Document:

Exhibit 10.1

 

2017 REPLACEMENT TERM LOAN AMENDMENT

 

2017 REPLACEMENT TERM LOAN AMENDMENT, dated as of August 17, 2017 (this “Amendment”), to that certain Amended and Restated Credit and Guaranty Agreement, dated as of December 31, 2014, as amended by the Term Loan Joinder Agreement and Amendment dated as of July 15, 2016, the Term Loan Amendment dated as of July 26, 2016 and the Third Amendment dated as of February 8, 2017 (the “Term Loan Credit Agreement”), by and among Douglas Dynamics, Inc. (“Holdings”), Douglas Dynamics, L.L.C. (the “Company” or the “Borrower”), Douglas Dynamics Finance Company (“DD Finance”), Fisher, LLC (“Fisher”), Trynex International LLC (“Trynex”), Henderson Enterprises Group, Inc. (the survivor of a merger with DDIZ Acquisition, Inc.) (“HEG”), Henderson Products, Inc. (“HPI”) and Dejana Truck & Utility Equipment Company, LLC (“Dejana” and, together with Holdings, DD Finance, Fisher, Trynex, HEG and HPI, each a “Guarantor” and collectively, the “Guarantors”), the several lenders from time to time party thereto (the “Lenders”), JPMorgan Chase Bank, N.A. (“JPMorgan”), as administrative agent (in such capacity, the “Administrative Agent”) and as collateral agent (in such capacity, the “Collateral Agent”) and the other agents and parties party thereto.

 

W I T N E S S E T H:

 

WHEREAS, pursuant to the Term Loan Credit Agreement, the Lenders have agreed to make, and have made, certain loans and other extensions of credit to the Borrower;

 

WHEREAS, the Borrower has requested that (i) the Lenders effect certain modifications to the Term Loan Credit Agreement as described herein (the Term Loan Credit Agreement, as so modified hereby, the “Amended Credit Agreement”), and (ii) the outstanding Term B Loans be replaced with a new term loan B facility (the “2017 Replacement Term Loan Facility”) by obtaining the 2017 Replacement Term Loan Commitments (as defined in Section 3 of this Amendment);

 

WHEREAS, the loans under the 2017 Replacement Term Loan Facility (the “2017 New Term Loans”) will replace and refinance the currently outstanding Term B Loans and are collectively intended to be Replacement Term Loans, as contemplated in Section 10.5(f) of the Term Loan Credit Agreement;

 

WHEREAS, the 2017 New Term Loans will have the terms set forth in the Amended Credit Agreement;

 

WHEREAS, JPMorgan Chase Bank, N.A. is the lead arranger and bookrunner (the “Amendment Lead Arranger”) for the 2017 New Term Loans;

 

WHEREAS, (i) each existing Lender that executes and delivers a lender addendum signature page to this Amendment (substantially in the form attached hereto) in such capacity (a “Continuing Term Lender Addendum”) and in connection therewith agrees to continue up to all of its Existing Term Loans (as defined below) as 2017 New Term Loans (such continued Term Loans, the “Continued Term Loans”, and such Lenders, collectively, the “Continuing Term Lenders”) will thereby (i) agree to the terms of this Amendment and (ii) agree to continue, pursuant to a cashless roll, up to all of its existing Term B Loans (all existing Term B Loans outstanding under the Term Loan Credit Agreement, the “Existing Term Loans”, and the Lenders of such Existing Term Loans, collectively, the “Existing Term Lenders”) outstanding on the Effective Date (as defined below) as 2017 New Term Loans in a principal amount equal to the aggregate principal amount of such Existing Term Loans so continued (it being understood that the principal amount of Existing Term Loans so continued shall be its Continuing Term Loan Commitment (as defined in Section 3 of this Amendment);

 

 

WHEREAS, subject to the preceding recitals, each Person (other than a Continuing Term Lender in its capacity as such) that executes and delivers a lender addendum signature page to this Amendment (substantially in the form attached hereto) (a “Replacement Term Lender Addendum”) and agrees in connection therewith to provide its 2017 New Term Loan (collectively, the “Replacement Term Lenders”) will thereby (i) agree to the terms of this Amendment and (ii) commit to provide its 2017 New Term Loan on the Effective Date (the “Replacement Term Loans”) in such amount (not in excess of any such commitment) as is equal to its Replacement Term Loan Commitment (as defined in Section 3 of this Amendment);

 

WHEREAS, the proceeds of the Replacement Term Loans will be used to repay in full the outstanding principal amount of the Existing Term Loans that are not continued as 2017 New Term Loans by Continuing Term Lenders (the “Non-Continuing Term Loans”);

 

WHEREAS, the Continuing Term Lenders and the Replacement Term Lenders (collectively, the “2017 Term Lenders”) are severally willing to continue their Existing Term Loans as Continued Term Loans and/or to provide Replacement Term Loans, as the case may be, subject to the terms and conditions set forth in the Term Loan Credit Agreement, this Amendment and the Amended Credit Agreement, as applicable; and

 

WHEREAS, the 2017 Term Lenders and the Administrative Agent are willing to agree to this Amendment on the terms set forth herein;

 

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

 

I.  DEFINED TERMS

 

Terms defined in the Amended Credit Agreement and not defined herein are used herein as defined therein.

 

II.  AMENDMENTS TO THE TERM LOAN CREDIT AGREEMENT

 

The Term Loan Credit Agreement is hereby amended, effective immediately after the provision of, or the continuation of Existing Term Loans as, as applicable, 2017 New Term Loans on the Effective Date, as follows:

 

2.1          Amendments to Section 1.1 of the Term Loan Credit Agreement.  Section 1.1 of the Term Loan Credit Agreement is hereby amended as follows:

 

(a)           The definition of “Applicable Margin” is hereby amended and restated in its entirety as follows:

 

“Applicable Margin” means, for any day, with respect to any ABR Loan or Eurodollar Rate Loan, a percentage, per annum, equal to: (i) in the case of ABR Loans, 2.00% and (ii) in the case of Eurodollar Rate Loans, 3.00%.

 

2

 

(b)           The definition of “Lender” is hereby amended and restated in its entirety as follows:

 

“Lender” means, at any time, each financial institution or other entity that is listed on the signature pages of the 2017 Replacement Term Loan Amendment as a “Continuing Term Lender” and/or “Replacement Term Lender,” as applicable, and shall include any other Person that becomes a party hereto pursuant to an Assignment and Assumption or a Term Loan Joinder Agreement, other than any such Person that ceases to be a party hereto pursuant to an Assignment and Assumption.

 

(c)           The definition of “Sanctioned Country” is hereby amended by adding “Crimea,” immediately before “Cuba”.

 

(d)           The definition of “Term Loan” is hereby amended and restated in its entirety as follows:

 

“Term Loan” means, on and after the 2017 Replacement Term Loan Amendment Effective Date, any 2017 New Term Loans made or continued pursuant to the 2017 Replacement Term Loan Amendment and any Additional Term Loans made pursuant to Section 2.23, as applicable.  On and after the 2017 Replacement Term Loan Amendment Effective Date, each reference to a “Term Loan” in this Amendment and in the other Credit Documents shall be deemed to include the 2017 New Term Loans, except as the context may otherwise require.

 

(e)           The definition of “Term Loan Commitment” is hereby amended and restated in its entirety as follows:

 

“Term Loan Commitment” means, with respect to any Lender, the obligation of such Lender, if any, on and after the 2017 Replacement Term Loan Amendment Effective Date, (i) to continue its Existing Term Loans (as defined in the 2017 Replacement Term Loan Amendment) as a 2017 New Term Loan or (ii) to make a 2017 New Term Loan in the amount provided for in the 2017 Replacement Term Loan Amendment. The aggregate amount of the Term Loan Commitments on, and after giving effect to, the 2017 Replacement Term Loan Amendment Effective Date is $313,962,401.02.

 

The amount of each Lender’s Term Loan Commitment on the 2017 Replacement Term Loan Amendment Effective Date is its 2017 Replacement Term Loan Commitment.  For all purposes hereunder, from and after the 2017 Replacement Term Loan Amendment Effective Date, each reference to a “Term Loan Commitment” in this Amendment and in the Credit Documents shall be deemed to include the commitments to provide, or to continue Existing Term Loans as, the 2017 New Term Loans.

