Document:

CAREVIEW COMMUNICATIONS, INC. 10-K

     

    Exhibit
10.186  

 

TWELFTH
AMENDMENT TO MODIFICATION AGREEMENT

 

This TWELFTH AMENDMENT
TO MODIFICATION AGREEMENT (this “Amendment”) is made and entered into as of March 29, 2019 (the
“Amendment Effective Date”), by and among CAREVIEW COMMUNICATIONS, INC., a Nevada corporation (“Holdings”),
CAREVIEW COMMUNICATIONS, INC., a Texas corporation and a wholly owned subsidiary of Holdings (the “Borrower”),
CAREVIEW OPERATIONS, L.L.C., a Texas limited liability company (the “Subsidiary Guarantor”), and PDL
INVESTMENT HOLDINGS, LLC (as assignee of PDL BioPharma, Inc.), a Delaware limited liability company (both in its capacity as the
lender (“Lender”) and in its capacity as Agent (solely in such capacity as Agent, the “Agent”))
under the Credit Agreement (as defined below).

RECITALS

A.       

Reference is made to
that certain Credit Agreement dated as of June 26, 2015, among Holdings, the Borrower, the Lender and the Agent (as amended, supplemented
or modified as of the date hereof (the “Credit Agreement”), including pursuant to that certain First
Amendment to Credit Agreement dated as of October 7, 2015, that certain Modification Agreement dated as of February 2, 2018 (the
“Modification Agreement”), that certain Second Amendment to Credit Agreement dated as of February 23,
2018 (the “Second Amendment”), that certain Amendment to Modification Agreement dated as of May 31, 2018
(the “First Modification Amendment”), that certain Second Amendment to Modification Agreement dated as
of June 14, 2018 (the “Second Modification Amendment”), that certain Third Amendment to Modification
Agreement dated as of June 28, 2018 (the “Third Modification Amendment”), that certain Third Amendment
to Credit Agreement dated as of July 13, 2018, that certain Fourth Amendment to Modification Agreement dated as of August
31, 2018 (the “Fourth Modification Amendment”), that certain Fifth Amendment to Modification Agreement
dated as of September 28, 2018 (the “Fifth Modification Amendment”), that certain Sixth Amendment
to Modification Agreement dated as of November 12, 2018 (the “Sixth Modification Amendment”),
that certain Seventh Amendment to Modification Agreement dated as of November 19, 2018 (the “Seventh Modification Amendment”),
that certain Eighth Amendment to Modification Agreement dated as of December 3, 2018 (the “Eighth Modification Amendment”),
that certain Ninth Amendment to Modification Agreement dated as of December 17, 2018 (the “Ninth Modification Amendment”),
that certain Tenth Amendment to Modification Agreement dated as of January 31, 2019 (the “Tenth Modification Amendment”)
and that certain Eleventh Amendment to Modification Agreement dated as of February 28, 2019 (the “Eleventh Modification
Amendment”); capitalized terms used and not defined in this Amendment shall have the meaning set forth in the Credit
Agreement.

B.       

Pursuant to the Modification
Agreement, as amended by the First Modification Amendment, the Fifth Modification Amendment, the Sixth Modification Amendment,
the Seventh Modification Amendment, the Eighth Modification Amendment, the Ninth Modification Amendment, the Tenth Modification
Amendment and the Eleventh Modification Amendment, the parties agreed that the term, “Modification Termination Event”
would mean the earliest to occur of: (a) the occurrence of any Event of Default under any Loan Documents that does not constitute
a Covered Event; (b) the occurrence of any Agreement Event of Default; (c) the Lender’s delivery to Holdings and
the Borrower of a Lender Termination Notice; and (d) March 31, 2019, subject to the Lender’s right, in its sole discretion,
to terminate the Modification Period on July 31, 2018 and March 31, 2019 (with each such date permitted to be extended by the Lender
in its sole discretion).

C.       

The parties wish to
enter into this Amendment to extend the first date referred to in Recital B.(d) above from “March 31, 2019” until “April
30, 2019”.

D.       

Pursuant to the Modification
Agreement, as amended by the Second Amendment, the parties agreed that the Borrower shall obtain (i) at least $2,050,000 in
net cash proceeds from the issuance of Capital Stock (other than Disqualified Stock) or Debt on or prior to February 23, 2018
(which obligation Borrower satisfied by Holdings’ issuance of Debt pursuant to that certain Eighth Amendment to Note and
Warrant Purchase Agreement dated as of February 23, 2018) and (ii) an additional $3,000,000 in net cash proceeds from the
issuance of Capital Stock (other than Disqualified Stock) or Debt on or prior to May 31, 2018 (resulting in aggregate net
cash proceeds of at least $5,050,000).

