EXHIBIT 10.15

 
NINTH MODIFICATION TO
LOAN AND SECURITY AGREEMENT
 
This Ninth Modification to Loan and Security Agreement (this “Amendment”) is
entered into as of June 24, 2014 with an effective date of May 31, 2014, by and
among THE PRIVATEBANK AND TRUST COMPANY (the “Bank”), LIFEWAY FOODS, INC., an
Illinois corporation (“Lifeway”), FRESH MADE, INC., a Pennsylvania corporation
(“FMI”), HELIOS NUTRITION LIMITED, a Minnesota corporation (“Helios”), PRIDE OF
MAIN STREET DAIRY, LLC, a Minnesota limited liability company (“Pride”),
STARFRUIT, LLC, an Illinois limited liability company (“Starfruit”), and LIFEWAY
WISCONSIN, INC., an Illinois corporation (“LWI” and together with Lifeway, FMI,
Helios, Pride and Starfruit being sometimes collectively referred to as the
“Borrowers”).
 
RECITALS
 
WHEREAS, the Bank and the Borrowers (other than LWI which subsequently became a
Borrower) previously entered into a Loan and Security Agreement dated February
6, 2009, as amended by that certain First Modification to Loan and Security
Agreement dated as of August 13, 2009, by that certain Second Modification to
Loan and Security Agreement dated November 12, 2009, by that certain Third
Modification to Loan and Security Agreement dated February 6, 2010, by that
certain Fourth Modification to Loan and Security Agreement dated as of April 20,
2011, by ‘that certain Fifth Modification to Loan and Security Agreement dated
as of June 20, 2011 and by that certain Sixth Modification to Loan and Security
Agreement dated as of June 13, 2012, by that certain Seventh Modification to
Loan and Security Agreement dated as of May 14, 2013 and by that certain Eighth
Modification to Loan and Security Agreement dated as of September 4, 2013 (as
modified, the “Loan Agreement”), pursuant to which the Bank made available to
the Borrowers a credit facility.
 
WHEREAS, the Borrowers desire, and the Bank is willing, to (a) extend the
Revolving Loan Maturity Date, (b) waive Borrowers non-compliance with the Fixed
Charge Coverage Ratio financial covenant for the fiscal quarter ended March 31,
2014, and (c) make certain other modifications to the Fixed Charge Coverage
Ratio financial covenant to address certain Capital Expenditures made by
Borrowers in connection with the GGD Acquisition, all upon and subject to the
terms and conditions set forth in this Amendment; and
 
WHEREAS, this Amendment shall constitute a Loan Document and these Recitals
shall be construed as part of this Amendment.
 
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which hereby are acknowledged, the parties hereto hereby agree as follows:
 
1.   Definitions.  (a)  Undefined Terms. Unless the context otherwise provides
or requires, capitalized terms used herein which are not defined herein shall
have the meanings ascribed to them in the Loan Agreement; provided, however,
that all references in the Loan Agreement to (a) “Obligations” shall, in
addition to the definition set forth in the Loan Agreement include, but not be
limited to, the duties and obligations of the Borrowers under this Amendment,
and (b) “Loan Documents” shall, in addition to the definition set forth in the
Loan Agreement  include, but not be limited to, this Amendment and the documents
and instruments to be delivered pursuant to this Amendment.
 
 
 

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(b) Amended and Restated Defined Tenn. When used herein and in the Loan
Agreement, the following term shall have the following amended and restated
meaning:
 
“Revolving Loan Maturity Date” shall mean May 31, 2015, unless extended by the
Bank pursuant to any modification, extension or renewal note executed by the
Borrowers and accepted by the Bank in its sole and absolute discretion in
substitution for the Revolving Note.”
 
2            Amendments.
 
(a) The Revolving Loan is hereby extended to the Revolving Loan Maturity Date.
The Revolving Note is hereby amended by deleting all references to February 6,
2010 (subsequently amended to May 31, 2014) and replacing such references with
May 31, 2015.
 
(b) Commencing the fiscal quarter ending June 30, 2014, Section 10.2 of the Loan
Agreement is amended and restated as follows:
 
10.2 Fixed Charge Coverage. As of the end of each of its fiscal quarters, the
Borrowers and their Subsidiaries shall maintain a ratio of (a) the total for the
four fiscal quarters then ending of consolidated EBITDA minus, in respect of
such four fiscal quarters, the sum of (i) all income taxes paid in cash by the
Borrowers and their Subsidiaries, (ii) all Capital Expenditures which are not
financed with Funded Debt (excluding up to $2,400,000 of Capital Expenditures
made during the fiscal quarter ended September 30, 2013 which were not financed
with Funded Debt and were made in connection with the GGD Acquisition), (iii)
cash distributions or dividends and (iv) amounts paid to repurchase or redeem
stock or equity, to (b) the sum for such four fiscal quarters of (i) Interest
Charges plus (ii) required payments of principal of Funded Debt (including the
Term Loan and 2013 Term Loan, but excluding the (x) Revolving Loans, (y) Seller
Note and (z) Amani-Helios Note), of not less than 1.10 to 1.
 
