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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Jammin Java Corp (PK) | USOTC:JAMN | OTCMarkets | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 0.0001 | 0.0001 | 0.0001 | 0.00 | 01:00:00 |
UNITED STATES
|
SECURITIES AND EXCHANGE COMMISSION
|
For the quarterly period ended April 30, 2015
|
For the transition period from ______ to ______
|
Commission file number: 000-52161
|
(Exact name of registrant as specified in its charter)
|
Nevada
|
26-4204714
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(State or other jurisdiction of incorporation or organization)
|
(IRS Employer Identification No.)
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4730 Tejon St., Denver, Colorado 80211
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(Address of principal executive offices and Zip Code)
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Registrant’s telephone number, including area code: (323) 556-0746
|
Large accelerated filer ❑
|
Accelerated filer ❑
|
||
Non-accelerated filer ❑
|
Smaller reporting company ☑
|
||
(Do not check if a smaller reporting company)
|
Jammin Java Corp.
|
For the Three months Ended April 30, 2015 and 2014
|
INDEX
|
Page
|
||
PART I – FINANCIAL INFORMATION
|
||
Item 1.
|
Financial Statements
|
F-1
|
Balance Sheets as of April 30, 2015 (unaudited) and January 31, 2015
|
F-1
|
|
Statements of Operations (unaudited) - For the three months ended April 30, 2015 and 2014
|
F-2
|
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Statements of Cash Flows (unaudited) - For the three months ended April 30, 2015 and 2014
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F-3
|
|
Notes to Financial Statements (unaudited)
|
F-4
|
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
1
|
Item 3.
|
Quantitative and Qualitative Disclosures About Market Risk
|
12
|
Item 4.
|
Controls and Procedures
|
12
|
PART II – OTHER INFORMATION
|
||
Item 1.
|
Legal Proceedings
|
14
|
Item 1A.
|
Risk Factors
|
15
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
15
|
Item 3.
|
Defaults Upon Senior Securities
|
15
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Item 4.
|
Mine Safety Disclosures
|
15
|
Item 5.
|
Other Information
|
15
|
Item 6.
|
Exhibits
|
15
|
Signatures
|
15
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PART I - FINANCIAL INFORMATION
|
Item 1. Financial Statements.
|
JAMMIN JAVA CORP.
|
BALANCE SHEETS
|
April 30,
2015
|
January 31,
2015
|
|||||||
(Unaudited) | ||||||||
Assets
|
||||||||
Current Assets:
|
||||||||
Cash and cash equivalents
|
$
|
72,031
|
$
|
443,189
|
||||
Accounts receivable, net (includes $810,498 due from a related party)
|
1,732,247
|
1,154,252
|
||||||
Inventory
|
153,868
|
197,581
|
||||||
Prepaid expenses
|
11,660
|
18,986
|
||||||
Other current assets
|
3,421
|
3,784
|
||||||
Total Current Assets
|
1,973,227
|
1,817,792
|
||||||
Property and equipment, net
|
395,498
|
381,248
|
||||||
Intangible assets, net
|
718,428
|
734,753
|
||||||
Other assets
|
23,567
|
23,567
|
||||||
Total Assets
|
$
|
3,110,720
|
$
|
2,957,360
|
||||
Liabilities and Stockholders' Equity (Deficit)
|
||||||||
Current Liabilities:
|
||||||||
Accounts payable (includes $2,480,206 due to a related party)
|
$
|
3,253,092
|
$
|
2,492,900
|
||||
Accrued expenses
|
266,727
|
477,229
|
||||||
Accrued royalty and other expenses - related party
|
58,609
|
81,078
|
||||||
Notes payable
|
298,948
|
-
|
||||||
Total Current Liabilities
|
3,877,376
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3,051,207
|
||||||
Total Liabilities
|
3,877,376
|
3,051,207
|
||||||
Stockholders' Equity (Deficit):
|
||||||||
Common stock, $.001 par value, 5,112,861,525 shares authorized; 125,545,910 and 124,691,748 shares issued and outstanding, as of April 30, 2015 and January 31, 2015, respectively
|
125,546
|
124,692
|
||||||
Additional paid-in-capital
|
24,348,867
|
23,825,294
|
||||||
Accumulated deficit
|
(25,241,069)
|
(24,043,833)
|
||||||
Total Stockholders' Equity (Deficit)
|
(766,656)
|
(93,847)
|
||||||
Total Liabilities and Stockholders' Equity (Deficit)
|
$
|
3,110,720
|
$
|
2,957,360
|
||||
See accompanying notes to condensed financial statements
|
JAMMIN JAVA CORP.