    	 	 	 

    	 

    

 

E.       

Pursuant to the First
Modification Amendment, as amended by the Second Modification Amendment, the Third Modification Amendment, the Fourth Modification
Amendment, the Fifth Modification Amendment, the Sixth Modification Amendment, the Seventh Modification Amendment, the Eighth Modification
Amendment, the Ninth Modification Amendment, the Tenth Modification Amendment and the Eleventh Modification Amendment, the parties
agreed, among other things, to provide that the Borrower shall satisfy its obligation to obtain financing referenced in Recital D
above by obtaining: (i) at least $2,050,000 in net cash proceeds from the issuance of Capital Stock (other than Disqualified
Capital Stock) or Debt on or prior to February 23, 2018; and (ii) an additional (A) $750,000 in net cash proceeds from
the issuance of Capital Stock (other than Disqualified Capital Stock) or Debt on or prior to July 13, 2018 and (B) $750,000
in net cash proceeds from the issuance of Capital Stock (other than Disqualified Capital Stock) or Debt on or prior to March 31,
2019 (resulting in aggregate net cash proceeds of $3,550,000).

F.       

The parties also wish
to enter into this Amendment to extend the date referred to in Recital E.(ii)(B) above from “March 31, 2019” until
“April 30, 2019”.

G.       

Pursuant to the Modification
Agreement, as amended, the parties agreed that subject to the terms and conditions set forth therein, so long as no Modification
Termination Event shall have occurred, the occurrence and continuance of any of the Covered Events shall not constitute Events
of Default from the Effective Date through the end of the Modification Period and, for the avoidance of doubt, that the Default
Rate shall not apply during the Modification Period.

H.       

Pursuant to the Modification
Agreement, as amended by the Ninth Modification Amendment, the Tenth Modification Amendment and the Eleventh Modification Amendment,
the parties agreed to defer the Borrower’s interest payment that would otherwise be due to Lender on December 31, 2018
until March 31, 2019 (the end of the extended Modification Period as referenced in Recital C above), and to treat the deferral
of the December 31, 2018 interest payment as a “Covered Event”.

I.       

The parties acknowledge
that this Amendment will extend the date of the end of the extended Modification Period referred to in Recital H above (and the
date of the Borrower’s interest payment that would have otherwise been due to Lender on December 31, 2018) from March
31, 2019 until April 30, 2019.

J.       

The parties also wish
to enter into this Amendment to defer the Borrower’s interest payment that would otherwise be due to Lender on March 31,
2019 until April 30, 2019 (the end of the extended Modification Period referred to in Recitals H and I above), and as
such the parties will treat the deferral of the March 31, 2019 interest payment as a “Covered Event”.

K.       

Pursuant to the Modification
Agreement, as amended by the First Modification Amendment, the Fifth Modification Amendment, the Sixth Modification Amendment,
the Seventh Modification Amendment, the Eighth Modification Amendment, the Ninth Modification Amendment, the Tenth Modification
Amendment and the Eleventh Modification Amendment, the parties also agreed that (i) the Lender shall have a right to terminate
the Modification Period (as defined in the Modification Agreement) on July 31, 2018 and March 31, 2019 (with each such date permitted
to be extended by the Lender in its sole discretion).

L.       

The parties also wish
to enter into this Amendment to extend the date for Lender to terminate the Modification Period from March 31, 2019 until April
30, 2019.

M.       

The parties also wish
to enter into this Amendment to provide that any breaches by Holdings or the Borrower of the minimum cash balance requirement formerly
set forth in Section 5.3 of the HealthCor Note and Warrant Purchase Agreement, as amended, that occurred on or prior to March 27,
2019 will be permanently waived and shall not constitute Events of Default under a Loan Document so long as such breaches have
been waived under the HealthCor Note and Warrant Purchase Agreement, and as such the parties will treat any such breaches as a
“Covered Event”.

    	 	2	 

    	 

    

 

NOW, THEREFORE,
in consideration of the above premises, and for other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereby agree as follows:

Article
I.

AMENDMENTs TO MODIFICATION AGREEMENT

Upon the Amendment
Effective Date:

1.1       

Modification Period.
Section 2 of the Modification Agreement, as amended by the First Modification Amendment, the Fifth Modification Amendment, the
Sixth Modification Amendment, the Seventh Modification Amendment, the Eighth Modification Amendment, the Ninth Modification Amendment,
the Tenth Modification Amendment and the Eleventh Modification Amendment, is amended and restated in its entirety as follows:

“2.

