Exhibit 10.3

 

 

 

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Tenth Amendment to Loan and Security Agreement

 

Borrower: Local Corporation

   Krillion, Inc.

   Screamin Media Group, Inc.

 

Date: March 9, 2015

THIS TENTH AMENDMENT TO LOAN DOCUMENTS is entered into between SQUARE 1 BANK
(“Bank”) and the borrower named above (“Borrower”).

The Parties agree to amend the Loan and Security Agreement between them, dated
August 3, 2011 (as otherwise amended, if at all, the “Loan Agreement”), as
follows, effective as of the date hereof. (Capitalized terms used but not
defined in this Amendment, shall have the meanings set forth in the Loan
Agreement.)

1. Modified Financial Covenants. Section 6.7 of the Loan Agreement is amended to
read as follows:

6.7 Financial Covenants. Borrower shall at all times maintain the following
financial ratios and covenants:

(a) EBITDA. For the corresponding months set forth in the table immediately
below, calculated on a cumulative year-to-date basis, an Adjusted EBITDA of not
less than the amounts shown.

 

Applicable Month Ending

  

Minimum Adjusted EBITDA

January 31, 2015    ($1,500,000) February 28, 2015    ($2,000,000)

(b) Maximum Annual CAPEX. Borrower’s Capital Expenditures shall not exceed
$3,500,000 for the fiscal year ending December 31, 2015.

 

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Square 1 Bank

Tenth Amendment to Loan Agreement    

 

 

If necessary, Financial Covenants for any subsequent month(s) of 2015 shall be
set (or reset as appropriate) by Bank in an amendment of this Agreement, which
Borrower hereby agrees to execute, following Bank’s review of Borrower’s 2015
financial and operating plan, which shall be approved by Borrower’s board of
directors and delivered to Bank, with respect to any such applicable month(s).

2. New Subordinated Debt. Borrower has requested to obtain up to an additional
$9,250,000 in subordinated debt from various third parties (the “New Sub Debt”)
and Bank is agreeable thereto subject to the following terms and conditions:
(a) Such new indebtedness be made specifically subject to the terms and
provisions of a subordination agreement or subordination provisions in form and
substance acceptable to Bank in its sole discretion, the form of Supplement
Indenture presented to Bank being sufficient for such purposes, and (b) no cash
payments with respect to such new indebtedness shall be permitted as long as any
Obligations remain outstanding (collectively the receipt by Borrower of such new
subordinated debt pursuant to the foregoing terms and conditions is referred to
herein collectively as the “New Sub Debt Transaction”).

3. Consent to Repurchase of Certain Notes. Notwithstanding the terms and
provisions of Section 7.6 of the Loan Agreement, Borrower shall be permitted to
repurchase the outstanding 7% senior convertible notes of Local Corporation
totaling up to $6,100,000 as long as the funding of such repurchases is made
only with the proceeds of the New Sub Debt Transaction and as long as no Default
or Event of Default is then existing or would otherwise exist upon the closing
of any such repurchase transaction.

4. Fee. [Omitted].

5. Representations True. Borrower represents and warrants to Bank that all
representations and warranties set forth in the Loan Agreement, as amended
hereby, are true and correct.

6. General Release. In consideration for Bank entering into this Amendment,
Borrower hereby irrevocably releases and forever discharges Bank, and its
successors, assigns, agents, shareholders, directors, officers, employees,
agents, attorneys, parent corporations, subsidiary corporations, affiliated
corporations, affiliates, participants, and each of them (collectively, the
“Releasees”), from any and all claims, debts, liabilities, demands, obligations,
costs, expenses, actions and causes of action, of every nature and description,
known and unknown, which Borrower now has or at any time may hold, by reason of
any matter, cause or thing occurred, done, omitted or suffered to be done prior
to the date of this Amendment (collectively, the “Released Claims”). Borrower
hereby irrevocably waives the benefits of any and all statutes and rules of law
to the extent the same provide in substance that a general release does not
extend to claims which the creditor does not know or suspect to exist in its
favor at the time of executing the release and, without limiting the foregoing,
and without limiting the stipulation to governing law in Section 8, Borrower
irrevocably waives any benefits it may have under California Civil Code
Section 1542 which provides: “A general release does not extend to claims which
the creditor does not know or suspect to exist in his or her favor at the time
of executing the release, which if known by him or her must have materially
affected his or her settlement with the debtor.” Borrower represents and
warrants that it has not assigned to any

