Document:

ck1723866-ex102_86.htm

EXHIBIT 10.2 

EXECUTION 

VERSION

 

SECOND AMENDMENT TO AMENDED AND RESTATED LOAN, SECURITY AND 
GUARANTY AGREEMENT

THIS SECOND AMENDMENT TO AMENDED AND RESTATED LOAN, SECURITY AND GUARANTY AGREEMENT, dated as of July 23, 2019 (this “Agreement”) is entered into by and among SELECT INTERIOR CONCEPTS, INC., a Delaware corporation (“Topco”), ARCHITECTURAL GRANITE & MARBLE, LLC, a Delaware, limited liability company formerly known as G&M OPCO LLC (“AG&M”), PENTAL GRANITE AND MARBLE, LLC, a Washington limited liability company (“Pental”), L.A.R.K. INDUSTRIES, INC., a California corporation (“L.A.R.K.”), GREENCRAFT HOLDINGS, LLC, an Arizona limited liability company (“Greencraft  Holdings”), GREENCRAFT INTERIORS, LLC, an Arizona limited liability company (“Greencraft Interiors”), CASA VERDE SERVICES, LLC, a Delaware limited liability company (“Casa Verde”), GREENCRAFT STONE AND TILE LLC, an Arizona limited liability company (“Greencraft Stone”; and, together with Topco, AG&M, Pental Granite and Marble, L.A.R.K., Greencraft Holdings, Greencraft Interiors, Casa Verde, Greencraft Stone and each Person joined thereto as a borrower from time to time, individually and collectively, jointly and severally, “Borrower”), ARCHITECTURAL SURFACES GROUP, LLC, a Delaware limited liability company formerly known as TCFI G&M LLC (“AG&M Parent”), RESIDENTIAL DESIGN SERVICES, LLC, a Delaware limited liability company, formerly known as TCFI LARK LLC (“L.A.R.K. Parent”), AG IIOLDCO (SPV) LLC, a Delaware limited liability company (“AG SPV”) and SIC INTERMEDIATE, INC., a Delaware corporation (“SIC”, and together with Borrower, AG&M Parent, AG SPV and L.A.R.K. Parent, each individually, an “Obligor” and collectively, the “Obligors”) and BANK OF AMERICA, N.A., a national banking association (together with its successors and assigns, “Lender”).

WHEREAS, Borrower and Lender have entered into that certain Amended and Restated Loan, Security and Guaranty Agreement, dated June 28, 2018 (as amended by that certain First Amendment to Amended and Restated Loan, Security and Guaranty Agreement, dated as of December 11, 2018, and as may be further amended, restated, supplemented or otherwise modified from time to time, the “Loan Agreement”), pursuant to which the Lender has agreed to make certain loans (each a “Loan” and collectively the “Loans”); and

WHEREAS, Borrower has requested that Lender make certain amendments to the Loan Agreement.

NOW THEREFORE, in consideration of the premises and other good and valuable consideration, the receipt of which is hereby acknowledged, the parties hereto hereby agree as follows:

SECTION 1. Definitions. Reference is hereby made to the Loan Agreement for a statement of the terms thereof. All terms used in this Agreement which are defined therein and not otherwise defined herein shall have the same meanings herein as set forth therein.

 

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SECTION 2. Amendments to Loan Agreement. Effective as of the date hereof; Borrower and Lender amend the Loan Agreement as follows:

(a)The definition of “Purchase Money Debt” in Section 1.1 of the Loan Agreement is hereby deleted in its entirety and is replaced with the following:

“Purchase Money Debt: (a) Debt (other than the Obligations) for payment of any of the purchase price of fixed assets; (b) Debt (other than the Obligations) incurred within 10 Business Days before or after acquisition of any fixed assets, for the purpose of financing any of the purchase price thereof; (c) Debt constituting obligations incurred pursuant to any Capital Lease; and (d) any renewals, extensions or refinancings (but not increases) thereof.”

(b)Clause (c) of Section 9.2.1 of the Loan Agreement is hereby amended by (i) deleting “$8,000,000” found therein and (ii) inserting “$16,000,000” in lieu thereof.

(c)Clause (j) of Section 9.2.1 of the Loan Agreement is hereby amended by (i) deleting “$8,000,000” found therein and (ii) inserting “$16,000,000” in lieu thereof.