Modification
Period. Subject to the terms and conditions set forth herein, so long as no Modification Termination Event (as defined below)
shall have occurred, each of the Agent and the Lender agrees that the occurrence and continuance of any of the Covered Events shall
not constitute Events of Default from the Effective Date through the earliest to occur of any Modification Termination Event (the
“Modification Period”) and, for the avoidance of doubt, that the Default Rate shall not apply during the Modification
Period. As used herein, “Modification Termination Event” shall mean the earliest to occur of: (a) the occurrence of
any Event of Default under any Loan Documents that does not constitute a Covered Event; (b) the occurrence of any Agreement Event
of Default (as defined below); (c) the Lender’s delivery to Holdings and the Borrower of a Lender Termination Notice (as
defined below); and (d) April 30, 2019, subject to the Lender’s right, in its sole discretion, to terminate the Modification
Period on July 31, 2018 and April 30, 2019 (with each such date permitted to be extended by the Lender in its sole discretion).
Notwithstanding any other provision of this Modification Agreement or any other Loan Document, all principal and interest otherwise
due to Lender through the end of the Modification Agreement shall be due and payable at the end of the Modification Period and
if not paid in full in Cash at that time shall bear interest at the Default Rate from and after the end of the Modification Period.”

1.2       

Deadline for Raising
Monies. The first sentence of Section 5(a) of the Modification Agreement, as previously amended by the Second Amendment, the
First Modification Amendment, the Second Modification Amendment, the Third Modification Amendment, the Fourth Modification Amendment,
the Fifth Modification Amendment, the Sixth Modification Amendment, the Seventh Modification Amendment, the Eighth Modification
Amendment, the Ninth Modification Amendment, the Tenth Modification Amendment and the Eleventh Modification Amendment, is amended
and restated in its entirety as follows:

“(a)
The Borrower shall obtain: (i) at least $2,050,000 in net cash proceeds from the issuance of Capital Stock (other than Disqualified
Capital Stock) or Debt on or prior to February 23, 2018; and (ii) an additional (A) $750,000 in net cash proceeds from
the issuance of Capital Stock (other than Disqualified Capital Stock) or Debt on or prior to July 13, 2018 and (B) $750,000
in net cash proceeds from the issuance of Capital Stock (other than Disqualified Capital Stock) or Debt on or prior to April 30,
2019 (resulting in aggregate net cash proceeds of $3,550,000); provided that all such Debt described in clauses (i) and (ii) shall
be subordinated to the Loans under the Credit Agreement on terms satisfactory to the Lender in its sole discretion.”

1.3       

Additional Covered
Events. Recital C of the Modification Agreement is amended and restated in its entirety as follows:

    	 	3	 

    	 

    

 

“C.

Pursuant to the
Binding Term Sheet, the parties agreed that: (i) the Borrower would not make the principal payment due under the Credit Agreement
on December 31, 2017 until the end of the Modification Period, (ii) the Borrower would not pay the principal installments
due at the end of each calendar quarter during the Modification Period, and (iii) because the Borrower’s Liquidity was
anticipated to fall below $3,250,000, the Liquidity required during the Modification Period would be lowered; and the parties have
further agreed that (iv) the Borrower will not make the interest payments due under the Credit Agreement on December 31,
2018 and March 31, 2019 until the end of the Modification Period, and (v) any breaches by Holdings or the Borrower of
the minimum cash balance requirement formerly set forth in Section 5.3 of the HealthCor Note and Warrant Purchase Agreement,
as amended, that occurred on or prior to March 27, 2019 will be permanently waived and shall not constitute Events of Default
under a Loan Document so long as such breaches have been waived under the HealthCor Note and Warrant Purchase Agreement (items
(i), (ii), (iii), (iv) and (v), collectively, the “Covered Events”). For the avoidance of doubt, the waiver set forth
in item (v) of this Recital C shall survive the occurrence of any Modification Termination Event. The Lender, the Agent,
Holdings, the Borrower and the Subsidiary Guarantor wish to enter into this Agreement to set forth the terms and conditions pursuant
to which the parties will address the Covered Events.”

Article
II.