 

(f)            The following new definitions shall be inserted in their proper alphabetical order:

 

“2017 New Term Loans” shall have the meaning assigned to such term in the 2017 Replacement Term Loan Amendment.

 

“2017 Replacement Term Loan Amendment” shall mean the 2017 Replacement Term Loan Amendment, dated as of the 2017 Replacement Term Loan Amendment Effective Date, among the Borrower, the other Credit Parties party thereto, the Lenders party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent.

 

3

 

“2017 Replacement Term Loan Amendment Effective Date” shall mean August 17, 2017.

 

“2017 Replacement Term Loan Facility” shall have the meaning set forth in the 2017 Replacement Term Loan Amendment.

 

“2017 Replacement Term Loan Commitment” shall have the meaning set forth in the 2017 Replacement Term Loan Amendment.

 

“Continuing Term Lender” shall have the meaning assigned to such term in the 2017 Replacement Term Loan Amendment.

 

“Continued Term Loans” shall have the meaning assigned to such term in the 2017 Replacement Term Loan Amendment.

 

“Existing Term Loans” shall have the meaning assigned to such term in the 2017 Replacement Term Loan Amendment.

 

“Replacement Term Lender” shall have the meaning assigned to such term in the 2017 Replacement Term Loan Amendment.

 

2.2          Amendment to Section 2.1(a) of the Term Loan Credit Agreement.  Section 2.1(a) of the Term Loan Credit Agreement is hereby amended by adding the following at the end thereof:

 

Subject to the terms and conditions set forth in the 2017 Replacement Term Loan Amendment, on the 2017 Replacement Term Loan Amendment Effective Date, each Continuing Term Lender severally agrees to continue its Existing Term Loans pursuant to a cashless roll as 2017 New Term Loans in a principal amount not to exceed its 2017 Replacement Term Loan Commitment, and each Replacement Term Lender severally agrees to make 2017 New Term Loans to the Borrower in a principal amount not to exceed its 2017 Replacement Term Loan Commitment. Any amount borrowed or continued pursuant to the 2017 Replacement Term Loan Amendment and subsequently repaid or prepaid may not be reborrowed.  Subject to Sections 2.11, 2.12 and 2.13, all amounts owed hereunder with respect to the 2017 New Term Loans shall be paid in full no later than the Maturity Date.  Each Lender’s Term Loan Commitment shall terminate immediately and without further action on the 2017 Replacement Term Loan Amendment Effective Date after giving effect to the making by such Lender (if applicable) of, and the continuation by such Lender (if applicable) of Term Loans into, 2017 New Term Loans on the 2017 Replacement Term Loan Amendment Effective Date.

 

2.3          Amendment to Section 2.1(b) of the Term Loan Credit Agreement.  Section 2.1(b) of the Term Loan Credit Agreement is hereby amended and restated in its entirety as follows:

 

(b)           Borrowing Mechanics for 2017 New Term Loans.  The Company shall deliver to the Administrative Agent a fully executed and delivered Funding Notice no later than 10:00 a.m. (New York City time) at least (x) three Business Days in advance of the 2017 Replacement Term Loan Amendment Effective Date in the case of a Eurodollar Rate Loan to be made on the 2017 Replacement Term Loan Amendment Effective Date or (y) one Business Day in advance of the 2017 Replacement Term Loan Amendment Effective Date in the case of an ABR Loan to be made on the 2017 Replacement Term Loan Amendment Effective Date.  Promptly upon receipt by the Administrative Agent of such Funding Notice, the Administrative Agent shall notify each Lender of the proposed borrowing.

 

4

 

2.4          Amendment to Section 2.5 of the Term Loan Credit Agreement.  Section 2.5 of the Term Loan Credit Agreement is hereby amended and restated in its entirety as follows:

 

2.5          Use of Proceeds.  The proceeds of the 2017 New Term Loans made pursuant to the 2017 Replacement Term Loan Amendment shall be used on the 2017 Replacement Term Loan Amendment Effective Date to repay the Loans that are not Continued Term Loans that are required to be repaid pursuant to Section 2.11.  The proceeds of the Additional Term Loans made pursuant to Section 2.23 shall be used for general corporate purposes of the Borrower and its Subsidiaries.  No portion of the proceeds of any Credit Extension shall be used in any manner that causes or might cause such Credit Extension or the application of such proceeds to violate Regulation T, Regulation U or Regulation X of the Board of Governors of the Federal Reserve System or any other regulation thereof or to violate the Exchange Act.

 

2.5          Amendment to Section 2.11 of the Term Loan Credit Agreement.  Section 2.11 of the Term Loan Credit Agreement is hereby amended by (i) replacing the text “outstanding on the Third Amendment Effective Date” in the first paragraph thereof with “outstanding on the 2017 Replacement Term Loan Amendment Effective Date”, (ii) replacing the text “March 31, 2017” with “September 30, 2017” and (iii) inserting the following text at the end thereof “The Borrower shall repay to the Administrative Agent for the ratable account of the Lenders holding Term Loans that are not Continued Term Loans, the outstanding principal amount of such Term Loans that are not Continued Term Loans on the 2017 Replacement Term Loan Amendment Effective Date.”

 

2.6          Amendment to Section 2.19 of the Term Loan Credit Agreement.  Section 2.19 of the Term Loan Credit Agreement is hereby amended by adding the following as a new clause (h) therein:

 

(h)           Survival.  Each party’s obligations under this Section 2.19 shall survive the resignation or replacement of the Administrative Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all obligations under any Credit Document.

 

2.7          Amendment to Section 2.21 of the Term Loan Credit Agreement.  Section 2.21 of the Term Loan Credit Agreement is hereby amended by (i) replacing the text “six-month anniversary” with “twelve-month anniversary” and (ii) replacing the text “Third Amendment Effective Date” with “2017 Replacement Term Loan Amendment Effective Date”.

 

2.8          Amendment to Section 2.23(b) of the Term Loan Credit Agreement.  Section 2.23(b) of the Term Loan Credit Agreement is hereby amended by (i) replacing each reference therein to “Third Amendment Effective Date” with “2017 Replacement Term Loan Amendment Effective Date” and (ii) replacing each reference therein to “Term B Loans” with “2017 New Term Loans”.

 

2.9          Amendment to Section 10.6(c)(i) of the Term Loan Credit Agreement.  Section 10.6(c)(i) of the Term Loan Credit Agreement is hereby amended by replacing the reference therein to “$1,000,000” with “$500,000”.

 

III.  2017 NEW TERM LOANS; ALLOCATIONS AND REALLOCATIONS

 

3.1          Each (a) Replacement Term Lender, by executing a Replacement Term Lender Addendum, and (b) Continuing Term Lender, by executing a Continuing Term Lender Addendum, consents to the amendments to the Term Loan Credit Agreement set forth in this Amendment.

 

5

 

3.2          Subject to the terms and conditions set forth herein (i) each Continuing Term Lender agrees to continue, pursuant to a cashless roll, all its Existing Term Loans as a Continued Term Loan on the date requested by the Borrower to be the Effective Date in a principal amount equal to such Continuing Term Lender’s Continuing Term Loan Commitment (as defined below) and (ii) each Replacement Term Lender agrees to provide its Replacement Term Loan on such date in a principal amount equal to such Replacement Term Lender’s Replacement Term Loan Commitment (as defined below). The Borrower shall give notice to the Administrative Agent of the proposed Effective Date not later than one Business Day prior thereto, and the Administrative Agent shall notify each Continuing Term Lender and each Replacement Term Lender thereof.

