Document:

Exhibit

FIRST AMENDMENT TO THE HERITAGE BANK 
ENDORSEMENT METHOD
SPLIT DOLLAR AGREEMENT
(By and Between HERITAGE BANK and _____________)

This First Amendment to the Heritage Bank Endorsement Method Split Dollar Agreement (hereinafter “Amendment”) is made and entered into effective this __________, 2019, by and between Heritage Bank (“Bank”), and __________ (“Insured”). This Amendment hereby amends the Heritage Bank Endorsement Method Split Dollar Agreement by and between the Bank and the Insured (“Agreement”), effective as of August 3, 2015 , as follows:

1.   The existing Paragraph 7 shall be deleted in its entirety, and shall instead be replaced with the following:
 
		
	7.
	ACCELERATED BENEFIT IN THE EVENT OF TERMINAL OR CHRONIC ILLNESS (AS APPLICABLE) AND DIVISION OF CASH SURRENDER VALUE OF THE POLICY(IES).

    
		
	A. 
	Employment Qualifications. In order to have the right to request and receive an Accelerated Benefit under this Agreement, any one the following requirements must first be satisfied:

(i)     Insured has not Separated From Service; or
		
	(ii) 
	Insured Separates From Service on or after attaining the age of Sixty-Two (62); or

		
	(iii)
	A Change in Control has occurred prior to Insured’s Separation From Service. For the purposes of this paragraph, a Change in Control shall be defined as any of the following:

(a) The acquisition in one or more transactions by any     “person” (as such term is defined in Section 13(d) or 14(d) of the 1934 Act) of “beneficial ownership” (as defined in Rule 13d-3 promulgated under the Securities Exchange Act of 1934) of fifty percent (50%) or more of the combined voting power of the Company’s then outstanding Voting Securities (defined as any Company Security that ordinarily possesses the power to vote in the election of directors without any pre-condition or contingency); provided however, that for the purposes of this definition, the Voting Securities acquired directly from the Company by any person shall be excluded from the determination of such person’s beneficial ownership of Voting Securities (but such Voting Securities shall be included in the calculation of the total number of Voting Securities then outstanding);

(b) During any twelve (12) month period, the individuals who are members of the incumbent Board cease for any reason to constitute more than fifty percent (50%) of the Board; provided, however, that if the election, or nomination for election by the Company’s shareholders, of any new director was approved by a vote of at least two-thirds of the incumbent Board, such new director shall, for purposes of the Plan, be considered as a member of the incumbent Board, but excluding for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a person other than the Board; or

(c) The consummation of a merger or consolidation involving the Company if the Company’s shareholders immediately before such merger or consolidation do not own, directly or indirectly immediately following such merger or consolidation, more than fifty percent (50%)  of the combined voting power of the outstanding Voting Securities of the corporation resulting from such merger or consolidation in substantially the same proportion as their ownership of the Voting  Securities immediately before such merger or consolidation; or

(d)     The consummation of a complete liquidation or dissolution of the Company or an agreement for the sale or other disposition of all or substantially all of the assets of the Company; or

(e)    Acceptance by the Company’s shareholders of shares in a share exchange if the Company’s shareholders immediately before such exchange do not own, directly or indirectly immediately following such share exchange, more than fifty percent (50%) of the combined voting power of the outstanding voting securities of the corporation resulting from such share exchange in substantially the same proportion as their ownership of the Voting Securities outstanding immediately before such exchange. 

Notwithstanding the forgoing, a Change in Control shall not be deemed to occur solely because fifty percent (50%) or more of the then outstanding Voting Securities is acquired by (A) a trustee or other fiduciary holding securities under one (1) or more employee benefit plans maintained by the Company or any of its affiliates, or (B) any corporation that, immediately prior to such acquisition, is owned directly or indirectly by the Company’s shareholders in the same proportion as their ownership of stock in the Company immediately prior to such acquisition. 

