SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A AMENDMENT #2
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) April 30, 1996
IVC Industries, Inc.
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(Exact name of registrant as specified in its charter)
Delaware 33-730406 22-1567481
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
500 Halls Mill Road, Freehold, New Jersey 07728
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (908) 308-3000
International Vitamin Corporation
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(Former name or former address, if changed since last report.)
<PAGE>
Item 7. Financial Statements and Exhibits.
Exhibits:
Pursuant to Section 15 of Exhibit 10.11 of the Registrant's Form 8-K dated
May 14, 1996, certain security agreements were to be executed and delivered
within 10 days after the date of such exhibit. Such agreements have been
included in this Form 8-K/A Amendment #2. In addition, the annex to Exhibit
10.15 of the Registrant's Form 8-K dated May 14, 1996 was inadvertently omitted
from this Item. Exhibit 10.15 has been included in full in this Form 8-K/A
Amendment # 2.
2.1 Merger Agreement dated as of November 13, 1995, amended and restated as of
February 13, 1996, among International Vitamin Corporation, Hall
Laboratories, Inc., Andrew M. Pinkowski, Rita Pinkowski, Vicki Welsh Jones
and The Amelia Welsh Jones Trust under a Trust Agreement dated 6/4/93
(incorporated by reference to Appendix A to the Registrant's Proxy
Statement and Annual Report to Shareholders dated March 5, 1996).*
3.3 Amended Certificate of Incorporation of IVC Industries, Inc.*
3.4 Amended and Restated By-laws of IVC Industries, Inc.*
10.5 Registration Rights Agreement dated April 30, 1996 among IVC Industries,
Inc., Andrew M. Pinkowski, Rita Pinkowski, Vicki Welsh Jones, The Amelia
Welsh Jones Trust under a Trust Agreement dated 6/4/93, Lawrence A.
Newman, Duane Baxter, Peter W. Schreiber, John H. Dettra, Jr. and Larry
Corbridge.*
10.6 International Vitamin Corporation 1995 Stock Option Plan (incorporated by
reference to the Registrant's Statement and Annual Report to Shareholders
dated March 5, 1996).*
10.7 Credit Agreement dated as of April 30, 1996 among IVC Industries, Inc.,
the Banks party thereto and The Chase Manhattan Bank (National
Association), as Agent..*
10.8 Guaranty dated as of April 30, 1996 by the Guarantor.**
10.9 Guaranty Reimbursement Agreement dated as of April 30, 1996 by IVC
Industries, Inc., International Vitamin Overseas Sales Corp. and Hall
Laboratories, Ltd. in favor of the Guarantor.**
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* Previously filed.
** Previously filed. Confidential information indicated by Xs has been
omitted and filed separately with the Securities and Exchange Commission.
2
<PAGE>
10.10 Letter of Credit Reimbursement Agreement dated as of April 30, 1996 by and
between IVC Industries, Inc., International Vitamin Overseas Sales Corp.
and The Chase Manhattan Bank (National Association).*
10.11 Subordination and Intercreditor Agreement dated as of April 30, 1996 by
the Guarantor, The Chase Manhattan Bank (National Association), IVC
Industries, Inc., International Vitamin Overseas Sales Corp. and Hall
Laboratories, Ltd.**
10.12 Security Agreement dated as of April 30, 1996 by IVC Industries, Inc. in
favor of the Guarantor.**
10.13 Security Agreement dated as of April 30, 1996 by International Vitamin
Overseas Sales Corp. in favor of the Guarantor.**
10.14 Security Agreement dated as of April 30, 1996 by Hall Laboratories, Ltd.
in favor of the Guarantor.**
10.15 Trademark Collateral Assignment Agreement dated as of April 30, 1996 by
IVC Industries, Inc.***
10.16 Employment Agreement dated as of April 30, 1996 between IVC Industries,
Inc. and Andrew M. Pinkowski.*
10.17 Guaranty and Security Agreement dated as of May 10, 1996 by IVC
Industries, Inc. in favor of the Guarantor.***
10.18 Guaranty and Security Agreement dated as of May 10, 1996 by International
Vitamin Overseas Sales Corp. in favor of the Guarantor.***
10.19 Guaranty and Security Agreement dated as of May 10, 1996 by Hall
Laboratories, Ltd. in favor of the Guarantor.***
10.20 Trademark Collateral Assignment Agreement dated as of May 10, 1996 by IVC
Industries, Inc.***
99.2 Press Release dated May 1, 1996.*
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* Previously filed.
** Previously filed. Confidential information indicated by Xs has been
omitted and filed separately with the Securities and Exchange Commission.
*** Confidential information indicated by Xs has been omitted and filed
separately with the Securities and Exchange Commission.
3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this amendment to be signed on its behalf by the
undersigned hereunto duly authorized.
IVC INDUSTRIES, INC.
Date: August __, 1996 /s/ E. Joseph Edell
------------------------------------------
Name: E. Joseph Edell
Title:Chairman and Chief Executive Officer
4
<PAGE>
EXHIBIT INDEX
Sequential
Exhibit Page No.
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2.1 Merger Agreement dated as of November 13, 1995,
amended and restated as of February 13, 1996, among
International Vitamin Corporation, Hall Laboratories,
Inc., Andrew M. Pinkowski, Rita Pinkowski, Vicki Welsh
Jones and The Amelia Welsh Jones Trust under a Trust
Agreement dated 6/4/93 (incorporated by reference to
Appendix A to the Registrant's Proxy Statement and
Annual Report to Shareholders dated March 5, 1996).*
3.3 Amended Certificate of Incorporation of IVC
Industries, Inc.*
3.4 Amended and Restated By-laws of IVC Industries, Inc.*
10.5 Registration Rights Agreement dated April 30, 1996
among IVC Industries, Inc., Andrew M. Pinkowski, Rita
Pinkowski, Vicki Welsh Jones, The Amelia Welsh Jones
Trust under a Trust Agreement dated 6/4/93, Lawrence
A. Newman, Duane Baxter, Peter W. Schreiber, John H.
Dettra, Jr. and Larry Corbridge.*
10.6 International Vitamin Corporation 1995 Stock Option
Plan (incorporated by reference to the Registrant's
Statement and Annual Report to Shareholders dated
March 5, 1996).*
10.7 Credit Agreement dated as of April 30, 1996 among IVC
Industries, Inc., the Banks party thereto and The
Chase Manhattan Bank (National Association), as
Agent.*
10.8 Guaranty dated as of April 30, 1996 by the
Guarantor.**
10.9 Guaranty Reimbursement Agreement dated as of April 30,
1996 by IVC Industries, Inc., International Vitamin
Overseas Sales Corp. and Hall Laboratories, Ltd. in
favor of the Guarantor.**
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* Previously filed.
** Previously filed. Confidential information indicated by Xs has been
omitted and filed separately with the Securities and Exchange Commission.
5
<PAGE>
Sequential
Exhibit Page No.
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10.10 Letter of Credit Reimbursement Agreement dated as of
April 30, 1996 by and between IVC Industries, Inc.,
International Vitamin Overseas Sales Corp. and The
Chase Manhattan Bank (National Association).*
10.11 Subordination and Intercreditor Agreement dated as of
April 30, 1996 by the Guarantor, The Chase Manhattan
Bank (National Association), IVC Industries, Inc.,
International Vitamin Overseas Sales Corp. and Hall
Laboratories, Ltd.**
10.12 Security Agreement dated as of April 30, 1996 by IVC
Industries, Inc. in favor of the Guarantor.**
10.13 Security Agreement dated as of April 30, 1996 by
International Vitamin Overseas Sales Corp. in favor of
the Guarantor.**
10.14 Security Agreement dated as of April 30, 1996 by Hall
Laboratories, Ltd. in favor of the Guarantor.**
10.15 Trademark Collateral Assignment Agreement dated as of
April 30, 1996 by IVC Industries, Inc.***
10.16 Employment Agreement dated as of April 30, 1996
between IVC Industries, Inc. and Andrew M. Pinkowski.*
10.17 Guaranty and Security Agreement dated as of May 10,
1996 by IVC Industries, Inc. in favor of the
Guarantor.***
10.18 Guaranty and Security Agreement dated as of May 10,
1996 by International Vitamin Overseas Sales Corp. in
favor of the Guarantor.***
10.19 Guaranty and Security Agreement dated as of May 10,
1996 by Hall Laboratories, Ltd. in favor of the
Guarantor.***
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* Previously filed.