 

3.3          Each Replacement Term Lender will provide its Replacement Term Loan on the Effective Date by making available to the Administrative Agent, in the manner contemplated by the Amended Credit Agreement or as otherwise arranged by the Administrative Agent and such Replacement Term Lenders, an amount equal to its Replacement Term Loan Commitment. The “Replacement Term Loan Commitment” of any Replacement Term Lender will be such amount (not exceeding any commitment offered by such Replacement Term Lender) allocated to it by the Administrative Agent and notified to it on or prior to the Effective Date.  The “Continuing Term Loan Commitment” of any Continuing Term Lender will be the amount of its Existing Term Loans as set forth in the Register immediately prior to giving effect to the Effective Date (or such lesser amount as allocated to it by the Administrative Agent and notified to it on or prior to the Effective Date), which shall be continued as an equal amount of Continued Term Loans (it being understood that no cash will be advanced as part of any continuation of Continued Term Loans). Replacement Term Loan Commitments and Continuing Term Loan Commitments are collectively referred to herein as the “2017 Replacement Term Loan Commitment”.  The commitments of the Replacement Term Lenders and the continuation undertakings of the Continuing Term Lenders are several and no such Lender will be responsible for any other such Lender’s failure to provide, or continue its Existing Term Loans as, as applicable, its 2017 New Term Loan.  The 2017 New Term Loans may from time to time be ABR Loans or Eurodollar Rate Loans, as determined by the Borrower and notified to the Administrative Agent as contemplated by Sections 2.1 and 2.7 of the Amended Credit Agreement.  Upon the provision of, or the continuation of the Existing Term Loans as, as applicable, 2017 New Term Loans on the Effective Date, the 2017 New Term Loans shall be ABR Loans or Eurodollar Rate Loans, as the case may be, of the same Type and with the Interest Period(s) that were applicable to the Existing Term Loans immediately prior to the Effective Date uninterrupted thereby with the initial Interest Period(s) applicable to the 2017 New Term Loans equal to the remaining length of such Existing Term Loans’ Interest Period(s).

 

3.4          The obligation of each 2017 Term Lender to provide, or continue its Existing Term Loans as, as applicable, its 2017 New Term Loans on the Effective Date is subject to the satisfaction of the conditions set forth in Section 4 of this Amendment.

 

3.5          On and after the Effective Date, each reference in the Amended Credit Agreement to “Term B Loans” shall be deemed a reference to the 2017 New Term Loans contemplated hereby, except as the context may otherwise require.

 

3.6          The Lenders hereby agree to waive the notice requirements of Section 2.12 of the Amended Credit Agreement (which notice is otherwise hereby deemed to be effectively given to the Administrative Agent) in connection with the prepayment or replacement of Existing Term Loans contemplated hereby.  The Continuing Term Lenders, constituting Required Lenders immediately prior to the Effective Date, hereby agree to waive the breakage costs provisions of Section 2.17 of the Term Loan Credit Agreement in connection with the prepayment or replacement of Existing Term Loans contemplated hereby.

 

6

 

IV.  CONDITIONS TO EFFECTIVENESS

 

4.1          This Amendment shall become effective on the date of satisfaction of the following conditions precedent (such date, the “Effective Date”):

 

(a)           The Administrative Agent (or its counsel) shall have received from each Credit Party, the Administrative Agent and the 2017 Term Lenders either (x) a counterpart of this Amendment signed on behalf of such party or (y) written evidence satisfactory to the Administrative Agent (which may include fax or other electronic transmission of a signed signature page of this Amendment) that such party has signed a counterpart of this Amendment.

 

(b)           The Administrative Agent shall have received, on behalf of itself and the Lenders on the Effective Date, a customary written opinion of Foley & Lardner LLP, counsel for the Credit Parties, in form and substance satisfactory to the Administrative Agent, dated as of the Effective Date (and each Credit Party hereby instructs such counsel to deliver such opinion to the Administrative Agent.

 

(c)           The Administrative Agent shall have received (i) copies of each Organizational Document for each Credit Party, certified as of a recent date prior to the Effective Date by the appropriate governmental official or, as applicable, by an officer of such Credit Party, (ii) signature and incumbency certificates of the officers of each Credit Party executing the Credit Documents to which it is a party, (iii) resolutions of the Board of Directors or similar governing body of each Credit Party approving and authorizing the execution, delivery and performance of this Amendment and the other Credit Documents to which it is a party, certified as of the Effective Date by its secretary or an assistant secretary as being in full force and effect without modification or amendment, (iv) a good standing certificate from the applicable Governmental Authority of each Credit Party’s jurisdiction of incorporation, organization or formation and in each jurisdiction in which it is qualified as a foreign corporation or other entity to do business (other than the State of Maryland, with respect to Dejana), each dated a recent date prior to the Effective Date, and (v) such other documents as the Administrative Agent may reasonably request.

 

(d)           The Administrative Agent shall have received, at least five (5) Business Days in advance of the Effective Date, all documentation and other information required by Governmental Authorities under applicable “know-your-customer” and anti-money laundering rules and regulations, including, without limitation, as required by the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT ACT) Act of 2001.

 

(e)           All fees, expenses and other amounts due and payable to the Amendment Lead Arranger, the Agents, or to any Lender on or prior to the Effective Date and, to the extent invoiced, all other amounts due and payable pursuant to the Credit Documents on or prior to the Effective Date, including, to the extent invoiced, reimbursement or payment of all reasonable out-of-pocket expenses (including reasonable fees, charges and disbursements of Simpson Thacher & Bartlett LLP) required to be reimbursed or paid by the Credit Parties under the Term Loan Credit Agreement or under any other Credit Document shall have been paid or shall have been authorized to be deducted from the proceeds of the funding of the 2017 New Term Loans.

 

(f)            The Administrative Agent shall have received a certificate of an Authorized Officer of the Borrower dated the Effective Date certifying that (a) the representations and warranties contained in the Term Loan Credit Agreement and the other Credit Documents are true and correct in all material respects (or in all respects, if qualified by materiality) on and as of the Effective Date to the same extent as though made on and as of such date, except to the extent such representations and warranties specifically relate to an earlier date, in which case such representations and warranties were true and correct in all material respects (or in all respects, if qualified by materiality) on and as of such earlier date, and (b) both before and after giving effect to the making of the 2017 New Term Loans, no Default or Event of Default has occurred and is continuing or would result from the provision of, or the continuation of Existing Term Loans as, as applicable, 2017 New Term Loans on the Effective Date.

 

7

 

(g)           The Borrower shall have provided the Administrative Agent with a Funding Notice substantially in the form of Exhibit A-1 to the Term Loan Credit Agreement no later than 10:00 a.m. (New York City time) at least three Business Days in advance of the Effective Date with respect to the borrowing of Replacement Term Loans on the Effective Date.

 

Each 2017 Term Lender, by delivering its signature page to this Amendment and providing, or continuing its Existing Term Loans as, as applicable, its 2017 New Term Loan on the Effective Date shall be deemed to have acknowledged receipt of and consented to and approved each Credit Document and each other document required to be approved by the Administrative Agent or any Lender, as applicable, on the Effective Date.

 

V.  EFFECT ON THE CREDIT DOCUMENTS

 

5.1          Except as expressly provided herein, all of the terms and provisions of the Term Loan Credit Agreement and the other Credit Documents are and shall remain in full force and effect. This Amendment shall constitute a Credit Document for all purposes of the Term Loan Credit Agreement and the other Credit Documents.  Provisions of this Amendment are deemed incorporated into the Term Loan Credit Agreement as if fully set forth therein. To the extent required by the Term Loan Credit Agreement, the Borrower and the Administrative Agent hereby consent to each Replacement Term Lender becoming a Lender under the Term Loan Credit Agreement on the Effective Date.

 

VI. MORTGAGES

 

6.1          Within 90 days of the Effective Date (or such later date as the Collateral Agent shall agree), the Borrower shall have delivered, with respect to each Mortgage, either:

 

(a)           (i) An opinion in form and substance reasonably satisfactory to the Collateral Agent from local counsel in the jurisdiction in which such Mortgage is recorded substantially to the effect that: (x) the recording of the existing Mortgage is the only filing or recording necessary to give constructive notice to third parties of the lien created by such Mortgage as security for the Obligations, including the Obligations evidenced by the Term Loan Credit Agreement, as amended pursuant to this Amendment, for the benefit of the Secured Parties; and (y) no other documents, instruments, filings, recordings, re-recordings, re-filings or other actions, including, without limitation, the payment of any mortgage recording taxes or similar taxes, are necessary or appropriate under applicable law in order to maintain the continued enforceability, validity or priority of the lien created by such Mortgage as security for the Obligations, including the Obligations evidenced by the Term Loan Credit Agreement, as amended pursuant to this Amendment, for the benefit of the Secured Parties; and (ii) title reports in scope, form and substance reasonably satisfactory to the Collateral Agent describing no liens on said Property (as defined in such Mortgage) other than Permitted Liens; or

 

(b)           The following documentation:

 

(i)            an amendment to each existing Mortgage (each, a “Mortgage Amendment,” collectively, the “Mortgage Amendments”) to reflect the matters set forth in this Amendment, duly executed and acknowledged by the applicable Credit Party, and in form for recording in the recording office where such Mortgage was recorded, together with such certificates, affidavits, questionnaires or returns as shall be required in connection with the recording or filing thereof under applicable law, in each case in form and substance reasonably satisfactory to the Collateral Agent;

