Document:

Exhibit 10.12

 

Execution Version

 

AMENDMENT NO. 1 TO SECOND LIEN CREDIT AGREEMENT

 

AMENDMENT NO. 1 under the Second Lien Credit Agreement referred to below, dated as of March 2, 2018 (this “Amendment”), among FOCUS FINANCIAL PARTNERS, LLC, a Delaware limited liability company (together with its successors and assigns, the “Borrower”) and the Administrative Agent (as defined below).

 

RECITALS

 

WHEREAS, the Borrower is party to that certain Second Lien Credit Agreement, dated as of July 3, 2017 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), among the Borrower, the lenders or other financial institutions or entities from time to time party thereto and Royal Bank of Canada, as administrative agent and collateral agent (in such capacities, the “Administrative Agent”); and

 

WHEREAS, pursuant to Section 13.1 of the Credit Agreement, the Borrower and the Administrative Agent desire to amend the Credit Agreement to cure the ambiguity with respect to delivery of quarterly financial statements contained in Section 9.1(b) of the Credit Agreement.

 

NOW, THEREFORE, in consideration of the covenants and agreements contained herein, as well as other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

 

1.                                      Defined Terms.  Capitalized terms used but not defined herein shall have the meanings assigned to such terms in the Credit Agreement.

 

2.                                      Amendment.

 

(a)                                 Section 9.1(b) of the Credit Agreement (Quarterly Financial Statements) is hereby amended by deleting the phrase “first quarterly accounting period” appearing therein and replacing it with the phrase “first three quarterly accounting periods”.

 

3.                                      Conditions to Effectiveness of the Amendment.  This Amendment shall become effective upon execution by the Borrower and the Administrative Agent (the “Effective Date”).

 

4.                                      Counterparts.  This Amendment may be executed by one or more of the parties to this Amendment on any number of separate counterparts (including by facsimile or other electronic transmission), and all of said counterparts taken together shall be deemed to constitute an original and one and the same instrument.

 

5.                                      Credit Document.  This Amendment shall constitute a Credit Document for purposes of the Credit Agreement and from and after the Effective Date, all references to the Credit Agreement in any Credit Document and all references in the Credit Agreement to “this Agreement”, “hereunder”, “hereof” or words of like import referring to the Credit Agreement, shall, unless expressly provided otherwise, refer to the Credit Agreement as modified by this Amendment.

 

 

6.                                      Governing Law. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

7.                                      Headings.  The headings of this Amendment are for purposes of reference only and shall not limit or otherwise affect the meaning hereof.

 

8.                                      Severability.  Any provision of this Amendment that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

 

9.                                      Miscellaneous.  The provisions of Sections 13.13 and 13.15 of the Credit Agreement are incorporated by reference herein and made a part hereof mutatis mutandis.

 

[Remainder of page intentionally left blank.]

 

2

 

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

 

	
 
    	
FOCUS   FINANCIAL PARTNERS, LLC
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ James   Shanahan
    
	
 
    	
 
    	
Name: 
    	
James Shanahan
    
	
 
    	
 
    	
Title: 
    	
Chief   Financial Officer
    

 

[Signature Page to Amendment No. 1]

 

 

	
 
    	
ROYAL   BANK OF CANADA,
    
	
 
    	
as   Administrative Agent and Collateral Agent
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Yvonne, Brazier
    
	
 
    	
 
    	
Name: 
    	
Yvonne,   Brazier
    
	
 
    	
 
    	
Title: 
    	
Manager, Agency
    

 

[Signature Page to Amendment No. 1]EX-10.1

 Exhibit 10.1 

AMENDMENT AGREEMENT 
 This
Amendment Agreement is entered into and effective as of December 1, 2017, by and between Cryo-Cell International, Inc. (the “Company”) and Oleg Mikulinsky (the “Executive”). 

RECITALS 
  

	 	A.	The Company and the Executive entered into an Employment Agreement dated March 5, 2012 (the “Employment Agreement”). 

  

	 	B.	The initial term of term of the Employment Agreement concluded and an amendment was entered into on May 1, 2013 and a subsequent one on December 1, 2015. 

 

	 	C.	The Company and the Executive desire to further amend the terms of the Executive’s Employment Agreement as shown below in order to retain the Executive’s services with the Company. 