** Previously filed. Confidential information indicated by Xs has been
omitted and filed separately with the Securities and Exchange Commission.
*** Confidential information indicated by Xs has been omitted and filed
separately with the Securities and Exchange Commission.
6
<PAGE>
Sequential
Exhibit Page No.
- ------- --------
10.20 Trademark Collateral Assignment Agreement dated as of
May 10, 1996 by IVC Industries, Inc.***
99.2 Press Release dated May 1, 1996.*
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* Previously filed.
*** Confidential information indicated by Xs has been omitted and filed
separately with the Securities and Exchange Commission.
7
EXHIBIT 10.15
Confidential information indicated by Xs has been omitted and filed separately
with the Securities and Exchange Commission.
TRADEMARK COLLATERAL ASSIGNMENT
IVC INDUSTRIES, INC. (formerly known as INTERNATIONAL VITAMIN
CORPORATION), a Delaware corporation (the "Assignor"), does hereby grant, assign
and convey to XXXXXXXXXXXXX (the "Assignee"), the registered trademarks and
trademark applications identified on Annex I hereto and the goodwill represented
thereby (the "Trademarks") together with all the proceeds thereof, as collateral
security for all the Liabilities (as hereinafter defined);
SUBJECT TO a reservation on the part of the Assignor (until the occurrence
of a Reimbursement Default, as hereinafter defined) of a license to use the
Trademarks for the Assignor's own benefit. The license so reserved shall
terminate upon the occurrence of a Reimbursement Default.
This Assignment is being executed and delivered pursuant to the Guaranty
Reimbursement Agreement dated the date hereof from the Assignor, International
Vitamin Overseas Sales Corp. and Hall Laboratories, Ltd. in favor of the
Assignee (the "Guaranty Reimbursement Agreement").
As used herein, the term "Liabilities" means all indebtedness, obligations
and liabilities of every kind and nature of the Assignor to the Assignee under
the Guaranty Reimbursement Agreement. The term "Reimbursement Default" means a
default on the part of the Assignor in paying when due any amount required to be
paid to the Assignee under the Guaranty Reimbursement Agreement.
The assignment effected hereby shall be governed by Article 9 of the New
York Uniform Commercial Code. Upon the occurrence and during the continuance of
a Reimbursement Default, the Assignee shall have the rights and remedies of a
secured party as set forth therein (including, without limitation, the right to
dispose of the Trademarks and to apply the proceeds of the disposition to
satisfy the Obligations) and otherwise available at law or in equity.
The Assignee shall have no duties with respect to the Trademarks, other
than the duties of a secured party under the New York Uniform Commercial Code.
Without limiting the generality of the foregoing, the Assignee shall have no
duty to prosecute any action for trademark infringement against any person.
<PAGE>
The address of the Assignee for purposes of this Agreement is:
XXXXXXXXXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXXXXXXXXX
or such other address as the Assignee may designate to the Assignor in writing
from time to time.
The assignment effected hereby is subject and subordinate to the
assignment of the Trademarks effected pursuant to the Trademark Collateral
Assignment dated the date hereof from the Assignor to The Chase Manhattan Bank
(National Association) as Agent.
IN WITNESS WHEREOF, the Assignor has executed this Assignment as of this
30th day of April, 1996.
ATTEST/WITNESS: IVC INDUSTRIES, INC.
By:/s/E. Joseph Edell
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STATE OF ___________ :
: ss.:
COUNTY OF __________ :
On this 30th day of April, 1996, before me, the undersigned, personally
appeared __________, the __________ of IVC Industries, Inc., who, I am
satisfied, is the person who signed the foregoing instrument, and he or she did
acknowledge that he or she signed and delivered the same in his or her capacity
as such officer, and that he or she was authorized to do so, and that the
foregoing instrument is the voluntary act and deed of such corporation, made by
virtue of the authority of its board of directors.
-----------------------------------
Notary Public
2
<PAGE>
ANNEX I
MARK REG. NO. DATE
---- -------- ----
AMERICANA 1,011,338 5-27-75
BIO-CEE 632,670 8-14-56
BUSY BODY 1,147,926 3-3-81
CHOLINOS 563,811 9-9-52
CPL (stylized) 1,036,435 3-23-76
FAMILY CHOICE 1,182,667 12-22-81
FAMILY CHOICE AND DESIGN 1,011,331 5-27-75
FIELDS OF NATURE 973,822 11-27-73
FOODS PLUS 735,918 8-14-62
4-T PLUS 584,486 1-12-54
FORTY-PLUS 1,799,035 10-19-93
GAIN N' GROW 706,534 11-1-60
GOLD CREST 1,929,598 10-24-95
HALL 1,254,876 10-18-83
HEALTH ESSENTIALS 1,657,983 9-24-95
INSUR-ALL 841,848 1-9-68
IRON PLUS 813,694 8-23-66
LIFESTAGE 1,847,214 7-26-94
MISC. DESIGN
(Design of a robot) 1,474,713 2-2-88
NAIL-TONE 703,156 8-23-60
NATURAL CHILD CARE 1,744,202 1-5-93
NATURAL CHILD CARE COMPANY 1,744,209 1-5-93
NATURAL DERMA-SALVE 1,730,618 11-10-92
NATURAL EXTRA-STRENGTH
SAFE-N-FREE 1,726,979 10-27-92
NATURE'S WONDER 1,069,719 7-19-77
NITE NITE 1,752,185 2-16-93
O.J.C. 1,151,430 4-21-81
3
<PAGE>
MARK REG. NO. DATE
---- -------- ----
PETAGREE 693,420 2-23-60
PREVITALEN 635,084 10-2-56
SPECTRO-VITE 1,413,864 12-23-80
SUPER REVINOL 1,795,566 9-28-93
SURE VITE-ALL 1,871,807 1-3-95
SYNERGY 1,297,341 9-25-84
TRINSVITE 632,571 8-14-56
VCA 1,484,961 4-19-88
VITABOTS 1,448,108 7-21-87
THE VITAMIN PLACE 1,767,872 4-27-93
VITEMIA 632,572 8-14-56
PENDING APPLICATIONS
--------------------
MARK SER. NO. FILED
---- -------- -----
BEAUTY AM 75/012,294 10-30-95
BEAUTY PM 75/012,295 10-30-95
BEAUTY NUTRITIONALS 74/698,617 7-10-95
BEAUTY REGIMEN 74/733,175 9-22-95
BETA CAROTENE PLUS 74/633,733 2-13-95
DIET ASSISTANCE 75/010,170 10-20-95
DIET INSURANCE 74/733,176 9-22-95
EARTH ESSENTIALS 74/718,051 8-21-95
GASSO 74/718,052 8-21-95
HIGH ENERGY 74/722,071 8-17-95
INNER STRUCTURE 75/005,256 10-13-95
IPANA 74/081,310 7-16-90
PINE BROS. 74/497,746 3-7-94
PRO HAIR2 74/597,137 11-9-94
PROTECTOR 74/521,111 5-9-94
4
<PAGE>
MARK SER. NO. FILED
---- -------- -----
RYBUTOL 75/054,607 1-22-96
THE SECOND BEST WAY TO GET
YOUR VEGETABLES 74/645,787 3-13-95
SYNERGY PLUS 75/054,610 1-22-96
VIBRANT SKIN 74/733,174 9-22-95
VISION-ALL 74/718,053 8-21-95
VITAMIN ESSENTIALS 74/594,418 11-3-94
ZESTABS 74/718,055 8-21-95
5
EXHIBIT 10.17
Confidential information indicated by Xs has been omitted and filed separately
with the Securities and Exchange Commission.