 

8

 

(ii)           a date down, modification and/or so-called “nonimpairment” endorsement to each Title Policy (each, a “Title Endorsement,” collectively, the “Title Endorsements”) relating to each Mortgage insuring the Collateral Agent that such Mortgage, as amended by such Mortgage Amendment, is a valid and enforceable first priority lien on the Collateral described therein in favor of the Collateral Agent for the benefit of the Secured Parties free and clear of all defects, encumbrances and liens except for Permitted Liens, and such Title Endorsements shall otherwise be in form and substance reasonably satisfactory to the Collateral Agent;

 

(iii)          customary legal opinions addressed to the Collateral Agent for itself and the benefit of each of the Secured Parties covering the enforceability of the applicable Mortgage as amended by the Mortgage Amendment in form and substance reasonably satisfactory to the Collateral Agent; and

 

(iv)          such affidavits, certificates, information and instruments of indemnification as shall be required to induce the title insurance company to issue the Title Endorsements and evidence of payment by the Borrower of all applicable title insurance premiums, search and examination charges, escrow charges and related charges, mortgage recording taxes, fees, charges, costs and expenses required for the recording of the Mortgage Amendments and issuance of Title Endorsements.

 

VII.  COVENANTS

 

7.1          Within 30 days of the Effective Date (or such later date as the Administrative Agent may agree in its sole discretion, acting reasonably), the Administrative Agent shall have received, with respect to Dejana, a certificate from the State of Maryland with respect to its qualification as a foreign entity in good standing to engage in business in such jurisdiction.

 

VIII.  REAFFIRMATION

 

8.1          By signing this Amendment, each Credit Party hereby confirms that (a) its obligations and liabilities under the Term Loan Credit Agreement as modified hereby (including with respect to the 2017 New Term Loans contemplated by this Amendment) and the other Credit Documents to which it is a party remain in full force and effect on a continuous basis after giving effect to this Amendment, (b) the Secured Parties remain entitled to the benefits of the Guaranty and the security interests set forth or created in the Collateral Documents and the other Credit Documents, (c) notwithstanding the effectiveness of the terms hereof, the Collateral Documents and the other Credit Documents are, and shall continue to be, in full force and effect and are hereby ratified and confirmed in all respects and (d) each Replacement Term Lenders shall be a “Secured Party” and a “Lender” for all purposes of the Term Loan Credit Agreement and the other Credit Documents.  Each Credit Party ratifies and confirms that all Liens granted, conveyed, or assigned to any Agent by such Person pursuant to each Credit Document to which it is a party remain in full force and effect, are not released or reduced, and continue to secure full payment and performance of the Obligations as increased hereby.

 

9

 

IX.  EXPENSES

 

9.1          The Borrower agrees to pay and reimburse the Administrative Agent for all its reasonable costs and out-of-pocket expenses incurred in connection with the preparation and delivery of this Amendment, including, without limitation, the reasonable and invoiced fees, charges and disbursements of one counsel in each applicable jurisdiction to the Administrative Agent.

 

X.  MISCELLANEOUS

 

10.1        This Amendment and the rights and obligations of the parties hereunder shall be governed by, and shall be construed and enforced in accordance with the laws of the State of New York without regard to conflict of law principles thereof that would result in the application of the laws of another jurisdiction.

 

10.2        EACH OF THE PARTIES HERETO HEREBY AGREES TO WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING HEREUNDER OR ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS AMENDMENT.  THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS AMENDMENT, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS.  EACH PARTY HERETO ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO THIS AMENDMENT, WHICH EACH HAS ALREADY RELIED ON THIS WAIVER IN ENTERING INTO THIS AMENDMENT, AND THAT EACH WILL CONTINUE TO RELY ON THIS WAIVER IN ITS RELATED FUTURE DEALINGS.  EACH PARTY HERETO FURTHER WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL.  THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN WAIVER SPECIFICALLY REFERRING TO THIS SECTION OF THIS AMENDMENT AND EXECUTED BY EACH OF THE PARTIES HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, SUPPLEMENTS OR MODIFICATIONS HERETO OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THIS AMENDMENT.  IN THE EVENT OF LITIGATION, THIS AMENDMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

 

10.3        This Amendment may be executed in counterparts, each of which when so executed and delivered shall be deemed an original, but all of such counterparts together shall constitute but one and the same instrument.  Delivery of an executed counterpart of a signature page to this Amendment by facsimile or electronic file shall be effective as delivery of a manually executed counterpart of this Amendment.

 

[Signature Pages Follow.]

 

10

 

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered by their respective duly authorized officers as of the day and year first above written.

 

	
 
    	
DOUGLAS DYNAMICS, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Robert J. Young
    
	
 
    	
 
    	
Name: Robert J. Young
    
	
 
    	
 
    	
Title: Vice President, Controller, and Treasurer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
DOUGLAS DYNAMICS, L.L.C.
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Robert J. Young
    
	
 
    	
 
    	
Name: Robert J. Young
    
	
 
    	
 
    	
Title: Vice President, Controller, and   Treasurer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
DOUGLAS DYNAMICS FINANCE COMPANY
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Robert L. McCormick
    
	
 
    	
 
    	
Name: Robert L. McCormick
    
	
 
    	
 
    	
Title: Vice President, CFO, Treasurer and   Secretary
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
FISHER, LLC
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
Douglas Dynamics, L.L.C., its sole Member
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Robert J. Young
    
	
 
    	
 
    	
Name: Robert J. Young
    
	
 
    	
 
    	
Title: Vice President, Controller, and   Treasurer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
TRYNEX INTERNATIONAL LLC
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Robert J. Young
    
	
 
    	
 
    	
Name: Robert J. Young
    
	
 
    	
 
    	
Title: Treasurer and Secretary
    

 

[Signature Page to 2017 Replacement Term Loan Amendment]

 

 

	
 
    	
HENDERSON ENTERPRISES GROUP, INC.
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Robert J. Young
    
	
 
    	
 
    	
Name: Robert J. Young
    
	
 
    	
 
    	
Title: Treasurer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    
	
 
    	
HENDERSON PRODUCTS, INC.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Robert J. Young
    
	
 
    	
 
    	
Name: Robert J. Young
    
	
 
    	
 
    	
Title: Treasurer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    
	
 
    	
DEJANA TRUCK & UTILITY EQUIPMENT 

COMPANY, LLC
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Robert J. Young
    
	
 
    	
 
    	
Name: Robert J. Young
    
	
 
    	
 
    	
Title: Treasurer
    

 

[Signature Page to 2017 Replacement Term Loan Amendment]

 

 

	
 
    	
JPMORGAN CHASE BANK, N.A., as
    
	
 
    	
Administrative Agent, as Collateral Agent
    
	
 
    	
and as a Lender
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Patrick J. Reardon
    
	
 
    	
 
    	
Name: Patrick J. Reardon
    
	
 
    	
 
    	
Title: Authorized Officer
    

 

[Signature Page to 2017 Replacement Term Loan Amendment]Exhibit 10.1

 

Employment Agreement

 

This Employment Agreement (the “Agreement”)
is made and entered into as of August 1, 2017 (the "Effective Date"), by and between Christopher Sabec, an individual
(the “Executive”), and Rightscorp, Inc., a Nevada corporation (the “Company”).

 

WHEREAS, the
Company desires to employ the Executive on the terms and conditions set forth herein; and

 

WHEREAS, the Executive desires to be employed by the Company
on such terms and conditions.

 

NOW, THEREFORE, in consideration of the mutual covenants, promises,
and obligations set forth herein, the parties agree as follows:

 

1. Term. The Executive's employment hereunder shall be
effective as of the Effective Date and shall continue until the third anniversary thereof (the “Initial Term”), unless
terminated earlier pursuant to Section 4 of this Agreement; provided that, on such third anniversary and each annual anniversary
thereafter (such date and each annual anniversary thereof, a “Renewal Date”), the Agreement shall be deemed
to be automatically extended, upon the same terms and conditions, for successive periods of one year (each, a “Renewal Term”),
unless either party provides written notice of its intention not to extend the term of the Agreement at least 90 days' prior to
the applicable Renewal Date. The period during which the Executive is employed by the Company hereunder is hereinafter referred
to as the “Employment Term.”