|
||||||||
STATEMENTS OF OPERATIONS
|
||||||||
(Unaudited)
|
||||||||
Three Months Ended April 30,
|
||||||||
2015
|
2014
|
|||||||
Revenue:
|
$ | 2,738,379 | $ | 2,141,037 | ||||
Discounts and allowances
|
(156,952 | ) | (19,916 | ) | ||||
Net revenue
|
2,581,427 | 2,121,121 | ||||||
Cost of sales:
|
||||||||
Cost of sales products
|
1,784,812 | 1,668,376 | ||||||
Total cost of sales
|
1,784,812 | 1,668,376 | ||||||
Gross Profit
|
796,615 | 452,745 | ||||||
Operating Expenses:
|
||||||||
Compensation and benefits
|
972,806 | 1,132,148 | ||||||
Selling and marketing
|
521,116 | 822,773 | ||||||
General and administrative
|
492,824 | 780,600 | ||||||
Total operating expenses
|
1,986,746 | 2,735,521 | ||||||
Other income (expense):
|
||||||||
Other income (expense)
|
- | 370,024 | ||||||
Interest expense
|
(7,105 | ) | (437 | ) | ||||
Total other income (expense)
|
(7,105 | ) | 369,587 | |||||
Net Loss
|
$ | (1,197,236 | ) | $ | (1,913,189 | ) | ||
Net loss per share:
|
||||||||
Basic and diluted loss per share
|
$ | (0.01 | ) | $ | (0.02 | ) | ||
Weighted average common shares outstanding - basic and diluted
|
124,879,545 | 106,390,682 | ||||||
See accompanying notes to condensed financial statements
|
STATEMENTS OF CASH FLOWS
|
||||||||
(Unaudited)
|
||||||||
Three Months Ended April 30,
|
||||||||
2015
|
2014
|
|||||||
Cash Flows From Operating Activities:
|
||||||||
Net loss
|
$
|
(1,197,236)
|
$
|
(1,913,189)
|
||||
Adjustments to reconcile net loss to net cash used in operating activities:
|
||||||||
Common stock issued for services
|
156,381
|
166,147
|
||||||
Shared-based employee compensation
|
368,046
|
604,777
|
||||||
Depreciation
|
41,273
|
22,637
|
||||||
Amortization of license agreement
|
4,159
|
1,248
|
||||||
Amortization of intangible assets
|
12,166
|
12,167
|
||||||
Changes in operating assets and liabilities:
|
||||||||
Accounts receivable
|
(577,995)
|
(390,616)
|
||||||
Inventory
|
43,713
|
239,944
|
||||||
Prepaid expenses and other current assets
|
7,689
|
1,023,940
|
||||||
Other assets - long term
|
-
|
(5,600)
|
||||||
Accounts payable
|
760,192
|
(657,968)
|
||||||
Accrued expenses
|
(210,502)
|
(17,145)
|
||||||
Accrued royalty and other expenses - related party
|
(22,469)
|
(7,233)
|
||||||
Net cash used in operating activities
|
(614,583)
|
(920,891)
|
||||||
Cash Flows From Investing Activities:
|
||||||||
Purchases of property and equipment
|
(55,523)
|
(13,089)
|
||||||
Net cash used in investing activities
|
(55,523)
|
(13,089)
|
||||||
Cash Flows From Financing Activities:
|
||||||||
Common stock issued for cash
|
-
|
2,500,000
|
||||||
Borrowings on short term debt
|
298,948
|
(4,965)
|
||||||
Net cash provided by financing activities
|
298,948
|
2,495,035
|
||||||
Net change in cash and cash equivalents
|
(371,158)
|
1,561,055
|
||||||
Cash and cash equivalents at beginning of period
|
443,189
|
857,122
|
||||||
Cash and cash equivalents at end of period
|
$
|
72,031
|
$
|
2,418,177
|
||||
Non-Cash Transactions:
|
||||||||
Extinguishment of debt for stock
|
$
|
-
|
$
|
369,589
|
||||
Addition of capital leases
|
$
|
73,000
|
$
|
-
|
||||
See accompanying notes to condensed financial statements
|
April 30,
|
January 31,
|
|||||||
2015
|
2015
|
|||||||
Finished Goods - Coffee
|
$ | 153,868 | $ | 197,581 | ||||
$ | 153,868 | $ | 197,581 |
April 30,
|
January 31,
|
|||||||
2015
|
2015
|
|||||||
License Agreement
|
$ | 730,000 | $ | 730,000 | ||||
Intangible assets
|
49,900 | 49,900 | ||||||
Total
|
$ | 779,900 | $ | 779,900 | ||||
Accumulated amortization
|
(149,634 | ) | (133,309 | ) | ||||
Intangibles subject to amortization
|
$ | 630,266 | 646,591 | |||||
Goodwill
|
88,162 | 88,162 | ||||||
Total intangible assets
|
$ | 718,428 | $ | 734,753 |
For the three months ending April 30,
|
||||||||
2015
|
2014
|
|||||||
License Agreement
|
$ | (12,166 | ) | $ | (12,167 | ) | ||
Intangible assets
|
(4,159 | ) | (1,248 | ) | ||||
Total License Agreement Amortization Expense
|
$ | (16,325 | ) | $ | (13,415 | ) |
Years Ending January 31,
|
||||
2016
|
$ | 34,126 | ||
2017
|
46,292 | |||
2018
|
46,292 | |||
2019
|
46,292 | |||
2020
|
46,292 | |||
Thereafter
|
376,874 | |||
Total
|
$ | 596,168 |
Weighted Average
|
|||||||
Number of
|
Weighted Average
|
Remaing Contract
|
|||||
Shares
|
Exercise Price
|
Term (# of years)
|
|||||
Outstanding at February 1, 2015
|
17,830,000
|
$
|
0.35
|
||||
Granted
|
500,000
|
0.22
|
|||||
Exercised
|
-
|
-
|
|||||
Forfeited and canceled
|
(60,000)
|
0.21
|
|||||
Outstanding at April 30, 2015
|
18,270,000
|
$
|
0.35
|
3.13
|
|||
Exercisable at April 30, 2015
|
11,149,160
|
$
|
0.33
|
2.82
|
·
|
$1,844 per month from December 10, 2014 to November 10, 2017;
|
|
·
|
$575 per month from June 10, 2015 to May 10, 2018.
