Beyond Meat(BYND) - 2025 Q1 - Quarterly Results

Loan and Security Agreement This agreement, effective May 7, 2025, outlines the terms for a term loan between UNPROCESSED FOODS, LLC and BEYOND MEAT, INC., secured by the Borrower's assets Parties and Effective Date This Loan and Security Agreement is dated May 7, 2025, between UNPROCESSED FOODS, LLC (as a Lender), other Lenders, BEYOND MEAT, INC. (as Borrower), and its Guarantors - The agreement is effective as of May 7, 2025[2] Parties to the Agreement | Role | Entity | Jurisdiction | | :--- | :--- | :--- | | Lender | UNPROCESSED FOODS, LLC | Wyoming limited liability company | | Borrower | BEYOND MEAT, INC. | Delaware corporation | Loan and Terms of Payment This section details the term loan's availability, repayment terms, interest rates (including PIK and default rates), fees, and provisions for changes in circumstances and tax treatment Term Loan The agreement provides for term loan advances up to the Term Loan Availability Amount, which cannot be reborrowed after repayment. All outstanding amounts are due on the Term Loan Maturity Date. The agreement details procedures for borrowing, optional prepayments, and mandatory prepayments upon certain events. A key feature is the MOIC (Multiple of Invested Capital) Amount, ensuring Lenders achieve at least a 2.0x return, or a Termination Fee in specific insolvency scenarios Term Loan Key Terms | Feature | Detail | | :--- | :--- | | Availability | Up to the Term Loan Availability Amount during the Draw Period. Not re-borrowable. | | Minimum Advance | $3 million per advance. | | Maturity | All unpaid principal, interest, and other Obligations are due on the Term Loan Maturity Date. | | Optional Prepayment | Allowed at any time with 3 business days' notice, must include accrued interest and any MOIC Amount. | - Mandatory prepayment is required upon a Liquidation Event or an Inconsistent Use Event (use of funds for purposes not specified in the Side Letter)[6][8] - Any repayment or prepayment under sections 1.1(c), (d), (e), or (f) must include a "MOIC Amount" to ensure Lenders receive a return of at least a 2.00 to 1.00 multiple of invested capital. In certain insolvency cases, this is replaced by a Termination Fee[9][12] Payment of Interest Interest on the term loan is paid-in-kind (PIK) quarterly by capitalizing it and adding it to the principal balance. The standard interest rate is 12.0%, increasing to 17.5% if the maturity date is extended. A default rate of an additional 2.25% applies during an Event of Default - Quarterly interest payments are made by capitalizing the interest ("PIK Interest"), which increases the outstanding principal amount of the loan. Cash interest is only payable upon repayment or prepayment of the principal[14] Interest Rates | Condition | Per Annum Fixed Rate | | :--- | :--- | | Standard Rate | 12.0% | | Post-Extension Rate | 17.5% (after Initial Maturity Date is extended) | | Default Rate | Standard Rate + 2.25% | Fees The Borrower is required to pay a Commitment Fee to UF as outlined in the separate Commitment Letter - Borrower must pay the Commitment Fee to UF as per the terms of the Commitment Letter[18] Change in Circumstances If a change in law or regulations increases the Lenders' costs or reduces their rate of return related to the loan, the Borrower must pay additional amounts to compensate the Lenders for these increased costs or reductions - Borrower must compensate Lenders for increased costs or reduced returns resulting from any "Change in Law," which includes changes in reserve requirements, taxes (other than excluded taxes), or capital/liquidity requirements[21][22] Taxes The Borrower must make all payments free of tax deductions, unless required by law. If taxes are withheld, the Borrower must 'gross-up' the payment so the Lender receives the full intended amount. The Borrower also agrees to indemnify Lenders for any "Indemnified Taxes" - All payments by the Borrower must be made without deduction for any Taxes, except as required by law. If an Indemnified Tax is withheld, the payment amount must be increased to ensure the Lender receives the full sum it would have otherwise received[25] - The Borrower indemnifies each Lender for the full amount of any Indemnified Taxes paid by the Lender[27] Extension of Maturity Date The Borrower may request to extend the Term Loan Maturity Date, and any Lender may agree to such an extension for its portion of the loan at its sole discretion. The maturity date cannot be extended beyond May 7, 2035 - The Term Loan Maturity Date can be extended with the mutual consent of the Borrower and the individual Lender for that Lender's portion of the Term Loan Advances. The final possible maturity date is May 7, 2035[33] Conditions Precedent This section specifies the essential conditions that must be met for the loan agreement to become effective and for any term loan advances to be disbursed Conditions Precedent to Effectiveness For the agreement to become effective, the Borrower must deliver several key documents, including the signed agreement, a Perfection Certificate, and corporate resolutions. Additionally, the Commitment Fee must be paid, certain representations and warranties must be true, and all necessary filings to perfect the Lender's lien must be in proper form - Key deliverables for effectiveness include: executed Loan Documents (Agreement, Side Letter, Warrant Agreement), payment of the Commitment Fee, corporate authorizing resolutions, good standing certificates, a legal opinion, and a solvency certificate[34][35][36] Conditions Precedent to all Term Loan Advances Before each term