GUARANTY AND SECURITY AGREEMENT
THIS AGREEMENT, dated as of the 10th day of May, 1996, is made by IVC
INDUSTRIES, INC., a Delaware corporation (the "Grantor"), in favor of
XXXXXXXXXXXXXXXXXXX (the "Secured Party").
Preliminary Statement
A. The Grantor has executed and delivered to the Secured Party (i) a
certain Guaranty Reimbursement Agreement dated as of April 30, 1996 from itself,
Hall Laboratories, Ltd. ("Hall") and International Vitamin Overseas Sales Corp.
("IVOSC") in favor of the Secured Party (the "Guaranty Reimbursement
Agreement"), (ii) a certain Security Agreement dated as of April 30, 1996 from
itself in favor of the Secured Party (the "Security Agreement") and (iii) a
certain Subordination and Intercreditor Agreement dated as of April 30, 1996
among the Secured Party, the Grantor, Hall and IVOSC (the "Subordination
Agreement"). Pursuant to the Guaranty Reimbursement Agreement, the Grantor has
agreed to reimburse and pay to the Secured Party (among other things) any and
all amounts that may be paid by the Secured Party to the Banks and the Agent (as
defined therein) under a certain guaranty being executed and delivered by the
Secured Party in favor of the Banks and the Agent. Such guaranty guarantees
certain indebtedness of the Grantor to the Banks and the Agent. Pursuant to the
Security Agreement, the Grantor has granted to the Secured Party a security
interest in and a general lien upon certain security described therein as
security for the obligations of it and the other Obligors to the Secured Party
under the Guaranty Reimbursement Agreement.
B. Pursuant to Section 15 of the Subordination Agreement, Grantor has
agreed to execute and deliver to Secured Party a security agreement in the form
hereof, together with UCC-1 financing statements in connection therewith, to be
held by Secured Party, and deemed effective and which shall be enforceable only
upon the occurrence of an Event of Default (as hereinafter defined) and
notification from the Secured Party to Grantor that it considers the interests
granted under this Security Agreement effective and therefore enforceable.
NOW, THEREFORE, for good and valuable consideration (the receipt and
sufficiency of which are hereby acknowledged), and in order to induce the
Secured Party to execute and deliver the aforesaid guaranty, the Grantor hereby
agrees as follows:
1. As used in this Agreement, the term "Liabilities" shall mean (i) all
trade credit extended by the Secured Party to the Grantor for the purchase by
the Grantor from the Secured Party of goods in the ordinary course of business
on open account or as may be evidenced by promissory notes and (ii) the
Grantor's guaranty obligations under Section 2 of this Agreement. The term
"Security" shall mean all personal property and fixtures of the Grantor, whether
now or hereafter
<PAGE>
existing or now owned or hereafter acquired and wherever located, of every kind
and description, tangible or intangible, including, but not limited to, all
money, goods (including equipment, farm products and inventory), instruments,
securities, documents, chattel paper, accounts, contract rights, general
intangibles, credits, claims, demands, precious metals and any other property,
rights and interests of the Grantor, and shall include the proceeds, products
and accessions of and to any thereof. The term "Reimbursement Default" means a
default on the part of the Grantor in paying when due any amount required to be
paid to the Secured Party under the Guaranty Reimbursement Agreement.
2. Effective as of the Effective Date (as defined below), the Grantor
guarantees to the Secured Party, absolutely and conditioned only on the
existence of a Reimbursement Default, that Hall and IVOSC will promptly pay,
perform and observe all the obligations under the Liabilities (for purposes of
this paragraph, as said term is defined in the Guaranty and Security Agreements
delivered to the Secured Party by each of Hall and IVOSC in conjunction
herewith) and that all sums stated to be payable in, or which become payable
under, the terms of the Liabilities by Hall and IVOSC will promptly be paid when
due, whether at stated maturity or earlier by reason of acceleration or
otherwise, irrespective of the validity, regularity, or enforceability of any of
the documents underlying the Liabilities and irrespective of any present or
future law or order of any government (whether of right or in fact and whether
the Secured Party shall have consented thereto) or of any agency thereof
purporting to reduce, amend, restructure or otherwise affect any Liability of
Hall and/or IVOSC or to vary the terms of payment. The Grantor agrees that, as
among the Grantor and the Secured Party, the Liabilities may be declared to be
due and payable for purposes of this Agreement notwithstanding any stay,
injunction or other prohibition which may prevent, delay or vitiate any such
declaration as against Hall and/or IVOSC and that, in the event of any such
declaration (or attempted declaration), such Liabilities (whether or not due and
payable by Hall and/or IVOSC) shall forthwith become due and payable by the
Grantor for purposes of this Agreement. The Grantor consents that from time to
time, without notice to or further consent of the Grantor, the payment,
performance or observance of any or all of the Liabilities may be waived or
changed or the time of payment or performance or observance of any or all of the
Liabilities may be waived or changed or the time of payment or performance
thereof extended or accelerated, or renewed in whole or in part, or the terms of
the Liabilities may be changed and any collateral therefor may be exchanged,
surrendered, released or otherwise dealt with as the Secured Party may
determine, all without affecting the obligations of the Grantor hereunder. The
Grantor waives presentment of any instrument, demand of payment, protest and
notice of non-payment or protest thereof or of any exchange, sale, surrender or
other handling or disposition of such collateral, and any requirement that the
Secured Party exhaust any right, power or remedy or proceed against Hall and/or
IVOSC under the Liabilities. For purposes of the guarantee provided hereunder,
the Grantor further waives any defense whatsoever which might constitute a
defense available to, or discharge of, the Grantor, Hall and/or IVOSC.
3. As security for the Liabilities, the Grantor grants to the Secured
Party, effective as of the Effective Date (as defined below), a security
interest in and a general lien upon the Security. The security interest
specified herein shall be effective and may be perfected by the Secured Party
only on such date (the "Effective Date") as (i) an Event of Default shall have
occurred under that certain Credit Agreement dated as of April 30, 1996 among
Grantor, the Banks party thereto and
2
<PAGE>
The Chase Manhattan Bank (National Association), as agent and (ii) the Grantor
shall have received notice from the Secured Party that it considers the security
interest referred to herein effective and enforceable. Notwithstanding anything
to the contrary set forth herein, all rights, remedies, and other actions
permitted the Secured Party hereunder shall be available to the Secured Party
only on and after the Effective Date.
4. At any time and from time to time, upon the demand of the Secured
Party, the Grantor will: (1) deliver and pledge to the Secured Party, indorsed
and/or accompanied by such instruments of assignment and transfer in such form
and substance as the Secured Party may request, any and all instruments,
documents and/or chattel paper comprising the Security as the Secured Party may
specify in its demand; (2) give, execute, deliver, file and/or record any
notice, statement, instrument, document, agreement or other papers that may be
necessary or desirable, or that the Secured Party may request, in order to
create, preserve, perfect, or validate any security interest granted pursuant
hereto or to enable the Secured Party to exercise and enforce its rights
hereunder or with respect to such security interest; (3) keep and stamp or
otherwise mark any and all documents and chattel paper and its individual books
and records relating to inventory, accounts and contract rights in such manner
as the Secured Party may require; and (4) permit representatives of the Secured
Party at any time during business hours to inspect its inventory and to inspect
and make abstracts from the Grantor's books and records pertaining to inventory,
accounts, contract rights, chattel paper, instruments and documents. The right
is expressly granted to the Secured Party, at its discretion, to file one or
more financing statements under the Uniform Commercial Code naming the Grantor
as debtor and the Secured Party as secured party and indicating therein the
types or describing the items of Security herein specified. A photographic or
other reproduction of this agreement shall be sufficient as a financing
statement. With respect to the Security, or any part thereof, which at any time
shall come into the possession or custody or under the control of the Secured
Party or any of their agents, associates or correspondents, for any purpose, the
right is expressly granted to the Secured Party, at its discretion, to transfer
to or register in the name of itself or its nominee any of the Security; to
exchange any of the Security for other property upon any reorganization,
recapitalization or other readjustment and in connection therewith to deposit
any of the Security with any committee or depositary upon such terms as it may
determine; if a Reimbursement Default exists, to notify any account debtor or
obligor on an instrument to make payment to the Secured Party; and to exercise
or cause its nominee to exercise all or any powers with respect to the Security
with the same force and effect as an absolute owner thereof; all without notice
(except such notice as may be required by applicable law and cannot be waived)
and without liability except to account for property actually received by it.