|
April 30, 2015
|
January 31, 2015
|
Increase/(Decrease)
|
||||||||||
Working Capital
|
$ | (1,904,149 | ) | $ | (1,233,415 | ) | $ | (670,734 | ) | |||
Cash
|
$ | 72,031 | $ | 443,189 | $ | (371,158 | ) |
Three months Ended
|
||||||||
April 30,2015
|
April 30,2014
|
|||||||
Net cash used in operating activities
|
$ | (614,583 | ) | $ | (920,891 | ) | ||
Net cash provided by (used in) investing activities
|
$ | (55,523 | ) | $ | (13,089 | ) | ||
Net cash provided by financing activities
|
$ | 298,948 | $ | 2,495,035 |
|
|
(1)
|
lack of a functioning audit committee and lack of a majority of outside directors on the Company’s Board of Directors capable to oversee the audit function;
|
|
|
(2)
|
inadequate segregation of duties due to limited number of personnel, which makes the reporting process susceptible to management override;
|
|
|
(3)
|
insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of GAAP and SEC disclosure requirements; and
|
|
|
(4)
|
ineffective controls over period end financial disclosure and reporting processes.
|
JAMMIN JAVA CORP.
|
|
Dated: June 15, 2015
|
By: /s/ Brent Toevs
|
Brent Toevs
|
|
Chief Executive Officer
|
|
(Principal Executive Officer)
|
JAMMIN JAVA CORP.
|
|
Dated: June 15, 2015
|
By: /s/ Anh Tran
|
Anh Tran
|
|
President, Secretary and Treasurer
|
|
(Principal Accounting and Financial Officer)
|
Exhibit Index
|
Exhibit Number
|
Description
|
|
2.1
|
Asset Purchase Agreement with BikeCaffe Franchising Inc. (December 4, 2013)(incorporated by reference to Exhibit 2.1 of the Company’s Current Report on Form 8-K, filed with the Commission on December 10, 2013)
|
|
3.1
|
Restated Articles of Incorporation (incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K filed April 1, 2014)
|
|
3.2
|
Amended and Restated Bylaws of Jammin Java Corp. (May 23, 2014) (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed May 30, 2014)
|
|
3.3
|
Articles of Merger (incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K filed March 12, 2008)
|
|
3.4
|
Articles of Merger (incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K filed September 17, 2009)
|
|
4.1
|
Specimen Stock Certificate (incorporated by reference to Exhibit 4.1 of the Company’s Registration Statement on Form SB-2 filed August 3, 2005)
|
|
4.2
|
2011 Equity Compensation Plan (incorporated by reference to Exhibit 10.4 of the Company’s Form 8-K filed August 10, 2011)
|
|
4.3
|
Amended and Restated 2012 Equity Incentive Plan (incorporated by reference to Exhibit 4.1 of the Company’s Form S-8/A Registration Statement filed October 17, 2013)
|
|
4.4
|
Form of Common Stock Purchase Warrant (incorporated by reference to Exhibit 4.5 of the Company’s Quarterly Report on Form 10-Q filed September 12, 2013)
|
|
4.5
|
2013 Equity Incentive Plan (incorporated by reference to Exhibit 4.1 of the Company’s Registration Statement on Form S-8 filed October 17, 2013)
|
|
10.1
|
Trademark License Agreement, dated as of March 31, 2010, by and between Marley Coffee, LLC and the Company (incorporated by reference to the Company’s Annual Report on Form 10-K filed May 17, 2011)
|
|
10.2**
|
Supply and Toll Agreement, dated as of April 28, 2010, between Canterbury Coffee Corporation and the Company (incorporated by reference to Exhibit 10.2 of the Company’s Annual Report on Form 10-K filed May 17, 2011)
|
|
10.3
|
Exclusive Sales and Marketing Agreement, dated as of April 25, 2011, by and between National Coffee Service & Vending and the Company (incorporated by reference to Exhibit 10.3 of the Company’s Annual Report on Form 10-K filed May 17, 2011)
|
|
10.4**
|
First Amendment to Supply and Toll Agreement, dated as of May 12, 2011, by and between Canterbury Coffee Corporation and the Company (incorporated by reference to Exhibit 10.5 of the Company’s Annual Report on Form 10-K filed May 17, 2011)
|
10.5
|
Amendment to Trademark License Agreement, dated as of August 5, 2011, by and between Marley Coffee, LLC and the Company (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed August 10, 2011)
|
|
10.6+
|
Grant of Contractor Stock Option, dated as of August 11, 2011, from the Company to Shane Whittle (incorporated by reference to Exhibit 10.3 of the Company’s Current Report on Form 8-K/A filed August 11, 2011)
|
|
10.7
|
Jammin Java Corp. Equity Compensation Plan (incorporated by reference to Exhibit 10.4 of the Company’s Current Report on Form 8-K filed August 10, 2011)
|
|
10.8+
|
Employment Agreement, dated as of August 5, 2011, by and between Anh Tran and the Company (incorporated by reference to Exhibit 10.5 of the Company’s Current Report on Form 8-K filed August 10, 2011)
|
|
10.9+
|
Employment Agreement, dated as of August 8, 2011, by and between Brent Toevs and the Company (incorporated by reference to Exhibit 10.6 of the Company’s Current Report on Form 8-K filed August 10, 2011)