 

2. Position.

 

During the Employment Term, the Executive shall serve as the
President of the Company, reporting to the Board of Directors of the Company (the “Board”). In such position,
the Executive shall have such duties, authority, and responsibility as shall be determined from time to time by the Board, which
duties, authority, and responsibility are consistent with the Executive's position.

 

3. Compensation.

 

3.1 Base Salary. The Company
shall pay the Executive an annual rate of base salary of $150,000 in periodic installments in accordance with the Company's customary
payroll practices and applicable wage payment laws, but no less frequently than monthly, except that, (i) the Executive's Base
Salary will increase from $150,000 to $250,000, effective upon the Company's achievement of $100,000 in gross monthly revenue
for three consecutive months, (ii) the Executive's Base Salary will increase to $350,000 upon the Company achieving $2,500,000
in gross revenue in any one year period commencing on the Effective Date, and (iii) effective upon the Company's receipt of an
aggregate of $10,000,000 in cumulative gross revenue during the Initial Term and any Renewal Term, the Base Salary will increase
to $500,000 . Executive's Base Salary may not be decreased during the Initial term or any Renewal Term. The Executive's annual
base salary, as in effect from time to time, is hereinafter referred to as “Base Salary”.

 

 

 

 

    	 	1	 

     

    

 

3.2 Signing and Annual Bonus.
The Company shall pay Executive a past performance bonus of $50,000 upon execution of this Agreement. For each calendar year of
the Employment Term, the Executive shall be eligible to receive an annual bonus (the “Annual Bonus”). However,
the decision to provide any Annual Bonus and the amount and terms of any Annual Bonus shall be in the sole and absolute discretion
of the Board.

 

3.3 Equity Award. On the
Effective Date, the Company shall issue to Executive 10-year options to purchase 5,000,000 shares of common stock with an exercise
price of $0.05, 1,500,000 of which will vest on the Effective Date, and the remaining 3,500,000 of which will vest monthly in
48 equal monthly installments (each of 72,917 options) commencing on August 1, 2017.

 

3.4 Fringe Benefits and Perquisites.
During the Employment Term, the Executive shall be entitled to fringe benefits and perquisites consistent in accordance with the
practices of the Company, and to the extent the Company provides similar benefits or perquisites (or both) to similarly situated
executives of the Company.

 

3.5 Employee Benefits. During
the Employment Term, the Executive shall be entitled to participate in all employee benefit plans, practices, and programs maintained
by the Company, as in effect from time to time (collectively, "Employee Benefit Plans"), on a basis which is no less
favorable than is provided to other similarly situated executives of the Company, to the extent consistent with applicable law
and the terms of the applicable Employee Benefit Plans. The Company reserves the right to amend or cancel any Employee Benefit
Plans at any time in its sole discretion, subject to the terms of such Employee Benefit Plan and applicable law.

 

3.6 Vacation; Paid Time-Off.
During the Employment Term, the Executive will be entitled to six weeks of paid vacation time annually. The Executive shall receive
other paid time- off in accordance with the Company's policies for executive officers as such policies may exist from time to
time.

 

3.7 Business Expenses. The
Executive shall be entitled to reimbursement for all reasonable and necessary out-of-pocket business, entertainment, and travel
expenses incurred by the Executive in connection with the performance of the Executive's duties hereunder in accordance with the
Company's expense reimbursement policies and procedures.

 

3.8 Indemnification. In
the event that the Executive is made a party or threatened to be made a party to any action, suit, or proceeding, whether civil,
criminal, administrative, or investigative (a “Proceeding”), other than any Proceeding initiated by the Executive
or the Company related to any contest or dispute between the Executive and the Company, or any of its affiliates with respect
to this Agreement, or the Executive's employment hereunder, by reason of the fact that the Executive is or was a director or officer
of the Company, or any affiliate of the Company, or is or was serving at the request of the Company as a director, officer, member,
employee, or agent of another corporation or a partnership, joint venture, trust, or other enterprise, the Executive shall be
indemnified and held harmless by the Company to the fullest extent applicable to any other officer or director of the Company
from and against any liabilities, costs, claims, and expenses, including all costs and expenses incurred in defense of any Proceeding
(including attorneys' fees).

 

 

 

 

    	 	2	 

     

    

 

4. Termination of Employment. Upon termination of the Executive's employment during the Initial
Term or a Renewal Term, the Executive shall be entitled to the compensation and benefits described in this Section 4 and shall
have no further rights to any compensation or any other benefits from the Company or any of its affiliates.

 

4.1 Executive's Failure to Renew, Company's Termination for
Cause or Executive's Termination without Good Reason.

 

(a) The Executive's employment
hereunder may be terminated by the Executive's failure to renew the Agreement in accordance with Section 1, by the Company for
Cause or by the Executive without Good Reason. lithe Executive's employment is terminated upon the Executive's failure to renew
the Agreement, by the Company for Cause or by the Executive without Good Reason, the Executive shall be entitled to receive:

 

(i) any accrued but unpaid Base
Salary and accrued but unused vacation, which shall be paid on the Termination Date (as defined below);

 

(ii) reimbursement for unreimbursed
business expenses properly incurred by the Executive, which shall be subject to and paid in accordance with the Company's expense
reimbursement policy, and

 

(iii) such employee benefits (including equity compensation), if any, to which the Executive may be entitled
under the Company's employee benefit plans as of the Termination Date; provided that, in no event shall the Executive be entitled
to any payments in the nature of severance or termination payments except as specifically provided herein

 

Items 4.1(a)(i) through 4.1(a)(iii) are referred to herein collectively
as the “Accrued Amounts”.

 

(b) For purposes of this Agreement, “Cause”
shall mean:

 

(i) the Executive's willful failure to perform his duties (other
than any such failure resulting from incapacity due to physical or mental illness);

 

(ii) the Executive's willful failure to comply with any valid
and legal directive of the Board;

 

 

 

 

    	 	3	 

     

    

 

 

(iii) the Executive's willful engagement in dishonesty, illegal
conduct, or misconduct, which is, in each case, materially injurious to the Company or its affiliates;

 

(iv) the Executive's embezzlement, misappropriation, or fraud,
whether or not related to the Executive's employment with the Company;

 

(v) the Executive's conviction of, or plea of, guilty or nobo
contendere to a crime that constitutes a felony (or state law equivalent) or a crime that constitutes a misdemeanor involving moral
turpitude;

 

(vi) the Executive's violation
of a material policy of the Company;

 

(vii) the Executive's willful unauthorized
disclosure of Confidential Information (as defined below);

 

(viii) the Executive's material
breach of any material obligation under this Agreement or any other written agreement between the Executive and the Company; or

 

(ix)
any material failure by the Executive to comply with the Company's written policies or rules, as they may be in effect from time
to time during the Employment Term, if such failure causes material/reputational or financial harm to the Company.

 

For purposes of this provision, no act or failure to act on
the part of the Executive shall be considered “willful” unless it is done, or omitted to be done, by the Executive
in bad faith or without reasonable belief that the Executive's action or omission was in the best interests of the Company. Any
act, or failure to act, based upon authority given pursuant to a resolution duly adopted by the Board or upon the advice of counsel
for the Company shall be conclusively presumed to be done, or omitted to be done, by the Executive in good faith and in the best
interests of the Company.

 

Termination of the Executive's employment shall not be deemed
to be for Cause unless and until the Company delivers to the Executive a copy of a resolution duly adopted by the affirmative vote
of not less than a majority of the Board, but only after written notice ("Written Notice") is first provided to the Executive
detailing the facts and circumstances which the Board claims provide a basis for termination for Cause and only after the Executive
is given an opportunity, together with his counsel, to be heard before the Board on the issue of whether Cause exists justifying
termination of this Agreement (the "Cause Meeting"). The Cause Meeting shall take place ten (10) business days following
Executive's receipt of the Written Notice. The Cause Meeting shall take place at a time of day and location to which the Company
and Executive shall reasonably agree. Except for a failure, breach, or refusal which, by its nature, cannot reasonably be expected
to be cured, the Executive shall have thirty (30) days from the conclusion of the Cause Meeting within which to cure any claimed
acts or omissions constituting Cause;

 

 

 

 

    	 	4	 

     

    

 

(c) For purposes of this Agreement, “Good Reason”
shall mean the occurrence of any of the following, in each case during the Employment Term without the Executive's written consent:

 

(i) a material reduction in the Executive's Base Salary;

 

(ii) any material breach by the Company of any material provision
of this Agreement or any material provision of any other agreement between the Executive and the Company;

 

(iii) the Company's failure to obtain an agreement from any
successor to the Company to assume and agree to perform this Agreement in the same manner and to the same extent that the Company
would be required to perform if no succession had taken place, except where such assumption occurs by operation of law;

 

(iv) a material, adverse change in the Executive's title, authority,
duties, or responsibilities (other than temporarily while the Executive is physically or mentally incapacitated or as required
by applicable; or

 

(v) requiring Executive to report to any person, other than
the Board.

