Document:

Borrowing Base Rider between EPAM and PNC

 Exhibit 10.3 

 

			
	 Borrowing Base Rider
	  	

 THIS BORROWING BASE RIDER (“Rider”) is executed
as of the 22nd day of November, 2006, by and between EPAM SYSTEMS, INC. (the “Borrower”) with an address at 989 Lenox Drive, Suite 305, Lawrenceville, New Jersey 08648, and PNC BANK, NATIONAL ASSOCIATION (the
“Bank”), with an address at Two Tower Center Boulevard, East Brunswick, New Jersey 08816. This Rider is incorporated into and made part of that certain Letter Agreement and promissory note of even date, and also into certain other
financing documents and security agreements executed by and between the Borrower and the Bank (all such documents including this Rider are collectively referred to as the “Loan Documents”). All initially capitalized terms not
otherwise defined in this Rider shall have the same meanings assigned to such terms in the other Loan Documents. 
 Pursuant to the Loan Documents, the Bank has extended a “Facility” or “Loans” (as defined in the Loan Documents) to the Borrower, under which the Borrower may borrow, repay and
reborrow funds at any time prior to the Expiration Date (such Facility or Loans being referred to herein as the “Facility”). As a condition to the Bank’s willingness to extend the Facility to the Borrower, the Bank and the
Borrower are entering into this Rider in order to set forth their agreement regarding the maximum amount which may be outstanding under the Facility at any time, and for the other purposes set forth below. 

NOW, THEREFORE, with the foregoing background deemed incorporated by reference and made a part hereof, the parties
hereto, intending to be legally bound, covenant and agree as follows: 
 1. Limitations on Borrowings
Under Facility. Notwithstanding any provision to the contrary in any of the other Loan Documents, at no time shall the aggregate principal amount of indebtedness outstanding at any one time under the Facility exceed the Borrowing Base (as
hereinafter defined) at such time. If at any time the aggregate principal amount of indebtedness outstanding under the Facility exceeds the limitations set forth in this Section 1 for any reason, then, upon request by the Bank, the Borrower
shall immediately repay the amount of such excess to the Bank in immediately available funds. 

2. Borrowing Base Certificates. In addition to any and all provisions of the
other Loan Documents which establish conditions to the Borrower’s ability to request and obtain any advance under the Facility, the Borrower may not request an advance under the Facility unless a Borrowing Base Certificate (as hereinafter
defined) shall have been delivered to the Bank on or before the 15th day of each calendar month. 

3. Certain Defined Terms. In addition to the words and terms defined elsewhere in this Rider or in the
other Loan Documents, the following words and terms, as used in this Rider, shall have the following meanings: 

“Account” shall mean an “account” or a “general intangible” of the Borrower as
defined in the Uniform Commercial Code as in effect in the jurisdiction whose Law governs the perfection of the Bank’s security interest therein, whether now owned or hereafter acquired or arising. 

“Account Debtor” shall mean, with respect to any Account, each Person who is obligated to make payments
to the Borrower on such Account. 
 “Affiliate” of the Borrower or any Account Debtor shall
mean (a) any Person who (either alone or with a group of Persons, and either directly or indirectly through one or more intermediaries) is in control of, is controlled by or is under common control with the Borrower or such Account Debtor,
(b) any director, officer, partner, employee or agent of the Borrower or such Account Debtor, and (c) any member of the immediate family of any natural person described in the preceding clauses (a) and (b). A Person or group of
Persons shall be deemed to be in control of the Borrower or an Account Debtor when such Person or group of Persons possesses, 