SECTION 3. Effectiveness. This Agreement shall become effective upon its execution by Borrower, the other Obligors party thereto and the Lender and receipt by the Lender of a copy of this Agreement, duly executed by Borrower, the other Obligors party thereto and the Lender.

SECTION 4. Notices, Etc. All notices and other communications provided for hereunder shall comply with Section 11.4 of the Loan Agreement.

SECTION 5. General Provisions.

(a)Each Obligor confirms that all of its Obligations under the Loan Agreement and the Loan Documents (each as amended by this Agreement) are in full force and effect and are performable in accordance with their respective terms without setoff, defense, counter-claim or claims in recoupment. Each Obligor hereby ratifies and confirms the Liens and security interests granted under the Loan Agreement and the Loan Documents and further ratifies and agrees that such Liens and security interests secure all obligations and indebtedness now, hereafter or from time to time made by, owing to or arising in favor of the Lender pursuant to the Loan Agreement and the Loan Documents (as now, hereafter or from time to time amended).

(b)Each Obligor agrees that at any time and from time to time, upon the written request of Lender, such Obligor will execute and deliver such further documents and do such further acts and things as the Lender may reasonably request in its Permitted Discretion in order to effect the provisions of this Agreement.

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(c)Except as supplemented hereby, the Loan Agreement and each other Loan Document shall continue to be, and shall remain, in full force and effect. This Agreement shall not be deemed (i) to be a waiver of, or consent to, or a modification or amendment of, any other term or condition of the Loan Agreement or any other Loan Document or (ii) to prejudice any right or rights which the Lender may now have or may have in the future under or in connection with the Loan Agreement or the other Loan Documents or any of the instruments or agreements referred to therein, as the same may be amended, restated, supplemented or otherwise modified from time to time, including any replacement instrument or agreement therefor.

(d)Borrower agrees to pay on demand all reasonable and documented out-of-pocket costs and expenses incurred by or on behalf of the Lender in connection with the negotiation, preparation, execution, delivery and performance of this Agreement, including, without limitation, the reasonable fees, costs, client charges and expenses of counsel for the Lender.

(e)This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which shall be deemed to be an original, but all of which taken together shall constitute one and the same agreement. Delivery of an executed counterpart of this Agreement by telecopier or electronic transmission shall be equally as effective as delivery of an original executed counterpart of this Agreement. Any party delivering an executed counterpart of this Agreement by telecopier or electronic transmission also shall deliver an original executed counterpart of this Agreement but the failure to deliver an original executed counterpart shall not affect the validity, enforceability, and binding effect of this Agreement.

(f)Section headings in this Agreement are included herein for the convenience of reference only and shall not constitute a part of this Agreement for any other purpose.

(g)In addition to and without limitation of any of the foregoing, this Agreement shall be deemed to be a Loan Document and shall otherwise be subject to all of terms and conditions contained in Sections 11.14, 11.15 and 11.16 of the Loan Agreement, mutatis mutandi.

(h)This Agreement, together with the Loan Agreement and the other Loan Documents, reflects the entire understanding of the, parties with respect to the transactions contemplated hereby and thereby and shall not be contradicted or qualified by any other agreement, oral or written, before the date hereof.

[Remainder of Page Intentionally Left Blank]

 

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VERSION

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officers thereunto duly authorized, as of the date first above written.

 

	
BORROWERS:

	
 
	
 
	
 

	
SELECT INTERIOR CONCEPTS, INC.

	
 
	
 
	
 

	
 
	
 
	
 

	
By:
	
 
	
/s/ Nadeem Moiz

	
Name:
	
 
	
 Nadeem Moiz

	
Title:
	
 
	
Chief Financial Officer

	
 
	
 
	
 

	
ARCHITECTURAL GRANITE & MARBLE, LLC

	
 
	
 
	
 

	
By:
	
 
	
Architectural Surfaces Group, LLC its Sole Member

	
 
	
 
	
 

	
By:
	
 
	
SIC Intermediate, Inc., its Sole Member

	
 
	
 
	
 

	
 
	
 
	
 

	
By:
	
 
	
/s/ Nadeem Moiz

	
Name:
	
 
	
Nadeem Moiz

	
Title:
	
 
	
Chief Financial Officer

	
 
	
 
	
 