 

4.2 Company's Failure to Renew, Company's Termination without
Cause or Executive's Termination for Good Reason. The Employment Term and the Executive's employment hereunder may be terminated
by the Company's failure to renew the Agreement in accordance with Section 1, by the Executive for Good Reason or by the Company
without Cause. In the event of such termination, any unvested options held by Executive will automatically vest effective on the
Termination Date; the Executive shall be entitled to receive the Accrued Amounts; and, subject to his execution of a release of
claims in favor of the Company, its affiliates and their respective officers and directors in a reasonable form provided by the
Company (the “Release”) and such Release becoming effective within 30 days following the Termination Date (such
30-day period, the “Release Execution Period”), the Executive shall be entitled to receive a lump sum payment
(calculated in each case based on the Base Salary in effect on the Termination Date) equal to the greater of (i) six months of
the Executive's Base Salary, and (ii) (a) the Base Salary payable for the remainder of the Initial Term (in the event such termination
occurs during the Initial Term, or (b) the Base Salary payable for the remainder of the Renewal Term (in the event such termination
occurs during a Renewal Term), which shall be paid within 30 days following the Termination Date.

 

4.3 Death or Disability.

 

 

 

    	 	5	 

     

    

 

(a) The Executive's employment hereunder shall terminate automatically
upon the Executive's death during the Employment Term, and the Company may terminate the Executive's employment on account of the
Executive's Disability (as defined below)

 

(b) If the Executive's employment is terminated during the Employment
Term on account of the Executive's death or Disability (as defined below), the Executive (or the Executive's estate and/or beneficiaries,
as the case may be) shall be entitled to receive the Accrued Amounts.

 

Notwithstanding any other provision contained herein, all payments
made in connection with the Executive's Disability (as defined below) shall be provided in a manner which is consistent with federal
and state law.

 

(c) For purposes of this Agreement, “Disability”
shall mean the Executive's inability, due to physical or mental incapacity, to perform the essential functions of his job, with
or without reasonable accommodation, for one hundred eighty (180) days out of any three hundred sixty-five (365) day period. Any
question as to the existence of the Executive's Disability as to which the Executive and the Company cannot agree shall be determined
in writing by a qualified independent physician mutually acceptable to the Executive and the Company. If the Executive and the
Company cannot agree as to a qualified independent physician, each shall appoint such a physician and those two physicians shall
select a third who shall make such determination in writing. The determination of Disability made in writing to the Company and
the Executive shall be final and conclusive for all purposes of this Agreement.

 

4.4 Change in Control Termination.

 

(a) Notwithstanding any other provision contained herein, if
the Executive's employment hereunder is terminated by the Executive for Good Reason or by the Company without Cause (other than
on account of the Executive's death or Disability), in each case within twelve (12) months following a Change in Control, the Executive
shall be entitled to receive the Accrued Amounts and subject to his execution of a Release which becomes effective within 30 days
following the Termination Date, the Executive shall be entitled to receive a lump sum payment equal to the sum of three years of
the Executive's Base Salary as in effect on the Termination Date(or if greater, as in effect immediately prior to such Change in
Control), which shall be paid within 30 days following the Termination Date.

 

(b) For purposes of this Agreement, “Change in Control”
shall mean the occurrence of any of the following after the Effective Date:

 

(i) one person (or more than one
person acting as a group) acquires ownership of stock of the Company that, together with the stock held by such person or group,
constitutes more than 50% of the total fair market value or total voting power of the stock of such corporation; provided that,
a Change in Control shall not occur if any person (or more than one person acting as a group) owns more than 501% of the total
fair market value or total voting power of the Company's stock and acquires additional stock;

 

 

 

 

 

    	 	6	 

     

    

 

(ii) one person (or more than one
person acting as a group) acquires (or has acquired during the twelve-month period ending on the date of the most recent acquisition)
ownership of the Company's stock possessing 30% or more of the total voting power of the stock of such corporation;

 

(iii) a majority of the members
of the Board are replaced during any twelve-month period by directors whose appointment or election is not endorsed by a majority
of the Board before the date of appointment or election; or

 

(iv) the sale of all or substantially all of the Company's assets.

 

4.5 Notice of Termination. Subject to Section 1 and Section
4, above, any termination of the Executive's employment hereunder by the Company or by the Executive during the Employment Term
(other than termination pursuant to Section 4.3(a) on account of the Executive's death) shall be communicated by written notice
of termination ("Notice of Termination") to the other party hereto in accordance with Section 17. The Notice of Termination
shall specify:

 

(a) The termination provision of
this Agreement relied upon;

 

(b) To the extent applicable, the
facts and circumstances claimed to provide a basis for termination of the Executive's employment under the provision so indicated;
and

 

(c) The applicable Termination Date.

 

4.6 Termination Date. Subject to Section 1 and Section
4, above, the Executive's “Termination Date” shall be.

 

(a) If the Executive's employment
hereunder terminates on account of the Executive's death, the date of the Executive's death;

 

(b) If the Executive's employment
hereunder is terminated on account of the Executive's Disability, the date that it is determined that the Executive has a Disability;

 

(c) If the Company terminates the
Executive's employment hereunder for Cause, the date the Notice of Termination is delivered to the Executive;

 

 

 

 

    	 	7	 

     

    

 

(d) If the Company terminates the
Executive's employment hereunder without Cause, the date specified in the Notice of Termination, which shall be no less than 30
days following the date on which the Notice of Termination is delivered; ;

 

(e) If the Executive terminates
his employment hereunder with or without Good Reason, the date specified in the Executive's Notice of Termination, which shall
be no less than 30 days following the date on which the Notice of Termination is delivered; ; and

 

(f) If the Executive's employment
hereunder terminates because either party provides notice of non-renewal pursuant to Section 1, the Renewal Date immediately following
the date on which the applicable party delivers notice of non- renewal.

 

Notwithstanding anything contained herein, the Termination Date
shall not occur until the date on which the Executive incurs a "separation from service" within the meaning of Section
409A of the Internal Revenue Code (“Section 409A”).

 

4.7 Mitigation. In no event shall the Executive be obligated
to seek other employment or take any other action by way of mitigation of the amounts payable to the Executive under any of the
provisions of this Agreement and any amounts payable pursuant to this Section 4 shall not be reduced by compensation the Executive
earns on account of employment with another employer.

 

4.8 Resignation of All Other Positions. Upon termination
of the Executive's employment hereunder for any reason, the Executive, effective on the Termination Date shall be deemed to have
resigned from all positions that the Executive holds as an officer or member of the Board (or a committee thereof) of the Company
or any of its affiliates.

 

5. Cooperation. The parties agree that certain matters
in which the Executive will be involved during the Employment Term may necessitate the Executive's cooperation in the future. Accordingly,
following the termination of the Executive's employment for any reason, to the extent reasonably requested by the Board, the Executive
shall cooperate with the Company in connection with matters arising out of the Executive's service to the Company; provided that,
the Company shall make reasonable efforts to minimize disruption of the Executive's other activities. The Company shall reimburse
the Executive for reasonable expenses incurred in connection with such cooperation and, to the extent that the Executive is required
to spend substantial time on such matters, the Company shall compensate the Executive at an hourly rate based on the Executive's
Base Salary on the Termination Date.

 

6. Confidential Information. The Executive understands
and acknowledges that during the Employment Term, he will have access to and learn about Confidential Information, as defined below.

 

6.1 Confidential Information Defined.

 

 

 

    	 	8	 

     

    

 

(a) Definition.