Moreover, notwithstanding the forgoing, a Change in Control shall not be deemed to occur solely because any one person (“subject person”) acquires beneficial ownership of more than the permitted amount of the outstanding Voting Securities as a result of the acquisition of Voting Securities by the Company that, by reducing the number of Voting Securities outstanding, increases the proportional number of shares beneficially owned by the subject person, provided that if a Change in Control would occur (but for the operation of this sentence) as a result of the acquisition of Voting Securities by the Company, and after such share acquisition by the Company, the Subject Person becomes the beneficial owner of any additional Voting Securities that increases the percentage of then outstanding Voting Securities beneficially owned by the Subject Person, then a Change in Control shall be deemed to have occurred. 

		
	B. 
	Contractual Qualifications. In addition to the forgoing, the following requirements must also be satisfied in order for Insured to be entitled to request and receive an Accelerated Benefit:

		
	(i) 
	Insured’s right to receive benefits under this Agreement has not terminated pursuant to the provisions of Paragraph 8 herein; 

		
	(ii)
	The Policy(ies) provides for such option through an Accelerated Benefit rider; and 

		
	(iii) 
	Insured  must qualify (physically and/or mentally) to receive an Accelerated Benefit as required under the Policy(ies).

		
	C. 
	Provided Insured satisfies the requirements specified in 7A and B above, then Insured shall have the right to request (in writing) and to receive an amount equal to the following: the lesser of Five Hundred Thousand Dollars ($500,000) or an amount which would result in the minimum required death benefit being maintained, such that the Policy(ies) will not be disqualified for the purposes of acting as “life Insurance” under the Internal Revenue Code. Furthermore, all amounts referenced in this Paragraph 7 shall be subject to any further limitations imposed by the individual Policy(ies). (See Exhibit “A” attached hereto and incorporated by reference herein, an excerpt from the Penn Mutual Policy’s Accelerated Benefit rider, as an example of the limiting language that may apply). Finally, any Accelerated Benefit paid to the Insured hereunder shall be deducted from any amounts to which Insured or his Beneficiary(ies) is or may be entitled pursuant to the provisions of Paragraph 6 above should Insured not have Separated From Service at the time of his death.  

Neither the Bank nor Corrigan & Company make any representations or warranties about the tax consequences of such a request for accelerated or living benefits.

		
	D. 
	Subject to the forgoing, at all times prior to the Insured’s death, the Bank shall be entitled to an amount equal to the Policy(ies)’s cash value, as that term is defined in the Policy(ies) contract, less any Policy loans, accelerated benefits and unpaid interest or cash withdrawals previously incurred by the Bank and any applicable surrender charges. Such cash value shall be determined as of the date of surrender or death as the case may be.

2.   The existing Paragraph 8 shall be deleted in its entirety, and shall instead be replaced with the following:
 
8.    TERMINATION OF AGREEMENT.

		
	A.
	Right to receive Death Benefit. Insured’s right to receive death benefit proceeds pursuant to the provisions of Paragraph 6 shall terminate upon Insured’s Separation From Service. 

		
	B.
	Right to Receive an Accelerated Benefit. If Insured either requests payment of an Accelerated Benefit before Separating From Service and receives payment of such amounts thereafter or, if Insured maintains the right to receive an Accelerated Benefit after  Separation From Service by virtue of satisfying the requirements of Paragraph 7A, then this Agreement shall terminate in its entirety only upon (i) the mutual written agreement of the Bank and the Insured, or (ii) upon Insured requesting and receiving an Accelerated Benefit in the full amount he is (or may be) entitled to receive pursuant to the provisions of Paragraph 7 above. 

