Document:

Exhibit 10.2 

 

 

 

SECOND
AMENDMENT, WAIVER AND RATIFICATION

 

dated
as of April 13, 2015

 

Among

 

PCS
LINK, INC. d/b/a GREENWOOD & HALL,

 

as
the Borrower,

 

GREENWOOD
HALL, INC.

 

as
the Guarantor,

 

and

 

OPUS
BANK,

 

as
the Bank

 

 

 

Re
Amended and Restated Credit Agreement dated as of July 18, 2014

 

 

 

    	 

    	 

    

 

SECOND AMENDMENT,
WAIVER AND RATIFICATION

 

THIS
SECOND AMENDMENT, WAIVER AND RATIFICATION dated as of April 13, 2015 (this “Amendment”)
is by and among (a) PCS LINK, INC., a California corporation d/b/a Greenwood & Hall (“Borrower”),
(b) GREENWOOD HALL, INC., a Nevada corporation (“Guarantor,” and
together with the Borrower, collectively, “Credit Parties”), and
(c) OPUS BANK, a California commercial bank, as Bank (“Bank”).
All capitalized terms used herein without definition shall have the same meanings herein as such terms are defined in the below
defined Loan Agreement.

 

WITNESSETH:

 

WHEREAS,
the Credit Parties and Bank entered into that certain Amended and Restated Credit Agreement dated as of July 18, 2014, as amended
by that certain First Amendment, Waiver and Ratification, dated as of December 12, 2014 (the “Loan
Agreement”). Capitalized terms used but not defined herein shall have the meanings given to them in the Loan
Agreement;

 

WHEREAS,
certain Events of Default have occurred and are continuing under Section 9.1B. of the Loan Agreement due to the Credit Parties’
failure to comply with (a) the requirements of Section 6.3A. of the Loan Agreement (Senior Funded Debt to EBITDA Ratio) for the
fiscal quarter ended December 31, 2014 and (b) the requirements of Section 6.3B. of the Loan Agreement (Minimum Asset Coverage
Ratio) for the months ended November 30, 2014, December 31, 2014, January 31, 2014 and February 28, 2014 (collectively, the “Acknowledged
Events of Default”);

 

WHEREAS,
the Credit Parties have requested that Bank waive the Acknowledged Events of Default and amend certain provisions of the Loan
Agreement;

 

WHEREAS,
Bank is willing to waive the Acknowledged Events of Default and make such amendments to the Loan Agreement, each in accordance
with and subject to the terms and conditions set forth herein; and

 

WHEREAS,
concurrently herewith, California United Bank and Colgan agree to permit the transactions set forth herein regardless of the terms
of the Omnibus Amendment, Reaffirmation and Ratification dated as of December 18, 2014.

 

NOW,
THEREFORE, in consideration of the mutual covenants and agreements herein contained, the parties hereto agree as follows:

 

Section
1.             Amendments. From and after
the Effective Date, the Loan Agreement is hereby amended as follows:

 

(a)          The
definition of Maturity Date in each Note is hereby amended to read as follows:

 

“Maturity
Date” means January 1, 2016.

 

    	 

    	 

    

  

(b)          Section
3 of the Loan Agreement is hereby amended and supplemented by adding therein a new Section 3.40A as follows:

 

“3.40A
“Second Amendment” means the Second Amendment,
Waiver and Ratification dated as of April 13, 2015, by and among Borrower, Guarantor and Bank.