Without limiting the generality of the foregoing, payments, distributions and/or
dividends (other than ordinary cash dividends paid prior to the occurrence of a
Reimbursement Default) in securities, property or cash, including without
limitation dividends representing stock or liquidating dividends or a
distribution or return of capital upon or in respect of the Security or any part
thereof or resulting from any split-up, revision or reclassification of the
Security or any part thereof or received in exchange for the Security or any
part thereof as a result of a merger, consolidation or otherwise, shall (unless
required to be paid to the Agent) be paid directly to and retained by the
Secured Party and held by it until applied as herein provided, as additional
collateral security pledged under and subject to the terms hereof. The Secured
Party shall be deemed to have possession of any of the Security in transit to or
set apart for it or any of its agents, associates, or correspondents.
3
<PAGE>
5. The Secured Party at its discretion may, if a Reimbursement Default
exists, in its name or in the name of the Grantor or otherwise, demand, sue for,
collect or receive any money or property at any time payable or receivable on
account of or in exchange for, or make any compromise or settlement deemed
desirable with respect to, any of the Security, but shall be under no obligation
to do so, or the Secured Party may extend the time of payment, arrange for
payment in installments, or otherwise modify the terms of, or release, any of
the Security, without thereby incurring responsibility to, or discharging or
otherwise affecting any liability of, the Grantor. The Secured Party shall not
be required to take any steps necessary to preserve any rights against prior
parties to any of the Security. If a Reimbursement Default exists, the Secured
Party may use or operate any of the Security for the purpose of preserving the
Security or its value in the manner and to the extent the Secured Party
reasonably deems appropriate, but the Secured Party shall be under no obligation
to do so. Upon the occurrence and during the continuance of a Reimbursement
Default, the Grantor shall, at the request of the Secured Party, assemble the
Security at such place or places as the Secured Party designates in its request,
and, to the extent permitted by applicable law, the Secured Party shall have the
right, with or without legal process and with or without prior notice or demand,
to take possession of the Security or any part thereof and to enter any premises
for the purpose of taking possession thereof. The Secured Party shall have the
rights and remedies with respect to the Security of a secured party under the
Uniform Commercial Code (whether or not such Code is in effect in the
jurisdiction where the rights and remedies are asserted). In addition, with
respect to the Security, or any part thereof, which shall then be or shall
thereafter come into the possession or custody of the Secured Party or any of
its agents, associates or correspondents, the Secured Party may sell or cause to
be sold in the Borough of Manhattan, New York City, or elsewhere, in one or more
sales or parcels, at such price as the Secured Party may deem best, and for cash
or on credit or for future delivery, without assumption of any credit risk, all
or any of the Security, at any broker's board or at public or private sale, in
any reasonable manner permissible under the Uniform Commercial Code (except
that, to the extent permitted thereunder, the Grantor hereby waives the
requirements of said Code), and the Secured Party or anyone else may be the
purchaser of any or all of the Security so sold and thereafter hold the same
absolutely, free from any claim or right of whatsoever kind, including any
equity of redemption, of the Grantor, any such demand, notice or right and
equity being hereby expressly waived and released. The Grantor will pay to the
Secured Party all reasonable expenses (including reasonable attorneys' fees and
expenses) of, or incidental to, the enforcement of any of the provisions hereof
or of any of the Liabilities, or any actual or attempted sale, or any exchange,
enforcement, collection, compromise or settlement of any of the Security or
receipt of the proceeds thereof, and for the care of the Security and defending
or asserting the rights and claims of the Secured Party in respect thereof, by
litigation or otherwise, including expense of insurance; and all such expenses
shall be indebtedness within the terms of this agreement. The Secured Party
shall apply the net cash receipts from the Security to the payment of the
Liabilities, in such order and priority as the Secured Party may elect.
Notwithstanding that the Secured Party, whether in its own behalf and/or in
behalf of another or others, may continue to hold Security and regardless of the
value thereof, the Grantor shall be and remain liable for the payment in full,
principal and interest, of any balance of the Liabilities and expenses at any
time unpaid.
6. No delay on the part of the Secured Party in exercising any power or
right hereunder shall operate as a waiver thereof; nor shall any single or
partial exercise of any power or right hereunder preclude other or further
exercise thereof or the exercise of any other power or right.
4
<PAGE>
The rights, remedies and benefits herein expressly specified are cumulative and
not exclusive of any rights, remedies or benefits which the Secured Party may
otherwise have. The Grantor hereby waives presentment, notice of dishonor and
protest of all instruments included in or evidencing the Liabilities or the
Security and any and all other notices and demands whatsoever, whether or not
relating to such instruments.
7. No provision hereof shall be modified or limited except by a written
instrument executed by the party sought to be charged therewith, expressly
referring hereto and to the provision so modified or limited. This agreement
shall be binding upon the Grantor and its successors and assigns, and shall
inure to the benefit of the Secured Party and its successors and assigns, shall
constitute a continuing agreement, applying to all future as well as existing
transactions, whether or not of the character contemplated at the date of this
agreement; and shall be governed by and construed according to the laws of the
State of New York. Unless the context otherwise requires, all terms used herein
which are defined in the New York Uniform Commercial Code shall have the
meanings therein stated.
8. The Grantor agrees that it will not after the Effective Date grant any
security interest in any of the Security to any creditor without the written
consent of the Secured Party (which shall not be unreasonably withheld), except
for (i) purchase money security interests as to the acquisition of equipment;
(ii) security interests that refinance and replace other security interests
encumbering the same Security, provided that the amount of any security interest
so granted does not exceed the then-outstanding amount secured by the security
interest so refinanced; and (iii) other security interests ("basket security
interests") that secure an amount not in excess of $500,000 in the aggregate as
to all such basket security interests of the Grantor, Hall and IVOSC.
5
<PAGE>
9. The security interest and lien granted hereby are subject and
subordinate to the security interest and lien granted to the Agent pursuant to
the security agreement dated as of April 30, 1996 from the Grantor in favor of
the Agent.
IVC INDUSTRIES, INC.
By:____________________________________
Name:
Title:
6
EXHIBIT 10.18
Confidential information indicated by Xs has been omitted and filed separately
with the Securities and Exchange Commission.
GUARANTY AND SECURITY AGREEMENT
THIS AGREEMENT, dated as of the 10th day of May, 1996, is made by
INTERNATIONAL VITAMIN OVERSEAS SALES CORP., a New Jersey corporation (the
"Grantor"), in favor of XXXXXXXXXXXXXXXXXX (the "Secured Party").
Preliminary Statement
A. The Grantor has executed and delivered to the Secured Party (i) a
certain Guaranty Reimbursement Agreement dated as of April 30, 1996 from itself,
IVC Industries, Inc. ("IVC") and Hall Laboratories, Ltd. ("Hall") in favor of
the Secured Party (the "Guaranty Reimbursement Agreement"), (ii) a certain
Security Agreement dated as of April 30, 1996 from itself in favor of the
Secured Party (the "Security Agreement") and (iii) a certain Subordination and
Intercreditor Agreement dated as of April 30, 1996 among the Secured Party, the
Grantor, IVC and Hall (the "Subordination Agreement"). Pursuant to the Guaranty
Reimbursement Agreement, the Grantor has agreed to reimburse and pay to the
Secured Party (among other things) any and all amounts that may be paid by the
Secured Party to the Banks and the Agent (as defined therein) under a certain
guaranty being executed and delivered by the Secured Party in favor of the Banks
and the Agent. Such guaranty guarantees certain indebtedness of IVC to the Banks
and the Agent, for the payment of which the Grantor is also liable. Pursuant to
the Security Agreement, the Grantor has granted to the Secured Party a security
interest in and a general lien upon certain security described therein as
security for the obligations of it and the other Obligors to the Secured Party
under the Guaranty Reimbursement Agreement.