		
	C. 
	Termination By Operation. Notwithstanding the forgoing, this Agreement shall immediately terminate in its entirety in the event Insured is Terminated For Cause at any time or in the event Insured is no longer entitled to a benefit as addressed in Paragraphs 8A and B above. The term “Termination For Cause” shall have the same meaning as is used in the Bank’s Employee Handbook or any Employment Agreement the parties have entered into. If there is no definition of a “For Cause” termination appearing in a Bank Employee Handbook, or in the event Insured has no Employment Agreement, then a Separation From Service which is initiated by the Bank and is due to any of the following shall be considered a “Termination For Cause”: 

		
	(i)      
	A conviction of, or a plea of nolo contendere by Insured to a felony or to fraud, embezzlement or misappropriation of funds;

		
	(ii)    
	The commission of a fraudulent act or omission, breach of trust or fiduciary duty, or insider abuse with regard to the Bank, that has had a material adverse effect on the Bank;

    
		
	(iii)     
	A material violation by Insured of any applicable federal banking law or regulation that has had a material adverse effect on the Bank.

To the extent that any paragraph, term, or provision of the Agreement is not specifically amended herein, or in any other amendment thereto, said paragraph, term, or provision shall remain in full force and effect as set forth in said Agreement.

IN WITNESS WHEREOF, the Insured and a duly authorized Bank officer have signed this Amendment as of the written date.

HERITAGE BANK                     INSURED

By: ________________________        By: ______________________
Signature & Title         

		
	Date: _______________________
	Date: ____________________

Witness: _____________________            Witness: __________________

1prcp-ex1059_12.htm

 

Exhibit 10.59

 

AMENDMENT NO. 1 TO CREDIT AGREEMENT AND WAIVER

 

This Amendment No. 1 to Credit Agreement and Waiver (“Amendment”) is dated as of February 20, 2019, and effective as of January 31, 2019, by and between PERCEPTRON, INC. (“Borrower”) and CHEMICAL BANK (“Bank”).

Recitals

	
A.
	
Borrower and Bank entered into that certain Credit Agreement dated December 4, 2017 (the “Agreement”).

	
B.
	
Borrower and Bank desire to amend the Agreement and waive compliance with certain covenants all as set forth below.

The parties agree as follows:

1.Section 8.1(c) of the Agreement is amended to read in its entirety as follows:

 

“(c)(i) within thirty (30) days after and as of the end of each fiscal quarter of Borrower and (ii) within thirty (30) days after and as of the end of each month in which an Advance is made under the Revolving Credit; Borrower shall provide to Bank a Borrowing Base Certificate, each such Borrowing Base Certificate to be accompanied by (A) a report of the aging of accounts receivable and accounts payable and (B) an inventory report, in each case in form and detail reasonably acceptable to Bank;”

 

2.Borrower did not comply with Section 8.1(c) of the Agreement for the months ending July 31, 2018, August 31, 2018, October 31, 2018 and November 30, 2018 (the “Covenant Exceptions”).  Bank hereby waives compliance with Section 8.1(c) of the Agreement for the months ending July 31, 2018, August 31, 2018, October 31, 2018 and November 30, 2018 and any Event of Default under the Agreement resulting from the Covenant Exceptions.  This waiver shall not be deemed to amend or alter in any respect the terms and conditions of the Agreement (including without limitation all conditions and requirements for advances and any financial covenants), the Notes or any of the other Loan Documents, or to constitute a waiver or release by the Bank of any right, remedy, Default or Event of Default under the Agreement, the Notes or any of the other Loan Documents, except to the extent specifically set forth above.  Furthermore, this waiver shall not affect in any manner whatsoever any rights or remedies of the Bank with respect to any other non-compliance by the Borrowers, or either of them, with the Agreement or the other Loan Documents whether in the nature of a Default or Event of Default, and whether now in existence or subsequently arising.  