 

(c)          Section
4.4 of the Loan Agreement is hereby amended by deleting the same in its entirety and inserting the following in lieu thereof:

 

“4.4
Conditions Precedent to Extensions of Credit after the Second Amendment Effective Date. Notwithstanding
anything to the contrary in the Loan Agreement, Bank shall make the following advances under Facility B:

 

(i)          an
additional $300,000 on the Second Amendment Effective Date (as defined in Section 8 of the Second Amendment), and up to an additional
$200,000, not to exceed $50,000 per week, over the next four (4) weeks, all of which additional advances pursuant to this subsection
(i), together with all other advances outstanding under this Agreement, shall bear interest at the rate of 5.8125% per annum unless
and until Bank makes the advances described in subsection (ii) below; and

 

(ii)         so
long as: (A) Bank has received evidence acceptable to Bank that Borrower has raised (1) at least $1,000,000 in new cash (equity
or subordinated debt) subordinated to Bank’s debt in form and substance acceptable to Bank (‘Acceptable Additional
Capital’) by May 15, 2015 (with the understanding that on March 31, 2015, Borrower received $229,782.81 of new cash that
will count toward such $ 1,000,000 minimum) and (2) at least another $1,000,000 of Acceptable Additional Capital by June 30, 2015;
(B) no new material Events of Default shall have occurred and be continuing; and (C) Borrower shall have demonstrated to Bank’s
reasonable satisfaction that Borrower has expended in connection with Borrower’s operations all of the net proceeds to Borrower
of all Acceptable Additional Capital raised pursuant to subclauses (1) and (2) of clause (A) above, up to an additional $500,000
in the aggregate, not to exceed $50,000 per week, as and when necessary to permit Borrower to pay its expenses when due in accordance
with the Budget delivered by Borrower to Bank pursuant to (and as defined in) Section l(d)(iii) of the Second Amendment, all of
which additional advances pursuant to this subsection (ii), together with all additional advances made pursuant to subsection
(i) above and all other advances outstanding under this Agreement shall bear interest at the rate of 6.25% per annum. If the Bank
determines that any evidence is not satisfactory to it in its sole discretion, the Bank shall be entitled to request and receive
additional information and documentation to its satisfaction prior to any such extension of credit.”

 

(d)
         The following covenants are hereby added to the Loan Agreement, failure to comply with which on a timely manner shall constitute
an Event of Default:

 

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(i)          Borrower
shall engage and keep engaged an investment banker acceptable to Bank at all times to assist with raising capital and
finding potential investors and buyers, and such investment banker shall provide weekly written updates and information to
Bank and otherwise be available to communicate directly with Bank and cooperate with Bank;

 

(ii)         Borrower
shall provide weekly written updates to Bank of all proposals, letters of intent, commitments and investments received from existing
and new investors and potential buyers, and shall promptly after receipt thereof provide Bank with copies of all signed proposals,
letters of intent and commitments;

 

(iii)        Borrower
shall deliver to Bank no later than April 20, 2015: (i) a projected cash flow forecast of Borrower, broken down by week, covering
the period commencing on the Second Amendment Effective Date and ending on July 31, 2015; and (ii) a projected cash flow forecast
of Borrower, broken down by month, covering the period commencing on August 1, 2015 and ending on December 31, 2015.

 

(iv)        (A)
For each of the weeks of April 20, 2015 through and including July 27, 2015, Borrower shall provide to Bank weekly written rolling
updates to the projected cash flow forecast for the period from the Second Amendment Effective Date through July 31, 2015 delivered
by Borrower to Bank pursuant to the immediately preceding clause (iii), and (B) for each of the months of August 2015 through
and including December 2015, Borrower shall provide to Bank monthly written rolling updates to the projected cash flow forecasts
for the period of August 1, 2015 through December 31, 2015 delivered by Borrower to Bank pursuant to the immediately preceding
clause (iii); and

 

(v)         Notwithstanding anything to the contrary in any subordination
agreement or Loan Document or other agreement, Borrower shall not make any payments to any subordinated creditors or other persons
or entities, except as provided in Borrower’s weekly budget submitted to and approved by Bank. Specifically, all amounts
received by Borrower shall be used by Borrower only for its operating needs, and shall not be used to pay any subordinated creditors
or other persons or entities, except as provided in Borrower’s weekly budget submitted to and approved by Bank.

