Exhibit 10.1

 

EXECUTION VERSION

 

 

ELEVENTH AMENDMENT TO CREDIT AGREEMENT AND CONSENT AGREEMENT

 

THISELEVENTHAMENDMENTTOCREDITAGREEMENTANDCONSENT

AGREEMENT (this “Agreement”) dated as of March 20, 2020 (the “Eleventh Amendment
Effective Date”) is entered into among VENUS CONCEPT CANADA CORP., an Ontario
corporation (“Venus Canada”), VENUS CONCEPT USA INC., a Delaware corporation
(“Venus USA” and together with Venus Canada, each a “Borrower” and collectively,
the “Borrowers”), VENUS CONCEPT LTD., an Israeli corporation (the “Parent”),
VENUS CONCEPT INC., a Delaware corporation (the “Super Parent”), the Lenders
party hereto and MADRYN HEALTH PARTNERS, LP, a Delaware limited partnership, as
Administrative Agent. All capitalized terms used herein and not otherwise
defined herein shall have the meanings given to such terms in the Credit
Agreement (as defined below).

 

RECITALS

 

WHEREAS, the Borrowers, the Parent, the Super Parent, the other Guarantors, the
Lenders and the Administrative Agent are parties to that certain Credit
Agreement dated as of October 11, 2016 (as amended by that certain First
Amendment to Credit Agreement and Investment Documents dated as of May 25, 2017,
that certain Second Amendment to Credit Agreement and Consent Agreement dated as
of February 15, 2018, that certain Third Amendment to Credit Agreement and
Waiver dated as of August 14, 2018, that certain Fourth Amendment to Credit
Agreement dated as of January 11, 2019, that certain Fifth Amendment to Credit
Agreement dated as of March 15, 2019, that certain Sixth Amendment to Credit
Agreement and Consent dated as of April 25, 2019, that certain Seventh Amendment
to Credit Agreement, Consent and Waiver dated as of June 25, 2019, that certain
Omnibus Amendment and Waiver dated as of July 26, 2019, that certain Ninth
Amendment to Credit Agreement dated as of August 14, 2019, that certain Tenth
Amendment to Credit Agreement, Consent and Joinder Agreement dated as of
November 7, 2019 and as further amended or modified from time to time, the
“Credit Agreement”);

 

WHEREAS, the Loan Parties intend to cause the Super Parent to become a borrower
under the Permitted Senior Revolving Credit Documents (the “Permitted Senior
Revolving Credit Documents Amendment”) and have requested that the Credit
Agreement be amended in connection therewith; and

 

WHEREAS, the Lenders are willing to amend the Credit Agreement and provide their
consent to the consummation of the Permitted Senior Revolving Credit Documents
Amendment, in each case, subject to the terms and conditions hereof;

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

 

1.

Amendments.Effective as of the Eleventh Amendment Effective Date, the Credit
Agreement shall be amended as follows:

 

 

 

(a)

Section 1.01 of the Credit Agreement is hereby amended by amending and restating
the following defined terms appearing therein in their entirety to read as
follows:

 

 

“Liquidity” means, as of any date, an amount equal to the sum of (a)
Unrestricted Cash of the Loan Parties held in accounts for which the
Administrative Agent has received a Qualifying Control Agreement as of such date
plus (b) Unrestricted Cash of the Loan Parties not held in accounts for which
the Administrative Agent has received a Qualifying Control Agreement as of such
date plus (c) the aggregate amount available to be drawn by

 

 

 

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the Borrowers and/or the Super Parent under the Permitted Senior Revolving
Credit Indebtedness as of such date.

 

“Permitted Senior Revolving Credit Documents” means each agreement, instrument
and document entered into by the Super Parent or any Subsidiary in connection
with the Permitted Senior Revolving Credit Indebtedness, in each case in form
and substance reasonably satisfactory to the Administrative Agent, as the same
may be amended, modified, extended, restated, replaced or supplemented from time
to time subject to the terms and provisions of the intercreditor agreement
entered into by the Administrative Agent in connection therewith.

 

“Permitted Senior Revolving Credit Indebtedness” means senior secured
Indebtedness of one or more of the Borrowers and/or the Super Parent incurred
under the Permitted Senior Revolving Credit Documents which satisfies the
following requirements:

(a)the Borrowers shall have delivered to the Administrative Agent and the
Lenders the material Permitted Senior Revolving Credit Documents prior to
incurrence of the Permitted Senior Revolving Credit Indebtedness, certified by a
Responsible Officer of each Borrower, (b) the Administrative Agent shall have
approved the financial institution providing the Permitted Senior Revolving
Credit Indebtedness (the “Permitted Senior Revolving Credit Lender”) and (c) no
Subsidiary that is not a Loan Party shall Guarantee, or provide a Lien with
respect to, such Indebtedness.

