EXHIBIT 10.1

 

AMENDMENT NO. 2 TO

AMENDED AND RESTATED FINANCING AGREEMENT,

AND REAFFIRMATION OF GUARANTY

 

This AMENDMENT NO. 2 TO AMENDED AND RESTATED FINANCING AGREEMENT AND
REAFFIRMATION OF GUARANTY dated as of September 12, 2018 (the “Amendment”), is
executed among Midwest Energy Emissions Corp., a Delaware corporation, (the
“Borrower”), MES, Inc., a North Dakota corporation (“MES” or “Guarantor”), and
AC Midwest Energy LLC, a Delaware limited liability company (the “Lender”).

 

R E C I T A L S:

 

A. Borrower, Guarantor and Lender entered into that certain Amended and Restated
Financing Agreement, dated as of November 1, 2016 (the “Amended and Restated
Financing Agreement”), pursuant to which Amended and Restated Financing
Agreement the Borrower, Guarantor and Lender amended and restated a previously
entered into Financing Agreement among the parties, dated as of August 14, 2014,
as amended on March 16, 2015, November 16, 2015 and January 28, 2016.

 

B. In connection with the Amended and Restated Financing Agreement, and in
exchange for certain previously issued Notes and other consideration, the
Borrower issued to the Lender (i) a new senior note in the principal amount of
$9,646,686 (the “Secured Note”), and (ii) a subordinated unsecured note in the
principal amount of $13,000,000 (the “Unsecured Note”).

 

C. On June 14, 2018, Borrower, Guarantor and Lender entered into that certain
Amendment No.1 to Amended and Restated Financing Agreement, and Reaffirmation of
Guaranty (the “First Amendment”) which provided that (i) the Remaining Secured
Note Principal Balance which at the date thereof was in the amount of
$521,686.10 be paid as follows: (a) $250,000 on or prior to June 15, 2018 (which
has been paid by Borrower), and (b) the balance on or prior to September 1,
2018, and (ii) until the Remaining Secured Note Principal Balance is paid in
full, the Secured Note shall bear interest on the unpaid principal balance
thereof at a rate equal to the Current Interest Rate plus three percent (3.0%)
per annum. (The Amended and Restated Financing Agreement as amended by the First
Amendment is referred to as the “Restated Financing Agreement”.)

 

D. As of the date hereof, the Remaining Secured Note Principal Balance is in the
amount of $271,686.10.

 

E. At the present time the Borrower and the Guarantor request, and the Lender is
agreeable to, an extension on the payment of the Remaining Secured Note
Principal Balance on the terms and conditions hereinafter set forth.

 

NOW THEREFORE, in consideration of the premises and other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
Borrower, the Guarantor and the Lender agree as follows:

 

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A G R E E M E N T S:

 

1. RECITALS. The foregoing recitals are hereby made a part of this Amendment.

 

2. DEFINITIONS. Capitalized words and phrases used herein without definition
shall have the respective meanings ascribed to such words and phrases in the
Restated Financing Agreement.

 

3. AMENDMENTS TO THE RESTATED FINANCING AGREEMENT.

 

3.1 Revisions With Respect to Repayment of Remaining Secured Note Principal
Balance. Notwithstanding anything to the contrary contained in the Restated
Financing Agreement, the Remaining Secured Note Principal Balance shall be paid
on or prior to December 15, 2018.

 

3.2 Revisions With Respect to Mandatory Prepayments. Notwithstanding anything to
the contrary contained in Section 2.3(c) of the Restated Financing Agreement, no
mandatory prepayment shall be required unless the net proceeds from any such
enumerated actions or events exceed $3,500,000.

 

3.3 Covenant Waiver. The Lender hereby waives compliance with the EBITDA
covenant contained in Section 8.1 of the Restated Financing Agreement until
December 15, 2018, at which time such covenant shall continue in full force and
effect.

 

3.4 Interest Prepayment. As consideration for the Amendment, the Borrower hereby
agrees to prepay on or before September 15, 2018, the interest payments due on
September 30, 2018 and December 31, 2018 for the Secured Note and Unsecured
Note.

 

4. GENERAL.

 

4.1 Governing Law; Severability. This Amendment shall be construed in accordance
with and governed by the laws of the State of New York. Wherever possible each
provision of the Restated Financing Agreement and this Amendment shall be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of the Restated Financing Agreement and this Amendment
shall be prohibited by or invalid under such law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of the
Restated Financing Agreement and this Amendment.

 

4.2 Successors and Assigns. This Amendment shall be binding upon the Borrower,
the Guarantor and the Lender and their respective successors and assigns, and
shall inure to the benefit of the Borrower, the Guarantor and the Lender and the
successors and assigns of the Lender.

 

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4.3 Continuing Force and Effect of Loan Documents. Except as specifically
modified or amended by the terms of this Amendment, all other terms and
provisions of the Restated Financing Agreement and the other Secured Note
Documents are incorporated by reference herein, and in all respects, shall
continue in full force and effect. The Borrower, by execution of this Amendment,
hereby reaffirms, assumes and binds itself to all of the obligations, duties,
rights, covenants, terms and conditions that are contained in the Restated
Financing Agreement and the other Secured Note Documents. The Guarantor, by
execution of this Amendment, hereby reaffirms, assumes and binds itself to all
of the obligations, duties, rights, covenants, terms and conditions that are
contained in the Restated Financing Agreement.

 

4.4 References to Restated Financing Agreement. Each reference in the Restated
Financing Agreement to “this Agreement”, “hereunder”, “hereof”, or words of like
import, and each reference to the Restated Financing Agreement in any and all
instruments or documents delivered in connection therewith, shall be deemed to
refer to the Restated Financing Agreement, as amended hereby.

 

4.5 Counterparts/Electronic Signatures. This Amendment may be executed in two or
more identical counterparts, all of which shall be considered one and the same
agreement and shall become effective when counterparts have been signed by each
party and delivered to each other party; provided that a facsimile or other
electronic signature shall be considered due execution and shall be binding upon
the signatory thereto with the same force and effect as if the signature were an
original, not a facsimile or electronic signature.

 

[SIGNATURE PAGE FOLLOWS]

 

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IN WITNESS WHEREOF, the parties hereto have executed this Amendment No. 2 to
Amended and Restated Financing Agreement and Reaffirmation of Guaranty as of the
date first above written.

 

 

BORROWER:

MIDWEST ENERGY EMISSIONS CORP.

        By: /s/ Richard H. Gross

 

Name:

Richard H. Gross     Title:  Chief Financial Officer  

 

 

GUARANTOR:

 

MES, INC.

        By: /s/ Richard H. Gross

 

Name:

Richard H. Gross     Title: Chief Financial Officer          

 

LENDER:

 

AC MIDWEST ENERGY LLC

 

 

 

 

 

 

By:

/s/ Samir Patel

 

 

Name:

Samir Patel

 

 

Title:

Manager

 

  

 

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