Document:

Exhibit
10.25

 

AMENDMENT
NUMBER 2 TO 

LOAN AND SECURITY AGREEMENT

 

 

This
Amendment Number 2 to Loan and Security Agreement dated as of September 24, 2019, among U.S. BANK NATIONAL ASSOCIATION (“Bank”)
and SHIFT TECHNOLOGIES, INC., a Delaware corporation (“STI”) and SHIFT OPERATIONS LLC, a
Delaware limited liability company (“SOL”), as co-obligors and co-borrowers and not as accommodation parties
(unless otherwise specified herein, STI and SOL are each individually a “Borrower” and collectively the “Borrowers”)
(this “Amendment”) amends the Loan and Security Agreement among Borrowers and Bank dated as of October
11, 2018, which has been amended by an amendment dated February 14, 2019 (collectively, the “Loan Agreement”).

 

In
consideration of the mutual covenants set forth herein and for other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, Borrowers and Bank hereby agree as follows:

 

		1.	Definitions.

 

(a) Capitalized
terms not otherwise defined in this Amendment shall have the meanings given such terms in the Loan Agreement.

 

(b) The
following term defined in Article 1 of the Loan Agreement is deleted and replaced with the following defined term:

 

“Expiration
Date” means December 31, 2019, or such earlier date as may be applicable due to acceleration of Obligations in accordance
with the terms of this Agreement.

 

		2.	Amendments.

 

		(a)	The
definitions of “LIBOR Rate” “New York Banking Day” and “Reprice Date” set forth in Section 2.8(a)
(Interest Rate and Payment Schedule) of the Loan Agreement are deleted and replaced with the following:

 

“LIBOR
Rate” means the greater of (a) zero percent (0.0%) and (b) the one-month LIBOR rate quoted by Bank from Reuters
Screen LIBOR0l Page or any successor thereto which may be designated by Bank as provided below, which shall be that one-month
LIBOR rate in effect two New York Banking Days prior to the Rate Adjustment Date, adjusted for any reserve requirement and
any subsequent costs arising from a change in government regulation, and such rate to be reset monthly on each Rate
Adjustment Date. The term “New York Banking Day” means any date (other than a Saturday or Sunday) on which
commercial banks are open for business in New York, New York. The term “Rate Adjustment Date” means the
first day of each month. If the initial advance occurs other than on the Rate Adjustment Date, the initial one-month LIBOR
rate shall be that one-month LIBOR rate in effect two New York Banking Days prior to the date of the initial advance, which
rate plus the percentage described above shall be in effect until the next Rate Adjustment Date. If the rate index described
above shall become unavailable or shall cease to exist, Bank may in its discretion, designate a successor to the interest
rate described above (which may include a successor index and a spread adjustment). Bank’s internal records of applicable
interest rates shall be determinative in the absence of manifest error.

 

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(b) Section
5.1l (c) (Warranties and Covenants: Financial Statements and Reporting) of the Loan Agreement is deleted and replaced
with the following:

 

		(c)	[Reserved].

 

		(c)	Section
5.13 (Warranties and Covenants: Financial Covenant) of the Loan Agreement is deleted and replaced with the following:

 

5.13
Financial Covenant. As of the last day of each calendar month during the term of this Agreement commencing with the calendar
month ending July 31, 2019 (each a “Determination Date”), Borrowers’ Liquidity as of such Determination Date
shall equal or exceed three (3) times the Three-Month Cash Burn Amount as of such date.

 

As
used herein:

 

“Liquidity” means,
as of any Determination Date, an amount equal to the sum of (i) cash that would appear on Borrowers’ consolidated balance
sheet as unrestricted on such date plus (ii) the aggregate principal amount of loans that Borrowers could duly borrow
and incur on such date and that, under the terms of the loan agreement for such loans, Borrowers may use for any general
corporate or general working capital purpose (as opposed to loans that, under the terms of the loan agreement for such loans,
Borrowers must use for a specific purpose), including, without limitation, loans under the Lithia Loan Agreement to the
extent the conditions for drawing such loans have been satisfied.

 

“Three-Month
Cash Burn Amount” means, as of any Determination Date, an amount equal to the decrease, if any, in the amount of cash
and cash equivalents held by Borrowers and their Subsidiaries on such day as compared to the amount of cash and cash equivalents
held by Borrowers and their Subsidiaries as of the last day of the month three months prior thereto.

