Exhibit 10.33

 

FIRST AMENDMENT
TO
LOAN AGREEMENT

 

THIS FIRST AMENDMENT to Loan Agreement (this “Amendment”) is entered into this
2nd day of August, 2018, by and between ____________________, a _______________
(“Lender”), and WORKHORSE GROUP INC., a Nevada corporation (“Borrower”).

 

Recitals

 

A. Lender and Borrower have entered into that certain Loan Agreement dated as of
July 6, 2018 (as the same may from time to time be amended, modified,
supplemented or restated, the “Loan Agreement”), pursuant to which Lender has
made a loan to Borrower for the purposes permitted in the Loan Agreement.

 

B. Borrower has requested that Lender amend the Loan Agreement to (i) make an
additional loan to Borrower, and (ii) make certain other revisions to the Loan
Agreement as more fully set forth herein.

 

C. Lender has agreed to so amend certain provisions of the Loan Agreement, but
only to the extent, in accordance with the terms, subject to the conditions and
in reliance upon the representations and warranties set forth below.

 

Agreement

 

Now, Therefore, in consideration of the foregoing recitals and other good and
valuable consideration, the receipt and adequacy of which is hereby
acknowledged, and intending to be legally bound, the parties hereto agree as
follows:

 

1. Definitions. Capitalized terms used but not defined in this Amendment shall
have the meanings given to them in the Loan Agreement.

 

2. Amendments to Loan Agreement.

 

2.1 Section 2.1.1(a) (Availability). Section 2.1.1(a) of the Loan Agreement is
amended in its entirety and replaced with the following:

 

“(a) Availability.

 

(i) Subject to the terms and conditions of this Agreement, on the Effective Date
Lender advanced to Borrower an aggregate amount equal to Six Million One Hundred
Thousand Dollars ($6,100,000.00) (the “Original Loan”). The proceeds of the
Original Loan shall have been used by Borrower to make the payments set forth on
Schedule 2.1.1. Borrower acknowledges that the payment of the Original Loan
proceeds directly to the parties set forth on Schedule 2.1.1 pursuant to
instructions provided by Borrower to Lender in writing constituted the making of
the Original Loan by Lender to Borrower.

 

(ii) Subject to the terms and conditions of this Agreement, on the First
Amendment Effective Date, Lender shall lend to Borrower an aggregate amount not
to exceed One Million Seven Hundred Thousand Dollars ($1,700,000.00) (the “First
Amendment Loan” and together with the Original Loan, the “Loan”). The proceeds
of the First Amendment Loan shall be used by Borrower for working capital and
general corporate purposes of Borrower.”

 

 

 

  

2.2 Section 2.2 (Interest Calculation). Section 2.2(c)(ii) of the Loan Agreement
is amended in its entirety and replaced with the following: “(ii) the date on
which the Loan is advanced shall be included and the date of payment shall be
excluded.”

 

2.3 Section 5.9 (Use of Proceeds). Section 5.9 of the Loan Agreement is amended
in its entirety and replaced with the following:

 

“5.9 Use of Proceeds. The proceeds of (i) the Original Loan shall be used
exclusively by Borrower to pay in full in cash on the Effective Date the
obligations described on Schedule 2.1.1 and (ii) the First Amendment Loan shall
be used exclusively by Borrower for working capital and general corporate
purposes of Borrower (collectively, the “Proceeds Purposes”), and, in each case,
not for personal, family, household or agricultural purposes.”

 

2.4 Section 6.12(h) (Mortgages). Section 6.12(h) is amended by deleting the
words “Within sixty (60) days after the Effective Date” and substituting the
following therefor: “Concurrently with the repayment of the Existing Mortgage
Loan and in no case later than October 1, 2018”.

 

2.5 Section 6.12(j) (Sale Process and Financing Milestones). Sections 6.12(j)(i)
and (iii) are amended by deleting the reference to “July 16, 2018” therein and
substituting “August 1, 2018” therefor.

 

2.6 Section 6 (Affirmative Covenants). Section 6 is further amended by adding a
new Section 6.13 at the end thereof as follows:

 

“6.13 Repayment of Mortgage Loan. Immediately upon receipt of the proceeds from
the Equity Offering, and in no case later than October 1, 2018, Borrower shall
repay in full the principal amount of $1,850,000 together with interest and all
other obligations owing to Spring Valley Bank pursuant to that certain Mortgage
secured by Borrower’s facility located at 100 Commerce Drive, Loveland, Ohio
45140 (the “Existing Mortgage Loan”) and deliver evidence that the mortgage
securing the Existing Mortgage Loan has been released.”

 

2.7 Section 13 (Definitions). The following terms and their respective
definitions hereby are added or amended and restated in their entirety in
Section 13.1 of the Loan Agreement, as appropriate, as follows:

 

“First Amendment Effective Date” is August 2, 2018.

 

“First Amendment Loan” is defined in Section 2.1.1(a)(ii).

 

“Original Loan” is defined in Section 2.1.1(a)(i).

 

3. Limitation of Amendments.

 

3.1 The amendments set forth in Section 2, above, are effective for the purposes
set forth herein and shall be limited precisely as written and shall not be
deemed to (a) be a consent to any amendment, waiver or modification of any other
term or condition of any Loan Document, or (b) otherwise prejudice any right or
remedy which Lender may now have or may have in the future under or in
connection with any Loan Document.

