Document:

zyxi-ex102_140.htm

 

Exhibit 10.2

AMENDMENT NO. 2 TO FORBEARANCE AGREEMENT

This Amendment No. 2 to Forbearance Agreement (“Amendment”) dated effective June 30, 2015 is by and between ZYNEX, INC., a Nevada corporation, ZYNEX MEDICAL, INC., a Colorado corporation, ZYNEX NEURODIAGNOSTICS, INC., a Colorado corporation, ZYNEX MONITORING SOLUTIONS, INC., a Colorado corporation, and ZYNEX BILLING AND CONSULTING, LLC, a Colorado limited liability company (collectively, and jointly and severally, “Borrower”), and TRIUMPH COMMUNITY BANK, N.A., dba Triumph Healthcare Finance (“Lender”).   

RECITALS

	
A.
	
The parties entered into a Forbearance Agreement dated December 17, 2014, as amended by Amendment No. 1 to Forbearance Agreement dated March 27, 2015 (the “Forbearance Agreement”).  

	
B.
	
The parties desire to amend the Forbearance Agreement to extend the Forbearance Period.

AGREEMENT

	
1.
	
Amendment.  Section 4.1(i)  of the Forbearance Agreement is amended to read as follows:  “11:59 pm Portland, Oregon time on September 30, 2015.”  

	
2.
	
Other Provisions.  Except as specifically provided herein, all terms and conditions of the Forbearance Agreement shall remain in full force and effect, without waiver or modification.  All terms defined in the Forbearance Agreement shall have the same meaning when used in this Amendment.  This Amendment and the Forbearance Agreement shall be read together, as one document.  

	
3.
	
Signatures.  This Amendment may be executed in any number of counterparts, each of which when executed and delivered shall be deemed to be an original, and all of which when taken together shall constitute one and the same Amendment.

UNDER OREGON LAW, MOST AGREEMENTS, PROMISES AND COMMITMENTS MADE BY A LENDER CONCERNING 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 THE LENDER TO BE ENFORCEABLE.

 

[signature page follows]

 

AMENDMENT NO. 2 TO FORBEARANCE AGREEMENT

 

Dated effective as of the date first written above.

 

						
	
BORROWER:
	
LENDER:

	
 
	
 

	
ZYNEX, INC., a Nevada corporation
	
TRIUMPH COMMUNITY BANK, N.A. dba Triumph Healthcare Finance 

 

	
By:
	
/s/ Thomas Sandgaard
	
 
	
By:
	
/s/ Jonathan Kott
	
 

	
Name:
	
Thomas Sandgaard
	
 
	
Name:
	
Jonathan Kott
	
 

	
Title:
	
CEO
	
 
	
Title:
	
SVP
	
 

	
 
	
 

	
ZYNEX MEDICAL, INC., a Colorado corporation 
	
 

	
 
	
 
	
 

	
By:
	
/s/ Thomas Sandgaard
	
 
	
 

	
Name:
	
Thomas Sandgaard
	
 
	
 

	
Title:
	
CEO
	
 
	
 

	
 
	
 

	
ZYNEX NEURODIAGNOSTICS, INC., a Colorado corporation
	
 

	
 
	
 

	
By:
	
/s/ Thomas Sandgaard
	
 
	
 

	
Name:
	
Thomas Sandgaard
	
 
	
 

	
Title: 
	
CEO
	
 
	
 

	
 
	
 

	
ZYNEX MONITORING SOLUTIONS, INC., a Colorado corporation
	
 

	
 
	
 

	
By:
	
/s/ Thomas Sandgaard
	
 
	
 

	
Name:
	
Thomas Sandgaard
	
 
	
 

	
Title:
	
CEO
	
 
	
 

	
 
	
 

	
ZYNEX BILLING AND CONSULTING, LLC, a Colorado limited liability company
	
 

	
 
	
 

	
By:
	
/s/ Thomas Sandgaard
	
 
	
 

	
Name:
	
Thomas Sandgaard
	
 
	
 

	
Title:
	
CEO
	
 
	
 

 

 