REPRESENTATIONS AND WARRANTIES

In order to induce
the Agent and the Lender to enter into this Amendment, each of Holdings, the Borrower and the Subsidiary Guarantor hereby represents
and warrants to the Agent and the Lender that as of the date hereof, both prior to and after giving effect to this Amendment:

2.1       

Organization.
Holdings is a corporation validly existing and in good standing under the laws of the State of Nevada; the Borrower is a corporation
validly existing and in good standing under the laws of the State of Texas; and each other Loan Party and each of its Subsidiaries
is duly organized, validly existing and in good standing (as applicable) under the laws of the jurisdiction of its incorporation
or organization. Each Loan Party has all power and authority and all material governmental approvals required for the ownership
and operation of its properties and the conduct of its business as now conducted and as proposed to be conducted and is qualified
to do business, and is in good standing (as applicable), in every jurisdiction where, because of the nature of its activities or
properties, such qualification is required, except for such jurisdictions where the failure to so qualify could not reasonably
be expected to have a Material Adverse Effect.

2.2       

Due Authorization.
The execution, delivery and performance of this Amendment, and the performance of its obligations under the Modification Agreement
and Credit Agreement, each as amended hereby, have been duly authorized by all necessary action on the part of each Loan Party
that is a party hereto.

2.3       

No Conflict.
The execution, delivery and performance of this Amendment by each Loan Party that is a party hereto and the consummation of the
transactions contemplated hereby do not and will not (a) require any consent or approval of, or registration or filing with or
any other action by, any Governmental Authority (other than any consent or approval which has been obtained and is in full force
and effect), (b) conflict with (i) any provision of material Applicable Law, (ii) the charter, by-laws, limited liability company
agreement, partnership agreement or other organizational documents of any Loan Party or (iii) any material agreement, indenture,
instrument or other document, or any judgment, order or decree, which is binding upon any Loan Party or any of their respective
properties or (c) require, or result in, the creation or imposition of any Lien on any asset of Holdings, the Borrower or any other
Loan Party (other than Permitted Liens and Liens in favor of the Agent created pursuant to the Collateral Documents).

2.4       

Incorporation of
Representations and Warranties from Loan Documents. Each representation and warranty by each Loan Party that is a party hereto
contained in the Modification Agreement, the Credit Agreement or in any other Modification Document or Loan Document to which such
Loan Party is a party is true and correct in all material respects (without duplication of any materiality qualifier contained
therein) as of the date hereof (or as of a specific earlier date if such representation or warranty expressly relates to an earlier
date).

    	 	4	 

    	 

    

 

2.5       

No Default.
Both prior to (except as expressly waived in Section 1.3 of this Amendment with the addition of item (v) to Recital C as a
Covered Event) and after giving effect to this Amendment, no Default or Event of Default has occurred and is continuing, and no
Default or Event of Default will result from the execution and delivery of this Amendment and the consummation of the transactions
contemplated herein.

2.6       

Validity; Binding
Nature. This Amendment has been duly executed by each Loan Party that is a party hereto, and each of (i) this Amendment, (ii) the
Modification Agreement as amended hereby and (iii) the Credit Agreement as amended hereby is the legal, valid and binding obligation
of each Loan Party that is a party hereto, enforceable against such Person in accordance with its terms, subject to bankruptcy,
insolvency and similar laws affecting the enforceability of creditors’ rights generally and to general principles of equity.

Article
III.

MISCELLANEOUS

3.1       

Modification and
Loan Document. This Amendment is a Modification Document and Loan Document executed pursuant to the Credit Agreement and shall
(unless otherwise expressly indicated therein) be construed, administered and applied in accordance with the terms and provisions
of the Credit Agreement.

3.2       

Effect of Amendment.
Except as expressly set forth herein, this Amendment shall not by implication or otherwise limit, impair, constitute a waiver of,
or otherwise affect, the rights and remedies of the parties to the Credit Agreement and shall not alter, modify, amend or in any
way affect any of the terms or conditions contained therein, all of which are ratified and affirmed in all respects and shall continue
in full force and effect. Nothing herein shall be deemed to entitle any Loan Party to any future consent with respect to, or waiver,
amendment, modification or other change of, any of the terms or conditions contained in the Credit Agreement in similar or different
circumstances. Except as expressly stated herein, the Agent and the Lender reserve all rights, privileges and remedies under the
Loan Documents. All references in the Credit Agreement and the other Loan Documents to the Credit Agreement shall be deemed to
be references to the Credit Agreement as modified hereby.