 

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Tenth Amendment to Loan Agreement    

 

 

other Person any Released Claim, and agrees to indemnify Bank against any and
all actions, demands, obligations, causes of action, decrees, awards, claims,
liabilities, losses and costs, including but not limited to reasonable
attorneys’ fees of counsel of Bank’s choice and costs, which Bank may sustain or
incur as a result of a breach or purported breach of the foregoing
representation and warranty.

7. No Waiver. Nothing herein constitutes a waiver of any default or Event of
Default under the Loan Agreement or any other Loan Documents, whether or not
known to Bank.

8. Governing Law; Jurisdiction; Venue. All of the provisions of Section 11 of
the Loan Agreement shall apply to this Amendment, and the same are incorporated
herein by this reference.

9. General Provisions. Borrower hereby ratifies and confirms the continuing
validity, enforceability and effectiveness of the Loan Agreement and all other
Loan Documents. This Amendment, the Loan Agreement, any prior written amendments
to the Loan Agreement signed by Bank and Borrower, and the other written
documents and agreements between Bank and Borrower set forth in full all of the
representations and agreements of the parties with respect to the subject matter
hereof and supersede all prior discussions, representations, agreements and
understandings between the parties with respect to the subject hereof. Except as
herein expressly amended, all of the terms and provisions of the Loan Agreement,
and all other documents and agreements between Bank and Borrower shall continue
in full force and effect and the same are hereby ratified and confirmed. This
Amendment may be executed in multiple counterparts, by different parties signing
separate counterparts, and all of the same taken together shall constitute one
and the same agreement.

10. Mutual Waiver of Jury Trial. BANK AND BORROWER EACH ACKNOWLEDGE THAT THE
RIGHT TO TRIAL BY JURY IS A CONSTITUTIONAL RIGHT, BUT THAT IT MAY BE WAIVED.
EACH OF THE PARTIES, AFTER CONSULTING OR HAVING HAD THE OPPORTUNITY TO CONSULT,
WITH COUNSEL OF THEIR CHOICE, KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES
ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LITIGATION BASED UPON OR ARISING
OUT OF THIS AMENDMENT OR ANY RELATED INSTRUMENT OR LOAN DOCUMENT OR ANY OF THE
TRANSACTIONS CONTEMPLATED BY THIS AMENDMENT OR ANY COURSE OF CONDUCT, DEALING,
STATEMENTS (WHETHER ORAL OR WRITTEN), ACTION OR INACTION OF ANY OF THEM. THESE
PROVISIONS SHALL NOT BE DEEMED TO HAVE BEEN MODIFIED IN ANY RESPECT OR
RELINQUISHED BY BANK OR BORROWER, EXCEPT BY A WRITTEN INSTRUMENT EXECUTED BY
EACH OF THEM. IF FOR ANY REASON THE PROVISIONS OF THIS SECTION ARE VOID, INVALID
OR UNENFORCEABLE, THE SAME SHALL NOT AFFECT ANY OTHER TERM OR PROVISION OF THIS
AMENDMENT, AND ALL OTHER TERMS AND PROVISIONS OF THIS AMENDMENT SHALL BE
UNAFFECTED BY THE SAME AND CONTINUE IN FULL FORCE AND EFFECT.

[Signatures on Next Page]

 

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Square 1 Bank

Tenth Amendment to Loan Agreement    

 

 

Borrower:

 

LOCAL CORPORATION

Bank:

 

SQUARE 1 BANK

By /s/ Ken Cragun By /s/ Mark Salem

Title CFO Title Vice President

 

Borrower:

 

KRILLION, INC.

Borrower:

 

SCREAMIN MEDIA GROUP, INC.

By /s/ Ken Cragun By /s/ Ken Cragun

Title CFO Title CFO

[Signature Page—Tenth Amendment to Loan Agreement]

 

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