 
directly or indirectly, the power to direct or cause the direction of the management or policies of the Borrower or such Account Debtor, whether through the ownership of voting securities, by
contract or otherwise. 
 “Borrowing Base” at any time shall mean the lesser of
(a) $7,000,000.00 (the maximum principal amount of the Facility) and (b) 85% of Qualified Accounts at such time. The value of Qualified Accounts at any time shall be determined by reference to the most recent Borrowing Base Certificate
delivered by the Borrower to the Bank. 
 “Borrowing Base Certificate” shall mean each
Borrowing Base Certificate to be delivered by the Borrower to the Bank pursuant to Section 2 of this Rider, in substantially the form attached as Exhibit A to this Rider, executed by the Borrower and with blanks appropriately completed, as
amended, supplemented or otherwise modified from time to time. 
 “Eligible Location” shall
mean one of the addresses in the United States of America at which the Borrower maintains, keeps or stores Inventory, as listed in the Security Agreement executed and delivered by the Borrower and the Bank in connection with the Facility, and, if
such location is leased by the Borrower, for which the Bank has received a landlord’s waiver acceptable to the Bank. The Borrower and the Bank may agree jointly to add other addresses of the Borrower to such list at any time by executing and
delivering a substitute list of addresses under said Security Agreement. The Bank may in its discretion at any time determine that any address on such list shall no longer be an Eligible Location, by giving written notice of such determination to
the Borrower. 
 “Law” shall mean any law (including common law), constitution, statute,
treaty, regulation, rule, ordinance, order, injunction, writ, decree or award of any Official Body. 

“Lien” shall mean any mortgage, pledge, security interest, bailment, encumbrance, claim, lien or charge
of any kind, including any agreement to give any of the foregoing, any conditional sale or other title retention agreement and any lease in the nature thereof, and the filing of or agreement to give any financing statement under the Uniform
Commercial Code. 
 “Official Body” shall mean any government or political subdivision or any
agency, authority, bureau, central bank, commission, department or instrumentality of any government or political subdivision, or any court, tribunal, grand jury or arbitrator, in each case whether foreign or domestic. 

“Person” shall mean an individual, sole proprietorship, corporation, partnership (general or limited),
trust, business trust, limited liability company, unincorporated organization or association, joint venture, joint-stock company, Official Body, or any other entity of whatever nature. 

“Qualified Accounts” shall mean Accounts which are and at all times continue to be acceptable to the
Bank in its sole discretion. Standards of acceptability include but are not limited to the following conditions: 
 (a) The Account duly complies with all applicable Laws, whether Federal, state or local, including but not limited to usury Laws, the Federal Truth in Lending Act, the Federal Consumer Credit Protection
Act, the Fair Credit Billing Act, and Regulation Z of the Board of Governors of the Federal Reserve System; 

(b) The Account was not originated in, and is not subject to the Laws of, a jurisdiction whose Laws would make the
account or the grant of the security interest in the Account to the Bank unlawful, invalid or unenforceable; 

(c) The Account was originated by the Borrower in connection with the sale of goods or the rendering of services by the
Borrower in the ordinary course of business under an enforceable contract, and such sale has been consummated and such goods have been delivered or such services have been rendered so that the performance of such contract has been completed by the
Borrower and by all parties other than the Account Debtor; 

  
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 (d) The Account is evidenced by a written invoice or other documentation and
arises from a contract, all of which are in form and substance satisfactory to the Bank; 
 (e) The Account does
not arise out of a contract with, or order from, an Account Debtor that, by its terms, forbids or makes void or unenforceable the grant of the security interest by the Borrower to the Bank in and to the Account arising with respect thereto;

 (f) The title of the Borrower to the Account and, except as to the Account Debtor, to any related goods is
absolute and is not subject to any Lien except Liens in favor of the Bank; 
 (g) The Account provides for
payment in United States Dollars by the Account Debtor; 
 (h) The Account shall have amounts owing that are not
less than the amounts represented by the Borrower; 
 (i) The portion of the Account for which income has not
yet been earned or which constitutes unearned discount, service charges or deferred interest shall be ineligible; 
 (j) The Account shall be eligible only to the extent that it is not subject to any defense, claim of reduction, counterclaim, set-off, recoupment, or any dispute or claim for credits, allowances or
adjustments by the Account Debtor because of returned, inferior, damaged goods or unsatisfactory services, or for any other reason; 
 (k) The goods the sale of which gave rise to the Account were shipped or delivered or provided to the Account Debtor on an absolute sale basis and not on a bill and hold sale basis, a consignment sale
basis, a guaranteed sale basis, a sale or return basis, or on the basis of any other similar terms making the Account Debtor’s payment obligations conditional; 