 

(e)          Notwithstanding
anything to the contrary set forth in the Loan Agreement or in any other Loan Document, until June 30, 2015 only (the “Financial
Covenant Suspension Period”), Borrower shall not be obligated to comply with either the quarterly maximum
Senior Funded Debt to EBITDA Ratio covenant set forth in Section 6.3A of the Loan Agreement or the monthly Minimum Asset Coverage
Ratio covenant set forth in Section 6.3B of the Loan Agreement. Any breach by Borrower of either of the foregoing financial covenants
after the Financial Covenant Suspension Period shall constitute an Event of Default.

 

(f)          Notwithstanding
anything to the contrary set forth in the Loan Agreement or any other Loan Document, until the earlier of (A) August 1, 2015 or
(B) the date on which any new material Event of Default occurs (as applicable, the ‘Forbearance
Termination Date”), Borrower shall not be obligated to make any scheduled payments of principal
or interest to Bank under the Loan Agreement and the other Loan Documents, all of which
amounts shall accrue and be due and payable in full on the Maturity Date. All principal and interest payments shall be paid as
scheduled from and after the Forbearance Termination Date.

 

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Section 2.            Waiver
of Acknowledged Events of Default.

 

(a)          Waiver
of Acknowledged Events of Default. From and after the Second Amendment Effective Date, notwithstanding the provisions
of the Loan Agreement to the contrary, Bank hereby waives, on a one-time basis, the Acknowledged Events of Default.

 

(b)         Effectiveness
of Waiver. This waiver shall be effective only to the extent specifically set forth herein and shall not (a) be construed
as a waiver of any breach or Event of Default other than as specifically waived herein nor as a waiver of any breach or Event
of Default of which Bank has not been informed in writing by the Credit Parties, (b) affect the right of Bank to demand compliance
by the Credit Parties with all terms and conditions of the Loan Documents, except as specifically modified or waived by this Amendment,
(c) be deemed a waiver of any transaction or future action on the part of the Credit Parties requiring Bank’s consent or
approval under the Loan Documents, or (d) except as waived hereby, be deemed or construed to be a waiver or release of, or a limitation
upon, Bank’s exercise of any rights or remedies under the Loan Agreement or any other Loan Document, whether arising as
a consequence of any Event of Default (other than an Acknowledged Event of Default) which may now exist or otherwise, all such
rights and remedies hereby being expressly reserved.

 

Notwithstanding
the above waiver, such Acknowledged Events of Default shall not be considered waived for purposes of Sections 6.2L. (Distributions)
or 4.2B. (No Default) of the Loan Agreement.

 

Section 3.          Representations
and Warranties. Each
Credit Party hereby represents and warrants to Bank as follows:

 

(a)          After
giving effect to this Amendment, no Event of Default has occurred and is continuing.

 

(b)          The
execution, delivery and performance by each Credit Party of this Amendment has been duly authorized by all necessary
corporate and other action, no registration with, consent or approval of, or notice to or action by, any Person (including
any governmental authority) is required in order to be effective and enforceable.

 

(c)          This
Amendment and each of the other Loan Documents constitute the legal, valid and binding respective obligations of each Credit Party,
enforceable against it in accordance with their respective terms.

 

(d)          All
representations and warranties of each Credit Party in the Loan Documents are true and correct in all material respects as of
the date hereof (except to the extent such representations and warranties expressly refer to an earlier date, in which case they
were true and correct in all material respects as of such earlier date).

  

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(e)          Each
Credit Party is entering into this Amendment on the basis of its own investigation and for its own reasons, without reliance upon
Bank or any other Person.

 

(f)          Each
Credit Party’s respective obligations under the Loan Agreement and under the other Loan Documents, as applicable, are not
subject to any defense, counterclaim, set-off, right of recoupment, abatement or other claim.

 

Section
4.            Continuing Effectiveness; Ratification of Loan Documents. Each
of the Loan Documents shall remain in full force and effect and each of the agreements, guarantees
and obligations contained therein (as amended hereby) is hereby ratified and confirmed in all respects.