AMENDMENT NO. 2 TO FORBEARANCE AGREEMENT

Signature PageExhibit

Exhibit 10.1

Amendment No. RIB051P

AMENDMENT
TO THE
MASTER LOAN AGREEMENT

THIS  AMENDMENT is entered into as of July 16, 2015, between CoBANK, ACB ("CoBank") and SOUTH DAKOTA SOYBEAN PROCESSORS, LLC, Volga, South Dakota (the "Company").
BACKGROUND
CoBank and the Company are parties to a Master Loan Agreement dated March 19, 2012 (such agreement, as previously amended, is hereinafter referred to as the "MLA"). CoBank and the Company now desire to amend the MLA. For that reason, and for valuable consideration (the receipt and sufficiency of which are hereby acknowledged), CoBank and the Company agree as follows:
1.Section 9, Subsections (A), (B), and (I) of the MLA are hereby amended and restated to read as follows:
SECTION 9.    Negative Covenants.  Unless otherwise agreed to in writing by CoBank, while this agreement is in effect the Company will not:
(A)Borrowings. Create, incur, assume, or allow to exist, directly or indirectly, any indebtedness or liability for borrowed money (including trade or bankers' acceptances), letters of credit, or the deferred purchase price of property or services (including capitalized leases), except for: (1) debt to CoBank; (2) accounts payable to trade creditors incurred in the ordinary course of business; (3) current operating liabilities (other than for borrowed money) incurred in the ordinary course of business; (4) indebtedness of the Company under its member or patron investment program, provided, however, that such indebtedness is expressly stated to be subordinate in right of payment to all obligations of the Company to CoBank; (5) unsecured debt of the Company to State of South Dakota (through Brookings County Regional Railroad Authority) in an amount not to exceed $965,000.00; (6) capitalized leases with Farm Credit Leasing Services Corporation ("FCL"); and (7) debt of the Company to other creditors in an amount not to exceed $300,000.00 in the aggregate at any one time.
(B)Liens. Create, incur, assume, or allow to exist any mortgage, deed of trust, pledge, lien (including the lien of an attachment, judgment, or execution), security interest, or other encumbrance of any kind upon any of its property, real or personal (collectively, "Liens"). The forgoing restrictions shall not apply to: (1) Liens in favor of CoBank; (2) Liens for taxes, assessments, or governmental charges that are not past due; (3) Liens and deposits under workers' compensation, unemployment insurance, and social security Laws; (4) Liens and deposits to secure the performance of bids, tenders, contracts (other than contracts for the payment of money), and like obligations arising in the ordinary course of business as conducted on the date hereof; (5) Liens imposed by Law in favor of mechanics, materialmen, warehousemen, and like persons that secure obligations that are not past due; (6) easements, rights-of-way, restrictions, and other similar encumbrances which, in the aggregate, do not materially  interfere with  the occupation, use, and enjoyment of the property  or assets encumbered thereby in the normal course of its business or materially impair the value of the property subject thereto; (7) Liens in favor of FCL to secure indebtedness permitted hereunder; and (8) Liens in favor of other creditors to secure indebtedness permitted hereunder.
(I)Leases. Create, incur, assume, or permit to exist any obligation as lessee under operating leases which should be capitalized in accordance with GAAP for the rental or hire of any real or personal property, except: (1) leases of soybean oil storage tank space with aggregate annual payments not to exceed $400,000.00; (2) railcar leases (including railcar leases from FCL); provided, however, that no new railcar leases, or renewals thereof, may exceed ten years in duration and must be on terms and conditions acceptable to CoBank; and (3) other leases, excluding those allowed above, which do not in the aggregate require the Company to make scheduled payments to the lessors in any fiscal year of the Company in excess of $400,000.00.

Exhibit 10.1

2.Except as set forth in this amendment, the MLA, including all amendments thereto, shall continue in full force and effect as written.
IN WITNESS WHEREOF, the parties have caused this amendment to be executed by their duly authorized officers as of the elate shown above.
	
					
	CoBANK, ACB
	 
	SOUTH DAKOTA SOYBEAN PROCESSORS, LLC

	 
	 
	 
	 
	 

	By:
	/s/ Patty Machado
	 
	By:
	/s/ Mark Hyde

	 
	 
	 
	 
	 