loan advance, the Borrower must satisfy several conditions. These include submitting an Advance Request Form, ensuring no liens other than permitted ones exist, providing evidence of insurance, and confirming that no Default or Event of Default has occurred. Additionally, representations and warranties must be true and correct at the time of the advance - For each loan advance, the Borrower must provide an Advance Request Form, and Lenders must have received satisfactory UCC lien search results, evidence of insurance, and pledged equity certificates (if any)[37] - A critical condition for each advance is that no Default or Event of Default has occurred and is continuing, and all representations and warranties remain true and correct[38] - A Warrant to purchase Borrower's common stock must be registered for each Lender in proportion to their share of the Term Loan Advance, not to exceed the Maximum Warrant Share Amount[38] Creation of Security Interest This section establishes the Lenders' first-priority security interest in all of the Borrower's and its Domestic Subsidiaries' assets, outlining the conditions for its termination Grant of Security Interest To secure all obligations, the Borrower and its Domestic Subsidiaries grant the Lenders a continuing first-priority security interest in all of their assets, referred to as the Collateral. This includes all current and future property and its proceeds - The Borrower and each Domestic Subsidiary grant UF, for the benefit of Lenders, a continuing first priority lien on and security interest in the Collateral to secure all Obligations[40] Termination and Release of Liens The Lenders' lien on the Collateral will continue until all obligations under the agreement are paid in full. Upon full repayment and termination of the lending commitment, the lien will be automatically released and all rights to the Collateral will revert to the Borrower - Upon full payment of the Obligations (other than certain surviving obligations) and termination of the Lenders' commitment to make loans, all Liens in favor of the Lenders will be automatically released and discharged[43] Representations and Warranties This section details the Borrower's and Loan Parties' assurances regarding their corporate status, collateral ownership, financial condition, and compliance with all applicable laws Summary of Representations and Warranties The Borrower and its Loan Parties make several standard representations and warranties to the Lenders. These include assurances of due organization, valid corporate authority, ownership of collateral, accuracy of financial statements, solvency, and compliance with laws (including regulatory, tax, and anti-corruption laws). They also confirm there has been no Material Adverse Change since December 31, 2024, and that all information provided is complete and not misleading - Corporate Status: Each Loan Party is duly organized, in good standing, and has the authority to enter into the Loan Documents[45] - Collateral: Each Loan Party has good title to the Collateral, and the security interest granted is a first priority perfected lien, subject only to Permitted Liens[50] - Financial Condition: Financial statements provided are fair representations, the company is solvent, and there has been no Material Adverse Change since December 31, 2024[54][55][65] - Compliance: The Loan Parties are in compliance with all applicable laws, including regulatory (e.g., not an 'investment company'), tax, ERISA, sanctions, and anti-corruption laws[57][60][62][64] Affirmative Covenants This section outlines the ongoing obligations of the Borrower, including the permitted use of loan proceeds, regular financial reporting, and requirements for new subsidiaries Use of Proceeds The proceeds from the term loans must be used exclusively for financing working capital needs or for general corporate purposes. The funds are explicitly forbidden from being used to repay or restructure existing notes or other borrowed money, with minor exceptions - Loan proceeds are to be used solely for working capital and general corporate purposes[67] - Proceeds may not be used to repay Existing Notes, New Notes, or other indebtedness for borrowed money, except for debt owed to Lenders or certain asset financing[67] Financial Statements and Reporting The Borrower is required to provide Lenders with regular financial reports and other key information. This includes audited annual financial statements within 90 days of fiscal year-end, unaudited quarterly statements within 45 days of quarter-end, and a compliance certificate with each. They must also provide annual projections, key performance indicator reports, and prompt notice of any defaults or material adverse changes - Deliver audited annual financial statements within 90 days of fiscal year-end[71] - Deliver unaudited quarterly financial statements within 45 days of each fiscal quarter-end[71] - Concurrently with financials, deliver a Compliance Certificate and a report on Key Performance Indicators (KPIs) including revenue, margins, and cash flow[71] - Promptly notify Lenders of any Default, Event of Default, or any development that could result in a Material Adverse Change[72] Formation or Acquisition of Subsidiaries If the Borrower forms or acquires a new subsidiary (that is not an Excluded Subsidiary), it must cause the new subsidiary to become a Guarantor under the agreement. This involves executing a Guaranty Joinder and pledging the subsidiary's equity interests to secure the loan - Any newly formed or acquired subsidiary (unless it is an Excluded Subsidiary) must become a Guarantor by executing a