(l) The Account Debtor has not returned, rejected or refused to retain, or otherwise notified the Borrower of any dispute
concerning, or claimed nonconformity of, any of the goods from the sale of which the Account arose; 
 (m) No
material default exists under the Account by any party thereto, and all rights and remedies of the Borrower under the Account are freely assignable by the Borrower; 

(n) The Account has not been outstanding for more than ninety (90) days past the invoice date and is not subject to
“dating” terms; 
 (o) The Account shall be ineligible if 50% or more of the accounts of the related
Account Debtor and its Affiliates are more than ninety (90) days past due from the date of original invoice therefor; 
 (p) Other than the Accounts owed by the entities enumerated below, the Account shall be ineligible to the extent that the aggregate amount of all the Accounts of the Account Debtor and its Affiliates
exceed 25% of all of the Borrower’s Accounts , provided however, with respect to Accounts owed by SAP Labs LLC (SAP AG), Reuters America, LLC, Hyperion Solutions Corp., Knova Software, Inc., and I-Many, Inc., the same owed by such Accounts and
their Affiliates shall not each (on a individualized basis) exceed 40% of all of the Borrower’s Accounts; 

(q) The Borrower has not received any note, trade acceptance, draft, chattel paper or other instrument with respect to,
or in payment of, the Account, unless, if any such instrument has been received, the Borrower immediately notifies the Bank and, at the Bank’s request, endorses or assigns and delivers such instrument to the Bank; 

  
 - 3 -

 (r) The Borrower has not received any notice of (i) the death of the
Account Debtor, if an individual, or of a partner or member thereof if a partnership or a limited liability company, (ii) the filing by or against the Account Debtor of any proceeding in bankruptcy, receivership, insolvency, reorganization,
liquidation, conservatorship or any similar proceeding, or (iii) any assignment by the Account Debtor for the benefit of creditors. Upon receipt by the Borrower of any such notice, it will give the Bank prompt written notice thereof;

 (s) The Account Debtor is not an Affiliate of the Borrower; 

(t) The Account shall be ineligible if the underlying Account Debtor is domiciled in any country other than the United
States of America or the Province of Ontario, Canada, or a Province of Canada which has adopted and has in effect the Personal Property Security Act, and, subject to all actions having been taken which in the reasonable discretion of the Bank have
satisfactorily perfected the Bank’s security interest in Accounts which constitute German Receivables (as defined in the Letter Agreement entered into contemporaneously herewith), Accounts which are deemed perfected German Receivables, in each
ase, unless such Account is supported by a documentary letter of credit, duly assigned to and in the possession of the Bank, from a financial institution acceptable to the Bank and the terms and conditions of which are acceptable to the Bank;

 (u) The Account shall be ineligible if the Account Debtor is an Official Body, unless the Borrower shall have
taken all actions deemed necessary by the Bank in order to perfect the Bank’s security interest therein, including but not limited to any notices or filings required under the Assignment of Claims Act of 1940, as amended, or other applicable
Laws; 
 (v) The Bank has not deemed such Account ineligible because of uncertainty about the creditworthiness
of the Account Debtor (including, without limitation, unsatisfactory past experiences of the Borrower or the Bank with the Account Debtor or unsatisfactory reputation of the Account Debtor) or because the Bank otherwise makes a determination that
the collateral value of the Account to the Bank is impaired or that the Bank’s ability to realize such value is insecure; 
 (w) The Account shall be eligible only to the extent that the amount owing on the Account is not a Payment Intangible; and 

(x) The Account shall comply with the additional eligibility standards, if any, which are set forth on Exhibit B to this
Rider. 
 Standards of acceptability shall be fixed and may be revised from time to time solely by the Bank in its exclusive
judgment. In the case of any dispute about whether an Account is or has ceased to be a Qualified Account, the decision of the Bank shall be final. 
 “Payment Intangible” shall mean a “payment intangible” as defined in the Uniform Commercial Code as in effect in the jurisdiction whose Law governs the perfection of the
Bank’s security interest in the Accounts. 
 4. Governing Law. This Rider will be interpreted
and the rights and liabilities of the parties hereto determined in accordance with the laws of the State where the Bank’s office indicated above is located, excluding its conflicts of laws rules. 