 

3.Borrower hereby represents and warrants that, after giving effect to the amendment and waivers contained herein, (a) execution, delivery and performance of this Amendment and any other documents and instruments required under this Amendment or the Agreement are within its corporate powers and authorities, have been duly authorized, are not in contravention of law or the terms of its Articles of Incorporation or Bylaws, and do not require the consent or approval of any governmental body, agency, or authority; and this Amendment and any other documents and instruments required under this Amendment or the Agreement, will be valid and binding in accordance with their terms; (b) the representations and warranties of Borrower as set forth in the Agreement are true and correct on and as of the date hereof with the same force and effect as if made on and as of the date hereof; and (c) no Event of Default, or condition or event which, with the giving of notice or the passage of time, or both, would constitute an Event of Default, has occurred and is continuing under the Agreement as of the date hereof.

 

4.Capitalized terms used but not otherwise defined herein shall have the respective meanings ascribed to them in the Agreement.

 

 

 

5.As a condition of the above amendments, Borrower waives, discharges, and forever releases Bank, and Bank’s employees, officers, directors, attorneys, stockholders and successors and assigns, from and of any and all claims, causes of action, allegations or assertions that Borrower has or may have had at any time up through, and including, the date of this Amendment, against any or all of the foregoing, regardless of whether any such claims, causes of action, allegations or assertions are known to Borrower or whether any such claims, causes of action, allegations or assertions arose as a result of Bank’s actions or omissions in connection with the Agreement, including any amendments, or modifications thereto, or otherwise.

 

6.This Amendment shall be effective as of the date hereof upon (a) execution by Borrower and Bank of this Amendment, and (b) execution of the Affirmation of Guaranties set forth below.

 

7.Borrower is responsible for all costs incurred by Bank, including without limit reasonable attorneys’ fees, with regard to the preparation and execution of this Amendment and any documents, instruments or agreements executed in connection herewith.

 

8.This Amendment may be executed in counterparts, each of which counterpart shall constitute one and the same original.

 

9.This Amendment is not an agreement to any further or other amendment of the Agreement.

 

10.Except as modified hereby, all of the terms and conditions of the Agreement shall remain in full force and effect.

 

[Remainder of Page Intentionally Left Blank]

 

 

2

 

 

WITNESS the due execution hereof on the day and year first above written.

 

	
CHEMICAL BANK
	
 
	
PERCEPTRON, INC.

	
By:
	
/s/ Robert A. Rosati
	
 
	
By:
	
/s/ David L. Watza

	
 
	
Robert A. Rosati
	
 
	
 
	
David L. Watza

	
Its:
	
Senior Vice President
	
 
	
Its:
	
President, Chief Executive Officer

	
 
	
 
	
 
	
 
	
and Chief Financial Officer

 

 

 

 

3

 

 

AFFIRMATION OF GUARANTIES

 

The undersigned, Guarantors under certain Guaranties each dated December 4, 2017 (“Guaranties”) made by the undersigned in favor of Chemical Bank (“Bank”) with respect to the liabilities and obligations of Perceptron, Inc. (“Borrower”) to Bank, (i) affirm their obligations to Bank under their Guaranties and acknowledge that their Guaranties remain in full force and effect in accordance with their terms, subject to no setoff, defense or counterclaim, and (ii) confirm that this Affirmation is not required by the terms of their Guaranties and need not be obtained in connection with any prior or future waivers or amendments or extensions of additional credit to Borrower. 

Dated:  February 20, 2019

 

	
 
	
 
	
GUARANTORS:

	
 
	
 
	
 

	
 
	
 
	
PERCEPTRON SOFTWARE

TECHNOLOGY, INC.

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 
	
By:
	
/s/ David L. Watza

	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
Its:
	
President, Chief Executive Officer

	
 
	
 
	
 
	
 
	
and Chief Financial Officer

 

	
 
	
 
	
PERCEPTRON GLOBAL, INC.

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 
	
By:
	
/s/ David L. Watza

	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
Its:
	
President, Chief Executive Officer

	
 
	
 
	
 
	
 
	
and Chief Financial Officer

 

 

 

 

 

 

 

 

 

4

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00295-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00295-of-00352.parquet"}]]