	Title:
	Assistant Corporate Secretary
	 
	Title:
	CFOExhibit

Exhibit 10.2

Loan No. RIB051S01V

MONITORED REVOLVING CREDIT SUPPLEMENT

THIS SUPPLEMENT to the Master Loan Agreement dated March 19, 2012 (the "MLA"), is entered into as of July 16, 2015 between CoBANK, ACB ("CoBank") and SOUTH DAKOTA SOYBEAN PROCESSORS, LLC, Volga, South Dakota (the "Company"), and amends and restates the Supplement dated March 19, 2015 and numbered RIB051S01U.
SECTION 1.    The Revolving Credit Facility. On the terms and conditions set forth in the MLA and this Supplement, CoBank agrees to make loans to the Company during the period set forth below in an aggregate principal amount not to exceed, at any one time outstanding, $1,000,000.00 (the "Commitment"); provided, however that the amount available under the Commitment shall not exceed the "Borrowing Base" (as calculated pursuant to the Borrowing Base Report attached hereto as Exhibit A) on the date for which Borrowing Base Reports are required pursuant to Section 6 below.  Within the limits of the Commitment, the Company may borrow, repay, and reborrow.
SECTION 2.    Purpose. The purpose of the Commitment is to finance the inventory and receivables referred to in the Borrowing Base Report.
SECTION 3.    Term. The term of the Commitment shall be from the date hereof, up to and including September 30, 2015, or such later date as CoBank may, in its sole discretion, authorize in writing.
SECTION 4.    Interest. The Company agrees to pay interest on the unpaid balance of the loan(s) in accordance with one or more of the following interest rate options, as selected by the Company:
(A)One-Month LIBOR Index Rate. At a rate (rounded upward to the nearest 1/100th and adjusted for reserves required on "Eurocurrency Liabilities" [as hereinafter defined] for banks subject to "FRB Regulation D" [as hereinafter defined] or required by any other federal law or regulation) per annum equal at all times to 2.20% above the rate reported at 11:00 a.m. London time for the offering of one (1)-month U.S. dollars deposits, by Bloomberg Information Services (or any successor or substitute service providing rate quotations comparable to those currently provided by such service, as determined by CoBank from time to time, for the purpose of providing quotations of interest rates applicable to dollar deposits in the London interbank market) on the first "U.S. Banking Day" (as hereinafter defined) in each week, with such rate to change weekly on such day. The rate shall be reset automatically, without the necessity of notice being provided to the Company or any other party, on the first "U.S. Banking Day" of each succeeding week, and each change in the rate shall be applicable to all balances subject to this option. Information about the then-current rate shall be made available upon telephonic request. For purposes hereof: (1) "U.S. Banking Day" shall mean a day on which CoBank is open for business and banks are open for business in  New York, New York; (2) "Eurocurrency Liabilities" shall have the meaning as set forth in "FRB Regulation D"; and (3) "FRB Regulation D" shall mean Regulation D as promulgated by the Board of Governors of the Federal Reserve System, 12 CFR Part 204, as amended.
(B)Quoted Rate. At a fixed rate per annum to be quoted by CoBank in its sole discretion in each instance. Under this option, rates may be fixed on such balances and for such periods, as may be agreeable to CoBank in its sole discretion in each instance, provided that: (1) the minimum fixed period shall be 30 days; (2) amounts may be fixed in increments of $100,000.00 or multiples thereof; and (3) the maximum number of fixes in place at any one time shall be five.
The Company shall select the applicable rate option at the time it requests a loan hereunder and may, subject to the limitations set forth above, elect to convert balances bearing interest at the variable rate option to one of the fixed rate options. Upon the expiration of any fixed rate period, interest shall automatically accrue at the variable rate option unless the amount fixed is repaid or fixed for an additional period in accordance with the terms hereof. Notwithstanding the foregoing, rates may not be fixed for periods expiring after the maturity date of the loans and rates may not be fixed in such a manner as to cause the Company to have to break any fixed rate balance in order to pay any installment of principal. All elections provided for herein shall be made telephonically or in writing and must be received by 12:00 