3.3       

Reaffirmation.
Each of Holdings, the Borrower and the Subsidiary Guarantor hereby reaffirms its obligations under each Modification Document and
Loan Document to which it is a party. Each of Holdings, the Borrower and the Subsidiary Guarantor hereby further ratifies and reaffirms
the validity and enforceability of all of the liens and security interests heretofore granted, pursuant to and in connection with
the Guarantee and Collateral Agreement or any other Loan Document, to the Agent, as collateral security for the obligations under
the Loan Documents in accordance with their respective terms, and acknowledges that all of such liens and security interests, and
all Collateral heretofore pledged as security for such obligations, continue to be and remain collateral for such obligations from
and after the date hereof.

3.4       

Fees and Expenses.
The Borrower agrees to pay within five Business Days of the Amendment Effective Date, by wire transfer of immediately available
funds to an account of the Agent designated in writing, reimbursement from the Borrower of all costs and expenses incurred by the
Agent and the Lender in connection with this Amendment, including any and all fees payable or owed to Gibson, Dunn & Crutcher
LLP in connection with the drafting, negotiation, and execution of this Amendment.

3.5       

Counterparts.
This Amendment may be executed by the parties hereto in several counterparts, each of which shall be deemed to be an original and
all of which shall constitute together but one and the same agreement. Delivery of an executed signature page of this Amendment
by facsimile transmission or electronic transmission shall be as effective as delivery of a manually executed counterpart hereof.

3.6       

Construction; Captions.
Each party hereto hereby acknowledges that all parties hereto participated equally in the negotiation and drafting of this Amendment
and that, accordingly, no court construing this Amendment shall construe it more stringently against one party than against the
other. The captions and headings of this Amendment are for convenience of reference only and shall not affect the interpretation
of this Amendment.

    	 	5	 

    	 

    

 

3.7       

Successors and Assigns.
This Amendment shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns
(as permitted under the Credit Agreement).

3.8       

GOVERNING LAW.
THIS AMENDMENT, THE RIGHTS AND OBLIGATIONS OF THE PARTIES HERETO, AND ANY CLAIMS OR DISPUTES RELATING THERETO SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES (OTHER
THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW).

3.9       

Severability.
The illegality or unenforceability of any provision of this Amendment or any instrument or agreement required hereunder shall not
in any way affect or impair the legality or enforceability of the remaining provisions of this Amendment or any instrument or agreement
required hereunder.

3.10       

Release of Claims.
In consideration of the Lender’s and Agent’s agreements contained in this Amendment, each of Holdings, the Borrower
and the Subsidiary Guarantor hereby releases and discharges the Lender and the Agent and their affiliates, subsidiaries, successors,
assigns, directors, officers, employees, agents, consultants and attorneys (each, a “Released Person”)
of and from any and all other claims, suits, actions, investigations, proceedings or demands, whether based in contract, tort,
implied or express warranty, strict liability, criminal or civil statute or common law of any kind or character, known or unknown,
which Holdings, the Borrower or the Subsidiary Guarantor ever had or now has against the Agent, any Lender or any other Released
Person which relates, directly or indirectly, to any acts or omissions of the Agent, any Lender or any other Released Person relating
to the Modification Agreement or Credit Agreement or any other Modification Document or Loan Document on or prior to the date hereof.

[Signature page follows]

    	 	6	 

    	 

    

IN WITNESS WHEREOF,
the parties hereto have caused this Amendment to be executed as of the date first above written.

 

	 	CAREVIEW COMMUNICATIONS, INC.,
	 	a Nevada corporation,
	 	as Holdings
	 	 
	 	By:	 /s/ Steven G. Johnson
	 	Name:	 Steven G. Johnson
	 	Title:	 President and Chief Executive Officer
	 	 	 
	 	CAREVIEW COMMUNICATIONS, INC.,
	 	a Texas corporation,
	 	as Borrower
	 	 
	 	By:	/s/ Steven G. Johnson
	 	Name:	Steven G. Johnson
	 	Title:	 President and Chief Executive Officer
	 	 	 
	 	CAREVIEW OPERATIONS, L.L.C.,
	 	a Texas limited liability company,
	 	as Subsidiary Guarantor
	 	 
	 	By:	 /s/ Steven G. Johnson
	 	Name:	Steven G. Johnson
	 	Title:	President and Chief Executive Officer

   

[Signature Page to Twelfth Amendment to Modification
Agreement]

 

    	 

    	 

    

 

IN WITNESS WHEREOF,
the parties hereto have caused this Amendment to be executed as of the date first above written. 