|
|
10.10+
|
Grant of Employee Stock Option dated as of August 5, 2011, from the Company to Anh Tran (incorporated by reference to Exhibit 10.7 of the Company’s Current Report on Form 8-K filed August 10, 2011)
|
|
10.11+
|
Grant of Employee Stock Option, dated as of August 5, 2011, from the Company to Rohan Marley (incorporated by reference to Exhibit 10.8 of the Company’s Current Report on Form 8-K filed August 10, 2011)
|
|
10.12+
|
Grant of Employee Stock Option, dated as of August 10, 2011, from the Company to Brent Toevs (incorporated by reference to Exhibit 10.9 of the Company’s Current Report on Form 8-K filed August 10, 2011)
|
|
10.13**
|
Roasting and Distribution Agreement, dated as of January 1, 2012, by and between the Company and Canterbury Coffee Corporation, (incorporated by reference to Exhibit 10.15 to the Company’s Annual Report on Form 10-K filed May 14, 2012)
|
|
10.14
|
License Agreement with Fifty-Six Hope Road Music Limited dated September 13, 2012 (incorporated by reference to Exhibit 10.7 of the Company’s Amended Report on Form 10-Q/A, filed on October 4, 2012)
|
|
10.15
|
Form of Subscription Agreement (August 2013 Offering) (incorporated by reference to Exhibit 10.23 of the Company’s Quarterly Report on Form 10-Q filed September 12, 2013)
|
|
10.16+
|
Amended and Restated Employment Agreement with Brent Toevs (August 2013) (incorporated by reference to Exhibit 10.24 of the Company’s Quarterly Report on Form 10-Q filed September 12, 2013)
|
|
10.17+
|
Amended and Restated Employment Agreement with Anh Tran (August 2013) (incorporated by reference to Exhibit 10.25 of the Company’s Quarterly Report on Form 10-Q filed September 12, 2013)
|
|
10.18
|
Lease Agreement (June 2013) – 4730 Tejon Street, Denver, Colorado 80211 (incorporated by reference to Exhibit 10.26 of the Company’s Quarterly Report on Form 10-Q filed September 12, 2013)
|
10.19
|
Asset Purchase Agreement between the Company and Black Rock Beverage Services, LLC (August 2013) (incorporated by reference to Exhibit 10.27 of the Company’s Annual Report on Form 10-K filed May 16, 2014)
|
|
10.20
|
Form of Subscription Agreement July/August 2013 Offering (incorporated by reference to Exhibit 10.28 of the Company’s Annual Report on Form 10-K filed May 16, 2014)
|
|
10.21
|
Form of Common Stock Purchase Warrant Agreement July/August 2013 Offering (incorporated by reference to Exhibit 10.29 of the Company’s Annual Report on Form 10-K filed May 16, 2014)
|
|
10.22
|
Amended and Restated License Agreement with Mother Parkers Tea & Coffee Inc. (May 20, 2014) (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed May 30, 2014)
|
|
10.23
|
Form of 2013 Equity Incentive Plan Stock Option Agreement (incorporated by reference to Exhibit 10.3 of the Company’s Current Report on Form 8-K filed on August 29, 2014)
|
|
10.24
|
Form of Amended and Restated 2012 Equity Incentive Plan Stock Option Agreement (incorporated by reference to Exhibit 10.4 of the Company’s Current Report on Form 8-K filed on August 29, 2014)
|
|
10.25+
|
Form of Restricted Stock Grant Agreement to Advisory Board Members (June 2014) (incorporated by reference to Exhibit 10.33 of the Company’s Quarterly Report on Form 10-Q filed on September 15, 2014)
|
Revolving Line of Credit Agreement dated February 16, 2015, and entered into June 9, 2015, by and between Colorado Medical Finance Services, LLC (dba Gold Cross Capital LLC) and Jammin Java Corp. (No Revolving Credit Note has been executed by the parties to date in connection with amounts borrowed under the Revolving Line of Credit).
|
||
Certification of the Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
||
Certification of the Principal Accounting and Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
||
Certifications of the Principal Executive Officer and the Principal Accounting and Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
||
99.1**** | Press Release dated June 15, 2015 | |
101.INS***
|
XBRL Instance Document
|
|
101.SCH***
|
XBRL Taxonomy Extension Schema Document
|
|
101.CAL***
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF***
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
101.LAB***
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
101.PRE***
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
* Filed herewith.
|
** The Company has obtained confidential treatment of certain portions of this agreement which have been omitted and filed separately with the U.S. Securities and Exchange Commission.
|
*** XBRL information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act, is deemed not filed for purposes of Section 18 of the Exchange Act, and otherwise is not subject to liability under these sections.