 

For purposes of this Agreement, “Confidential
Information” includes, but is not limited to, all information not generally known to the public, in spoken, printed,
electronic or any other form or medium, relating directly or indirectly to: business processes, practices, methods, policies,
plans, publications, documents, research, operations, services, strategies, techniques, agreements, contracts, terms of agreements,
transactions, potential transactions, negotiations, pending negotiations, know-how, trade secrets„ databases, manuals, records,
articles, systems, material, sources of material, supplier information, vendor information, financial information, results, accounting
information, accounting records, legal information, marketing information, advertising information, pricing information, credit
information, design information, payroll information, staffing information, personnel information, employee lists, supplier lists,
vendor lists, developments, reports, internal controls, security procedures, graphics, drawings, sketches, market studies, sales
information, revenue, costs, formulae, notes, communications, algorithms, product plans, designs, styles, models, ideas, audiovisual
programs, inventions, unpublished patent applications, original works of authorship, discoveries, experimental processes, experimental
results, specifications, customer information, manufacturing information, factory lists, distributor lists, and buyer lists of
the Company or its businesses or any existing or prospective customer, supplier, investor or other associated third party, or
of any other person or entity that has entrusted information to the Company in confidence.

 

The Executive understands that the above
list is not exhaustive, and that Confidential Information also includes other information that is marked or otherwise identified
as confidential or proprietary, or that would otherwise appear to a reasonable person to be confidential or proprietary in the
context and circumstances in which the information is known or used.

 

The Executive understands and agrees that Confidential Information
includes information developed by him in the course of his employment by the Company as if the Company furnished the same Confidential
Information to the Executive in the first instance. Confidential Information shall not include information that is generally available
to and known by the public at the time of disclosure to the Executive; provided that, such disclosure is through no direct or
indirect fault of the Executive or person(s) acting on the Executive's behalf.

 

(b) Company Creation and Use of Confidential Information.

 

The Executive understands and acknowledges that the Company
has invested, and continues to invest, substantial time, money, and specialized knowledge into developing its resources, and training
its employees. The Executive understands and acknowledges that as a result of these efforts, the Company has created, and continues
to use and create Confidential Information. This Confidential Information provides the Company with a competitive advantage over
others in the marketplace.

 

 

 

 

    	 	9	 

     

    

 

(c) Disclosure and Use Restrictions.

 

The Executive agrees and covenants: (i) to treat all Confidential
Information as strictly confidential; (ii) not to directly or indirectly disclose, publish, communicate, or make available Confidential
Information, or allow it to be disclosed, published, communicated, or made available, in whole or part, to any entity or person
whatsoever (including other employees of the Company) not having a need to know and authority to know and use the Confidential
Information in connection with the business of the Company and, in any event, not to anyone outside of the direct employ of the
Company except as required in the performance of the Executive's authorized employment duties to the Company or with the prior
consent of the Board acting on behalf of the Company in each instance (and then, such disclosure shall be made only within the
limits and to the extent of such duties or consent); and (iii) not to access or use any Confidential Information, and not to copy
any documents, records, files, media, or other resources containing any Confidential Information, or remove any such documents,
records, files, media, or other resources from the premises or control of the Company, except as required in the performance of
the Executive's authorized employment duties to the Company or with the prior consent of the Board acting on behalf of the Company
in each instance (and then, such disclosure shall be made only within the limits and to the extent of such duties or consent. Nothing
herein shall be construed to prevent disclosure of Confidential Information as may be required by applicable law or regulation,
or pursuant to the valid order of a court of competent jurisdiction or an authorized government agency, provided that the disclosure
does not exceed the extent of disclosure required by such law, regulation, or order. The Executive shall promptly provide written
notice of any such order to the Board.

 

(d) Notice of Immunity Under the Economic Espionage Act of
1996, as amended by the Defend Trade Secrets Act of 2016 (“DTSA”). Notwithstanding any other provision of this
Agreement:

 

(i) The Executive will not be held criminally or civilly
liable under any federal or state trade secret law for any disclosure of a trade secret that.

 

(A) is made (1) in confidence to
a federal, state, or local government official, either directly or indirectly, or to an attorney; and (2) solely for the purpose
of reporting or investigating a suspected violation of law; or

 

(B) is made in a complaint or other
document filed under seal in a lawsuit or other proceeding.

 

(ii) If the Executive files a lawsuit for retaliation by the Company
for reporting a suspected violation of law, the Executive may disclose the Company's trade secrets to the Executive's attorney
and use the trade secret information in the court proceeding if the Executive:

 

 

 

    	 	10	 

     

    

 

(A) files any document containing
trade secrets under seal; and

 

(B) does not disclose trade secrets, except pursuant to court order.

 

7. Proprietary Rights.

 

7.1 Work Product. The Executive acknowledges and agrees
that all right, title, and interest in and to all writings, works of authorship, technology, inventions, discoveries, processes,
techniques, methods, ideas, concepts, research, proposals, materials, and all other work product of any nature whatsoever, that
are created, prepared, produced, authored, edited, amended, conceived, or reduced to practice by the Executive individually or
jointly with others during the period of his employment by the Company and relate in any way to the business or contemplated business,
products, activities, research, or development of the Company or result from any work performed by the Executive for the Company
(in each case, regardless of when or where prepared or whose equipment or other resources is used in preparing the same), all rights
and claims related to the foregoing, and all printed, physical and electronic copies, and other tangible embodiments thereof (collectively,
“Work Product”), as well as any and all rights in and to US and foreign (a) patents, patent disclosures and
inventions (whether patentable or not), (b) trademarks, service marks, trade dress, trade names, logos, corporate names, and domain
names, and other similar designations of source or origin, together with the goodwill symbolized by any of the foregoing, (c) copyrights
and copyrightable works (including computer programs), and rights in data and databases, (d) trade secrets, know-how, and other
confidential information, and (e) all other intellectual property rights, in each case whether registered or unregistered and including
all registrations and applications for, and renewals and extensions of, such rights, all improvements thereto and all similar or
equivalent rights or forms of protection in any part of the world (collectively, “Intellectual Property Rights”),
shall be the sole and exclusive property of the Company.

 

For purposes of this Agreement, Work Product includes, but is
not limited to, Company information, including plans, publications, research, strategies, techniques, agreements, documents, contracts,
terms of agreements, negotiations, know-how, work in process, databases, manuals, results, developments, reports, graphics, market
studies, formulae, notes, communications, algorithms, product plans, product designs, models, inventions, unpublished patent applications,
original works of authorship, discoveries, experimental processes, experimental results, specifications, manufacturing information,
marketing information, advertising information, and sales information.

 

7.2 Work Made for Hire; Assignment. The Executive acknowledges
that, by reason of being employed by the Company at the relevant times, to the extent permitted by law, all of the Work Product
consisting of copyrightable subject matter is "work made for hire" as defined in 17 U.S.C. § 101 and such copyrights
are therefore owned by the Company. To the extent that the foregoing does not apply, the Executive hereby irrevocably assigns to
the Company, for no additional consideration, the Executive's entire right, title, and interest in and to all Work Product and
Intellectual Property Rights therein, including the right to sue, counterclaim, and recover for all past, present, and future infringement,
misappropriation, or dilution thereof, and all rights corresponding thereto throughout the world. Nothing contained in this Agreement
shall be construed to reduce or limit the Company's rights, title, or interest in any Work Product or Intellectual Property Rights
so as to be less in any respect than that the Company would have had in the absence of this Agreement.

 

 

 

    	 	11	 

     

    

 

7.3 Further Assurances; Power of Attorney. During and
after his employment, the Executive agrees to reasonably cooperate with the Company to (a) apply for, obtain, perfect, and transfer
to the Company the Work Product as well as any and all Intellectual Property Rights in the Work Product in any jurisdiction in
the world; and (b) maintain, protect and enforce the same, including, without limitation, giving testimony and executing and delivering
to the Company any and all applications, oaths, declarations, affidavits, waivers, assignments, and other documents and instruments
as shall be requested by the Company. The Executive hereby irrevocably grants the Company power of attorney to execute and deliver
any such documents on the Executive's behalf in his name and to do all other lawfully permitted acts to transfer the Work Product
to the Company and further the transfer, prosecution, issuance, and maintenance of all Intellectual Property Rights therein, to
the full extent permitted by law, if the Executive does not promptly cooperate with the Company's request (without limiting the
rights the Company shall have in such circumstances by operation of law). The power of attorney is coupled with an interest and
shall not be affected by the Executive's subsequent incapacity.

 

7.4 No License. The Executive understands that this Agreement
does not, and shall not be construed to, grant the Executive any license or right of any nature with respect to any Work Product
or Intellectual Property Rights or any Confidential Information, materials, software, or other tools made available to him by the
Company.