 

	 	PDL INVESTMENT HOLDINGS, LLC,
	 	a Delaware limited liability company,
	 	as Agent
	 	 
	 	By:	 /s/ Christopher Stone
	 	Name:	Christopher Stone
	 	Title:	CEO and Treasurer
	 	 	 
	 	PDL INVESTMENT HOLDINGS, LLC,
	 	a Delaware limited liability company,
	 	as Lender
	 	 
	 	By:	/s/ Christopher Stone
	 	Name:	Christopher Stone
	 	Title:	CEO and Treasurer

  

[Signature Page to Twelfth Amendment to Modification
Agreement]asv-ex1020_471.htm

EX 10.20

SECOND AMENDMENT TO AMENDED AND RESTATED REVOLVING CREDIT, TERM LOAN AND SECURITY AGREEMENT

This SECOND AMENDMENT TO AMENDED AND RESTATED REVOLVING CREDIT, TERM LOAN AND SECURITY AGREEMENT (this “Second Amendment”) is entered into as of March 28, 2019, by and among ASV HOLDINGS, INC., a Delaware corporation (“ASV”, together with each Person joined to the Credit Agreement (as defined below) as a borrower from time to time, collectively, the “Borrowers” and each a “Borrower”; the Borrowers together with the Guarantors, collectively the “Loan Parties” and each a “Loan Party”), the financial institutions which are now or which hereafter become a party to the Credit Agreement as lenders  (collectively, the “Lenders” and each individually a “Lender”) and PNC BANK, NATIONAL ASSOCIATION (“PNC”), as agent for Lenders (PNC, in such capacity, the “Administrative Agent”) with respect to the following:

PRELIMINARY STATEMENTS

	
A.
	
Borrowers, Lenders and Administrative Agent, previously entered into that certain Amended and Restated Revolving Credit, Term Loan and Security Agreement dated as of December 27, 2017 (as has been and may hereafter be amended, restated or otherwise modified from time to time, the “Credit Agreement”);

	
B.
	
Borrowers have requested that Administrative Agent and Lenders agree to amend certain provisions in the Credit Agreement and Administrative Agent and Lenders have agreed to such amendment, subject to the terms and conditions contained herein; and

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties, intending to be legally bound, agree as follows:

1.Definitions.  Capitalized terms used in this Second Amendment are as defined in the Credit Agreement, as amended hereby, unless otherwise stated.

2.Amendments to Credit Agreement.  Subject to and in accordance with the terms and conditions set forth herein, the parties hereto agree that as of the Second Amendment Date:1

	
A.
	
Definitions.   

	
 
	
a.
	
The following definition contained in Section 1.2 of the Credit Agreement is hereby amended and restated as follows: 

“Fee Letter” shall mean collectively, (a) the amended and restated fee letter dated the Closing Date among Borrowers and Administrative Agent, (b) the fee letter dated as of the First Amendment Date among Borrowers and Administrative Agent (the “First Amendment Fee Letter”) and (c) the fee letter dated as of the 

	
	 

	
1 
	
 Certain language has been italicized in this Second Amendment solely for purposes of indicating new or changed language in this Second Amendment; deletions are not reflected. 

			
	
 
	
 
	
 

 

 

Second Amendment Date among Borrowers and Administrative Agent (the “Second Amendment Fee Letter”).

	
 
	
b.
	
The following sentence shall be added to the end of the definition of “Applicable Margin” contained in Section 1.2 of the Credit Agreement:

Notwithstanding anything to the contrary contained above, the Applicable Margin in effect for each type of Advance shall be increased by fifty (50) basis points for the period from the Second Amendment Date until the first Business Day following Administrative Agent’s receipt of a quarterly Compliance Certificate required pursuant to Section 9.9 hereof evidencing that Borrowers’ Leverage Ratio, as of the last day of such fiscal quarter (measured as set forth in Section 6.5(b)) is not greater than 2.75 to 1.00.

	
B.
	
New Definitions.  The following definition is hereby added to Section 1.2 of the Credit Agreement in the appropriate alphabetical sequence:

“Second Amendment Date” shall mean March 28, 2019. 

	
C.
	
Sublimits.  Section 2.1(a)(ii) of the Credit Agreement is hereby amended and restated, with respect to subsection (C) thereof, as follows: 

	

	
(ii) the least of (A) the sum of (I) up to 65% of the value of the Eligible Inventory (other than Eligible Inventory consisting of finished goods machines and service parts that are current), plus (II) 80% of the value of Eligible Inventory consisting of finished goods machines, plus (III) 75% of the value of Eligible Inventory consisting of service parts that are current) (as applicable, the “Inventory Advance Rate”), (B) up to 90% of the appraised net orderly liquidation value of Eligible Inventory (as evidenced by an Inventory appraisal satisfactory to Administrative Agent in its sole discretion exercised in good faith) (the “Inventory NOLV Advance Rate”, together with the Inventory Advance Rate and the Receivables Advance Rates, collectively, the “Advance Rates”), or (C) $18,000,000 in the aggregate at any one time, minus

	
D. 
	