B. Pursuant to Section 15 of the Subordination Agreement, Grantor has
agreed to execute and deliver to Secured Party a security agreement in the form
hereof, together with UCC-1 financing statements in connection therewith, to be
held by Secured Party, and deemed effective and which shall be enforceable only
upon the occurrence of an Event of Default (as hereinafter defined) and
notification from the Secured Party to Grantor that it considers the interests
granted under this Security Agreement effective and therefore enforceable.
NOW, THEREFORE, for good and valuable consideration (the receipt and
sufficiency of which are hereby acknowledged), and in order to induce the
Secured Party to execute and deliver the aforesaid guaranty, the Grantor hereby
agrees as follows:
1. As used in this Agreement, the term "Liabilities" shall mean (i) all
trade credit extended by the Secured Party to the Grantor for the purchase by
the Grantor from the Secured Party of goods in the ordinary course of business
on open account or as may be evidenced by promissory notes and (ii) the
Grantor's guaranty obligations under Section 2 of this Agreement. The term
"Security" shall mean all personal property and fixtures of the Grantor, whether
now or hereafter
<PAGE>
existing or now owned or hereafter acquired and wherever located, of every kind
and description, tangible or intangible, including, but not limited to, all
money, goods (including equipment, farm products and inventory), instruments,
securities, documents, chattel paper, accounts, contract rights, general
intangibles, credits, claims, demands, precious metals and any other property,
rights and interests of the Grantor, and shall include the proceeds, products
and accessions of and to any thereof. The term "Reimbursement Default" means a
default on the part of the Grantor in paying when due any amount required to be
paid to the Secured Party under the Guaranty Reimbursement Agreement.
2. Effective as of the Effective Date (as defined below), the Grantor
guarantees to the Secured Party, absolutely and conditioned only on the
existence of a Reimbursement Default, that IVC and Hall will promptly pay,
perform and observe all the obligations under the Liabilities (for purposes of
this paragraph, as said term is defined in the Guaranty and Security Agreements
delivered to the Secured Party by each of IVC and Hall in conjunction herewith)
and that all sums stated to be payable in, or which become payable under, the
terms of the Liabilities by IVC and Hall will promptly be paid when due, whether
at stated maturity or earlier by reason of acceleration or otherwise,
irrespective of the validity, regularity, or enforceability of any of the
documents underlying the Liabilities and irrespective of any present or future
law or order of any government (whether of right or in fact and whether the
Secured Party shall have consented thereto) or of any agency thereof purporting
to reduce, amend, restructure or otherwise affect any Liability of IVC and/or
Hall or to vary the terms of payment. The Grantor agrees that, as among the
Grantor and the Secured Party, the Liabilities may be declared to be due and
payable for purposes of this Agreement notwithstanding any stay, injunction or
other prohibition which may prevent, delay or vitiate any such declaration as
against IVC and/or Hall and that, in the event of any such declaration (or
attempted declaration), such Liabilities (whether or not due and payable by IVC
and/or Hall) shall forthwith become due and payable by the Grantor for purposes
of this Agreement. The Grantor consents that from time to time, without notice
to or further consent of the Grantor, the payment, performance or observance of
any or all of the Liabilities may be waived or changed or the time of payment or
performance or observance of any or all of the Liabilities may be waived or
changed or the time of payment or performance thereof extended or accelerated,
or renewed in whole or in part, or the terms of the Liabilities may be changed
and any collateral therefor may be exchanged, surrendered, released or otherwise
dealt with as the Secured Party may determine, all without affecting the
obligations of the Grantor hereunder. The Grantor waives presentment of any
instrument, demand of payment, protest and notice of non-payment or protest
thereof or of any exchange, sale, surrender or other handling or disposition of
such collateral, and any requirement that the Secured Party exhaust any right,
power or remedy or proceed against IVC and/or Hall under the Liabilities. For
purposes of the guarantee provided hereunder, the Grantor further waives any
defense whatsoever which might constitute a defense available to, or discharge
of, the Grantor, IVC and/or Hall.
3. As security for the Liabilities, the Grantor grants to the Secured
Party, effective as of the Effective Date (as defined below), a security
interest in and a general lien upon the Security. The security interest
specified herein shall be effective and may be perfected by the Secured Party
only on such date (the "Effective Date") as (i) an Event of Default shall have
occurred under that certain Credit Agreement dated as of April 30, 1996 among
IVC, the Banks party thereto and The Chase Manhattan Bank (National
Association), as agent and (ii) the Grantor shall have received
2
<PAGE>
notice from the Secured Party that it considers the security interest referred
to herein effective and enforceable. Notwithstanding anything to the contrary
set forth herein, all rights, remedies, and other actions permitted the Secured
Party hereunder shall be available to the Secured Party only on and after the
Effective Date.
4. At any time and from time to time, upon the demand of the Secured
Party, the Grantor will: (1) deliver and pledge to the Secured Party, indorsed
and/or accompanied by such instruments of assignment and transfer in such form
and substance as the Secured Party may request, any and all instruments,
documents and/or chattel paper comprising the Security as the Secured Party may
specify in its demand; (2) give, execute, deliver, file and/or record any
notice, statement, instrument, document, agreement or other papers that may be
necessary or desirable, or that the Secured Party may request, in order to
create, preserve, perfect, or validate any security interest granted pursuant
hereto or to enable the Secured Party to exercise and enforce its rights
hereunder or with respect to such security interest; (3) keep and stamp or
otherwise mark any and all documents and chattel paper and its individual books
and records relating to inventory, accounts and contract rights in such manner
as the Secured Party may require; and (4) permit representatives of the Secured
Party at any time during business hours to inspect its inventory and to inspect
and make abstracts from the Grantor's books and records pertaining to inventory,
accounts, contract rights, chattel paper, instruments and documents. The right
is expressly granted to the Secured Party, at its discretion, to file one or
more financing statements under the Uniform Commercial Code naming the Grantor
as debtor and the Secured Party as secured party and indicating therein the
types or describing the items of Security herein specified. A photographic or
other reproduction of this agreement shall be sufficient as a financing
statement. With respect to the Security, or any part thereof, which at any time
shall come into the possession or custody or under the control of the Secured
Party or any of their agents, associates or correspondents, for any purpose, the
right is expressly granted to the Secured Party, at its discretion, to transfer
to or register in the name of itself or its nominee any of the Security; to
exchange any of the Security for other property upon any reorganization,
recapitalization or other readjustment and in connection therewith to deposit
any of the Security with any committee or depositary upon such terms as it may
determine; if a Reimbursement Default exists, to notify any account debtor or
obligor on an instrument to make payment to the Secured Party; and to exercise
or cause its nominee to exercise all or any powers with respect to the Security
with the same force and effect as an absolute owner thereof; all without notice
(except such notice as may be required by applicable law and cannot be waived)
and without liability except to account for property actually received by it.
Without limiting the generality of the foregoing, payments, distributions and/or
dividends (other than ordinary cash dividends paid prior to the occurrence of a
Reimbursement Default) in securities, property or cash, including without
limitation dividends representing stock or liquidating dividends or a
distribution or return of capital upon or in respect of the Security or any part
thereof or resulting from any split-up, revision or reclassification of the
Security or any part thereof or received in exchange for the Security or any
part thereof as a result of a merger, consolidation or otherwise, shall (unless
required to be paid to the Agent) be paid directly to and retained by the
Secured Party and held by it until applied as herein provided, as additional
collateral security pledged under and subject to the terms hereof. The Secured
Party shall be deemed to have possession of any of the Security in transit to or
set apart for it or any of its agents, associates, or correspondents.