	
PENTAL GRANITE AND MARBLE, LLC

	
 
	
 
	
 

	
By:
	
 
	
Architectural Granite & Marble, LLC its Sole Member

	
 
	
 
	
 

	
By:
	
 
	
Architectural Surfaces Group, LLC its Sole Member

	
 
	
 
	
 

	
By:
	
 
	
SIC Intermediate, Inc., its Sole Member

	
 
	
 
	
 

	
 
	
 
	
 

	
By:
	
 
	
/s/ Nadeem Moiz

	
Name:
	
 
	
Nadeem Moiz

	
Title:
	
 
	
Chief Financial Officer

	
 
	
 
	
 

	
L.A.R.K. INDUSTRIES, INC.

	
 
	
 
	
 

	
 
	
 
	
 

	
By:
	
 
	
/s/ Nadeem Moiz

	
Name:
	
 
	
Nadeem Moiz

	
Title:
	
 
	
Chief Financial Officer

	
 
	
 
	
 

 

EXECUTION 

VERSION

 

	
GREENCRAFT HOLDINGS, LLC

	
 
	
 
	
 

	
By:
	
 
	
L.A.R.K. Industries, Inc., its Sole Member

	
 
	
 
	
 

	
By:
	
 
	
/s/ Nadeem Moiz

	
Name:
	
 
	
Nadeem Moiz

	
Title:
	
 
	
Chief Financial Officer

	
 
	
 
	
 

	
 
	
 
	
 

	
GREENCRAFT INTERIORS, LLC

	
 
	
 
	
 

	
By:
	
 
	
Greencraft Holdings, LLC its Sole Member

	
 
	
 
	
 

	
By:
	
 
	
L.A.R.K. Industries, Inc., its Sole Member

	
 
	
 
	
 

	
By:
	
 
	
/s/ Nadeem Moiz

	
Name:
	
 
	
Nadeem Moiz

	
Title:
	
 
	
Chief Financial Officer

	
 
	
 
	
 

	
 
	
 
	
 

	
CASA VERDE SERVICES, LLC

	
 
	
 
	
 

	
By:
	
 
	
Greencraft Holdings, LLC its Sole Member

	
 
	
 
	
 

	
By:
	
 
	
L.A.R.K. Industries, Inc., its Sole Member

	
 
	
 
	
 

	
By:
	
 
	
/s/ Nadeem Moiz

	
Name:
	
 
	
Nadeem Moiz

	
Title:
	
 
	
Chief Financial Officer

	
 
	
 
	
 

	
GREENCRAFT STONE AND TILE LLC

	
 
	
 
	
 

	
By:
	
 
	
Greencraft Holdings, LLC its Sole Member

	
 
	
 
	
 

	
By:
	
 
	
L.A.R.K. Industries, Inc., its Sole Member

	
 
	
 
	
 

	
By:
	
 
	
/s/ Nadeem Moiz

	
Name:
	
 
	
Nadeem Moiz

	
Title:
	
 
	
Chief Financial Officer

	
 
	
 
	
 

 

EXECUTION 

VERSION

 

	
 
	
 
	
 

	
T.A.C. CERAMIC TILE CO.

	
 
	
 
	
 

	
 
	
 
	
 

	
By:
	
 
	
/s/ Nadeem Moiz

	
Name:
	
 
	
Nadeem Moiz

	
Title:
	
 
	
Chief Financial Officer

	
 

	
OTHER OBLIGORS:

	
 
	
 
	
 

	
ARCHITECTURAL SURFACES GROUP, LLC

	
 
	
 
	
 

	
By:
	
 
	
SIC Intermediate, Inc., its Sole Member

	
 
	
 
	
 

	
 
	
 
	
 

	
By:
	
 
	
/s/ Nadeem Moiz

	
Name:
	
 
	
Nadeem Moiz

	
Title:
	
 
	
Chief Financial Officer

	
 
	
 
	
 

	
RESIDENTIAL DESIGN SERVICES, LLC

	
 
	
 
	
 

	
By:
	
 
	
SIC Intermediate, Inc., its Sole Member

	
 
	
 
	
 

	
 
	
 
	
 

	
By:
	
 
	
/s/ Nadeem Moiz

	
Name:
	
 
	
Nadeem Moiz

	
Title:
	
 
	