(c) Except as specifically set forth herein, the Revolving Note, the Term Note,
2013 Term Loan Note and the Loan Documents previously delivered by the Borrowers
shall remain in full force and effect and are hereby ratified and confirmed in
all respects. The indebtedness evidenced by the Revolving Note, Term Note and
2013 Term Loan Note (as hereby amended by this Ninth Modification) is continuing
indebtedness of the Borrowers and nothing herein shall be deemed to constitute a
payment, settlement or novation of the Revolving Note, Term Note or 2013 Term
Loan Note, or to release or otherwise adversely affect any lien or security
interest securing such indebtedness or any rights of the Bank against any party
primarily or secondarily liable for such indebtedness.
 
 
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2.   Waiver of Fixed Charge Coverage Ratio Breach. The Bank waives the
Borrowers’ compliance with Section 10.2 “Fixed Charge Coverage” of the Loan
Agreement in respect to the Borrowers’ fiscal quarter ended March 31, 2014 (the
“FCCR Default”). From and  after the date of this Amendment, the Bank hereby
waives its right to pursue remedies on account of the FCCR Default. Such waiver
(a) shall not be deemed to extend to any other Event of Default which has arisen
or may hereafter arise, whether or not known to the Bank or any Borrower on the
date hereof, (b) shall not be deemed to effect any amendment of the Loan
Agreement or any of the Loan Documents, all of which shall remain in full force
and effect in accordance with their respective terms except as expressly amended
hereby and (c) shall not be deemed to establish a custom or course of dealing
between the Borrowers and the Bank.
 
3.   Representations and Warranties of Borrowers.
 
(a) The Recitals in this Amendment are true and correct in all respects.
 
(b) All representations and warranties of each Borrower in the Loan Agreement
and in the other Loan Documents to which each Borrower is a party are
incorporated herein in full by this reference and are true and correct in all
material respects as of the date hereof, except to the extent that any such
representation or warranty expressly relates to an earlier date.
 
(c) After giving effect to this Amendment, no Event of Default or Unmatured
Event of Default has occurred and is continuing.
 
(d) Each Borrower has the power, and has been duly authorized by all requisite
action, to execute and deliver this Amendment. This Amendment has been duly
executed by each Borrower.
 
(e) This Amendment is the legal, valid and binding obligation of each Borrower,
enforceable against each Borrower and each of the other Borrowers in accordance
with their respective terms, except as such enforceability may be limited by any
applicable bankruptcy, insolvency, reorganization, moratorium, or similar law
affecting creditors’ rights generally.
 
(f) The execution, delivery and performance of this Amendment do not and will
not (i) violate any law, rule, regulation or court order to which any of the
Borrowers is subject; (ii) conflict with or result in a breach of the
certificate of formation or incorporation, bylaws, limited liability company
agreement or other organizational documents of any of the Borrowers or any other
agreement or instrument to which it is party or by which the properties of any
of the Borrowers is bound; or (iii) result in the creation or imposition of any
Lien on any property of any of the Borrowers, whether now owned or hereafter
acquired, other than Liens in favor of the Bank.
 
(g) No consent or authorization of, filing with or other act by or in respect of
any Person is required in connection with the execution, delivery or performance
by each of the Borrowers, or the validity or enforceability, of this Amendment,
or the consummation of the transactions contemplated hereby.
 
 
 
 
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4.   Conditions Precedent to Effectiveness. This Amendment shall be effective on
the date when each of the following conditions shall have been satisfied in the
sole discretion of the Bank:
 
(a) Amendment.  Each of the Borrowers and the Bank shall have delivered to the
Bank executed counterparts of this Amendment;
 
(b) Secretary and Manager Certificates.  With respect to each Borrower (i) good
standing certificates in its state of incorporation (or formation) and in each
other state requested by the Bank; and (ii) certification that the certificates
delivered by such Borrower on or about April 20, 2011, remain in full force and
effect (it being understood that the Bank may conclusively rely on each such
certificate until formally advised by a like certificate of any changes
therein), all certified by its secretary or an assistant secretary or manager
(or similar officer) as being in full force and effect without modification; and
 
(c) Other Documents.  The Borrowers shall have delivered to the Bank such other
agreements, certificates, instruments and other documents as the Bank may
reasonably request to accomplish the purposes of this Amendment.
 