3
<PAGE>
5. The Secured Party at its discretion may, if a Reimbursement Default
exists, in its name or in the name of the Grantor or otherwise, demand, sue for,
collect or receive any money or property at any time payable or receivable on
account of or in exchange for, or make any compromise or settlement deemed
desirable with respect to, any of the Security, but shall be under no obligation
to do so, or the Secured Party may extend the time of payment, arrange for
payment in installments, or otherwise modify the terms of, or release, any of
the Security, without thereby incurring responsibility to, or discharging or
otherwise affecting any liability of, the Grantor. The Secured Party shall not
be required to take any steps necessary to preserve any rights against prior
parties to any of the Security. If a Reimbursement Default exists, the Secured
Party may use or operate any of the Security for the purpose of preserving the
Security or its value in the manner and to the extent the Secured Party
reasonably deems appropriate, but the Secured Party shall be under no obligation
to do so. Upon the occurrence and during the continuance of a Reimbursement
Default, the Grantor shall, at the request of the Secured Party, assemble the
Security at such place or places as the Secured Party designates in its request,
and, to the extent permitted by applicable law, the Secured Party shall have the
right, with or without legal process and with or without prior notice or demand,
to take possession of the Security or any part thereof and to enter any premises
for the purpose of taking possession thereof. The Secured Party shall have the
rights and remedies with respect to the Security of a secured party under the
Uniform Commercial Code (whether or not such Code is in effect in the
jurisdiction where the rights and remedies are asserted). In addition, with
respect to the Security, or any part thereof, which shall then be or shall
thereafter come into the possession or custody of the Secured Party or any of
its agents, associates or correspondents, the Secured Party may sell or cause to
be sold in the Borough of Manhattan, New York City, or elsewhere, in one or more
sales or parcels, at such price as the Secured Party may deem best, and for cash
or on credit or for future delivery, without assumption of any credit risk, all
or any of the Security, at any broker's board or at public or private sale, in
any reasonable manner permissible under the Uniform Commercial Code (except
that, to the extent permitted thereunder, the Grantor hereby waives the
requirements of said Code), and the Secured Party or anyone else may be the
purchaser of any or all of the Security so sold and thereafter hold the same
absolutely, free from any claim or right of whatsoever kind, including any
equity of redemption, of the Grantor, any such demand, notice or right and
equity being hereby expressly waived and released. The Grantor will pay to the
Secured Party all reasonable expenses (including reasonable attorneys' fees and
expenses) of, or incidental to, the enforcement of any of the provisions hereof
or of any of the Liabilities, or any actual or attempted sale, or any exchange,
enforcement, collection, compromise or settlement of any of the Security or
receipt of the proceeds thereof, and for the care of the Security and defending
or asserting the rights and claims of the Secured Party in respect thereof, by
litigation or otherwise, including expense of insurance; and all such expenses
shall be indebtedness within the terms of this agreement. The Secured Party
shall apply the net cash receipts from the Security to the payment of the
Liabilities, in such order and priority as the Secured Party may elect.
Notwithstanding that the Secured Party, whether in its own behalf and/or in
behalf of another or others, may continue to hold Security and regardless of the
value thereof, the Grantor shall be and remain liable for the payment in full,
principal and interest, of any balance of the Liabilities and expenses at any
time unpaid.
6. No delay on the part of the Secured Party in exercising any power or
right hereunder shall operate as a waiver thereof; nor shall any single or
partial exercise of any power or right hereunder preclude other or further
exercise thereof or the exercise of any other power or right.
4
<PAGE>
The rights, remedies and benefits herein expressly specified are cumulative and
not exclusive of any rights, remedies or benefits which the Secured Party may
otherwise have. The Grantor hereby waives presentment, notice of dishonor and
protest of all instruments included in or evidencing the Liabilities or the
Security and any and all other notices and demands whatsoever, whether or not
relating to such instruments.
7. No provision hereof shall be modified or limited except by a written
instrument executed by the party sought to be charged therewith, expressly
referring hereto and to the provision so modified or limited. This agreement
shall be binding upon the Grantor and its successors and assigns, and shall
inure to the benefit of the Secured Party and its successors and assigns, shall
constitute a continuing agreement, applying to all future as well as existing
transactions, whether or not of the character contemplated at the date of this
agreement; and shall be governed by and construed according to the laws of the
State of New York. Unless the context otherwise requires, all terms used herein
which are defined in the New York Uniform Commercial Code shall have the
meanings therein stated.
8. The Grantor agrees that it will not after the Effective Date grant any
security interest in any of the Security to any creditor without the written
consent of the Secured Party (which shall not be unreasonably withheld), except
for (i) purchase money security interests as to the acquisition of equipment;
(ii) security interests that refinance and replace other security interests
encumbering the same Security, provided that the amount of any security interest
so granted does not exceed the then-outstanding amount secured by the security
interest so refinanced; and (iii) other security interests ("basket security
interests") that secure an amount not in excess of $500,000 in the aggregate as
to all such basket security interests of the Grantor, IVC and Hall.
5
<PAGE>
9. The security interest and lien granted hereby are subject and
subordinate to the security interest and lien granted to the Agent pursuant to
the security agreement dated as of April 30, 1996 from the Grantor in favor of
the Agent.
INTERNATIONAL VITAMIN OVERSEAS SALES
CORP.
By:____________________________________
Name:
Title:
6
EXHIBIT 10.19
Confidential information indicated by Xs has been omitted and filed separately
with the Securities and Exchange Commission.
GUARANTY AND SECURITY AGREEMENT
THIS AGREEMENT, dated as of the 10th day of May, 1996, is made by HALL
LABORATORIES, LTD., a corporation organized under the laws of British Columbia
(the "Grantor"), in favor of XXXXXXXXXXXXXXX (the "Secured Party").
Preliminary Statement
A. The Grantor has executed and delivered to the Secured Party (i) a
certain Guaranty Reimbursement Agreement dated as of April 30, 1996 from itself,
IVC Industries, Inc. ("IVC") and International Vitamin Overseas Sales Corp.
("IVOSC") in favor of the Secured Party (the "Guaranty Reimbursement
Agreement"), (ii) a certain Security Agreement dated as of April 30, 1996 from
itself in favor of the Secured Party (the "Security Agreement") and (iii) a
certain Subordination and Intercreditor Agreement dated as of April 30, 1996
among the Secured Party, the Grantor, IVC and IVOSC (the "Subordination
Agreement"). Pursuant to the Guaranty Reimbursement Agreement, the Grantor has
agreed to reimburse and pay to the Secured Party (among other things) any and
all amounts that may be paid by the Secured Party to the Banks and the Agent (as
defined therein) under a certain guaranty being executed and delivered by the
Secured Party in favor of the Banks and the Agent. Such guaranty guarantees
certain indebtedness of IVC to the Banks and the Agent, for the payment of which
the Grantor is also liable. Pursuant to the Security Agreement, the Grantor has
granted to the Secured Party a security interest in and a general lien upon
certain security described therein as security for the obligations of it and the
other Obligors to the Secured Party under the Guaranty Reimbursement Agreement.
B. Pursuant to Section 15 of the Subordination Agreement, Grantor has
agreed to execute and deliver to Secured Party a security agreement in the form
hereof, together with UCC-1 financing statements in connection therewith, to be
held by Secured Party, and deemed effective and which shall be enforceable only
upon the occurrence of an Event of Default (as hereinafter defined) and
notification from the Secured Party to Grantor that it considers the interests
granted under this Security Agreement effective and therefore enforceable.