 

		3.	Effectiveness.
The effectiveness of this Amendment is subject to execution by all parties to the Loan Agreement and satisfaction by Borrowers
of such other requirements as Bank may require.

 

		4.	Representations
and Warranties. Each Borrower and by signing below, Guarantor, reaffirms the representations and warranties made by such Borrower
and Guarantor, respectively, in each of the Loan Documents and agrees that (a) each of such representations and warranties are
true and correct as though made on the date hereof, except for changes that are permitted by the terms of such Loan Document;
(b) except as amended hereby or otherwise amended in writing signed by all parties thereto, the Loan Agreement and the other Loan
Documents remain unmodified and in full force and effect in accordance with their terms and (c) neither Borrowers nor any other
Loan Party has any defenses, setoffs, counterclaims or claims against the Bank related to any of the Loan Documents or any of
the indebtedness or obligations related thereto.

 

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		5.	Miscellaneous.

 

(a)
Counterparts. This Amendment may be executed in any number of counterparts all of which taken together shall constitute
one and the same instrument and any of the parties hereto may execute this Amendment by signing any such counterpart.

 

(b) Copies.
The Loan Agreement, together with all amendments thereto from time to time, is a “transferable record” as defined
in applicable law relating to electronic transactions. Therefore, Bank may, on behalf of Borrowers, create a microfilm or optical
disk or other electronic image of the Loan Agreement (and all amendments thereto including, without limitation, this Amendment)
that is an authoritative copy of the Loan Agreement as defined in such law. Bank may store the authoritative copy of the Loan
Agreement in its electronic form and then destroy the paper original as part of Bank’s normal business practices. Bank, on its
own behalf, may control and transfer such authoritative copy as permitted by such law.

 

 (c) References. Any and all references to the Loan Agreement in any instrument or document are hereby amended to refer to the Loan Agreement as amended by this Amendment.

 

 (d) Expenses. Each Borrower agrees to reimburse Bank upon demand for all attorneys’ fees of in-house and outside counsel and all other costs, fees and out-of-pocket expenses incurred by Bank in connection with the preparation, negotiation, execution, and delivery of this Amendment and any other document required to be furnished herewith and in enforcing each Borrower’s obligations hereunder.

 

		6.	Entire
Agreement; Modification. This Amendment constitutes the entire understanding and agreement of the parties as to the matters
set forth herein. No modification or amendment to any of the Loan Documents shall be effective unless in writing signed by the
party or parties sought to be charged or bound by such modification or amendment.

 

UNDER
OREGON LAW, MOST AGREEMENTS, PROMISES AND COMMITMENTS MADE BY US CONCERNING ANY LOANS AND OTHER CREDIT EXTENSIONS WHICH ARE NOT
FOR PERSONAL, FAMILY OR HOUSEHOLD PURPOSES OR SECURED SOLELY BY THE BORROWER’S RESIDENCE MUST BE IN WRITING, EXPRESS CONSIDERATION
AND BE SIGNED BY US TO BE ENFORCEABLE.

 

Signature
page follows.

 

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	SHIFT TECHNOLOGIES, INC.	 	U.S. BANK NATIONAL ASSOCIATION
	 	 	 	 	 
	By:	/s/ Irakly
    George Arison Areshidze	 	By:	/s/ Gilmore
    Hector
	Name: 	Irakly George Arison Areshidze	 	Name:  	Gilmore Hector
	Title: 	Co-Chief Executive Officer	 	Title: 	Vice President

 

	SHIFT
    OPERATIONS LLC	 
	 	 
	By:
    Shift Technologies, Inc., Managing Member	 
	 	 
	By:
    	/s/
    Irakly George Arison Areshidze	 
	Name: 
    	Irakly
    George Arison Areshidze	 
	Title:
    	Co-Chief
    Executive Officer	 

 

ACKNOWLEDGEMENT
AND CONSENT OF GUARANTOR

 

Guarantor
hereby acknowledges, consents, and agrees to all terms and conditions of the foregoing Amendment.

 

	LITHIA
    MOTORS, INC.	 
	 	 	 