Leverage Ratio.  Section 6.5(b) of the Credit Agreement is hereby amended and restated as follows:

(b)Leverage Ratio.  Maintain as of the end of each fiscal quarter, commencing with the fiscal quarter ending March 31, 2020, a ratio (the “Leverage Ratio”) of Funded Debt, calculated as of such date, to EBITDA, measured for the period of four fiscal quarters then ended, of not greater than the ratios set forth below for the applicable fiscal quarter then ending:

		
	
Fiscal Quarter Ending
	
Maximum Leverage Ratio

	
March 31, 2020
	
2.75

	
June 30, 2020
	
2.50

			
	
 
	
2
	
 

 

 

 

		
	
September 30, 2020 and each fiscal quarter thereafter
	
2.25

 

E.Minimum EBITDA.  A new Section 6.5(c) shall be added to the Credit Agreement as follows:

(c)Minimum EBITDA.  Cause the Borrowers on a Consolidated Basis to maintain EBITDA of not less than the amounts set forth below for the corresponding fiscal quarter then ending, in each case measured on a trailing twelve month basis: 

		
	
Fiscal Quarter Ending
	
Minimum EBITDA

	
March 31, 2019
	
$5,943,438

	
June 30, 2019
	
$5,913,857

	
September 30, 2019
	
$6,043,309

	
December 31, 2019
	
$8,472,716

 

3.Conditions to Effectiveness.  The effectiveness of this Second Amendment is subject to the satisfaction of the following conditions precedent, unless specifically waived in writing by Agents:

(a)Administrative Agent shall have received this Second Amendment duly executed by Borrowers, the other Loan Parties, Lenders and Administrative Agent; and

(b)no Default or Event of Default shall have occurred and be continuing; and 

(c)Borrower shall pay all fees and expenses set forth in that certain Second Amendment Fee Letter executed on the date hereof. 

4.Ratifications.  Except as expressly modified and superseded by this Second Amendment, the terms and provisions of the Credit Agreement and the Other Documents are ratified and confirmed and shall continue in full force and effect.  Loan Parties hereby agree that all liens and security interests securing payment of the Obligations under the Credit Agreement (as amended hereby) are hereby collectively renewed, ratified and brought forward as security for the payment and performance of the Obligations.  Borrowers, the other Loan Parties, Lenders and Administrative Agent agree that the Credit Agreement and the Other Documents, as amended hereby, shall continue to be legal, valid, binding and enforceable in accordance with their respective terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally or by general principles of equity.

			
	
 
	
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5.Representations and Warranties with respect to Other Documents.  Each of the Loan Parties hereby represents and warrants to Administrative Agent and Lenders as follows:  (a) it is duly organized, validly existing and in good standing under the laws of its jurisdiction of organization; (b) the execution, delivery and performance by it of this Second Amendment and all Other Documents executed and/or delivered in connection herewith are within its company powers, have been duly authorized, and do not contravene (i) its Organizational Documents, or (ii) any applicable law; (c) no Consent of any Governmental Body or other Person is required in connection with the execution, delivery, performance, validity or enforceability of this Second Amendment, except as has been obtained; (d) this Second Amendment and all Other Documents executed and/or delivered in connection herewith have been duly executed and delivered by it; (e) this Second Amendment and all Other Documents executed and/or delivered in connection herewith constitute its legal, valid and binding obligation of such Person enforceable against it in accordance with their terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally or by general principles of equity; (f) no Default or Event of Default has occurred and is continuing or would immediately thereafter result by the execution, delivery or performance of this Second Amendment; (g) the representations and warranties contained in the Credit Agreement and the Other Documents are true and correct in all material respects (except to the extent already qualified by materiality in which case such representation and warranties shall be true and correct in all respects) on and as of the date hereof and on and as of the date of execution hereof as though made on and as of each such date (except to the extent any such representation or warranty expressly relates only to any earlier and/or specified date); and (h) ASV has not amended its Organizational Documents in a manner that would constitute a Default or Event of Default.

6.Survival of Representations and Warranties.  All representations and warranties made in the Credit Agreement or the Other Documents, including, without limitation, any document furnished in connection with this Second Amendment, shall survive the execution and delivery of this Second Amendment and the Other Documents.