5.   Reference to and Effect on Loan Documents.
 
(a) Ratification.  Except as specifically provided in this Amendment, the Loan
Agreement and the other Loan Documents shall remain in full force and effect and
each Borrower hereby ratifies and confirms each such Loan Document.
 
(b) No Waiver.  The execution, delivery and effectiveness of this Amendment
shall not operate as a waiver or forbearance of any right, power or remedy of
the Bank under the Loan Agreement or any of the other Loan Documents, or, except
as expressly provided in herein, constitute a consent, waiver or modification
with respect to any provision of the Loan Agreement or any of the other Loan
Documents. Upon the effectiveness of this Amendment each reference in (a) the
Loan Agreement to “this Agreement,” “hereunder,” “hereof,” or words of similar
import and (b) any other Loan Document to “the Agreement” shall, in each case
and except as otherwise specifically stated therein, mean and be a reference to
the Loan Agreement as amended and modified hereby.
 
6.   Entire Agreement.  This Amendment, including all annexes, exhibits,
schedules and other documents incorporated by reference herein or delivered in
connection herewith, constitutes the entire agreement of the parties with
respect to the subject matter hereof and supersedes all other understandings,
oral or written, with respect to the subject matter hereof.
 
7.   Fees and Expenses.  As provided in the Loan Agreement, the Borrowers agree
to pay on demand all fees, costs and expenses incurred by the Bank in connection
with the preparation, execution and delivery of this Amendment.
 
8.   Severability.  Wherever possible, each provision of this Amendment shall be
interpreted in such a manner as to be effective and valid under applicable law,
but if any provision of this Amendment shall be prohibited by or invalid under
applicable law, such provision shall be ineffective only to the extent of such
prohibition or invalidity, without invalidating the remainder of such provision
or the remaining provisions of this Amendment.
 
 
 
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9.   Conflict of Terms.  Except as otherwise provided in this Amendment, if any
provision contained in this Amendment is in conflict with, or inconsistent with,
any provision in  any of the other Loan Documents, the provision contained in
this Amendment shall govern and control.
 
10.     Successors and Assigns.  This Amendment shall inure to the benefit of
and be binding upon the successors and permitted assigns of the Bank and shall
be binding upon the successors and assigns of each Borrower.
 
11.     Counterparts.  This Amendment may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
taken together shall be one and the same instrument. Signature pages may be
detached from multiple separate counterparts and attached to a single
counterpart. Delivery of an executed signature page of this Amendment by
facsimile transmission or electronic transmission (such as fax or e-mail) shall
be as effective as delivery of a manually executed counterpart thereof.
 
12.     Headings.  The paragraph headings used in this Amendment are for
convenience only and shall not affect the interpretation of any of the
provisions hereof.
 
13.    Applicable Law.  THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, THE LAWS SET FORTH IN THE CREDIT AGREEMENT, OR, IF
NO JURISDICTION IS SET FORTH THEREIN, BY THE INTERNAL LAWS (AS OPPOSED TO
CONFLICT OF LAWS PROVISIONS) OF THE STATE OF ILLINOIS.
 
14.     Forum Selection and Consent to Jurisdiction.  ANY LITIGATION BASED
HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH THIS AMENDMENT OR ANY
OTHER LOAN DOCUMENT, SHALL BE BROUGHT AND MAINTAINED EXCLUSIVELY IN THE COURTS
OF THE STATE OF ILLINOIS OR IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN
DISTRICT OF ILLINOIS; PROVIDED THAT NOTHING IN THIS AMENDMENT SHALL BE DEEMED OR
OPERATE TO PRECLUDE THE BANK FROM BRINGING SUIT OR TAKING OTHER LEGAL ACTION IN
ANY OTHER JURISDICTION. EACH OF THE BORROWERS HEREBY EXPRESSLY AND IRREVOCABLY
SUBMITS TO THE JURISDICTION OF THE COURTS OF THE STATE OF ILLINOIS AND OF THE
UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS FOR THE
PURPOSE OF ANY SUCH LITIGATION AS SET FORTH ABOVE. EACH OF THE BORROWERS FURTHER
IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED MAIL, POSTAGE
PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF ILLINOIS. EACH OF
THE BORROWERS HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING
OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND
ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
 
 
 