Guaranty Joinder[81] - The Loan Party must pledge the equity interests of the new subsidiary to the Lenders as part of the collateral[81] Negative Covenants This section details the restrictions on the Borrower's activities, including limitations on asset dispositions, business changes, mergers, indebtedness, liens, distributions, investments, and financial covenants Dispositions Loan Parties are prohibited from selling, leasing, or otherwise transferring their business or property, except for specific permitted transfers. These exceptions include selling inventory in the ordinary course of business, disposing of obsolete equipment, and other transfers of assets up to a specified aggregate value of $7.5 million, with other specific caps for certain types of sales - General prohibition on asset transfers, with exceptions for ordinary course inventory sales, disposal of worn-out equipment, and transfers between Loan Parties[87] - Specific caps on other dispositions include: up to $25 million for assets sold to non-Loan Party subsidiaries, up to $25 million for assets held for sale, and a general basket of up to $7.5 million for other asset transfers[88] Changes in Business and M&A Loan Parties cannot materially change their line of business, liquidate, or dissolve (unless merging into another Loan Party). They are also prohibited from merging with or acquiring other entities, with limited exceptions for mergers between existing subsidiaries or Loan Parties - Loan Parties must not engage in any material business other than their current business or reasonably related activities[89] - Mergers and acquisitions are generally prohibited, except for internal reorganizations where a Loan Party is the surviving entity[90] Indebtedness and Liens Loan Parties are forbidden from incurring any new debt or creating any liens on their property, except for specifically defined "Permitted Indebtedness" and "Permitted Liens." This ensures that the Lenders' security interest remains first priority and that the company's debt levels are controlled - Loan Parties cannot create, incur, or assume any Indebtedness other than Permitted Indebtedness[92] - Loan Parties cannot create or allow any Lien on their property except for Permitted Liens, ensuring the Lenders' security interest remains first priority[93] Distributions and Investments Loan Parties are restricted from paying dividends, making distributions, or repurchasing stock, with limited exceptions such as dividends payable in stock and small-scale repurchases from former employees. They are also prohibited from making any investments other than those defined as "Permitted Investments" - Dividends and stock repurchases are generally prohibited, with exceptions for non-cash dividends and repurchases from former employees up to $1 million per year[94] - Investments are restricted to a list of "Permitted Investments," which includes cash equivalents, certain intercompany loans, and a general basket for other investments[94] Financial Covenants The Borrower must adhere to two key financial covenants: maintaining a minimum level of liquidity and capping the annual cash interest payments on junior debt Financial Covenants | Covenant | Requirement | | :--- | :--- | | Minimum Liquidity | Must not be less than $15 million. | | Junior Debt Service Cap | Cash interest payments on junior debt must not exceed $20 million per fiscal year. | Cash Repayment of Existing Notes The agreement places a specific limit on the amount of cash that can be used to repay the company's Existing Notes at maturity. The cap is set at $60 million plus any cash proceeds from equity issuances. This restriction does not apply to refinancing the notes with new junior or unsecured debt - Loan Parties are prohibited from repaying the Existing Notes at maturity with cash exceeding the sum of $60 million plus proceeds from any equity issuance[100] Events of Default This section defines the specific occurrences, such as payment failures, covenant breaches, or insolvency, that trigger an Event of Default, allowing Lenders to exercise their remedies Summary of Events of Default An Event of Default can be triggered by several occurrences, giving Lenders the right to exercise their remedies. Key triggers include failure to make payments (Payment Default), violation of covenants (Covenant Default), insolvency or bankruptcy proceedings, default on other significant debt, large unpaid judgments, material misrepresentations in the loan documents, or a Change of Control of the Borrower - Payment Default: Failure to pay principal when due, or interest/other obligations within a 5-business-day grace period[101] - Covenant Default: Violation of any negative covenant (Article 6) or certain affirmative covenants, with cure periods of 15-30 days for less critical breaches[102] - Insolvency: The company becomes insolvent, begins bankruptcy proceedings, or has such proceedings initiated against it that are not dismissed within 60 days[102] - Other Triggers: Include default on other debt, large judgments (over $10 million), material misrepresentations, failure of the guaranty, or a Change of Control[102][103] Lenders' Rights and Remedies This section outlines the broad actions Lenders can take upon an Event of Default, including accelerating obligations, ceasing advances, and taking control of collateral Rights and Remedies Upon an Event of Default, Lenders have broad rights and remedies. They can declare all obligations immediately due and payable (acceleration), cease further lending, take control of and sell the Collateral, and exercise any other rights available under the law or the