|
**** Furnished herewith.
+ Indicates management contract or compensatory plan or arrangement.
|
|
A.
|
The Borrower has requested that the Lender extend to the Borrower a renewable revolving line of credit (the “Line of Credit”) to provide working capital for the Borrower.
|
|
B.
|
To the extent that any amount loaned under the Line of Credit is repaid by the Borrower, such amount may be re-borrowed pursuant to the terms and conditions of this Agreement.
|
|
C.
|
The Lender desires to lend to the Borrower, on a revolving line of credit basis, the amount set forth herein as the Line of Credit Limit, pursuant to the terms and conditions of this Agreement.
|
1.
|
Definitions.
|
|
1.1.
|
Defined Terms. As used in this Agreement, the following terms shall have the following meanings:
|
|
1.2.
|
Accounting Terms. All accounting terms not specifically defined herein shall be construed in accordance with other comprehensive basis of accounting – income tax basis consistent with those applied in the preparation of tax returns and all financial data submitted pursuant to this Agreement shall be prepared in accordance with such principles.
|
2.
|
Terms of Line of Credit.
|
|
2.1.
|
The Lender agrees to lend to the Borrower from the date hereof amounts, which together with all other outstanding principal amounts issued pursuant to this section do not exceed the Line of Credit Limit. The Borrower agrees to repay all amounts borrowed and advanced in accordance with the terms described herein. The Line of Credit Limit is the maximum amount the Lender may be required to advance to the borrower under this Agreement. The parties hereto specifically acknowledge that as of the date hereof, the Borrower has not received any advances.
|
|
2.2.
|
It is understood that the amount available to the Borrower will vary in accordance with Advances to the Borrower and payments made by the Lender to the Borrower.
|
|
2.3.
|
The Borrower may obtain Advances on the Line of Credit, as follows:
|
|
2.3.1.
|
Line of Credit Note. On each Advance Date, the Borrower shall issue to the Lender an updated promissory note substantially in the form attached hereto as Exhibit A (the “Line of Credit Note”) duly executed on behalf of the Borrower, dated as of the Advance Date and payable to the order of the Lender in the amount of all Advances made by the Lender to the Borrower as of such applicable Advance Date. Each Line of Credit Note shall automatically replace and supersede any prior Line of Credit Note. Each Line of Credit Note shall include on an exhibit thereto a summary of all prior Advances made by the Lender to the Borrower and the current outstanding amount of each such Advance (the “Advance Accounting”). Each Advance Accounting shall, in the absence of manifest error, be prima facie evidence of the total Advances outstanding under the Line of Credit Note.
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|
2.3.2.
|
Borrower may request that Lender make Advances from time to time by giving the Lender prior written notice in the form of U.S. mail or email (each a “Notice”) of its request for an Advance and the amount of the Advance, up to the Line of Credit Limit, at least two (2) Business Days prior to the date of such proposed Advance. Each Notice shall specify: (i) the aggregate principal amount of the Advance, (ii) the date of such requested Advance and (iii) the account where Borrower requests such Advance to be disbursed. The Borrower may not request Advances if as a result thereof, the aggregate amount of all Advances (together with accrued and unpaid interest) would exceed the amount of the Line of Credit Limit. Lender shall be required to made Advances to Borrower as described in the Notice, to the extent such aggregate Advances will not exceed the Line of Credit Limit.
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2.3.3.
|
All Advances made to the Borrower under this Agreement shall be deposited immediately, but in no event later than the next regular banking day, in the Borrower’s regular banking account.
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|
2.4
|
Loan Interest. The Borrower shall pay to the Lender interest on the outstanding balance of all Advances obtained under this Line of Credit. The interest rate that the aggregate amount of Advances shall bear Loan Interest and be payable as described below. Interest shall be compounded annually on the basis of a 365-day year and charged on the number of actual days Advances are outstanding.
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|
2.5
|
Interest Payment Applications. All payments on this Line of Credit shall be applied first in payment of accrued interest and any remainder in payment of principal.
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|
2.6
|
Principal Pay Downs. The Borrower may make principal payments in excess of the amount then due on this Line of Credit as described below and the Borrower may pre-pay the amount due under the Line of Credit (and accrued and unpaid interest thereon) at any time without penalty. In the event the Borrower determines to pay and pays the entirety of the outstanding principal balance of Advances and the interest which has accrued thereon as of any date prior to the Maturity Date, the Borrower shall be entitled to satisfy such amounts without further cost or fee as a result of such payment.
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|
2.7
|
Principal Amortization and Interest Payments. Borrower shall make principal amortization payments on the unpaid balance of Advances owed hereunder, based on an eighteen (18) month amortization schedule, beginning on the first day after the First Advance Date, and on each month thereafter. The Surcharge (as defined below) shall either be payable in kind as provided in Section 2.8 below, or shall accrue and be payable in cash on the Maturity Date. If any payment of principal or interest on this Agreement or any Line of Credit Note shall become due on a Saturday, Sunday or any other day on which national banks are not open for business, such payment shall be made on the next succeeding Business Day. “Business Day” means a day other than (i) a Saturday, (ii) a Sunday or (iii) a day on which commercial banks in Colorado or Florida, are authorized or required to be closed for business.