NOW, THEREFORE, for good and valuable consideration (the receipt and
sufficiency of which are hereby acknowledged), and in order to induce the
Secured Party to execute and deliver the aforesaid guaranty, the Grantor hereby
agrees as follows:
1. As used in this Agreement, the term "Liabilities" shall mean (i) all
trade credit extended by the Secured Party to the Grantor for the purchase by
the Grantor from the Secured Party of goods in the ordinary course of business
on open account or as may be evidenced by promissory notes and (ii) the
Grantor's guaranty obligations under Section 2 of this Agreement. The term
"Security" shall mean all personal property and fixtures of the Grantor, whether
now or hereafter
<PAGE>
existing or now owned or hereafter acquired and wherever located, of every kind
and description, tangible or intangible, including, but not limited to, all
money, goods (including equipment, farm products and inventory), instruments,
securities, documents, chattel paper, accounts, contract rights, general
intangibles, credits, claims, demands, precious metals and any other property,
rights and interests of the Grantor, and shall include the proceeds, products
and accessions of and to any thereof. The term "Reimbursement Default" means a
default on the part of the Grantor in paying when due any amount required to be
paid to the Secured Party under the Guaranty Reimbursement Agreement.
2. Effective as of the Effective Date (as defined below), the Grantor
guarantees to the Secured Party, absolutely and conditioned only on the
existence of a Reimbursement Default, that IVC and IVOSC will promptly pay,
perform and observe all the obligations under the Liabilities (for purposes of
this paragraph, as said term is defined in the Guaranty and Security Agreements
delivered to the Secured Party by each of IVC and IVOSC in conjunction herewith)
and that all sums stated to be payable in, or which become payable under, the
terms of the Liabilities by IVC and IVOSC will promptly be paid when due,
whether at stated maturity or earlier by reason of acceleration or otherwise,
irrespective of the validity, regularity, or enforceability of any of the
documents underlying the Liabilities and irrespective of any present or future
law or order of any government (whether of right or in fact and whether the
Secured Party shall have consented thereto) or of any agency thereof purporting
to reduce, amend, restructure or otherwise affect any Liability of IVC and/or
IVOSC or to vary the terms of payment. The Grantor agrees that, as among the
Grantor and the Secured Party, the Liabilities may be declared to be due and
payable for purposes of this Agreement notwithstanding any stay, injunction or
other prohibition which may prevent, delay or vitiate any such declaration as
against IVC and/or IVOSC and that, in the event of any such declaration (or
attempted declaration), such Liabilities (whether or not due and payable by IVC
and/or IVOSC) shall forthwith become due and payable by the Grantor for purposes
of this Agreement. The Grantor consents that from time to time, without notice
to or further consent of the Grantor, the payment, performance or observance of
any or all of the Liabilities may be waived or changed or the time of payment or
performance or observance of any or all of the Liabilities may be waived or
changed or the time of payment or performance thereof extended or accelerated,
or renewed in whole or in part, or the terms of the Liabilities may be changed
and any collateral therefor may be exchanged, surrendered, released or otherwise
dealt with as the Secured Party may determine, all without affecting the
obligations of the Grantor hereunder. The Grantor waives presentment of any
instrument, demand of payment, protest and notice of non-payment or protest
thereof or of any exchange, sale, surrender or other handling or disposition of
such collateral, and any requirement that the Secured Party exhaust any right,
power or remedy or proceed against IVC and/or IVOSC under the Liabilities. For
purposes of the guarantee provided hereunder, the Grantor further waives any
defense whatsoever which might constitute a defense available to, or discharge
of, the Grantor, IVC and/or IVOSC.
3. As security for the Liabilities, the Grantor grants to the Secured
Party, effective as of the Effective Date (as defined below), a security
interest in and a general lien upon the Security. The security interest
specified herein shall be effective and may be perfected by the Secured Party
only on such date (the "Effective Date") as (i) an Event of Default shall have
occurred under that certain Credit Agreement dated as of April 30, 1996 among
IVC, the Banks party thereto and
2
<PAGE>
The Chase Manhattan Bank (National Association), as agent and (ii) the Grantor
shall have received notice from the Secured Party that it considers the security
interest referred to herein effective and enforceable. Notwithstanding anything
to the contrary set forth herein, all rights, remedies, and other actions
permitted the Secured Party hereunder shall be available to the Secured Party
only on and after the Effective Date.
4. At any time and from time to time, upon the demand of the Secured
Party, the Grantor will: (1) deliver and pledge to the Secured Party, indorsed
and/or accompanied by such instruments of assignment and transfer in such form
and substance as the Secured Party may request, any and all instruments,
documents and/or chattel paper comprising the Security as the Secured Party may
specify in its demand; (2) give, execute, deliver, file and/or record any
notice, statement, instrument, document, agreement or other papers that may be
necessary or desirable, or that the Secured Party may request, in order to
create, preserve, perfect, or validate any security interest granted pursuant
hereto or to enable the Secured Party to exercise and enforce its rights
hereunder or with respect to such security interest; (3) keep and stamp or
otherwise mark any and all documents and chattel paper and its individual books
and records relating to inventory, accounts and contract rights in such manner
as the Secured Party may require; and (4) permit representatives of the Secured
Party at any time during business hours to inspect its inventory and to inspect
and make abstracts from the Grantor's books and records pertaining to inventory,
accounts, contract rights, chattel paper, instruments and documents. The right
is expressly granted to the Secured Party, at its discretion, to file one or
more financing statements under the Uniform Commercial Code naming the Grantor
as debtor and the Secured Party as secured party and indicating therein the
types or describing the items of Security herein specified. A photographic or
other reproduction of this agreement shall be sufficient as a financing
statement. With respect to the Security, or any part thereof, which at any time
shall come into the possession or custody or under the control of the Secured
Party or any of their agents, associates or correspondents, for any purpose, the
right is expressly granted to the Secured Party, at its discretion, to transfer
to or register in the name of itself or its nominee any of the Security; to
exchange any of the Security for other property upon any reorganization,
recapitalization or other readjustment and in connection therewith to deposit
any of the Security with any committee or depositary upon such terms as it may
determine; if a Reimbursement Default exists, to notify any account debtor or
obligor on an instrument to make payment to the Secured Party; and to exercise
or cause its nominee to exercise all or any powers with respect to the Security
with the same force and effect as an absolute owner thereof; all without notice
(except such notice as may be required by applicable law and cannot be waived)
and without liability except to account for property actually received by it.
Without limiting the generality of the foregoing, payments, distributions and/or
dividends (other than ordinary cash dividends paid prior to the occurrence of a
Reimbursement Default) in securities, property or cash, including without
limitation dividends representing stock or liquidating dividends or a
distribution or return of capital upon or in respect of the Security or any part
thereof or resulting from any split-up, revision or reclassification of the
Security or any part thereof or received in exchange for the Security or any
part thereof as a result of a merger, consolidation or otherwise, shall (unless
required to be paid to the Agent) be paid directly to and retained by the
Secured Party and held by it until applied as herein provided, as additional
collateral security pledged under and subject to the terms hereof. The Secured
Party shall be deemed to have possession of any of the Security in transit to or
set apart for it or any of its agents, associates, or correspondents.
