FIRST AMENDMENT TO REVOLVING CREDIT AND SECURITY AGREEMENT
Exhibit 10.1
FIRST AMENDMENT TO REVOLVING CREDIT AND SECURITY
AGREEMENT
THIS
FIRST AMENDMENT TO REVOLVING CREDIT AND SECURITY AGREEMENT (this
“Amendment”), dated as of
October 29, 2019, is entered into by and among the Lenders
signatory hereto, PNC BANK, NATIONAL ASSOCIATION, in its capacity
as agent for the Lenders (in such capacity “Agent”), AUTOWEB, INC., a
Delaware corporation (“AutoWeb”, and 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”), XXX.XXX,
INC., a Delaware corporation (“Xxx.xxx”), AUTOBYTEL,
INC., a Delaware corporation (“Autobytel”), AW GUA USA,
INC., a Delaware corporation (“AW GUA USA”, and together
with Xxx.xxx, Autobytel and each Person joined to the Credit
Agreement as a guarantor from time to time, collectively, the
“Guarantors”, and each a
“Guarantor” and together
with the Borrowers, collectively, the “Loan Parties” and each a
“Loan
Party”). Terms used herein without definition shall
have the meanings ascribed to them in the Credit Agreement defined
below.
RECITALS
A.
The Lenders, Agent and Loan Parties have previously entered into
that certain Revolving Credit and Security Agreement dated April
30, 2019 (as amended, modified and supplemented from time to time,
the “Credit
Agreement”), pursuant to which the Lenders have made
certain loans and financial accommodations available to
Borrowers.
B. The
Lenders, Agent and Loan Parties now wish to amend the Credit
Agreement on the terms and conditions set forth
herein.
C.
Loan Parties are entering into this Amendment with the
understanding and agreement that, except as specifically provided
herein, none of Agent’s or any Lender’s rights or
remedies as set forth in the Credit Agreement or any Other Document
are being waived or modified by the terms of this
Amendment.
AGREEMENT
NOW,
THEREFORE, in consideration of the foregoing and the mutual
covenants herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:
1. Amendments to Credit
Agreement.
(a) The following new
definitions are hereby added to Section 1.2 of the Credit Agreement
in alphabetical order as follows:
“Debt Payments” shall mean
for any Person for any period, all cash actually expended by such
Person to make: (a) interest payments on any Advances during such
period, plus (b)
payments of any fees, commissions and charges set forth herein
during such period, plus (c) payments in respect of
Capitalized Lease Obligations during such period, plus (d) payments with respect
to any other Indebtedness for borrowed money during such
period.
“Fixed Charge Coverage
Ratio” shall mean, with respect to any Person for any
fiscal period, the ratio of (a) the result of (i) EBITDA for such
Person for such period, minus (ii) Unfunded Capital
Expenditures made by such Person during such period, minus (iii) distributions and
dividends made by such Person during such period, minus (iv) cash taxes paid by
such Person during such period, to (b) all Debt Payments made by
such Person during such period.
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(b) Section 6.5 of the
Credit Agreement is hereby amended and restated to read in its
entirety as follows:
(a)
Minimum EBITDA. Cause to be
maintained as of the end of each fiscal quarter set forth below,
EBITDA for Borrowers and their Subsidiaries on a Consolidated Basis
of not less than the amount set forth below for such
period.
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Applicable
Measurement Period
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Minimum
EBITDA
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the
fiscal quarter ending September 30, 2019 (“Applicable Measurement Period
1”)
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$700,000
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the
fiscal month ending October 31, 2019 (“Applicable Measurement Period
2”)
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$250,000
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the two
(2) fiscal months ending November 30, 2019 (“Applicable Measurement Period
3”)
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$600,000
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the two
(2) fiscal quarters ending December 31, 2019 (“Applicable Measurement Period
4”)
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$3,600,000
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the
three (3) fiscal quarters ending March 31, 2020
(“Applicable
Measurement Period 5”)
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$3,750,000
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the
four (4) fiscal quarters ending June 30, 2020 (“Applicable Measurement Period
6”)
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$6,000,000
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the
four (4) fiscal quarters ending September 30, 2020
(“Applicable
Measurement Period 7”)
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$7,500,000
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each
four (4) fiscal quarter period ending on the last day of each
fiscal quarter beginning with the fiscal quarter ending December
31, 2020 and for each fiscal quarter thereafter (each such period
being an “Applicable
Measurement Period 8”)
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$7,500,000
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(b)
Fixed Charge Coverage Ratio.
Cause to be maintained a Fixed Charge Coverage Ratio for Borrowers
and their Subsidiaries on a Consolidated Basis of not less than
1.20 to 1.00 for each of Applicable Measurement Periods 1, 4, 5, 6,
7 and for each Applicable Measurement Period
8.