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2.8
|
Payment of Loan Interest. A total of ten percent (10%) of the Loan Interest accrued and due under this Agreement shall be payable in cash as provided in Section 2.7 above. A total of seven and one-half percent (7.5%) of the Loan Interest (the “Surcharge”) shall be payable in cash, or at the option of the Lender and with the consent of the Borrower, shall not be payable in cash and shall instead be payable either by a reduction in amounts owed to Borrower by Lender in connection with the sale of coffee or other promotional services from Borrower to Lender, as mutually agreed between the parties;
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2.9
|
Compliance with Borrowing Base. If at any time during the term of this Agreement, the Borrower obtains knowledge that the total principal amount of all Advances outstanding exceeds the Line of Credit Limit, the Borrower shall immediately reduce the principal amount of the Advance outstanding at that time by an amount equal to the excess.
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2.10
|
Changing the Line of Credit Limit. The Lender and the Borrower can mutually agree to change the Line of Credit Limit, such action to be added to this Agreement as an amendment signed by both parties.
|
3.
|
Termination. The Lender may terminate this Agreement for cause at any time by furnishing the Borrower with a written notice. Termination “for cause” is defined as termination pursuant to Section 5 herein. The Borrower may terminate this Agreement at any time with or without cause in the event that the total amount of the Advances (as well as any accrued and unpaid interest thereon) has been repaid and/or that no amount is currently outstanding under any Advances.
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4.
|
Maturity. Notwithstanding any provision herein to the contrary, all outstanding Advances together with accrued and unpaid interest, fees and charges shall mature and be due and payable in full on the Maturity Date.
|
5.
|
Events of Default: Remedies.
|
|
5.1.
|
Each of the following events constitutes an Event of Default:
|
|
5.1.1.
|
The Borrower fails to make due and punctual payment of principal or interest on the Line of Credit or any other of its obligations due to the tender or any part thereof, when the same become due and payable, whether at maturity or otherwise;
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|
5.1.2.
|
if there shall exist final judgments against the Borrower aggregating in excess of Five Hundred Thousand Dollars ($500,000) and if any one of such judgments shall have been outstanding for any period of forty-five (45) days or more from the date of its entry and shall not have been discharged in full or stayed pending appeal; or
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|
5.1.3.
|
the Borrower shall: (i) become insolvent or take any action which constitutes its admission of inability to pay its debts as they mature; (ii) make an assignment for the benefit of creditors, file a petition in bankruptcy, petition or apply to any tribunal for the appointment of a custodian, receiver or a trustee for it or a substantial portion of its assets; (iii) commence any proceeding under any bankruptcy, reorganization, arrangement, readjustment of debt, dissolution or liquidation or statute of any jurisdiction, whether now or hereafter in effect; (iv) have filed against it any such petition or application in which an order for relief is entered or which remains undismissed for a period of ninety (90) days or more; (v) indicate its consent to, approval of or acquiescence in any such petition, application, proceeding or order for relief or the appointment of a custodian, receiver or trustee for it or a substantial portion of its assets; or (vi) suffer any such custodianship, receivership or trusteeship to continue undischarged for a period of ninety (90) days or more.
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|
5.2.
|
Upon the occurrence of any Event of Default, the Lender may declare its commitment to make the Advances under the Line of Credit to be suspended and provide to the Borrower written notice of such default and request that the default be cured within ten (10) days following the date of such notice to the Borrower. Notwithstanding the provisions of Section 4 hereof, in the event such default is not cured within the ten (10) day demand period, then the Lender may terminate this Agreement and, in addition, may:
|
|
5.2.1.
|
Declare the unpaid principal balance, and all interest thereon and all other amounts payable under this Agreement immediately due and payable (in the event of demand hereunder all Surcharges shall be payable in cash).
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|
5.2.2.
|
Immediately, without expiration of any further period of grace, enforce payment of all obligations of the Borrower to the Lender under this Agreement and under agreements executed in connection herewith and may exercise any and all other remedies granted to the Lender at law, in equity or otherwise.
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|
5.2.3.
|
Exercise all of the Lender’s rights under the terms of any security agreement, assignment, trust deed, pledge or other lien document executed in connection herewith.
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|
5.3.
|
The Borrower agrees that after the exercise by the Lender of the remedies specified above, following an Event of Default, the obligations due hereunder shall accrue interest until paid at the rate of twenty percent (20%) per annum or the maximum amount permitted by law, whichever is less (the “Default Rate”).
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|
5.4.
|
On or after the occurrence of an Event of Default and the notice to the Borrower by the Lender of the Lender’s intention to declare the entire amount of outstanding principal and interest hereunder due and payable, the Borrower agrees to pay all expenses and fees including attorney’s fees and court costs incurred by the Lender in the collection of the obligations and/or incurred in any bankruptcy or insolvency proceeding or in any arbitration proceedings. These expenses shall be due and payable immediately. If the Borrower fails to make the full payment of such fees and expenses within fifteen days following the date of demand therefore, such fees and expenses shall accrue interest until paid at the Default Rate.