5. Counterparts. This Rider may be signed in any number of counterpart copies and by the parties hereto on
separate counterparts, but all such copies shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page to this Agreement by facsimile transmission shall be effective as delivery of a manually executed
counterpart. Any party so executing this Agreement by facsimile transmission shall promptly deliver a manually executed counterpart, provided that any failure to do so shall not affect the validity of the counterpart executed by facsimile
transmission. 

  
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 WITNESS the due execution hereof as a document under seal, as of the date first
written above. 
  

									
	 WITNESS / ATTEST:
	 		 	 EPAM Systems, Inc.

					
	 	 	 /s/ Anthony J. Conte
	 		 	 By:
	 	 /s/ Ilya Cantor

		 		 		 		 	(SEAL)

									
					
	 Print Name:
	 	 Anthony J. Conte
	 		 	 Print Name:
	 	 Ilya Cantor

									
					
	 Title:
	 	 	 		 	 Title:
	 	 CFO

	 (Include title only if an officer of entity signing to the right)
	 		 		 	
			
		 		 	 PNC BANK, NATIONAL ASSOCIATION

				
		 		 	 By:
	 	 /s/ Virginia G. Alling

		 		 		 	(SEAL)
		 		 		 	Virginia G. Alling
				
		 		 		 	Vice President

  
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 EXHIBIT A 
 TO BORROWING BASE RIDER 
  

			
	 Borrowing Base Certificate
	  	

 THIS BORROWING BASE CERTIFICATE, dated as of
                                    
                ,             , is executed and delivered by the undersigned borrower (the
“Borrower”) in favor of PNC BANK, NATIONAL ASSOCIATION (the “Bank”), pursuant to a letter agreement or loan agreement of even date (including any Borrowing Base Rider executed pursuant thereto and made a part
thereof, and as amended or otherwise modified from time to time, the “Agreement”). All initially capitalized terms used in this Certificate shall have the meanings assigned to them in the Agreement. To induce the Bank to make loans
and other financial accommodations available to the Borrower under the Agreement, the Borrower hereby certifies, represents and warrants to the Bank, as of the date hereof, that (a) the person signing below is an authorized officer or
representative of the Borrower; (b) the statements below concerning the collateral securing the Obligations are true and complete; (c) the eligible collateral described below represents only Qualified Accounts and Qualified Inventory;
(d) the Borrower is in compliance with all of the terms and provisions of the Agreement and the other Loan Documents; (e) all of the Borrower’s representations and warranties in the Agreement and the other Loan Documents are true and
correct; and (f) no Event of Default has occurred and is continuing or exists. 
 1. Collateral Availability

 

							
	 A. Accounts Receivable

 
	  			
	 1.
	  	 Beginning A/R Balance
	  	$	_____________	  
	 2.
	  	 Changes to A/R Balance
	  	$	_____________	  
	 3.
	  	 Total A/R
	  	$	_____________	  
	 4.
	  	 Ineligible A/R
	  	$	_____________	  
	 5.
	  	 Qualified A/R (L3 - L4)
	  	$	_____________	  
	 6.
	  	 Advance Percentage
	  	 	85	% 
	 7.
	  	 A/R Borrowing Availability
(L5 X L6)
	  	$	_____________	  
		