 

3.2 This Amendment shall be construed in connection with and as part of the Loan
Documents and all terms, conditions, representations, warranties, covenants and
agreements set forth in the Loan Documents, except as herein amended, are hereby
ratified and confirmed and shall remain in full force and effect.

 

 2 

 

 

4. Representations and Warranties. To induce Lender to enter into this
Amendment, Borrower hereby represents and warrants to Lender as follows:

 

4.1 Immediately after giving effect to this Amendment (a) the representations
and warranties contained in the Loan Documents are true, accurate and complete
in all material respects as of the date hereof (except to the extent such
representations and warranties relate to an earlier date, in which case they are
true and correct in all material respects as of such date), and (b) no Event of
Default has occurred and is continuing;

 

4.2 Borrower has the power and authority to execute and deliver this Amendment
and to perform its obligations under the Loan Agreement, as amended by this
Amendment;

 

4.3 The organizational documents of Borrower delivered to Lender on the
Effective Date remain true, accurate and complete and have not been amended,
supplemented or restated and are and continue to be in full force and effect;

 

4.4 The execution and delivery by Borrower of this Amendment and the performance
by Borrower of its obligations under the Loan Agreement, as amended by this
Amendment, have been duly authorized;

 

4.5 The execution and delivery by Borrower of this Amendment and the performance
by Borrower of its obligations under the Loan Agreement, as amended by this
Amendment, do not and will not contravene (a) any law or regulation binding on
or affecting Borrower, (b) any material contractual restriction with a Person
binding on Borrower, (c) any order, judgment or decree of any court or other
governmental or public body or authority, or subdivision thereof, binding on
Borrower, or (d) the organizational documents of Borrower;

 

4.6 The execution and delivery by Borrower of this Amendment and the performance
by Borrower of its obligations under the Loan Agreement, as amended by this
Amendment, do not require any order, consent, approval, license, authorization
or validation of, or filing, recording or registration with, or exemption by any
governmental or public body or authority, or subdivision thereof, binding on
either Borrower, except as already has been obtained or made; and

 

4.7 This Amendment has been duly executed and delivered by Borrower and is the
binding obligation of Borrower, enforceable against Borrower in accordance with
its terms, except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, liquidation, moratorium or other similar laws of
general application and equitable principles relating to or affecting creditors’
rights.

 

5. Acknowledgement and Consent. Each guarantor (or pledgor) listed on the
signatures pages hereof (each, a “Guarantor”) hereby acknowledges and agrees
that the Guarantee and Collateral Agreement and each other Loan Document to
which it is a party or otherwise bound (each, a “Credit Support Document”) shall
continue in full force and effect and that all of its obligations thereunder
shall be valid and enforceable and shall not be impaired or limited by the
execution or effectiveness of this Amendment. Each Guarantor represents and
warrants that all representations and warranties contained in the Loan Agreement
as amended by this Amendment and the Credit Support Documents to which it is a
party or otherwise bound are true, correct and complete in all material respects
on and as of the date hereof to the same extent as though made on and as of that
date, except to the extent such representations and warranties specifically
relate to an earlier date, in which case they were true, correct and complete in
all material respects on and as of such earlier date.

 

Each Guarantor acknowledges and agrees that (i) notwithstanding the conditions
to effectiveness set forth in this Amendment, such Guarantor is not required by
the terms of the Loan Agreement or any other Loan Document to consent to the
amendments to the Loan Agreement effected pursuant to this Amendment and
(ii) nothing in the Loan Agreement, this Amendment or any other Loan Document
shall be deemed to require the consent of such Guarantor to any future
amendments to the Loan Agreement.

 

6. Fees and Expenses. Borrower acknowledges that all actual and reasonable costs
and expenses incurred by Lender and all reasonable fees, expenses, and
disbursements of its counsel with respect to this Amendment and the documents
and transactions contemplated hereby shall be for the account of Borrower as a
Lender Expense.

 

7. Counterparts. This Amendment may be executed in any number of counterparts
and all of such counterparts taken together shall be deemed to constitute one
and the same instrument.

 

 3 

 

  

8. Effectiveness. This Amendment shall be deemed effective upon (a) the due
execution and delivery to Lender of (i) this Amendment by each party hereto and
(ii) written consent of Borrower’s board of directors to this Amendment and the
transactions contemplated hereby, (b) Borrower’s payment of all Lender Expenses
incurred and invoiced as of the date hereof, and (c) delivery of such other
documents as Lender may request.

 

[Balance of Page Intentionally Left Blank]

 

 4 

 

 

In Witness Whereof, the parties hereto have caused this Amendment to be duly
executed and delivered as of the date first written above.

 

  BORROWER:       WORKHORSE GROUP INC.         By:       Name:     Title:

 

  GUARANTORS:       WORKHORSE TECHNOLOGIES INC.       By:       Name:     Title:
      WORKHORSE PROPERTIES INC.       By:                                     
Name:     Title:       WORKHORSE MOTOR WORKS INC       By:     Name:     Title:
      SUREFLY, INC.       By:                                      Name:    
Title:

 

[Signature Page to First Amendment to Loan Agreement]

 

 

 

 

  LENDER:         By:                     Name:     Title:

 

[Signature Page to First Amendment to Loan Agreement]