loan documents - Upon an Event of Default, Lenders can declare all Obligations immediately due and payable[104] - Lenders may stop advancing money, take possession of and sell the Collateral, and collect directly from Account Debtors[104] - In the case of an insolvency-related default (Section 7.4), all Obligations become automatically due and payable without any action from the Lenders[104] Notices This section specifies the formal procedures and designated contacts for all official communications between the Borrower and the Lenders Notice Procedures This section specifies the official addresses and methods for all formal communications between the parties. Notices must be in writing and can be delivered by mail, electronic mail, or overnight courier to the designated contacts for the Borrower (Beyond Meat, Inc.) and the Lender (Unprocessed Foods, LLC) - All official notices must be in writing and sent to the specified addresses for Borrower (in El Segundo, CA) and Lenders (c/o Unprocessed Foods, LLC in Cheyenne, WY)[113][114] Governing Law and Jurisdiction This section establishes New York law as the governing legal framework for the agreement and includes an irrevocable waiver of jury trial for all parties Governing Law and Waiver of Jury Trial The loan documents are governed by the laws of the State of New York. All parties agree to the exclusive jurisdiction of U.S. federal or New York state courts in New York, New York for any disputes. Critically, all parties irrevocably waive their right to a trial by jury for any legal proceeding related to the agreement - The agreement and related documents shall be governed by and construed in accordance with the laws of the State of New York[115] - EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY in any legal proceeding arising out of the agreement[117] General Provisions This section covers standard contractual clauses, including restrictions on assignment, the Borrower's obligation to cover Lenders' expenses and indemnification, and confidentiality requirements Key General Provisions This section contains several standard but important clauses. The Borrower cannot assign its rights without Lender consent, while Lenders can only assign to specific affiliates. The Borrower must reimburse Lenders for all reasonable out-of-pocket expenses related to the loan (capped at $250,000 for initial documentation) and indemnify them against losses and claims. Lenders must maintain the confidentiality of information provided by the Borrower, with standard exceptions for legal requirements and sharing with advisors - Assignment: Borrower may not assign the agreement without Lender consent. Lenders may only assign to certain US-based affiliates not in the same industry as the Borrower[121] - Expenses & Indemnification: Borrower must pay Lenders' reasonable and documented out-of-pocket expenses, with legal fees for documentation capped at $250 thousand. Borrower also indemnifies Lenders from claims arising from the transaction[123][125] - Confidentiality: Lenders agree to keep information from the Borrower confidential, subject to legally required disclosures and sharing with affiliates and advisors who are also bound by confidentiality[132] Guaranty This section details the absolute, unconditional, and irrevocable guarantee provided by each Guarantor for all of the Borrower's obligations, waiving common defenses Guaranty Each Guarantor (typically a subsidiary of the Borrower) provides an absolute, unconditional, and irrevocable guarantee for the full payment of all Obligations. This is a guaranty of payment, not collection, meaning Lenders can demand payment directly from a Guarantor without first suing the Borrower. The Guarantors waive numerous defenses, ensuring the guaranty remains enforceable even in cases of bankruptcy or other issues with the Borrower - Each Guarantor is jointly and severally liable for all "Guaranteed Obligations" as a primary obligor, not merely as a surety[143] - The guaranty is one of payment, not collection, and is unconditional. Guarantors waive most defenses, including those arising from the Borrower's insolvency or changes to the underlying obligations[144][145][148] - New subsidiaries required to become Guarantors will do so by executing a "Guaranty Joinder"[162] Definitions This section provides precise definitions for all capitalized terms used throughout the agreement, clarifying key financial, collateral, and operational terms Key Definitions This section defines all capitalized terms used throughout the agreement. Key definitions include the financial terms that govern the loan, the scope of what constitutes collateral, the specific actions that are permitted or restricted, and the conditions that could lead to a default - Term Loan Availability Amount: The total principal amount available to be borrowed, defined as $100 million[292] - MOIC Amount: An additional payment required upon prepayment or repayment to ensure Lenders achieve at least a 2.00 to 1.00 multiple of invested capital[255] - Change of Control: Defined as any person or group (other than certain creditors) becoming the beneficial owner of more than 50% of the total voting stock of the Borrower[183] - Permitted Indebtedness: A detailed list of debt the company is allowed to incur, including the existing notes, subordinated debt up to $400 million, and various operational or capital expenditure-related debts within specific limits[264][265][266] - Subordinated Debt: Debt that is subordinated in payment and security to the Obligations owed to the Lenders, with a maturity date at least 90 days after the loan's maturity date[288]