	 B. Inventory NOT APPLICABLE
	  			
			
	 8.
	  	 Beginning Inventory Balance
	  	$	_____________	  
	 9.
	  	 Changes to Inventory Balance
	  	$	_____________	  
	 10.
	  	 Total Inventory
	  	$	_____________	  
	 11.
	  	 Ineligible Inventory
	  	$	_____________	  
	 12.
	  	 Qualified Inventory (L10 - L11)
	  	$	_____________	  
	 13.
	  	 Advance Percentage or Cap
	  	 	___% / $______	  
	 14.
	  	 Inv. Borrowing Availability
(lesser of L12 X L13 or cap)
	  	$	_____________	  

							
	 C. Other Assets
  
	  			
	15.	  	 Other Collateral Value
	  	$	________________	  
	16.	  	 Advance Percentage or Cap
	  	 	___% / $_________	  
	17.	  	 Other Borrowing Availability
(L15 X L16)
	  	 	$________________	  
	18.	  	 Total Availability
(Sum of L7, L14 & L17)
	  	$	________________	  
	  
 2. Borrowing
Availability
  
	  			
	19.	  	 Maximum Line Amount
	  	$	7,000,000.00	  
	20.	  	 Total Availability (L18)
	  	$	________________	  
	21.	  	 Maximum Borrowing Capacity
(lesser of L18 and L20)
	  	$	________________	  
	22.	  	 Outstanding Principal Balance
	  	$	________________	  
	23.	  	 L/C’s, other items to be covered
	  	$	________________	  
	24.	  	 Available to Borrow
L21 - L22 - L23
	  	$	________________	  
	25.	  	 Advance Request
	  	$	________________	  
	26.	  	 New Line Balance
	  	$	________________	  
	27.	  	 Collateral Coverage
	  	$	________________	  

 

  

							
	 Dated: ___________________________
	 		 	 EPAM Systems, Inc.

				
	 Certificate No.: ____________________
	 		 	 By:
	 	 
		 		 	 Print Name:
	 	 
		 		 	 Title:
	 	 

 EXHIBIT B 
 TO BORROWING BASE RIDER 
 The following shall constitute additional
eligibility standards for Accounts, as fully as if set forth in the definition of “Qualified Accounts” in the Rider to which this Exhibit B is attached: 

N/A 
 The following shall constitute additional eligibility standards for Inventory, as fully as if set forth in the definition of “Qualified Inventory” in the Rider to which this Exhibit B is
attached: 
 N/AFirst Amendment to loan documents between EPAM and PNC

 Exhibit 10.4 

 

			
	 First Amendment to Loan Documents
	  	

 THIS FIRST AMENDMENT TO LOAN DOCUMENTS (this
“Amendment”) is made as of September 30, 2010, by and between EPAM SYSTEMS, INC. (the “Borrower”), and PNC BANK, NATIONAL ASSOCIATION (the “Bank”). 

BACKGROUND 
 A. The Borrower has executed and delivered to the Bank (or a predecessor which is now known by the Bank’s name as set forth above), one or more promissory notes, letter agreements, loan agreements,
security agreements, mortgages, pledge agreements, collateral assignments, and other agreements, instruments, certificates and documents, some or all of which are more fully described on attached Exhibit A, which is made a part of this Amendment
(collectively as amended from time to time, the “Loan Documents”) which evidence or secure some or all of the Borrower’s obligations to the Bank for one or more loans or other extensions of credit (the
“Obligations”). 
 B. The Borrower and the Bank desire to amend the Loan Documents as provided
for in this Amendment. 
 NOW, THEREFORE, in consideration of the mutual covenants herein contained and
intending to be legally bound hereby, the parties hereto agree as follows: 
 1. Certain of the Loan Documents
are amended as set forth in Exhibit A. Any and all references to any Loan Document in any other Loan Document shall be deemed to refer to such Loan Document as amended by this Amendment. This Amendment is deemed incorporated into each of the Loan
Documents. Any initially capitalized terms used in this Amendment without definition shall have the meanings assigned to those terms in the Loan Documents. To the extent that any term or provision of this Amendment is or may be inconsistent with any
term or provision in any Loan Document, the terms and provisions of this Amendment shall control. 
 2. The
Borrower hereby certifies that: (a) all of its representations and warranties in the Loan Documents, as amended by this Amendment, are, except as may otherwise be stated in this Amendment: (i) true and correct as of the date of this
Amendment, (ii) ratified and confirmed without condition as if made anew, and (iii) incorporated into this Amendment by reference, (b) no Event of Default or event which, with the passage of time or the giving of notice or both, would
constitute an Event of Default, exists under any Loan Document which will not be cured by the execution and effectiveness of this Amendment, (c) no consent, approval, order or authorization of, or registration or filing with, any third party is
required in connection with the execution, delivery and carrying out of this Amendment or, if required, has been obtained, and (d) this Amendment has been duly authorized, executed and delivered so that it constitutes the legal, valid and
binding obligation of the Borrower, enforceable in accordance with its terms. The Borrower confirms that the Obligations remain outstanding without defense, set off, counterclaim, discount or charge of any kind as of the date of this Amendment.