Exhibit 10.2

Noon Company's local time. Interest shall be calculated on the actual number of days each loan is outstanding on the basis of a year consisting of 360 days and shall be payable monthly in arrears by the 20th day of the following month or on such other day in such month as CoBank shall require in a written notice to the Company.
SECTION 5.    Promissory Note. The Company promises to repay the unpaid principal balance of the loans on the last day of the term of the Commitment. In addition to the above, the Company promises to pay interest on the unpaid principal balance of the loans at the times and in accordance with the provisions set forth in Section 4 hereof. This note replaces and supersedes, but does not constitute payment of the indebtedness evidenced by, the promissory note set forth in the Supplement being amended and restated hereby.
SECTION 6.    Borrowing Base Reports, Etc. The Company agrees to furnish a Borrowing Base Report to CoBank at such times or intervals as CoBank may from time to time request. Until receipt of such a request, the Company agrees to furnish a Borrowing Base Report to CoBank within 30 days after each month end calculating the Borrowing Base as of the last day of the month for which the report is being furnished. However, if no balance is outstanding hereunder on the last day of such month, then no Report need be furnished. If on the date for which a Borrowing Base Report is required the amount outstanding under the Commitment exceeds the Borrowing Base, the Company shall immediately notify CoBank and repay so much of the loans as is necessary to reduce the amount outstanding under the Commitment to the limits of the Borrowing Base.
SECTION 7.    Letters of Credit.  If agreeable to CoBank in its sole discretion in each instance, in addition to loans, the Company may utilize the Commitment to open irrevocable letters of credit for its account.  Each letter of credit will be issued within a reasonable period of time after CoBank's receipt of a duly completed and executed copy of CoBank's then current form of Application and Reimbursement Agreement or, if applicable, in accordance with the terms of any CoTrade Agreement between the parties, and shall reduce the amount available under the Commitment by the maximum amount capable of being drawn thereunder. Any draw under any letter of credit issued hereunder shall be deemed a loan under the Commitment and shall be repaid in accordance with this Supplement.  Each letter of credit must be in form and content acceptable to CoBank and must expire no later than the maturity date of the Commitment. Notwithstanding the forgoing or any other provision hereof, the maximum amount capable of being drawn under each letter of credit must be statused against the Borrowing Base in the same manner as if it were a loan, and in the event that (after repaying all loans) the maximum amount capable of being drawn under the letters of credit exceeds the Borrowing Base, then the Company shall immediately notify CoBank and pay to CoBank (to be held as cash collateral) an amount equal to such excess.
SECTION 8.    Security. The  Company's obligations hereunder and, to the extent related hereto, under the MLA, including without limitation any future advances under any existing mortgage or deed of trust, shall be secured as provided in the Security Section of the MLA.
SECTION 9.    Collateral Inspections. In consideration of the loans made hereunder, the Company will permit CoBank or its representatives, agents or independent contractors, during normal business hours or at such other times as CoBank and the Company may agree to: (A) inspect or examine the Company's properties, books and records; (B) make copies of the Company's books and records; and (C) discuss the Company's affairs, finances and accounts with its officers, employees and independent certified public accountants. Without limiting the foregoing, the Company will permit CoBank, through an employee of CoBank or through an independent third party contracted by CoBank, to conduct on an annual basis a review of the collateral covered by the Security Agreement. The Company further agrees to pay to CoBank a collateral inspection fee designated by CoBank and reimburse CoBank all reasonable costs and expenses incurred by CoBank in connection with such collateral inspection reviews performed by CoBank employees or its agents.
SECTION 10.    Commitment Fee. Inconsideration of the Commitment, the Company agrees to pay to CoBank a commitment fee on the average daily unused portion of the Commitment at the rate of 0.20% per annum (calculated on a 360-day basis), payable monthly in arrears by the 20th day following each month. Such fee shall be payable for each month (or portion thereof) occurring during the original or any extended term of the Commitment. For purposes of calculating the commitment fee only, the "Commitment" shall mean the dollar amount specified in Section 1 hereof, irrespective of the Borrowing Base.

Exhibit 10.2

IN WITNESS WHEREOF, the parties have caused this Supplement to be executed by their duly authorized officers as of the date shown above.
	
					
	CoBANK, ACB
	 
	SOUTH DAKOTA SOYBEAN PROCESSORS, LLC

	 
	 
	 
	 
	 

	By:
	/s/ Patty Machado
	 
	By:
	/s/ Mark Hyde

	 
	 
	 
	 
	 

	Title:
	Assistant Corporate Secretary
	 
	Title:
	CFO

Exhibit 10.2

SEASONAL BORROWING BASE REPORT
CoBank, ACB
	
			
	Name of Borrower
	City, State
	Date of Period

	South Dakota Soybean Processors, LLC (18462590)
	Volga, South Dakota
	 

	
												
	PART A--ELIGIBLE RECEIVABLES

	 
	 
	 
	 
	 
	 
	 

	For purposes hereof, ELIGIBLE RECEIVABLES shall mean rights to payment for goods sold and delivered or for services rendered which: (a) are not subject to any dispute, set-off, or counterclaim; (b) are not owing by an account debtor that is subject to a  bankruptcy, reorganization, receivership or like proceeding; (c) are not subject to a lien in favor of any third party, other than liens authorized by CoBank in writing which are subordinate to CoBank’s lien: (d) are not owing by an account debtor that is owned or controlled by the borrower, (e) are not accounts due more than 30 days from invoice date, (f) are not accounts with balances past due more than 30 days, (g) are not deemed ineligible by CoBank.  For purposes thereof, CONTRACT RECEIVABLES shall mean all Accrued Grains & Losses on Open Purchase and Sale Contracts for grain which are (a) are not in dispute, (b) are legally enforceable, and (c) are not subject to a lien except in favor of CoBank.