NOW, THEREFORE, in consideration of the foregoing, the parties agree and the Employment Agreement is hereby amended as follows: 

Amendment 
  

	1.	The first paragraph of Section 1 is deleted in its entirety and replaced with the following : 

(a)    The Company hereby employs the Executive for a period of twenty-four months, commencing on December 1, 2017 and
expiring on November 30, 2019 (the “Initial Term”). The Initial Term shall be automatically extended for successive additional one-year periods (“Additional Employment Terms”) unless,
at least thirty (30) days prior to the end of the Initial Term or an Additional Employment Term, the Company or the Executive has notified the other in writing that the Agreement shall terminate at the end of the then-current term. References
herein to the “Term” shall mean the Initial Term as it may be so extended by one or more Additional Employment Terms. 
 2. Section 2(a) is
deleted in its entirety and replaced with the following: 
  

	 	a.)	Base Salary 

 The Executive shall receive an annualized base salary (the “Base
Salary”) which is not less than $250,000 per year. Throughout the Term, the Executive shall be eligible for discretionary annual merit increases and/or other base salary adjustments as deemed appropriate by the Company’s Co-Chief Executive Officers (the “Co-CEOs”). The Executive’s Base Salary will be payable in equivalent bi-weekly
installments, subject to usual and required payroll deductions, including, without limitation, applicable taxes.     

Cash Bonus. For the fiscal years December 1, 2017 to November 30, 2018 and December 1, 2018 to November 30, 2019,
the Executive’s bonus (“Bonus”) shall be a percentage of 20% of his Base Salary equal to the sum of (x) the product of 11.11% and the number of the six bonus criteria achieved based upon the Company’s annual Net Revenue and
Weighted Average Stock Price (as defined below) and (y) up to the percentage of 33.33% as subjectively determined by the Co-CEOs in their sole discretion. The bonus criteria for the fiscal year ending

 
November 30, 2018 are set forth in the following schedule. Bonus criteria for the fiscal year ending November 30, 2018 shall be based on the same three standards and the same three
criteria weighted the same as for the fiscal year ending November 30th, 2018 and shall be established by February 28, 2019 by the Co-CEOs in their
sole discretion after consultation with the Executive. 
 The Bonus for each fiscal year will be paid promptly after such year’s
audited financial statements for the Company have been finalized, and when the Co-CEOs have certified that the Bonus has been earned by the Executive; however, in no event will the Bonus be paid later than
five days following the completion by the independent auditors of the Company’s financial statements for such year. The Co-CEOs in their sole discretion may authorize payment of the Bonus prior to the
finalization of the Company’s audited financial statements. 
 The Co-CEOs will, with respect
to each bonus criteria, determine a bonus percentage within the percentage range for results that fall between Threshold and Target as well as between Target and Stretch levels of performance. The annual Bonus criteria and payouts shall be pro-rated for periods of employment of less than twelve months. The bonus criteria for each fiscal year shall be determined without regard to any accounting impact of any Bonus or Performance Grant, as defined
below, on the Company’s financial statements for such fiscal year. In addition to the Bonus, the Executive shall also be eligible to participate in any other bonus programs that are available to senior executive officers of the Company. 

  
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	 FYE 11/30/18
	  	Threshold	 	Target	 	Stretch
	 Net Revenue Increase for FYE 11/30/18 Compared to FYE 11/30/2017 weighted 1/3
	  	6%	 	8%	 	10%
	 Weighted Average Stock Price weighted 1/3
	  	$8.75	 	$9.50	 	$10.25
	 Subjective Performance weighted 1/3
	  	TBD by Co-CEOs
by Bonus due date	 	TBD by Co-CEOs
by Bonus due date	 	TBD by Co-CEOs
by Bonus due date

 The Net Revenue Increase bonus criteria shall be based on the annual net revenue of the Company as set forth
in its audited financial statement. 
 The Weighted Average Stock Price shall be calculated based on: (i) the trading day average
closing price of the Company’s stock for each of the last three months of the fiscal year; and (ii) the weighting of each monthly average closing price of the Company’s stock from September through November such that the October
average closing price is weighted twice the September average closing price; and the November average closing price is weighted three times the September average closing price.     

(b) Equity Awards. 
 (i)
Base Grants. 
 The Company agrees to grant to the Executive (1) 8,000 qualified stock options for the Company’s stock on the
date of this Agreement; and (2) 8,000 qualified stock options on December 1, 2019 if employed on such date. The options shall be issued under the Company’s 2012 Stock Plan or a subsequent Company stock plan. The options granted on the date
of this Agreement will vest 1/3 upon grant, 1/3 on December 1, 2018 and the remaining 1/3 on November 30th, 2019. The options granted on December 1, 2019 will vest 1/3 upon grant, 1/3 on December 1, 2020 and the remaining 1/3 on
November 30, 2021. A grant agreement memorializing these terms shall be executed by the parties on or as soon as practicable after the grant date. 

  
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 (ii) Performance Grants. 