 3. The Borrower hereby confirms that any collateral for the Obligations, including liens, security interests,
mortgages, and pledges granted by the Borrower or third parties (if applicable), shall continue unimpaired and in full force and effect, and shall cover and secure all of the Borrower’s existing and future Obligations to the Bank, as modified
by this Amendment. 
 4. As a condition precedent to the effectiveness of this Amendment, the Borrower shall
comply with the terms and conditions (if any) specified in Exhibit A. 

 5. This Amendment may be signed in any number of counterpart copies and by
the parties to this Amendment on separate counterparts, but all such copies shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page to this Amendment by facsimile transmission shall be effective as
delivery of a manually executed counterpart. Any party so executing this Amendment by facsimile transmission shall promptly deliver a manually executed counterpart, provided that any failure to do so shall not affect the validity of the counterpart
executed by facsimile transmission. 
 6. This Amendment will be binding upon and inure to the benefit of the
Borrower and the Bank and their respective heirs, executors, administrators, successors and assigns. 
 7. This
Amendment has been delivered to and accepted by the Bank and will be deemed to be made in the State where the Bank’s office indicated in the Loan Documents is located. This Amendment will be interpreted and the rights and liabilities of the
parties hereto determined in accordance with the laws of the State where the Bank’s office indicated in the Loan Documents is located, excluding its conflict of laws rules. 

8. Except as amended hereby, the terms and provisions of the Loan Documents remain unchanged, are and shall remain in
full force and effect unless and until modified or amended in writing in accordance with their terms, and are hereby ratified and confirmed. Except as expressly provided herein, this Amendment shall not constitute an amendment, waiver, consent or
release with respect to any provision of any Loan Document, a waiver of any default or Event of Default under any Loan Document, or a waiver or release of any of the Bank’s rights and remedies (all of which are hereby reserved). The Borrower
expressly ratifies and confirms the waiver of jury trial provisions contained in the Loan Documents. 

WITNESS the due execution of this Amendment as a document under seal as of the date first written above.

  

											
	 WITNESS / ATTEST:
	 		 	 EPAM SYSTEMS, INC.

				
	 /s/ Ginger Mosier
	 		 	 By: 
	 	 /s/ Ilya Cantor

		 		 		 		 		 	(SEAL)
	 Print Name:
	 	 Ginger Mosier
	 		 		 	 Ilya Cantor

	 Title:
	 	 General Counsel
	 		 		 	 Vice President and CFO

					
		 		 		 		 	 PNC BANK, NATIONAL ASSOCIATION

						
		 		 		 		 	 By: 
	 	 /s/ Mary P. Stine

		 		 		 		 		 	(SEAL)
		 		 		 		 		 	 Mary P. Stine

		 		 		 		 		 	 Vice President

  
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 EXHIBIT A TO 
 FIRST AMENDMENT TO LOAN DOCUMENTS 
 DATED AS OF SEPTEMBER 30, 2010

 (EPAM SYSTEMS, INC.) 
  

