LANDEC CORPORATION (NASDAQ:LNDC) Files An 8-K Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a RegistrantItem 2.03 of this Current Report on Form 8-K is incorporated into this Item 1.01 by reference.
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Item 2. |
Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
On November 30, 2018, Landec and certain of its subsidiariesentered into the Fourth Amendment and Joinder to the Credit Agreement and Other Loan Documents (the “Credit Amendment”) withJPMorgan Chase Bank, N.A. (“JPMorgan”), BMO Harris Bank N.A. and City National Bank, as lenders (collectively, the “Lenders”), which amended the Credit Agreement entered into on September 23, 2016 (the “Original Credit Agreement”) by and among Landec, certain of its subsidiaries, and the Lenders. The Credit Amendment increased the capacity of the credit facility available under the Original Credit Agreement by $55,000,000 to (i) a $105,000,000 revolving line of credit (the “Amended Revolver”) and (ii) a $100,000,000 term loan facility (the “Amended Term Loan” and, together with the Amended Revolver, the “Amended Credit Facility”)from its preexisting credit facility comprised of(i) a $100,000,000 revolving line of credit (the “Original Revolver”) and (ii) a $50,000,000 term loan facility (the “Original Term Loan”).
The Amended Credit Facility continues to be guaranteed by certain of Landec's direct and indirect subsidiaries and secured by substantially all of Landec's and such direct and indirect subsidiaries’ personal property assets (with the exception of Apio’s equity interest in Windset Holdings 2010 Ltd.). Both the Amended Revolver and the Amended Term Loan continue to mature on September 23, 2021, with the Amended Term Loan requiring increased quarterly payments of $2,500,000 and with the remainder continued to be due at maturity. Interest on both the Amended Revolver and the Amended Term Loan continues to be based upon the Company’s “Total Leverage Ratio”, now at a per annum rate of either (i) the prime rate plus a spread of between 0.25% and 2.25% or (ii) the Eurodollar rate plus a spread of between 1.25% and 3.25%, but also now allowing for a Total Leverage Ratio of up to 4.50 to 1.00. The Credit Agreement also contains an “accordion” feature that provides Landec the right to increase theRevolver commitments and/or theTerm Loan commitments by obtaining additional commitments either from one or more of the Lenders or another lending institution in an amount of up to $10,000,000.
Landec entered into the Credit Amendment primarily to fund its acquisition of Yucatan Foodsand its related entities on December 1, 2018, to pay certain fees and expenses incurred in connection with the consummation of the Credit Amendment, and for other general corporate purposes.
The Credit Agreement continues to contain customary events of default under which the obligation could be accelerated and/or the interest rate increased.
The foregoing description of the Credit Amendmentand the Amended Credit Facilitydoes not purport to be complete and is subject to, and qualified in its entirety by, reference to the Credit Amendment, a copy of which is attached hereto as Exhibit 10.1 and theOriginal Credit Agreement and the Pledge and Security Agreement, copies of which were attached as Exhibits 10.1 and 10.2 to the Company’s Current Report on Form 8-K filed on September 26, 2016, and the terms of which are each incorporated herein by reference.
The full text of thepress release, dated December 3, 2018, announcing the Acquisition, is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.
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Item 9.01 |
Financial Statements and Exhibits. |
(d)Exhibit.
The following exhibits are furnished as part of this report:
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Exhibit No. |
Description |
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2.1 |
Capital Contribution and Partnership Interest andStock Purchase Agreement dated December 1, 2018 by and among Apio, Inc., a Delaware Corporation, Yucatan Foods, L.P., a Delaware limited partnership(“Yucatan”), Camden Fruit Corporation, a California corporation, Landec Corporation, a Delaware corporation,in its capacity as guarantor, Ardeshir Haerizadeh, as an equityholder representative, and the equityholders of Camden and Yucatan (exhibits and schedules have been omitted to Item 601(b)(2) of Regulation S-K and will be provided to the Securities and Exchange Commission upon request) |
| 10.1 | Fourth Amendment and Joinder to the Credit Agreement and Other Loan Documents dated November 30, 2018 by and among Landec Corporation,Apio, Inc., Lifecore Biomedical, Inc., Lifecore Biomedical, LLC, and GreenLine Logistics, Inc., BMO Harris Bank N.A., City National Bank, and JPMorgan Chase Bank, N.A. |
| 99.1 | Press Release of Landec Corporation dated December 3, 2018 |
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.
Date: December 6, 2018
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LANDEC CORPORATION |
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By: |
/s/Gregory S. Skinner |
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Gregory S. Skinner |
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Vice President of Finance and Administration and |
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Chief Financial Officer |
EXHIBIT INDEX
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Exhibit No. |
Description |
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2.1 |
Capital Contribution and Partnership Interest andStock Purchase Agreement dated December 1, 2018 by and among Apio, Inc., a Delaware Corporation, Yucatan Foods, L.P., a Delaware limited partnership(“Yucatan”), Camden Fruit Corporation, a California corporation, Landec Corporation, a Delaware corporation,in its capacity as guarantor, Ardeshir Haerizadeh, as an equityholder representative, and the equityholders of Camden and Yucatan (exhibits and schedules have been omitted LANDEC CORP CA ExhibitEX-2.1 2 ex_127301.htm EXHIBIT 2.1 ex_127301.htm Exhibit 2.1 Capital Contribution AND PARTNERSHIP INTEREST AND STOCK PURCHASE AGREEMENT dated as of December 1,…To view the full exhibit click hereAbout LANDEC CORPORATION (NASDAQ:LNDC) Landec Corporation designs, develops, manufactures and sells a range of health and wellness products for food and biomaterials markets. The Company licenses technology applications to partners. The Company operates through three segments: Packaged Fresh Vegetables, Food Export and Biomaterials. The Packaged Fresh Vegetables segment markets and packs specialty packaged whole and fresh-cut fruit and vegetables, the majority of which incorporate the BreatheWay specialty packaging for the retail grocery, club store and food services industry. The Food Export segment is engaged in the purchase and sale of whole commodity fruit and vegetable products primarily to Asia. The Biomaterials segment sells products utilizing hyaluronan, a polysaccharide that is distributed in the extracellular matrix of connective tissues in both animals and humans, and non-hyaluronan (HA) products for medical use primarily in the ophthalmic, orthopedic and other markets. |