 

Section
5.            Counterparts. This Amendment may be executed in any number of
counterparts and by the different parties on separate counterparts, and each such counterpart shall be deemed to be an original
but all such counterparts shall together constitute one and the same Amendment.

 

Section
6.          Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF CALIFORNIA
APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE; PROVIDED THAT BANK SHALL RETAIN ALL RIGHTS ARISING
UNDER FEDERAL LAW.

 

Section
7.          Successors and Assigns. This Amendment shall be binding
upon the parties hereto and their respective
successors and assigns, and shall inure to the benefit of the parties hereto, and their respective successors and assigns.

 

Section
8.          Closing Conditions; Effectiveness. This Amendment shall become effective
as of the day and year set forth above (the “Second Amendment Effective Date”) upon satisfaction of
the following conditions (in each case, in form and substance acceptable to Bank):

 

(a)          This
Amendment. Bank shall have received a copy of this Amendment duly
executed by each of the Credit Parties and Bank.

 

(b)          CUB
and Colgan Waivers. Bank shall have received written evidence that each of California United Bank and Colgan Financial Group,
Inc. have waived any defaults or events of default existing as of the Second Amendment Effective Date under their respective agreements
with Borrower, and have agreed, notwithstanding anything to the contrary in any agreements between them and Borrower or between
them and Bank, not to receive any payments of principal, interest or other amounts from the date hereof through at least the Forbearance
Termination Date.

 

(c)          Hall
Guaranty. Bank shall have received an unlimited guaranty, in form and substance acceptable to Bank, duly executed and delivered
by John Hall.

 

(d)          Investment
Banker Engagement Letter. Bank shall have received a duly executed
copy of a letter amendment of that certain Berenson & Company letter agreement dated November 24, 2014, to extend the Berenson
& Company engagement through the new Maturity Date (i.e., January 1, 2016), or Borrower shall engage another investment
banking firm reasonably satisfactory to Bank for a period through the new Maturity Date.

 

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(e)          Default.
After giving effect to this Amendment, no Event of Default shall exist.

 

(f)          Fees
and Expenses. Bank shall have received from the Credit Parties such fees and expenses that are payable in connection
with the consummation of the transactions contemplated hereby and Bank’s counsel shall have received from the Credit Parties
payment of all outstanding fees and expenses previously incurred and all fees and expenses incurred in connection with this Amendment.

 

(g)          Miscellaneous.
All other documents and legal matters in connection with the transactions contemplated by this Amendment shall be reasonably satisfactory
in form and substance to Bank and its counsel.

 

Section
9.           Entire Agreement. This Amendment
constitutes the entire agreement and supersedes all prior agreements and understandings, both written and oral, among the parties
with respect to the subject matter hereof.

 

Section
10.          Release of Claims.

 

(a)          Effective
upon the execution hereof, and notwithstanding any failure of Borrower to satisfy any of the conditions precedent set forth in
Section 8 above, each of Borrower and Guarantor hereby agrees that, without any further act, Bank, together with its officers,
directors, employees, counsel, agents, and attorneys in fact, is fully and forever released and discharged from any and all claims
for damages or losses to Borrower or Guarantor (whether these damages or losses are known or unknown, foreseen or unforeseen,
or patent or latent) including, without limitation, tort claims, demands, actions and causes of action of any nature, whatsoever
arising under or relating to the Loan Documents or any of the transactions related thereto, prior to the date hereof, and each
of Borrower and Guarantor waives application of California Civil Code Section 1542.

 

(b)          Each
of Borrower and Guarantor certifies that it has read the following provisions of California Civil Code Section 1542:

 

A GENERAL
RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE
RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR.

 

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(c)          Each
of Borrower and Guarantor understands and acknowledges that the significance and consequence of this waiver of California Civil
Code Section 1542 is that even if it should eventually suffer additional damages arising out of the facts referred to above, it
will not be able to make any claim for those damages. Furthermore, each of Borrower
and Guarantor acknowledges that it intends these consequences even as to claims for damages that may exist as of the date of this
release but which they do not know exist, and which, if known, would materially affect their decision to execute this Amendment,
regardless of whether their lack of knowledge is the result of ignorance, oversight, error, negligence, or any other cause.