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6.
|
Representations of Borrower
|
|
6.1.
|
All financial statements and other information furnished to Lender are true and correct as of the date of the rendition of the statements or the information and there has been no substantial change in the financial position of Borrower since the date such statements were last furnished.
|
|
6.2.
|
There are no suits or proceedings of any kind or nature pending or threatened against Borrower in or before a court, administrative agency except as otherwise set forth in the Borrower’s public filings on the Securities and Exchange Commission’s Edgar database, which can be viewed at http://www.sec.gov/edgar/searchedgar/companysearch.html by searching for Jammin Java Corp.
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6.3.
|
Borrower has the power to execute and deliver this Agreement and each other Loan Document (as defined below) and to borrow funds hereunder.
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6.4.
|
Borrower has all required licenses and permits without unusual restrictions or limitations, to own, operate and lease its properties and to conduct the business in which it is presently engaged, all of which are in full force and effect.
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|
6.5.
|
The execution and delivery by Borrower of this Agreement, as supplemented and amended from time to time, each Line of Credit Note, and any other agreements required to be executed and delivered by Borrower under the terms of this Agreement, and Borrower’s performance of its obligations under each and all thereof (collectively, the “Loan Documents”), do not and will not conflict with any agreement, indenture, note or other instrument binding upon Borrower.
|
7.
|
Miscellaneous.
|
|
7.1.
|
Amendments and Waivers. No Amendment, modification, termination or waiver of any provisions of any agreement to which the Borrower and the Lender are a party shall be effective unless the same shall be in writing and signed by the Borrower and the Lender, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given.
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|
7.2.
|
Notices. All notices, requests, demands, claims and other communications hereunder shall be in writing. Any notice, request, demand, claim, or other communication hereunder shall be deemed given two Business Days after it is sent by registered or certified mail, return receipt requested, postage prepaid, and addressed to the intended recipient. Either party may send any notice, request, demand, claim, or other communication hereunder to the intended recipient using any other means (including personal delivery, express carrier, telecopy, or telex), but no such notice, request, demand, claim or other communication shall be deemed to have been duly given unless and until it actually is received by the intended recipient. Any party may change the address to which notices, request, demands, claims, and other communications hereunder are to be delivered by giving the other party notice in the manner herein set forth at least ten days prior to the effective date of such change in address.
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|
7.3.
|
Delay in Enforcement. Lender may delay or waive the enforcement of any of Lender’s rights under this Agreement without losing that right or any other right. If Lender delays or waives any of its rights, Lender may enforce that right at any time in the future without advance notice. For example, not terminating the Line of Credit for Borrower’s failure to make timely payments will not be a waiver of Lender’s right to terminate the Line of Credit in the future if Borrower has failed to make timely payments.
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|
7.4.
|
No Waiver. No failure or delay on the part of the Lender in exercising any right, power, or remedy hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any such right, power, or remedy preclude any other or further exercise thereof or the exercise of any other right, power, or remedy hereunder. The rights and remedies provided herein are cumulative, and are not exclusive of any other rights, powers, privileges, or remedies, now or hereafter existing, at law or in equity or otherwise.
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|
7.5.
|
Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the Borrower and the Lender and their respective successors and assigns, except that the Borrower may not assign or transfer any of its rights under this Agreement or document to which the Borrower is a party without the prior written consent of the Lender.
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|
7.6.
|
Integration. This Agreement contains the entire agreement between the parties relating to the subject matter hereof and supersedes all oral statements and prior writings with respect thereto.
|
|
7.6.
|
Integration. This Agreement contains the entire agreement between the parties relating to the subject matter hereof and supersedes all oral statements and prior writings with respect thereto.
|
|
7.6.
|
Dispute Resolution. Any dispute arising out of or relating to this Agreement shall be submitted to voluntary mediation at the Judicial Arbiter Group in Denver, Colorado within 30 days’ written notice of the dispute. If mediation does not resolve the dispute, the dispute shall proceed with another 30 days’ written notice to binding arbitration at the Judicial Arbiter Group. In that event, the AAA Commercial Arbitration Rules shall apply to the discovery and hearing of the dispute except that, notwithstanding any AAA Rule, the Federal Rules of Evidence shall determine the admissibility of evidence presented at the arbitration hearing.
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|
7.7.
|
Waiver and Amendment. Any provision of this Agreement can be amended, waived, modified, discharged or terminated upon the written consent of both the Lender and the Borrower.
|
|
7.8.
|
Severability of Provisions. Any invalidity, illegality or unenforceability of any provision of this Agreement in any jurisdiction will not invalidate or render illegal or unenforceable the remaining provisions hereof in such jurisdiction and will not invalidate or render illegal or unenforceable such provision in any other jurisdiction.
|
|
7.9.
