hereby release the Bank and each of its respective
officers, employees, representatives, agents, counsel and directors from any and
all actions, causes of action, claims, demands, damages and liabilities of
whatever kind or nature, in law or in equity, now known or unknown, suspected or
unsuspected to the extent that any of the foregoing arises from any action or
failure to act solely in connection with the Credit Documents on or prior to the
date hereof.

 

5.2 Governing Law. This Amendment shall be governed by and construed and
enforced in accordance with the laws of the State of New York (including
Sections 5-1401 and 5-1402 of the New York General Obligations Law, but
excluding all other choice of law and conflicts of law rules).

 

5.3 Full Force and Effect. Except as expressly amended hereby, the Credit
Agreement shall continue in full force and effect in accordance with the
provisions thereof on the date hereof. As used in the Credit Agreement,
“hereinafter,” “hereto,” “hereof,” and words of similar import shall, unless the
context otherwise requires, mean the Credit Agreement after amendment by this
Amendment. Any reference to the Credit Agreement or any of the other Credit
Documents herein or in any such documents shall refer to the Credit Agreement
and Credit Documents as amended hereby. This Amendment is limited as specified
and shall not constitute or be deemed to constitute an amendment, modification
or waiver of any provision of the Credit Agreement except as expressly set forth
herein. This Amendment shall constitute a Credit Document under the terms of the
Credit Agreement.

 

5.4 Expenses. The Borrower agrees on demand (i) to pay all reasonable fees and
expenses of counsel to the Bank, and (ii) to reimburse the Bank for all
reasonable out-of-pocket costs and expenses, in each case, in connection with
the preparation, negotiation, execution and delivery of this Amendment and the
other Credit Documents delivered in connection herewith.

 

5.5 Severability. To the extent any provision of this Amendment is prohibited by
or invalid under the applicable law of any jurisdiction, such provision shall be
ineffective only to the extent of such prohibition or invalidity and only in any
such jurisdiction, without prohibiting or invalidating such provision in any
other jurisdiction or the remaining provisions of this Amendment in any
jurisdiction.

 

 

 

 

5.6 Successors and Assigns. This Amendment shall be binding upon, inure to the
benefit of and be enforceable by the respective successors and permitted assigns
of the parties hereto.

 

5.7 Construction. The headings of the various sections and subsections of this
Amendment have been inserted for convenience only and shall not in any way
affect the meaning or construction of any of the provisions hereof.

 

5.8 Counterparts. This Amendment may be executed in any number of counterparts
and by different parties hereto on separate counterparts, each of which when so
executed and delivered shall be an original, but all of which shall together
constitute one and the same instrument.

 

[Signature Page to Follow]

 

 

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to Credit
Agreement to be executed by their duly authorized officers as of the date first
above written.

 

  THE BORROWER:         JAMBA JUICE & COMPANY               By: /s/ Karen Luey  
Name: Karen Luey   Title: Executive Vice President, Chief Financial Officer,
Chief Accounting Officer and Secretary               THE PARENT:         JAMBA,
INC.               By: /s/ Karen Luey   Name: Karen Luey   Title: Executive Vice
President, Chief Financial Officer,
Chief Accounting Officer and Secretary               THE SUBSIDIARY GUARANTORS:
        JAMBA JUICE ADVERTISING FUND INC.               By: /s/ Karen Luey  
Name: Karen Luey   Title: Executive Vice President, Chief Financial Officer,
Chief Accounting Officer and Secretary               TALBOTT TEAS INC.          
    By: /s/ Karen Luey   Name: Karen Luey   Title: Executive Vice President,
Chief Financial Officer,
Chief Accounting Officer and Secretary

 

 

 

 

Signature Page to Second Amendment

Jamba Juice Company 

 

 

 

 

  THE BANK:         WELLS FARGO BANK, NATIONAL ASSOCIATION               By: /s/
Cavan J. Harris   Name: Cavan J. Harris   Title: Senior Vice President

 

 

 

 

Signature Page to Second Amendment

Jamba Juice Company