In addition to the option grants described above, if the Executive is employed by the Company on November 30, 2018, then no later than
February 28, 2019, the Company shall grant the Executive up to 8,000 qualified stock options for the Company’s stock. If the Executive is employed by the Company on November 30, 2019, then no later than February 28, 2020 the
Company shall grant the Executive up to an additional 8,000 qualified stock options for the Company’ stock. Such performance grants shall be made under the Company’s 2012 Stock Plan or a subsequent Company stock plan. 

For the fiscal years December 1, 2017 to November 30, 2018 and December 1, 2018 to November 30, 2019, the Executive’s
performance grant shall be a percentage of 8,000 qualified stock options equal to the sum of (i) the product of 11.11% and the six bonus criteria achieved based on the Company’s annual Net Revenue and Weighted Average Stock Price; and
(ii) up to the percentage of 33.33% as subjectively determined by the Co-CEOs in their sole discretion. The performance grant criteria for the fiscal year ending November 30, 2018 are set forth in
the following schedule. Unless otherwise agreed to in writing by the Executive and the Co-CEOs, performance grant criteria for the fiscal year ending November 30, 2019 shall be based on the same
standards, and the same weightings as for the fiscal year ending November 30, 2018 and shall be established by February 28, 2019 by the Co-CEOs in their sole discretion. 

  
 4 

							
	 FYE 11/30/18
	  	Threshold	 	Target	 	Stretch
	 Net Revenue Increase for FYE 11/30/18 compared to FYE 11/30/2017 weighted 1/3
	  	10%	 	11%	 	12%
	 Adjusted Net Income for FYE 11/30/16 weighted 25%
	  	$10.25	 	$11.00	 	$11.75
	 Subjective Performance weighted 1/3
	  	TBD by Co-CEOs
by grant date	 	TBD by Co-CEOs
by grant date	 	TBD by Co-CEOs
by grant date

 The Net Revenue Increase performance grant criteria shall be based on the annual net revenue of the Company as
set forth in its audited financial statement. 
 The Weighted Average Stock Price shall be calculated based on: (i) the trading day
average closing price of the Company’s stock for each of the last three months of the fiscal year; and (ii) the weighting of each monthly average closing price of the Company’s stock from September through November such that the
October average closing price is weighted twice the September average closing price; and the November average closing price is weighted three times the September average closing price. 

The performance grants earned above by the Executive for each fiscal year will be made promptly after such year’s audited financial
statements for the Company have been finalized, and when the Co-CEOs has certified that the performance grants have been earned by the Executive, provided, however, in no event will the performance grants be
made later than five days following the completion by the independent auditors of the Company’s financial statements for such year. The Co-CEOs in their sole discretion may make the performance grants
prior to the finalization of the Company’s audited financial statements. 
 The Co-CEOs will,
with respect to each performance grant criteria, determine a performance grant criteria percentage within the percentage range for results that fall between Threshold and Target as well as between Target and Stretch levels of performance. 

The performance grant criteria for each fiscal year shall be determined without regard to any accounting impact of any Bonus or Performance
Grant on the Company’s financial statements for such fiscal year. 

  
 5 

 In addition to the option grants described above, if the Executive is employed by the Company on
November 30, 2018, then no later than February 28, 2019, the Company shall grant the Executive up to 2,000 qualified stock options for the Company’s stock for each dollar by which the Weighted Average Stock Price (as defined above)
exceeds $11.75 with respect to the 2018 fiscal year. If Executive is employed by the Company on November 30, 2019, then no later than February 28, 2020, the Company shall grant the Executive up to an additional 2,000qualified stock options
for the Company’s stock for each dollar by which the Weighted Average Stock Price exceeds a price to be determined at the discretion of the Co-CEOs with respect to the 2019 fiscal year. Such performance
grants shall be made under the Company’s 2012 Stock Plan or a subsequent Company stock plan. 
 (iii) Restricted Stock 

The Executive shall have the right to elect in writing to the Co-CEOs to receive a cash payment in lieu
of up to 38.5% of the performance grant shares of restricted stock earned for the fiscal year December 1, 2016 to November 30, 2017, provided that such election results in no additional expense to the Company nor has a detrimental impact
on the Company’s financial statements, as determined by the Co-CEOs. The cash payment shall be paid to Executive in a lump sum and shall be equal to the trading day closing price of the Company’s
common stock on the date of issuance of the shares, multiplied by the number of shares of restricted stock elected to be exchanged for a cash payment pursuant to this paragraph. 

IN WITNESS WHEREOF, the parties to this Amendment Agreement have placed their hands as of the day and year written above. 

 

									
		 		 		 	Cryo-Cell International, Inc.
				
	 /s/ Oleg Mikulinsky
	 		 	By:	 	 /s/ Mark Portnoy

	Oleg Mikulinsky	 		 	Name:	 	Mark Portnoy
		 		 	Title: Co-Chief Executive Officer

  
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