Chief Financial Officer

	
 
	
 
	
 

	
AG HOLDCO (SPV), LLC

	
 
	
 
	
 

	
By:
	
 
	
Architectural Granite & Marble, LLC its Sole Member

	
 
	
 
	
 

	
By:
	
 
	
Architectural Surfaces Group, LLC its Sole Member

	
 
	
 
	
 

	
By:
	
 
	
SIC Intermediate, Inc., its Sole Member

	
 
	
 
	
 

	
 
	
 
	
 

	
By:
	
 
	
/s/ Nadeem Moiz

	
Name:
	
 
	
Nadeem Moiz

	
Title:
	
 
	
Chief Financial Officer

 

EXECUTION 

VERSION

 

 

	
 
	
 
	
 

	
SIC INTERMEDIATE, INC.

	
 
	
 
	
 

	
 
	
 
	
 

	
By:
	
 
	
/s/ Nadeem Moiz

	
Name:
	
 
	
Nadeem Moiz

	
Title:
	
 
	
Chief Financial Officer

	
 
	
 
	
 

	
 
	
 
	
 

	
LENDER:

	
 

	
BANK OF AMERICA, N.A.

	
 
	
 
	
 

	
 
	
 
	
 

	
By:
	
 
	
/s/ John Olsen

	
Name:
	
 
	
John Olsen

	
Title:
	
 
	
Senior Vice Presidentck1723866-ex103_87.htm

EXHIBIT 10.3

 

SECOND AMENDMENT TO

EMPLOYMENT AGREEMENT

This SECOND AMENDMENT TO EMPLOYMENT AGREEMENT (this “Amendment”) is made and entered into as of July 12, 2019, by and between Select Interior Concepts, Inc., a Delaware corporation (the “Company”), and Kendall Hoyd (the “Executive”). The above parties are referred to together herein as the “Parties,” and individually as a “Party.”

RECITALS

A.    The Company and the Executive are parties to that certain Employment Agreement dated as of November 22, 2017, as amended pursuant to that certain first amendment made and entered into as of August 17, 2018 (the “Employment Agreement”), pursuant to which the Company agreed to employ the Executive, and the Executive agreed to accept employment with the Company, on the terms and subject to the conditions set forth therein.

B.    The Parties desire to further amend the Employment Agreement on the terms and conditions set forth herein.

AGREEMENT

NOW THEREFORE, in consideration of the promises, terms and conditions contained herein and such other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, each Party hereby agrees as follows:

A.    Defined Terms and Recitals. Except as otherwise defined herein, all capitalized terms used herein but not otherwise defined herein shall have the meanings set forth in the Employment Agreement. The Parties hereby agree that the recitals set forth hereinabove are true and correct and incorporated into this Amendment.

B.    Modifications to Employment Agreement. The Parties agree that from and after the date of this Amendment, the Employment Agreement shall be modified as follows:

1.Section 5(a)(v) of the Employment Agreement is amended by changing the reference to “twelve (12)-month period” to “twenty four- (24-) month period.”

2.Exhibit A to the Employment Agreement, which provides the definition of “Change in Control,” is deleted in its entirety and replaced with Exhibit A attached to this Amendment.

C.    No Further Modification. Except to the extent set forth herein, the Employment Agreement remains unmodified and in full force and effect. In the event of any inconsistency between the provisions of the Employment Agreement and this Amendment, the terms of this Amendment shall control.

 

 

 

D.    Governing Law. This Amendment shall be governed by and construed under and in accordance with the laws of the State of California.

E.    Counterparts and Facsimile. This Amendment may be executed in two or more counterparts, which when taken together shall constitute one and the same instrument. The Parties contemplate that they may be executing counterparts of this Amendment transmitted by facsimile or email in PDF format and agree and intend that a signature by either facsimile machine or email in PDF format shall bind the Party so signing with the same effect as though the signature were an original signature.

 

 

IN WITNESS WHEREOF, the Parties have executed this Amendment to Employment Agreement as of the date first written above.

 

	
COMPANY:

	
 

	
SELECT INTERIOR CONCEPTS, INC.