 

8. Security.

 

8.1 Security and Access. The Executive agrees and covenants
to comply with all Company security policies and procedures as in force from time to time.

 

8.2 Exit Obligations. Upon (a) voluntary or involuntary
termination of the Executive's employment or (b) the Company's request at any time during the Executive's employment, the Executive
shall (i) provide or return to the Company any and all Company property, and all Company documents and materials belonging to the
Company and stored in any fashion, including but not limited to those that constitute or contain any Confidential Information or
Work Product, that are in the possession or control of the Executive, whether they were provided to the Executive by the Company
or any of its business associates or created by the Executive in connection with his employment by the Company; and (ii) delete
or destroy all copies of any such documents and materials not returned to the Company that remain in the Executive's possession
or control, including those stored on any non-Company devices, networks, storage locations, and media in the Executive's possession
or control.

 

 

 

    	 	12	 

     

    

 

9. Governing Law: Jurisdiction and Venue. This Agreement,
for all purposes, shall be construed in accordance with the laws of California without regard to conflicts of law principles. Any
action or proceeding by either of the parties to enforce this Agreement shall be brought only in a state or federal court located
in the State of California, county of Los Angeles. The parties hereby irrevocably submit to the exclusive jurisdiction of such
courts and waive the defense of inconvenient forum to the maintenance of any such action or proceeding in such venue.

 

10. Entire Agreement. Unless specifically provided herein,
this Agreement contains all of the understandings and representations between the Executive and the Company pertaining to the subject
matter hereof and supersedes all prior and contemporaneous understandings, agreements, representations and warranties, both written
and oral, with respect to such subject matter. The parties mutually agree that the Agreement can be specifically enforced in court
and can be cited as evidence in legal proceedings alleging breach of the Agreement.

 

11. Modification and Waiver. No provision of this Agreement
may be amended or modified unless such amendment or modification is agreed to in writing and signed by the Executive and the Company.
No waiver by either of the parties of any breach by the other party hereto of any condition or provision of this Agreement to be
performed by the other party hereto shall be deemed a waiver of any similar or dissimilar provision or condition at the same or
any prior or subsequent time, nor shall the failure of or delay by either of the parties in exercising any right, power, or privilege
hereunder operate as a waiver thereof to preclude any other or further exercise thereof or the exercise of any other such right,
power, or privilege.

 

12. Severability. Should any provision of this Agreement
be held by a court of competent jurisdiction to be enforceable only if modified, or if any portion of this Agreement shall be held
as unenforceable and thus stricken, such holding shall not affect the validity of the remainder of this Agreement, the balance
of which shall continue to be binding upon the parties with any such modification to become a part hereof and treated as though
originally set forth in this Agreement.

 

The parties further agree that any such court is expressly authorized
to modify any such unenforceable provision of this Agreement in lieu of severing such unenforceable provision from this Agreement
in its entirety, whether by rewriting the offending provision, deleting any or all of the offending provision, adding additional
language to this Agreement, or by making such other modifications as it deems warranted to carry out the intent and agreement of
the parties as embodied herein to the maximum extent permitted by law.

 

The parties expressly agree that this Agreement as so modified
by the court shall be binding upon and enforceable against each of them. In any event, should one or more of the provisions of
this Agreement be held to be invalid, illegal, or unenforceable in any respect, such invalidity, illegality, or unenforceability
shall not affect any other provisions hereof, and if such provision or provisions are not modified as provided above, this Agreement
shall be construed as if such invalid, illegal, or unenforceable provisions had not been set forth herein.

 

13. Captions. Captions and headings of the sections and
paragraphs of this Agreement are intended solely for convenience and no provision of this Agreement is to be construed by reference
to the caption or heading of any section or paragraph.

 

 

 

 

 

    	 	13	 

     

    

 

14. Counterparts. This Agreement may be executed in separate
counterparts, each of which shall be deemed an original, but all of which taken together shall constitute one and the same instrument.

 

15. Section 409A.

 

15.1 General Compliance.
This Agreement is intended to comply with Section 409A or an exemption thereunder and shall be construed and administered in accordance
with Section 409A. Notwithstanding any other provision of this Agreement, payments provided under this Agreement may only be made
upon an event and in a manner that complies with Section 409A or an applicable exemption. Any payments under this Agreement that
may be excluded from Section 409A either as separation pay due to an involuntary separation from service or as a short-term deferral
shall be excluded from Section 409A to the maximum extent possible. For purposes of Section 409A, each installment payment provided
under this Agreement shall be treated as a separate payment. Any payments to be made under this Agreement upon a termination of
employment shall only be made upon a "separation from service" under Section 409A. Notwithstanding the foregoing, the
Company makes no representations that the payments and benefits provided under this Agreement comply with Section 409A, and in
no event shall the Company be liable for all or any portion of any taxes, penalties, interest, or other expenses that may be incurred
by the Executive on account of non-compliance with Section 409A.

 

15.2 Specified Employees.
Notwithstanding any other provision of this Agreement, if any payment or benefit provided to the Executive in connection with
his termination of employment is determined to constitute “nonqualified deferred compensation” within the meaning of
Section 409A and the Executive is determined to be a "specified employee" as defined in Section 409A(a)(2)(b)(i), then
such payment or benefit shall not be paid until the first payroll date to occur following the six-month anniversary of the Termination
Date or, if earlier, on the Executive's death (the “Specified Employee Payment Date”). The aggregate of any
payments that would otherwise have been paid before the Specified Employee Payment shall be paid to the Executive in a lump sum
on the Specified Employee Payment Date and thereafter, any remaining payments shall be paid without delay in accordance with their
original schedule.

 

15.3 Reimbursements. To
the extent required by Section 409A, each reimbursement or in-kind benefit provided under this Agreement shall be provided in
accordance with the following:

 

(a) the amount of expenses eligible
for reimbursement, or in-kind benefits provided, during each calendar year cannot affect the expenses eligible for reimbursement,
or in-kind benefits to be provided, in any other calendar year,

 

(b) any reimbursement of an eligible
expense shall be paid to the Executive on or before the last day of the calendar year following the calendar year in which the
expense was incurred; and

 

 

 

 

    	 	14	 

     

    

 

(c) any right to reimbursements or in-kind benefits under this Agreement shall not be subject to liquidation
or exchange for another benefit.

 

15.4 Tax Gross-ups. Any tax gross-up payments provided
under this Agreement shall be paid to the Executive on or before December 31 of the calendar year immediately following the calendar
year in which the Executive remits the related taxes.

 

16. Successors and Assigns. This Agreement is personal
to the Executive and shall not be assigned by the Executive. Any purported assignment by the Executive shall be null and void from
the initial date of the purported assignment. The Company may assign this Agreement to any successor or assign (whether direct
or indirect, by purchase, merger, consolidation, or otherwise) to all or substantially all of the business or assets of the Company.
This Agreement shall inure to the benefit of the Company and permitted successors and assigns.

 

17. Notice. Notices and all other communications provided
for in this Agreement shall be in writing and shall be delivered personally or sent by registered or certified mail, return receipt
requested, or by overnight carrier to the parties at the addresses set forth below (or such other addresses as specified by the
parties by like notice):

 

If to the Company:

Rightscorp, Inc.

3100 Donald Douglas Loop North

Santa Monica, CA 90405

 

If to the Executive:

 

Christopher Sabec

P.O. Box 100

Forest Knolls, CA 94933

 

18. Withholding. The Company shall have the right to
withhold from any amount payable hereunder any Federal, state, and local taxes in order for the Company to satisfy any withholding
tax obligation it may have under any applicable law or regulation.

 

19. Survival. Upon the expiration or other termination
of this Agreement, the respective rights and obligations of the parties hereto shall survive such expiration or other termination
to the extent necessary to carry out the intentions of the parties under this Agreement.

 

 

 

[SIGNATURE PAGE FOLLOWS]

 

 

 

 

 

 

 

 

    	 	15	 

     

    

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the date first above written.

 

RIGHTSCORP, INC.

 

By: /s/ Cecil Bond Kyte                      

Name: Cecil Bond Kyte

Title: CEO

 

EXECUTIVE

Signature: /s/ Christopher Sabec               

Print Name: Christopher Sabec

 

 

 

 

 

 

 

 

 

 

    	 	16

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00274-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00274-of-00352.parquet"}]]