 
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15.    Waiver of Jury Trial.  THE BANK AND EACH OF THE BORROWERS, AFTER
CONSULTING OR HAVING HAD THE OPPORTUNITY TO CONSULT WITH COUNSEL, EACH
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE IRREVOCABLY, ANY RIGHT TO A TRIAL
BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS
AMENDMENT, ANY NOTE, ANY OTHER LOAN DOCUMENT, ANY OF THE OTHER OBLIGATIONS, THE
COLLATERAL, OR ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR
WHICH MAY IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH OR THEREWITH OR
ARISING FROM ANY LENDING RELATIONSHIP EXISTING IN CONNECTION WITH ANY OF THE
FOREGOING, OR ANY COURSE OF CONDUCT OR COURSE OF DEALING IN WHICH THE BANK AND
ANY OF THE BORROWERS ARE ADVERSE PARTIES, AND EACH AGREE THAT ANY SUCH ACTION OR
PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY. THIS PROVISION
IS A MATERIAL INDUCEMENT FOR THE BANK ENTERING INTO THIS AMENDMENT.
 
16.    Release of Claims.  In consideration of the execution and delivery of
this Amendment by the Bank, the sufficiency of which is acknowledged, and
excepting only the contractual obligations respecting future performance by the
Bank arising under the Loan Agreement and the Loan Documents, each of the
Borrowers hereby irrevocably releases and forever discharges the Bank and each
of its affiliates, subsidiaries, successors, assigns, directors, officers,
employees, agents, representatives and attorneys (each, a “Released Person”) of
and from all damages, losses, claims, demands, liabilities, obligations, actions
and causes of action whatsoever which such Borrowers may now have or claim to
have on and as of the date hereof against any Released Person, whether presently
known or unknown, liquidated or unliquidated, suspected or unsuspected,
contingent or non-contingent, and of every nature and extent whatsoever
(collectively, “Claims”).  Each Borrower jointly and severally represents and
warrants to the Bank that it has not granted or purported to grant to any other
Person any interest whatsoever in any Claim, as security or otherwise. The
Borrowers shall jointly and severally indemnify, defend and hold harmless each
Released Person from and against any and all Claims and any loss, cost,
liability, damage or expense (including reasonable attorneys’ fees and expenses)
incurred by any Released Person in investigating, preparing for, defending
against, providing evidence or producing documents in connection with or taking
other action in respect of any commenced or threatened Claim.
 
EACH BORROWER AGREES TO ASSUME THE RISK OF ANY AND ALL UNKNOWN, UNANTICIPATED OR
MISUNDERSTOOD DEFENSES, CLAIMS, CONTRACTS, LIABILITIES, INDEBTEDNESS AND
OBLIGATIONS WHICH ARE RELEASED, WAIVED AND DISCHARGED BY THIS AMENDMENT. EACH
BORROWER HEREBY WAIVES AND RELINQUISHES ALL RIGHTS AND BENEFITS WHICH IT MIGHT
OTHERWISE HAVE UNDER ANY CIVIL CODE OR ANY SIMILAR LAW, TO THE EXTENT SUCH LAW
MAY BE APPLICABLE, WITH REGARD TO THE RELEASE OF SUCH UNKNOWN, UNANTICIPATED OR
MISUNDERSTOOD DEFENSES, CLAIMS, CONTRACTS, LIABILITIES, INDEBTEDNESS AND
OBLIGATIONS. TO THE EXTENT THAT SUCH LAWS MAY BE APPLICABLE, EACH BORROWER
WAIVES AND RELEASES ANY RIGHT OR DEFENSE WHICH IT MIGHT OTHERWISE HAVE UNDER ANY
OTHER LAW OR ANY APPLICABLE JURISDICTION WHICH MIGHT LIMIT OR RESTRICT THE
EFFECTIVENESS OR SCOPE OF ANY OF THEIR WAIVERS OR RELEASES HEREUNDER.
 
[Signature page follows]
 
 
 
 
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed
as of the date first written above.
 
THE BANK:

THE PRIVATEBANK AND TRUST COMPANY

By: /s/ Douglas W. Buehler                         
Authorized Officer
THE BORROWERS:
 
LIFEWAY FOODS, INC.
 
By: /s/ Edward Smolyansky                          
Title: Secretary                                                
 
 
FRESH MADE, INC.
 
By: /s/ Julie Smolyansky                               
Title: Secretary                                                
 
 
HELIOS NUTRITION LIMITED
 
By: /s/ Edward Smolyansky                          
Title: Secretary                                                
 
 
PRIDE OF MAIN STREET DAIRY, LLC
 
By: /s/ Edward Smolyansky                          
Title: Manager                                                
 
 
STARFRUIT, LLC
 
By: /s/ Edward Smolyansky                          
Title: Manager                                                
 
 
LIFEWAY WISCONSIN, INC.
 
By: /s/ Julie Smolyansky                               
Title: Secretary