 

[signature
page follows]

 

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IN
WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed and delivered by their duly authorized officers
as of the date first set forth above.

 

	 	PCS LINK, INC.,
    d/b/a GREENWOOD & HALL, as the Borrower
	 	 
	 	By:	/s/ John
    Hall
	 	 	Printed Name: John
    Hall 
	 	 	Its: Chief Executive
    Officer
	 	 	 
	 	GREENWOOD HALL,
    INC., as the Guarantor
	 	 
	 	By:	/s/ John Hall
	 	 	Printed Name:John Hall
    
	 	 	Its: Chief Executive
    Officer
	 	 	 
	 	OPUS BANK,
    as Bank
	 	 
	 	By: 	/s/  /s/ Kathryn
    Specht 
	 	 	Printed Name: Kathryn
    Specht
	 	 	Its: Senior Vice President,
    Special CreditsExhibit 10.3

 

April
13,2015

 

California
United Bank

15821
Ventura Boulevard

Suite
100

Encino,
California 91436

 

Ladies
and Gentlemen:

 

Reference
is made to the Amended and Restated Subordination Agreement dated July 18, 2014, by and among PCS Link, Inc., a California
corporation, d/b/a Greenwood and Hall (“Borrower”),
Greenwood Hall, Inc, a Nevada corporation (“Guarantor”
and together with Borrower, the “Credit
Parties”), California United Bank (“CUB”),
and Opus Bank (“Bank”), as amended by the
Omnibus Amendment, Reaffirmation and Ratification, dated as of December 18, 2014 (collectively, the “CUB
Subordination Agreement”). Unless otherwise defined herein, all capitalized terms used in this letter shall
have the same respective meanings specified for such terms in the CUB Subordination Agreement.

 

Please
be advised that the Credit Parties and Bank are entering into a Second Amendment, Waiver and Ratification dated as of the date
hereof (the “Bank Credit Agreement Amendment”)
with respect to the Bank Credit Agreement, pursuant to which Bank has agreed to waive certain existing events of default under
the Bank Credit Agreement and, subject to certain conditions therein contained, to provide additional loans and to grant certain
other accommodations to Borrower. It is a condition precedent to the effectiveness of the Bank Credit Agreement Amendment that
CUB enter into this letter agreement with Bank, pursuant to which CUB shall represent, warrant, and covenant and agree as follows:

 

(a)          CUB
has waived any defaults or events of default known to exist as of the date hereof under CUB’s existing loan documents with
Borrower (collectively, the “CUB Loan Documents”);
and

 

(b)          notwithstanding
anything to the contrary set forth in the CUB Loan Documents, until no earlier than August 1, 2015, CUB shall not demand, nor
shall CUB accept, payment from Borrower of any principal, interest (which shall accrue but not be payable), fees or other amounts
payable by Borrower to CUB pursuant to the CUB Loan Documents.

 

[Rest
of page intentionally left blank; signature page follows]

 

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Please
sign this letter in the space provided below to confirm your acknowledgment of and agreement to the foregoing.

 

	 	Very
    truly yours, 	 
	 	 	 
	 	OPUS
    BANK	 
	 	 	 
	 	By:	/s/
    Kathryn Specht	 
	 	Name: 	Kathryn Specht	 
	 	Title:	Senior Vive President	 

 

	ACKNOWLEDGED
                    AND AGREED

        AS
        OF THE DATE FIRST ABOVE WRITTEN:
	 	 
	 	 	 
	CALIFORNIA
    UNITED BANK	 	 
	 	 	 
	By: 	/s/ Kimberlee von Disterlo 	 	 
	Name:
    Kimberlee von Disterlo	 	 
	Title:
    First Vice President	 	 

 

    	2

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