|
Construction. When used in this Agreement, unless a contrary intention appears: (i) a term has the meaning assigned to it; (ii) “or” is not exclusive; (iii) “including” means including without limitation; (iv) words in the singular include the plural and words in the plural include the singular, and words importing the masculine gender include the feminine and neuter genders; (v) any agreement, instrument or statute defined or referred to herein or in any instrument or certificate delivered in connection herewith means such agreement, instrument or statute as from time to time amended, modified or supplemented and includes (in the case of agreements or instruments) references to all attachments thereto and instruments incorporated therein; (vi) the words “hereof”, “herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision hereof; (vii) references contained herein to Article, Section, Schedule and Exhibit, as applicable, are references to Articles, Sections, Schedules and Exhibits in this Agreement unless otherwise specified; (viii) references to “writing” include printing, typing, lithography and other means of reproducing words in a visible form, including, but not limited to email; (ix) references to “dollars”, “Dollars” or “$” in this Agreement shall mean United States dollars; (x) reference to a particular statute, regulation or Law means such statute, regulation or Law as amended or otherwise modified from time to time; (xi) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein); (xii) unless otherwise stated in this Agreement, in the computation of a period of time from a specified date to a later specified date, the word “from” means “from and including” and the words “to” and “until” each mean “to but excluding”; (xiii) references to “days” shall mean calendar days; and (xiv) the paragraph headings contained in this Agreement are for convenience only, and shall in no manner be construed as part of this Agreement.
|
|
7.10.
|
Attorney’s Fees. In the event of dispute arising out of this Agreement, the prevailing party is entitled to reasonable costs and attorney’s fees.
|
|
7.11
|
Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Colorado, without giving effect to any choice or conflict of law provisions or rules (whether of the State of Colorado or other jurisdiction) which would cause the application of any law, rule or regulation other than of the State of Colorado.
|
|
7.12
|
Counterparts, Effect of Facsimile, Emailed and Photocopied Signatures. This Agreement and any signed agreement or instrument entered into in connection with this Agreement, and any Addendums hereto or thereto, may be executed in one or more counterparts, all of which shall constitute one and the same instrument. Any such counterpart, to the extent delivered by means of a facsimile machine or by .pdf, .tif, .gif, .peg or similar attachment to electronic mail (any such delivery, an “Electronic Delivery”) shall be treated in all manner and respects as an original executed counterpart and shall be considered to have the same binding legal effect as if it were the original signed version thereof delivered in person. At the request of any party, each other party shall re execute the original form of this Agreement and deliver such form to all other parties. No party shall raise the use of Electronic Delivery to deliver a signature or the fact that any signature or agreement or instrument was transmitted or communicated through the use of Electronic Delivery as a defense to the formation of a contract, and each such party forever waives any such defense, except to the extent such defense relates to lack of authenticity.
|
LENDER
|
BORROWER
|
Colorado Medical Finance Services LLC
|
Jammin Java Corp.
|
By: /s/ Jim McNamara
|
By: /s/ Anh Tran
|
Printed Name: Jim McNamara
|
Printed Name: Anh Tran
|
Its: CEO
|
Its: President
|
Date of Advance
|
Original Amount of Advance
($)
|
Accrued And Unpaid Interest On Such Advance Through the Date of Execution Below
($)
|
Amount of Principal Repaid Through The Date of Execution Below (principal payments and prepayments)
(described in the notes below)
($)
|
Less Interest Paid In Cash
(described in the notes below)
($)
|
Less Surcharge Paid
(described in the notes below)
($)
|
Total Amount of Principal and Interest Owed As Of The Date of Execution Below
($)
|
TOTALS
|
Jammin Java Corp.
|
|
By: _________________
|
|
Printed Name:___________________
Title:_______________________
Date:__________________
|
|
EXHIBIT 31.1
|
I, Brent Toevs, certify that:
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Jammin Java Corp.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of a Quarterly Report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date: June 15, 2015
|
By:
|
/s/ Brent Toevs
|
Brent Toevs
|
||
Chief Executive Officer
|
||
(Principal Executive Officer)
|
EXHIBIT 31.2
|
I, Anh Tran, certify that:
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Jammin Java Corp.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of a Quarterly Report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date: June 15, 2015
|
By:
|
/s/ Anh Tran
|
Anh Tran
|
||
President, Chief Operating Officer, Secretary and Treasurer
|
||
(Principal Financial and Accounting Officer)
|
EXHIBIT 32.1
|
1.
|
the accompanying Quarterly Report on Form 10-Q for the three months ended April 30, 2015 (the “Report”) fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Dated: June 15, 2015
|
By: /s/ Brent Toevs
|
Brent Toevs
|
|
Chief Executive Officer
|
|
(Principal Executive Officer)
|
1.
|
the accompanying Quarterly Report on Form 10-Q for the three months ended April 30, 2015 (the “Report”) fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Dated: June 15, 2015
|
By: /s/ Anh Tran
|
Anh Tran
|
|
President, Secretary and Treasurer
|
|
(Principal Financial and Accounting Officer)
|
|
·
|
Quarter ended April 30, 2015 sales increased 27.9%($2,738,379) compared with last year's comparable sales while gross profits rose by 76% making it the 16th consecutive quarter that the company has grown its top line year over quarter since Mr. Brent Toevs took over as CEO.
|
|
·
|
Total operating expenses decreased by 27.4% showing continued efficient growth.
|
|
·
|
Net losses were down 37.4% compared to the same period last year and of those losses, ~$368,000 was attributed to stock based compensation, resulting in net losses before non-cash expenses of $829,191. We anticipate the losses for the three months ended July 31, 2015 to be the lowest the company has had to date and for that trend to continue through the rest of the year. In addition, we anticipate that the company will become profitable by the fourth quarter of this fiscal year (i.e., that the company will show a profit for the fourth quarter of this fiscal year).
|
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