	 A.
	 The “Loan Documents” that are the subject of this Amendment include the following (as any of the foregoing have previously been amended,
modified or otherwise supplemented): 

  

	 	 1.
	 Letter Agreement dated November 22, 2006 between the Borrower and the Bank (the “Agreement”) 

 

	 	 2.
	 $7,000,000.00 Committed Line of Credit Note executed and delivered by the Borrower to the Bank (the “Existing Line of Credit Note”)

  

	 	 3.
	 Borrowing Base Rider dated November 22, 2006 between the Borrower and the Bank (the “Rider”) 

 

	 	 4.
	 Security Agreement dated November 22, 2006 between the Borrower and the Bank 

 

	 	 5.
	 Reimbursement Agreements each dated September 30, 2003 executed and delivered by the Borrower to the Bank. 

 

	 	 6.
	 All other documents, instruments, agreements, and certificates executed and delivered in connection with the Loan Documents listed in this Section
A. 

  

	 B.
	 The Loan Documents are amended as follows: 

  

	 	 1.
	 Line of Credit Increase. The maximum amount of the Line of Credit in the Agreement is hereby increased from $7,000,000.00 to
$15,000,000.00. The “Re:” line and Section 1 are each hereby amended by deleting the reference therein to “$7,000,000.00” and replacing it with “$15,000,000.00”. 

 

	 	 2.
	 Restated Note. Concurrently with the execution and delivery of this Amendment, the Borrower shall execute and deliver to the Bank a
restated note (the “Restated Note”) evidencing the Line of Credit in the principal amount of $15,000,000.00, in form and substance satisfactory to the Bank. Upon receipt by the Bank of the Restated Note, the Existing Line of Credit
Note shall be canceled; the Line of Credit and all accrued and unpaid interest on the Existing Line of Credit Note shall thereafter be evidenced by the Restated Note; and all references to the “Note” evidencing the Line of Credit in any
documents relating thereto shall thereafter be deemed to refer to the Restated Note. Without duplication, the Restated Note shall not constitute a novation and shall in no way extinguish the Borrower’s unconditional obligation to repay all
indebtedness, including accrued and unpaid interest, evidenced by the Existing Line of Credit Note. 

  

	 	 3.
	 Modification to the Rider. The definition of “Borrowing Base” set forth in section 3 of the Rider is deemed amended to
delete the figure “$7,000,000.00”, which appears as the maximum amount of the Facility, and substitute therefor the figure “$15,000,000.00”, all other limitations contained in said definition remaining in effect unchanged:

  
 A-1

	 	 4.
	 Section 1 of the Financial Reporting Covenants set forth on Exhibit A to the Agreement is hereby amended by adding new subsections (e) and
(f) thereto to read as follows: 

 “(e) The Borrower will deliver to the Bank within
20 days following the close of each month, the Borrower’s detailed schedule of accounts receivable aging analysis including address and phone number for each customer.” 

“(f) Prior to the Expiration Date, and annually thereafter if the Expiration Date is extended, the Borrower must
permit the representatives of Bank to make at any time during normal business hours inspections of the Collateral and of Borrower's facilities, activities, and books and records, and shall cause its officers and employees to give full cooperation
and assistance in connection therewith. If an Event of Default has occurred and is continuing, Borrower shall be responsible for the cost of such field exams made annually; provided that immaterial, technical or informational Events of Default
will not trigger payment responsibility.” 
  

	 C.
	 Conditions to Effectiveness of Amendment: The Bank’s willingness to agree to the amendments set forth in this Amendment is subject to the prior
satisfaction of the following conditions: 

  

	 	 1.
	 Execution by all parties and delivery to the Bank of this Amendment and the Restated Note. 

 

	 	 2.
	 Reimbursement of the fees and expenses of the Bank’s in-house counsel in connection with this Amendment, which fees and expenses as of the date
of this Amendment are $500.00. 

  
 A-2

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