	By	/s/
    Chris Holzshu	
	Name: 	Chris Holzshu	 
	Title:	EVP	 

 

 

4 of 4Exhibit
10.26

 

AMENDMENT
NUMBER 3 TO 

LOAN AND SECURITY AGREEMENT

 

 

This
Amendment Number 3 to Loan and Security Agreement dated as of November 29, 2019, among U.S. BANK NATIONAL ASSOCIATION
(“Bank”) and SHIFT TECHNOLOGIES, INC., a Delaware corporation (“STI”) and SHIFT
OPERATIONS LLC, a Delaware limited liability company (“SOL”), as co-obligors and co-borrowers and not as
accommodation parties (unless otherwise specified herein, STI and SOL are each individually a “Borrower” and
collectively the “Borrowers”) (this “Amendment”) amends the Loan and Security Agreement
among Borrowers and Bank dated as of October 11, 2018, which has been amended by amendments dated February 14, 2019 and
September 24, 2019 (collectively, the “Loan Agreement”).

 

In
consideration of the mutual covenants set forth herein and for other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, Borrowers and Bank hereby agree as follows:

 

	1.	Definitions.

 

(a) Capitalized
terms not otherwise defined in this Amendment shall have the meanings given such terms in the Loan Agreement.

 

(b) The
following term defined in Article 1 of the Loan Agreement is deleted and replaced with the following defined term:

 

“Expiration
Date” means September 30, 2020, or such earlier date as may be applicable due to acceleration of Obligations in accordance
with the terms of this Agreement.

 

	2.	Amendments.

 

		(a)	Section
                                         2.3(b) (Flooring Line of Credit: Purpose of Advances) of the Loan Agreement is
                                         deleted and replaced with the following:

 

		(b)	No
Advance to finance Used Vehicles shall exceed an amount equal to: (A) for Used Vehicles purchased via automated auction, 100%
of a Borrower’s actual documented acquisition cost; or (B) for other Used Vehicles, (1) prior to January 1, 2020, 100% of the
wholesale value of such Used Vehicles and (2) on and after January 1, 2020, 80% of the wholesale value of such Used Vehicles,
as determined by Bank with reference to an acceptable Valuation Guide.

 

		(b)	Section
2.9(b) (Principal Payments: Unsold Vehicles) of the Loan Agreement is deleted and replaced with the following:

 

		(b)	Unsold
Vehicles. For Used Vehicles purchased pursuant to Section 2.3(b)(A) on and after January 1, 2020, Borrowers shall pay to Bank
on the first Business Day after the Advance Date for such Used Vehicle, 20% of the amount of the original Related Principal Portion
for such Used Vehicle. Borrowers shall pay to Bank the remaining Related Principal Portion for any Used Vehicle not previously
sold on the first Monthly Payment Date which is at least 6 months after the Advance Date for such Used Vehicle.

 

    
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		(c)	Section
5.13 (Warranties and Covenants: Financial Covenant) of the Loan Agreement is deleted and replaced with the following:

 

5.13
Financial Covenant. As of the last day of each calendar month during the term of this Agreement (each a “Determination
Date”), Borrowers’ Liquidity as of such Determination Date shall equal or exceed (a) three (3) times the Three-Month
Cash Burn Amount for the Determination Dates of November 30, 2019 and December 31, 2019, (b) two (2) times the Three-Month Cash
Burn Amount for the Determination Dates of January 31, 2020, February 29, 2020 and March 31, 2020, (c) one and one-half (1.5)
times the Three-Month Cash Burn Amount for the Determination Dates of April 30, 2020, May 31, 2020 and June 30, 2020 and (d) one
(1) times the Three-Month Cash Burn Amount for the Determination Date of July 31, 2020 and each Determination Date thereafter.

 

As
used herein:

 

“Liquidity” means,
as of any Determination Date, an amount equal to the sum of (i) cash that would appear on Borrowers’ consolidated balance
sheet as unrestricted on such date plus (ii) the aggregate principal amount of loans that Borrowers could duly borrow
and incur on such date and that, under the terms of the loan agreement for such loans, Borrowers may use for any general
corporate or general working capital purpose (as opposed to loans that, under the terms of the loan agreement for such loans,
Borrowers must use for a specific purpose), including, without limitation, loans under the Lithia Loan Agreement to the
extent the conditions for drawing such loans have been satisfied.

 

“Three-Month
Cash Burn Amount” means, as of any Determination Date, an amount equal to the decrease, if any, in the amount of cash
and cash equivalents held by Borrowers and their Subsidiaries on such day as compared to the amount of cash and cash equivalents
held by Borrowers and their Subsidiaries as of the last day of the month three months prior thereto.