3
<PAGE>
5. The Secured Party at its discretion may, if a Reimbursement Default
exists, in its name or in the name of the Grantor or otherwise, demand, sue for,
collect or receive any money or property at any time payable or receivable on
account of or in exchange for, or make any compromise or settlement deemed
desirable with respect to, any of the Security, but shall be under no obligation
to do so, or the Secured Party may extend the time of payment, arrange for
payment in installments, or otherwise modify the terms of, or release, any of
the Security, without thereby incurring responsibility to, or discharging or
otherwise affecting any liability of, the Grantor. The Secured Party shall not
be required to take any steps necessary to preserve any rights against prior
parties to any of the Security. If a Reimbursement Default exists, the Secured
Party may use or operate any of the Security for the purpose of preserving the
Security or its value in the manner and to the extent the Secured Party
reasonably deems appropriate, but the Secured Party shall be under no obligation
to do so. Upon the occurrence and during the continuance of a Reimbursement
Default, the Grantor shall, at the request of the Secured Party, assemble the
Security at such place or places as the Secured Party designates in its request,
and, to the extent permitted by applicable law, the Secured Party shall have the
right, with or without legal process and with or without prior notice or demand,
to take possession of the Security or any part thereof and to enter any premises
for the purpose of taking possession thereof. The Secured Party shall have the
rights and remedies with respect to the Security of a secured party under the
Uniform Commercial Code (whether or not such Code is in effect in the
jurisdiction where the rights and remedies are asserted). In addition, with
respect to the Security, or any part thereof, which shall then be or shall
thereafter come into the possession or custody of the Secured Party or any of
its agents, associates or correspondents, the Secured Party may sell or cause to
be sold in the Borough of Manhattan, New York City, or elsewhere, in one or more
sales or parcels, at such price as the Secured Party may deem best, and for cash
or on credit or for future delivery, without assumption of any credit risk, all
or any of the Security, at any broker's board or at public or private sale, in
any reasonable manner permissible under the Uniform Commercial Code (except
that, to the extent permitted thereunder, the Grantor hereby waives the
requirements of said Code), and the Secured Party or anyone else may be the
purchaser of any or all of the Security so sold and thereafter hold the same
absolutely, free from any claim or right of whatsoever kind, including any
equity of redemption, of the Grantor, any such demand, notice or right and
equity being hereby expressly waived and released. The Grantor will pay to the
Secured Party all reasonable expenses (including reasonable attorneys' fees and
expenses) of, or incidental to, the enforcement of any of the provisions hereof
or of any of the Liabilities, or any actual or attempted sale, or any exchange,
enforcement, collection, compromise or settlement of any of the Security or
receipt of the proceeds thereof, and for the care of the Security and defending
or asserting the rights and claims of the Secured Party in respect thereof, by
litigation or otherwise, including expense of insurance; and all such expenses
shall be indebtedness within the terms of this agreement. The Secured Party
shall apply the net cash receipts from the Security to the payment of the
Liabilities, in such order and priority as the Secured Party may elect.
Notwithstanding that the Secured Party, whether in its own behalf and/or in
behalf of another or others, may continue to hold Security and regardless of the
value thereof, the Grantor shall be and remain liable for the payment in full,
principal and interest, of any balance of the Liabilities and expenses at any
time unpaid.
6. No delay on the part of the Secured Party in exercising any power or
right hereunder shall operate as a waiver thereof; nor shall any single or
partial exercise of any power or right hereunder preclude other or further
exercise thereof or the exercise of any other power or right.
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<PAGE>
The rights, remedies and benefits herein expressly specified are cumulative and
not exclusive of any rights, remedies or benefits which the Secured Party may
otherwise have. The Grantor hereby waives presentment, notice of dishonor and
protest of all instruments included in or evidencing the Liabilities or the
Security and any and all other notices and demands whatsoever, whether or not
relating to such instruments.
7. No provision hereof shall be modified or limited except by a written
instrument executed by the party sought to be charged therewith, expressly
referring hereto and to the provision so modified or limited. This agreement
shall be binding upon the Grantor and its successors and assigns, and shall
inure to the benefit of the Secured Party and its successors and assigns, shall
constitute a continuing agreement, applying to all future as well as existing
transactions, whether or not of the character contemplated at the date of this
agreement; and shall be governed by and construed according to the laws of the
State of New York. Unless the context otherwise requires, all terms used herein
which are defined in the New York Uniform Commercial Code shall have the
meanings therein stated.
8. The Grantor agrees that it will not after the Effective Date grant any
security interest in any of the Security to any creditor without the written
consent of the Secured Party (which shall not be unreasonably withheld), except
for (i) purchase money security interests as to the acquisition of equipment;
(ii) security interests that refinance and replace other security interests
encumbering the same Security, provided that the amount of any security interest
so granted does not exceed the then-outstanding amount secured by the security
interest so refinanced; and (iii) other security interests ("basket security
interests") that secure an amount not in excess of $500,000 in the aggregate as
to all such basket security interests of the Grantor, IVC and IVOSC.
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<PAGE>
9. The security interest and lien granted hereby are subject and
subordinate to the security interest and lien granted to the Agent pursuant to
the security agreement dated as of April 30, 1996 from the Grantor in favor of
the Agent.
HALL LABORATORIES, LTD.
By:____________________________________
Name:
Title:
6
EXHIBIT 10.20
Confidential information indicated by Xs has been omitted and filed
separately with the Securities and Exchange Commission.
TRADEMARK COLLATERAL ASSIGNMENT
IVC INDUSTRIES, INC. (formerly known as INTERNATIONAL VITAMIN
CORPORATION), a Delaware corporation (the "Assignor"), does grant, assign and
convey to XXXXXXXXXXXXXXXXXXX (the "Assignee"), effective as of the Effective
Date (as hereinafter defined) the registered trademarks and trademark
applications identified on Annex I hereto and the goodwill represented thereby
(the "Trademarks") together with all the proceeds thereof, as collateral
security for all the Liabilities (as hereinafter defined).
This Assignment is being executed and delivered pursuant to Section 15 of
that certain Subordination and Intercreditor Agreement dated as of April 30,
1996, among the Assignor, International Vitamin Overseas Sales Corp. ("IVOSC"),
Hall Laboratories, Ltd. ("Hall") and the Assignee (the "Subordination
Agreement"), whereby each of the Assignor, IVOSC and Hall agreed to execute and
deliver to the Assignee a security agreement and related documents to be held by
the Assignee and deemed effective and enforceable only at the time set forth
herein.
As used herein, the term "Liabilities" means all trade credit extended by
the Assignor to the Assignee, IVOSC and/or Hall for the purchase by the
Assignor, IVOSC and/or Hall from the Assignee of goods in the ordinary course of
business on open account or as may be evidenced by promissory notes.
<PAGE>
The Assignee agrees that the assignment effected hereby shall be effective
only on such date (the "Effective Date") as (i) an Event of Default shall have
occurred under that certain Credit Agreement, dated as of April 30, 1996, among
the Assignor, the Banks party thereto and The Chase Manhattan Bank (National
Association), as agent, and (ii) the Assignor shall have received notice from
the Assignee that the assignment herein shall be effective and that it shall be
able to enforce its rights hereunder. Notwithstanding anything to the contrary
set forth herein, all rights, remedies and other actions permitted the Assignee
hereunder shall be available to the Assignee only on and after the Effective
Date.
The assignment effected hereby shall be governed by Article 9 of the New
York Uniform Commercial Code. On or after the Effective Date, the Assignee shall
have the rights and remedies of a secured party as set forth therein (including,
without limitation, the right to dispose of the Trademarks and to apply the
proceeds of the disposition to satisfy the Liabilities) and otherwise available
at law or in equity.
The Assignee shall have no duties with respect to the Trademarks other
than the duties of a secured party under the New York Uniform Commercial Code.
Without limiting the generality of the foregoing, the Assignee shall have no
duty to prosecute any action for trademark infringement against any person.
The address of the Assignee for purposes of this Agreement is:
XXXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXXX
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<PAGE>
or such other address as the Assignee may designate to the Assignor in writing
from time to time.
The assignment effected hereby is subject and subordinate to the
assignment of the Trademarks effected pursuant to the Trademark Collateral
Assignment dated as of April 30, 1996 from the Assignor to The Chase Manhattan
Bank (National Association) as Agent.
IN WITNESS WHEREOF, the Assignor has executed this Assignment as of the
10th day of May, 1996.
ATTEST/WITNESS: IVC INDUSTRIES, INC.
By: /s/ Arthur Edell
- ----------------------------- -----------------------------
Name: Arthur Edell
Title: President
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<PAGE>
STATE OF NEW YORK :
: ss.:
COUNTY OF NEW YORK :
On this ____ day of _________, 1996, before me the undersigned, personally
appeared _________________, the ____________ of IVC Industries, who, I am
satisfied, is the person who signed the foregoing instrument, and he did
acknowledge that he signed and delivered the same in his capacity as such
officer, and that he or she was authorized to do so, and that the foregoing
instrument is the voluntary act and deed of such corporation, made by virtue of
the authority of its board of directors.
---------------------------------
Notary Public
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