 

 

(b)

Section 8.03(g) of the Credit Agreement is hereby amended and restated in its
entirety to read as follows:

 

 

(g) Permitted Senior Revolving Credit Indebtedness in an aggregate principal
amount not to exceed the lesser of (i) $10,000,000 and (ii) the sum of (A)
eighty-five percent (85%) of eligible accounts of the Loan Parties (as
determined by the Permitted Senior Revolving Credit Documents), on a
consolidated basis, and the proceeds thereof plus (B) fifty percent (50%) of the
eligible inventory of the Loan Parties (as determined by the Permitted Senior
Revolving Credit Documents), on a consolidated basis, and the proceeds thereof,
at any one time outstanding pursuant to a revolving credit facility; provided,
that, (x) no Default or Event of Default shall have occurred and be continuing
both immediately before and immediately after giving effect to the execution and
delivery of the Permitted Senior Revolving Credit Documents and (y) prior to the
incurrence of such Indebtedness, (i) the Administrative Agent, the Loan Parties
and the Permitted Senior Revolving Credit Lender shall have entered into an
intercreditor agreement reasonably satisfactory to the Administrative Agent (as
amended from time to time, the “Intercreditor Agreement”) pursuant to which (A)
the Permitted Senior Revolving Credit Lender shall be granted a first priority
security interest only in the accounts and inventory of the Borrowers and the
Super Parent and proceeds thereof (collectively, the “Permitted Senior Revolving
Credit Priority Collateral”), (B) the Administrative Agent, on behalf of the
Secured Parties, shall be granted a second priority security interest in the
Permitted Senior Revolving Credit Priority Collateral, (C) the Administrative
Agent, on behalf of the Secured Parties, shall maintain its first priority
security interest in all other assets of the Loan Parties (other than Excluded
Property) and (D) the Permitted Senior Revolving Credit Lender may be granted a
perfected security interest in any other property of the Loan Parties, provided
that the Permitted Senior Revolving Credit Lender’s liens and security interests
in such property (other than the Permitted Senior Revolving Credit Priority
Collateral) shall be subordinate to the liens and security interests of the
Administrative Agent in manner satisfactory to the Administrative Agent and (ii)
the Administrative Agent and the Loan Parties shall have

 

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entered into amendments, in each case in form and substance reasonably
satisfactory to the Administrative Agent, to this Agreement and such other Loan
Documents as required to, among other things, include in the Loan Documents such
additional representations, warranties, covenants and defaults as are included
in the Permitted Senior Revolving Credit Documents (but not included in the Loan
Documents at such time);

 

2.

Consent. Subject to the other terms and conditions of this Agreement, the
Lenders and the Administrative Agent hereby consent to the consummation of the
Permitted Senior Revolving Credit Documents Amendment by the Loan Parties. The
above consent shall not otherwise modify or affect the Loan Parties’ obligations
to comply fully with the terms of any duty, term, condition or covenant
contained in the Credit Agreement or any other Loan Document in the future and
is limited solely to the matters set forth in this Section 2. Nothing contained
in this Agreement shall be deemed to constitute a waiver of any duty, term,
condition or covenant contained in the Credit Agreement in the future, or any
other rights or remedies the Administrative Agent or any Lender may have under
the Credit Agreement or any other Investment Documents or under applicable Law.

 

 

3.

Conditions Precedent. This Agreement shall be effective upon satisfaction of the
following conditions precedent:

 

 

 

(a)

receipt by the Administrative Agent of counterparts of this Agreement duly
executed by the Loan Parties, the Lenders and the Administrative Agent;

 

 

 

(b)

receipt by the Administrative Agent of a certificate of a Responsible Officer of
each Loan Party, attaching a true, correct and complete copy of the Permitted
Senior Revolving Credit Documents Amendment, which shall be in form and
substance reasonably satisfactory to the Administrative Agent;

 

 

 

(c)

receipt by the Administrative Agent of an amendment to the Intercreditor
Agreement, in form and substance reasonably satisfactory to the Administrative
Agent and duly executed by the Permitted Senior Revolving Credit Lender, the
Loan Parties and the Administrative Agent; and

 

 

 

(d)

receipt by the applicable party of all accrued fees and reasonable and
documented out-of-pocket expenses of the Administrative Agent and the Lenders
(including, without limitation, the fees and expenses of counsel for the
Administrative Agent).

 

 

4.

Reaffirmation. Each of the Loan Parties acknowledges and reaffirms (a) that it
is bound by all of the terms of the Investment Documents to which it is a party,
(b) that it is responsible for the observance and full performance of all of the
Obligations, including without limitation, the repayment of the Loans and (c)
that the Credit Agreement and the other Investment Documents shall remain in
full force and effect according to their terms, except as expressly modified or
waived by this Agreement. Furthermore, the Loan Parties acknowledge and confirm
that by entering into this Agreement, the Administrative Agent and the Lenders
do not, except as expressly set forth herein, waive or release any term or
condition of the Credit Agreement or any of the other Investment Documents or
any of their rights or remedies under such Investment Documents or any
applicable Law or any of the obligations of the Loan Parties thereunder.

 

 

 

5.

Miscellaneous.

 

 

(a)

This Agreement is a Loan Document.