	
 
	
 
	
 

	
 
	
 
	
 

	
By:
	
 
	
/s/ Tyrone Johnson

	
Name:
	
 
	
Tyrone Johnson

	
Title:
	
 
	
CEO

	
 

	
 

	
EXECUTIVE:

	
 

	
      /s/ Kendall Hoyd

 

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EXHIBIT A

 

For purposes of this Agreement, the following terms shall have the following meanings:

 

(a)“Beneficial Owner” shall have the meaning given such term in Rule 13d-3 of the General Rules and Regulations under the 1934 Act.

 

(b)“Change in Control” means and includes the occurrence of any of one of the following events:

(i)during any consecutive 12-month period, individuals who, at the beginning of such period, constitute the Board (the “Incumbent Directors”) cease for any reason to constitute at least a majority of such Board, provided that any person becoming a director after the beginning of such 12-month period and whose election or nomination for election was approved by a vote of at least a majority of the Incumbent Directors then on the Board shall be an Incumbent Director; provided, however, that no individual initially elected or nominated as a director of the Company as a result of an actual or threatened election contest with respect to the election or removal of directors (“Election Contest”) or other actual or threatened solicitation of proxies or consents by or on behalf of any Person other than the Board (“Proxy Contest”), including by reason of any agreement intended to avoid or settle any Election Contest or Proxy Contest, shall be deemed an Incumbent Director; or

(ii)any Person becomes a Beneficial Owner, directly or indirectly, of either (A) 50% or more of the then-outstanding shares of common stock of the Company (“Company Common Stock”) or (B) securities of the Company representing 50% or more of the combined voting power of the Company’s then outstanding securities eligible to vote for the election of directors (the “Company Voting Securities”); provided, however, that for purposes of this subsection (ii), the following acquisitions of Company Common Stock or Company Voting Securities shall not constitute a Change in Control: (w) an acquisition directly from the Company, (x) an acquisition by the Company or a Subsidiary, (y) an acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any Subsidiary, or (z) an acquisition pursuant to a Non-Qualifying Transaction (as defined in subsection (iii) below); or

(iii)the consummation of a reorganization, merger, consolidation, statutory share exchange or similar form of corporate transaction involving the Company or a Subsidiary (a “Reorganization”), or the sale or other disposition of all or substantially all of the Company’s assets (a “Sale”) or the acquisition of assets or stock of another corporation or other entity (an “Acquisition”), unless immediately following such Reorganization, Sale or Acquisition: (A) all or substantially all of the individuals and entities who were the Beneficial Owners, respectively, of the outstanding Company Common Stock and outstanding Company Voting Securities immediately prior to such Reorganization, Sale or Acquisition beneficially own, directly or indirectly, more than 50% of, respectively, the then outstanding shares of common stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the entity resulting from such Reorganization, Sale or Acquisition (including, without limitation, an entity which as a result of such transaction owns the 

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Company or all or substantially all of the Company’s assets or stock either directly or through one or more subsidiaries, the “Surviving Entity”) in substantially the same proportions as their ownership, immediately prior to such Reorganization, Sale or Acquisition, of the outstanding Company Common Stock and the outstanding Company Voting Securities, as the case may be, and (B) no Person (other than (x) the Company or any Subsidiary, (y) the Surviving Entity or its ultimate parent entity, or (z) any employee benefit plan (or related trust) sponsored or maintained by any of the foregoing is the Beneficial Owner, directly or indirectly, of 50% or more of the total common stock or 50% or more of the total voting power of the outstanding voting securities eligible to elect directors of the Surviving Entity, and (C) at least a majority of the members of the board of directors of the Surviving Entity were Incumbent Directors at the time of the Board’s approval of the execution of the initial agreement providing for such Reorganization, Sale or Acquisition (any Reorganization, Sale or Acquisition which satisfies all of the criteria specified in (A), (B) and (C) above shall be deemed to be a “Non-Qualifying Transaction”); or

(iv)approval by the stockholders of the Company of a complete liquidation or dissolution of the Company.

 

(c)“Person” means any individual, entity or group, within the meaning of Section 3(a)(9) of the 1934 Act and as used in Section 13(d)(3) or 14(d)(2) of the 1934 Act.

 

(d)“Subsidiary” means any corporation, limited liability company, partnership or other entity of which a majority of the outstanding voting stock or voting power is beneficially owned directly or indirectly by the Company.

 

(e)“1934 Act” means the Securities Exchange Act of 1934, as amended from time to time.

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