7.Reference to Credit Agreement.  Each of the Credit Agreement and the Other Documents, and any and all other agreements, documents or instruments now or hereafter executed and delivered pursuant to the terms hereof or pursuant to the terms of the Credit Agreement, as amended hereby, are hereby amended so that any reference in the Credit Agreement and such Other Documents to the Credit Agreement shall mean a reference to the Credit Agreement as amended hereby.

8.Expenses of Administrative Agent and Lenders.  Borrowers agree to pay on demand all reasonable out-of-pocket costs and expenses actually incurred by Administrative Agent and Lenders in connection with the preparation, negotiation, execution and closing of the Second Amendment, any and all amendments, modifications and supplements thereto and any Other Documents in connection therewith, including, without limitation, the costs and fees of Administrative Agent’s and Lenders’ legal counsel and financial advisors.

9.Severability.  If any part of this Second Amendment is contrary to, prohibited by, or deemed invalid under Applicable Laws, such provision shall be inapplicable and deemed 

			
	
 
	
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omitted to the extent so contrary, prohibited or invalid, but the remainder hereof shall not be invalidated thereby and shall be given effect so far as possible.

10.Successors and Assigns.  This Second Amendment is binding upon and shall inure to the benefit of Administrative Agent, Lenders and Loan Parties and their respective successors and assigns, except that no Loan Party may assign or transfer any of its rights or obligations hereunder without the prior written consent of Administrative Agent.

11.Counterparts.  This Second Amendment may be executed in one or more counterparts, each of which when so executed shall be deemed to be an original, but all of which when taken together shall constitute one and the same instrument.  Any signature delivered by a party by facsimile or electronic transmission (including email transmission of a PDF image) shall be deemed to be an original signature hereto.

12.Effect of Waiver.  No consent or waiver, express or implied, by Lenders or Administrative Agent to or for any breach of or deviation from any covenant or condition by Borrowers or any other Loan Party shall be deemed a consent to or waiver of any other breach of the same or any other covenant, condition or duty.

13.Headings.  The headings, captions, and arrangements used in this Second Amendment are for convenience only, are not a part of this Second Amendment, and shall not affect the interpretation hereof.

14.Governing Law; Judicial Reference.  Sections 12.1 through 12.3 and Section 16.1 of the Credit Agreement are incorporated herein by reference and are fully applicable to this Second Amendment.

15.Final Agreement.  THE CREDIT AGREEMENT AND THE OTHER DOCUMENTS, EACH AS AMENDED HEREBY, REPRESENT THE ENTIRE EXPRESSION OF THE PARTIES WITH RESPECT TO THE SUBJECT MATTER HEREOF ON THE DATE THIS SECOND AMENDMENT IS EXECUTED.  THE CREDIT AGREEMENT AND THE OTHER DOCUMENTS, AS AMENDED HEREBY, MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.  THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.  NO MODIFICATION, RESCISSION, WAIVER, RELEASE OR AMENDMENT OF ANY PROVISION OF THIS SECOND AMENDMENT SHALL BE MADE, EXCEPT IN ACCORDANCE WITH SECTION 16.2 OF THE CREDIT AGREEMENT.

16.Acknowledgements and Agreements.  Each of the Loan Parties hereby acknowledge and agree that:  (a) none has any  defenses, claims or set-offs to the enforcement by Administrative Agent or any Lender of the Obligations on the date hereof and on the date of execution hereof; (b) to their knowledge, Administrative Agent and Lenders have fully performed all undertakings and obligations owed to them as of the date hereof and on the date of execution hereof; and (c) except to the limited extent expressly set forth in this Second Amendment, Administrative Agent and Lenders do not waive, diminish or limit any term or condition contained in the Credit Agreement or any of the Other Documents.

			
	
 
	
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IN WITNESS WHEREOF, the parties have executed and delivered this Second Amendment as of the day and year first written above.

	
 
	
ASV HOLDINGS, INC. 

By:/s/ Melissa How
Name: Melissa How
Title: Chief Financial Officer

 

 

	
 
	
PNC BANK, NATIONAL ASSOCIATION, as Administrative Agent, a Revolving Lender and a Term Loan Lender

By: _/s/Timothy Canon_________________
Name: Timothy Canon
Title: Vice President

	
 
	
STEEL CITY CAPITAL FUNDING, a division of PNC Bank, National Association, as a Term Loan Lender

By: _/s/ Jesse Xu______________________
Name: Jesse Xu
Title: Vice President

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