 

		3.	Effectiveness.
The effectiveness of this Amendment is subject to execution by all parties to the Loan Agreement and satisfaction by Borrowers
of such other requirements as Bank may require.

 

		4.	Representations
and Warranties. Each Borrower and by signing below, Guarantor, reaffirms the representations and warranties made by such Borrower
and Guarantor, respectively, in each of the Loan Documents and agrees that (a) each of such representations and warranties are
true and correct as though made on the date hereof, except for changes that are permitted by the terms of such Loan Document;
(b) except as amended hereby or otherwise amended in writing signed by all parties thereto, the Loan Agreement and the other Loan
Documents remain unmodified and in full force and effect in accordance with their terms and (c) neither Borrowers nor any other
Loan Party has any defenses, setoffs, counterclaims or claims against the Bank related to any of the Loan Documents or any of
the indebtedness or obligations related thereto.

 

    
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		5.	Miscellaneous.

 

		(a)	Counterparts.
This Amendment may be executed in any number of counterparts all of which taken together shall constitute one and the
same instrument and any of the parties hereto may execute this Amendment by signing any such counterpart.

 

		(b)	Copies.
The Loan Agreement, together with all amendments thereto from time to time, is a “transferable record” as defined
in applicable law relating to electronic transactions. Therefore, Bank may, on behalf of Borrowers, create a microfilm or optical
disk or other electronic image of the Loan Agreement (and all amendments thereto including, without limitation, this Amendment)
that is an authoritative copy of the Loan Agreement as defined in such law. Bank may store the authoritative copy of the Loan
Agreement in its electronic form and then destroy the paper original as part of Bank’s normal business practices. Bank, on its
own behalf, may control and transfer such authoritative copy as permitted by such law.

 

		(c)	References.
Any and all references to the Loan Agreement in any instrument or document are hereby amended to refer to the Loan Agreement
as amended by this Amendment.

 

		(d)	Expenses.
Each Borrower agrees to reimburse Bank upon demand for all attorneys’ fees of in-house and outside counsel and all other
costs, fees and out-of-pocket expenses incurred by Bank in connection with the preparation, negotiation, execution, and delivery
of this Amendment and any other document required to be furnished herewith and in enforcing each Borrower’s obligations hereunder.

 

		6.	Entire
Agreement; Modification. This Amendment constitutes the entire understanding and agreement of the parties as to the matters
set forth herein. No modification or amendment to any of the Loan Documents shall be effective unless in writing signed by the
party or parties sought to be charged or bound by such modification or amendment.

 

UNDER
OREGON LAW, MOST AGREEMENTS, PROMISES AND COMMITMENTS MADE BY US CONCERNING ANY LOANS AND OTHER CREDIT EXTENSIONS WHICH ARE NOT
FOR PERSONAL, FAMILY OR HOUSEHOLD PURPOSES OR SECURED SOLELY BY THE BORROWER’S RESIDENCE MUST BE IN WRITING, EXPRESS CONSIDERATION
AND BE SIGNED BY US TO BE ENFORCEABLE.

 

Signature
page follows.

 

    
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	SHIFT TECHNOLOGIES, INC.	 	U.S. BANK NATIONAL ASSOCIATION
	 	 	 	 	 
	By:	/s/
    Irakly George Arison Areshidze	 	By:	/s/
    Gilmore Hector
	Name:  	Irakly George Arison Areshidze	 	Name:  	Gilmore Hector
	Title:	Co-Chief Executive Officer	 	Title: 	Vice President

 

	SHIFT
    OPERATIONS LLC	 
	 	 
	By:
    Shift Technologies, Inc., Managing Member	 
	 	 
	By:	/s/
    Irakly George Arison Areshidze	
	Name: 
    	Irakly
    George Arison Areshidze	 
	Title:
    	Co-Chief
    Executive Officer	 

 

ACKNOWLEDGEMENT
AND CONSENT OF GUARANTOR

 

Guarantor
hereby acknowledges, consents, and agrees to all terms and conditions of the foregoing Amendment.

 

	LITHIA MOTORS, INC.	 
	 	 	 
	By:	/s/
Bryan De Boer	 
	Name: 	Bryan De Boer	 
	Title:
     	CEO	 

 

 

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