 

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(b)

The Loan Parties hereby represent and warrant as follows:

 

 

(i)

Each Loan Party has taken all necessary action to authorize the execution,
delivery and performance of this Agreement.

 

 

 

(ii)

This Agreement has been duly executed and delivered by such Loan Party and
constitutes such Loan Party’s legal, valid and binding obligations, enforceable
in accordance with its terms, except as such enforceability may be limited by
Debtor Relief Laws and general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).

 

 

 

(iii)

No consent, approval, exemption, authorization or other action by, or notice to,
or filing with, any Governmental Authority or any other Person is necessary or
required in connection with the execution, delivery or performance by any Loan
Party of this Agreement except as have been made or obtained.

 

 

 

(c)

The Loan Parties represent and warrant to the Administrative Agent and the
Lenders that after giving effect to this Agreement (i) the representations and
warranties of the Loan Parties set forth in Article VI of the Credit Agreement
and in each other Loan Document are true and correct in all material respects
(and in all respects if any such representation or warranty is already qualified
by materiality or reference to Material Adverse Effect) as of the date hereof
with the same effect as if made on and as of the date hereof, except to the
extent such representations and warranties expressly relate solely to an earlier
date in which case they shall be true and correct in all material respects (and
in all respects if any such representation or warranty is already qualified by
materiality or reference to Material Adverse Effect) as of such earlier date and
(ii) no event has occurred and is continuing which constitutes a Default or an
Event of Default.

 

 

 

(d)

Each of the Loan Parties hereby affirms the Liens created and granted in the
Loan Documents in favor of the Administrative Agent, for the benefit of the
Secured Parties, and agrees that this Agreement does not adversely affect or
impair such liens and security interests in any manner.

 

 

 

(e)

This Agreement may be executed in counterparts (and by different parties hereto
in different counterparts), each of which shall constitute an original, but all
of which when taken together shall constitute a single contract. Delivery of an
executed counterpart of a signature page of this Agreement by facsimile or other
electronic imaging means (e.g. “pdf” or “tif”) shall be effective as delivery of
a manually executed counterpart of this Agreement.

 

 

 

(f)

If any provision of this Agreement is held to be illegal, invalid or
unenforceable,

(i) the legality, validity and enforceability of the remaining provisions of
this Agreement shall not be affected or impaired thereby and (ii) the parties
shall endeavor in good faith negotiations to replace the illegal, invalid or
unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the illegal, invalid or unenforceable
provisions. The invalidity of a provision in a particular jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction.

 

(g)THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL
BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK.

 

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Each of the parties hereto has caused a counterpart of this Agreement to be duly
executed and delivered as of the date first above written.

 

BORROWERS:VENUS CONCEPT CANADA CORP.,

an Ontario corporation

 

 

By: /s/ Domenic Serafino

Name: Domenic Serafino

Title: Chief Executive Officer

 

 

VENUS CONCEPT USA INC.,

a Delaware corporation

 

By: /s/ Domenic Serafino

Name: Domenic Serafino

Title: President

 

 

 

PARENT:VENUS CONCEPT LTD.,

an Israeli corporation

 

By: /s/ Domenic Serafino

Name: Domenic Serafino

Title: Director

 

 

 

 

SUPER PARENT:VENUS CONCEPT INC.,

a Delaware corporation

 

By: /s/ Domenic Serafino

Name: Domenic Serafino

Title: Chief Executive Officer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

VENUS CONCEPT CANADA CORP. AND VENUS CONCEPT USA INC. ELEVENTH AMENDMENT TO
CREDIT AGREEMENT AND CONSENT AGREEMENT

 

 

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ADMINISTRATIVE

AGENT:MADRYN HEALTH PARTNERS, LP,

a Delaware limited partnership

 

By:MADRYN HEALTH ADVISORS, LP,

its General Partner

 

By:MADRYN HEALTH ADVISORS GP, LLC,

its General Partner

 

      By: /s/ Avinash Amin        

      Name: Avinash Amin        

      Title: Member                    

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

VENUS CONCEPT CANADA CORP. AND VENUS CONCEPT USA INC. ELEVENTH AMENDMENT TO
CREDIT AGREEMENT AND CONSENT AGREEMENT

 

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LENDERS:MADRYN HEALTH PARTNERS, LP,

a Delaware limited partnership

 

By:MADRYN HEALTH ADVISO RS, LP,

its General Partner

 

By:MADRYN HEALTH ADVISORS GP, LLC,its General Partner

 

By: /s/ Avinash Amin        

Name: Avinash Amin        

Title: Member                    

 

 

 

 

 

MADRYN HEALTH PARTNERS (CAYMAN MASTER), LP

 

By:MADRYN HEALTH ADVISORS, LP,

its General Partner

 

By:MADRYN HEALTH ADVISORS GP, LLC, its General Partner

 

    By: /s/ Avinash Amin        

    Name: Avinash Amin        

    Title: Member                    

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

VENUS CONCEPT CANADA CORP. AND VENUS CONCEPT USA INC. ELEVENTH AMENDMENT TO
CREDIT AGREEMENT AND CONSENT AGREEMENT