	 
	 
	 
	 
	 
	 
	 

	ELIGIBLE RECEIVABLES
	AMOUNT
	 
	ADVANCE
RATE
	 
	ALLOWABLE
ADVANCE
	 

	 
	 
	 
	 
	 
	 
	 

	Trade Receivables 0 - 30 Days
	$
	—
	

	X
	85
	%
	=
	$
	—
	

	 

	Trade Receivables 31 - 60 Days
	$
	—
	

	X
	50
	%
	=
	$
	—
	

	 

	Trade Receivables 61 Days and Over
	$
	—
	

	X
	—
	%
	=
	$
	—
	

	 

	Other Receivables
	$
	—
	

	X
	—
	%
	=
	$
	—
	

	 

	Net Liquidated Value of Brokerage Accounts
	$
	—
	

	X
	90
	%
	=
	$
	—
	

	 

	 
	 
	 
	 
	 
	 
	 

	Net Contract Receivables for Old Crop Beans*
	$
	—
	

	X
	80
	%
	=
	$
	—
	

	 

	Net Contract Receivables for New Crop Beans*
	$
	—
	

	X
	70
	%
	=
	$
	—
	

	 

	Subtotal - Net Contract Receivables for Beans
	$
	—
	

	 
	 
	 
	$
	—
	

	 

	*Old crop ends September 30. Net contract receivables are accrued gains & losses on open purchase and sales contracts.

	 
	 
	 
	 
	 
	 
	 

	TOTAL PART A
	$
	—
	

	 
	 
	 
	$
	—
	

	 

	 
	 
	 
	 
	 
	 
	 

	
															
	PART B--ELIGIBLE INVENTORY

	 
	 
	 
	 
	 
	 
	 
	 

	For purposes hereof, ELIGIBLE INVENTORY shall mean inventory which: (a) is of a type shown below; (b) is owned by the borrower and not held by the borrower on consignment or similar basis; (c)  is not subject to a lien except in favor of CoBank.

	 
	 
	 
	 
	 
	 
	 
	 

	Types of Eligible Inventory
	AMOUNT
	Deduction
	 
	ADVANCE
RATE
	 
	ALLOWABLE
ADVANCE
	 

	Soybeans*
	$
	—
	

	 
	X
	85
	%
	=
	$
	—
	

	 

	Less: Grain Payables
	 
	$
	—
	

	X
	85
	%
	=
	$
	—
	

	 

	 
	 
	 
	 
	 
	 
	 
	 

	Soybean Meal**
	$
	—
	

	 
	X
	85
	%
	=
	$
	—
	

	 

	Soybean Oil**
	$
	—
	

	 
	X
	85
	%
	=
	$
	—
	

	 

	Soybean Hulls**
	$
	—
	

	 
	X
	75
	%
	=
	$
	—
	

	 

	Other Inventory
	$
	—
	

	 
	X
	—
	%
	=
	$
	—
	

	 

	TOTAL PART B
	$
	—
	

	 
	 
	 
	 
	$
	—
	

	 

	 
	 
	 
	 
	 
	 
	 
	 

	* Valued at Bid Price FOB Volga, SD
	 
	 
	 
	 
	 
	 
	 

	** Valued at Market FOB Volga, SD
	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 
	 
	 
	 

	
					
	PART C -- OBLIGATIONS

	Less:
	OBLIGATIONS
	 

	Book Overdraft (Bank overdraft net of cash available.)
	$
	—
	

	 

	Demand Patron Notes/Deposits
	$
	—
	

	 

	Accounts Payable Owed to Suppliers with PMSI Filings
	$
	—
	

	 

	Outstanding Balance of CoBank Loan(s), (as of date of this report):
	$
	—
	

	 

	CoBank Letters of Credit Issued (excluding North Western Services Corp. Letter of Credit)
	$
	—
	

	 

	TOTAL PART C (NET OBLIGATIONS SUMMARY)
	$
	—
	

	 

	 
	 
	 

	
					
	* EXCESS/OVERADVANCE (AS OF END OF PERIOD): TOTAL A + B - C
	$
	—
	

	 

	
	
	 * IF AN OVERADVANCE IS REPORTED ABOVE, PLEASE CONTACT YOUR RELATIONSHIP MANAGER IMMEDIATELY WITH:  1) AN UPDATED BORROWING BASE REPORT, AND 2) SPECIFICS OF ALL PAYMENTS REMITTED SINCE END OF PERIOD (CHECK NUMBERS, WIRE ROUTING NUMBERS, ETC.).  FUNDS MUST BE REMITTED TO COBANK WITHIN 5 BUSINESS DAYS OF MONTH END.

	 

I HEREBY CERTIFY THAT THIS INFORMATION IS CORRECT.
	
					
	AUTHORIZED SIGNATURE
	 
	TITLE
	 
	DATE

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