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In the
event that the Loan Parties fail to comply with the requirements of
Section 6.5(a) and/or 6.5(b) for any Applicable Measurement Period
(“Non-Complying
Applicable Measurement Period”), until the fifth
(5th)
Business Day after delivery of the Compliance Certificate for the
Non-Complying Applicable Measurement Period (“Cure Right Deadline
Date”), and so long as the Loan Parties have notified
Agent of their intent to use the Cure Right (defined below) on or
before the date of such delivery of the Compliance Certificate
(“Notice Deadline
Date”), the Loan Parties have the right (the
“Cure
Right”) to increase EBITDA by the Cure Amount (defined
below) for purposes of Section 6.5(a) and/or 6.5(b), as applicable,
with respect to the Non-Complying Applicable Measurement Period and
each other Applicable Measurement Period that includes any portion
of the Non-Complying Applicable Measurement Period. provided that, (a) the Loan Parties have
actually received proceeds of an issuance of Equity Interests
(other than Disqualified Equity Interests) for cash or otherwise
has received cash contributions to its capital (the proceeds
thereof being the “Equity Proceeds”) during
the Non-Complying Applicable Measurement Period or no later than
the Cure Right Deadline Date; (b) the Equity Proceeds are or have
previously been remitted to Agent for application to the
Obligations as required under Section 2.20(b); (c) the Equity
Proceeds are not less than the greater of (x) the aggregate amount
necessary to add to EBITDA in the case of a breach of Section
6.5(a) and/or 6.5(b), as applicable to cure the Event of Default
arising from failure to comply with Section 6.5(a) and/or 6.5(b),
as applicable, for the Non-Complying Applicable Measurement Period
and (y) $500,000 (the “Cure Amount”); (d) the
Cure Right shall not be exercised more than three (3) times during
the Term; (e) in each period of four (4) fiscal quarters, there
shall be at least two (2) fiscal quarters during which the Cure
Right is not exercised; (f) no Default or Event of Default shall
have occurred and be continuing after giving effect to the Cure
Right; and (g) Borrowers shall have Undrawn Availability of not
less than $2,500,000 after giving effect to the Cure Right. If,
after giving effect to the addition of the Cure Amount to EBITDA in
the case of a breach of Section 6.5(a) and/or 6.5(b), as
applicable, for the Non-Complying Applicable Measurement Period,
the Loan Parties are in compliance with the financial covenants set
forth in Section 6.5(a) and/or 6.5(b), as applicable, for the
Non-Complying Applicable Measurement Period, the Loan Parties shall
be deemed to have satisfied the requirements of Section 6.5(a)
and/or 6.5(b), as applicable, for the Non-Complying Applicable
Measurement Period with the same effect as though there had been no
such failure to comply with Section 6.5(a) and/or 6.5(b), as
applicable, and the applicable Default and Event of Default arising
therefrom shall be deemed not to have occurred for purposes of this
Agreement. The parties hereby acknowledge that the exercise of the
Cure Right may not be relied on for purposes of calculating any
financial performance calculation or other financial test specified
in this Agreement or any Other Document other than compliance with
Section 6.5(a) and/or 6.5(b), as applicable, as of the date such
compliance is required under this Agreement; provided, that, if a covenant in this
Section 6.5 is the subject of an exercise of the Cure Right,
such Cure Amount shall be included in EBITDA in the case of a
breach of Section 6.5(a) and/or 6.5(b), as applicable, for each
Applicable Measurement Period that includes any portion of the
Non-Complying Applicable Measurement Period. Upon receipt by Agent
of notice, on or prior to the Notice Deadline Date, that the Loan
Parties intend to exercise the Cure Right, Agent and the Lenders
shall not be permitted to accelerate the Obligations, exercise
remedies against the Collateral or exercise any other rights or
remedies under this Agreement or the Other Documents on the basis
of a failure to comply with the requirements of this
Section 6.5 until such failure is not cured pursuant to the
exercise of the Cure Right on or prior to the Cure Right Deadline
Date; provided,
that, a Default
shall be deemed to exist under this Agreement for all other
purposes until such failure is cured pursuant to the exercise of
the Cure Right on or prior to the Cure Deadline.
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2. Effectiveness of this
Amendment. This Amendment shall become effective upon the
satisfaction, as determined by Agent, of the following
conditions.
(a) Amendment. Agent shall have
received this Amendment duly executed by each Loan
Party.
(b) Representations and Warranties.
The representations and warranties set forth herein must be true
and correct.
(c) Other Required Documentation.
All other documents and legal matters in connection with the
transactions contemplated by this Amendment shall have been
delivered or executed or recorded, as required by
Agent.
3. Representations and Warranties.
Each Loan Party represents and warrants as follows:
(a) Authority. Such Loan Party has
the requisite corporate power and authority to execute and deliver
this Amendment, and to perform its obligations hereunder, under the
Credit Agreement (as amended or modified hereby) and under the
Other Documents to which it is a party. The execution, delivery and
performance by such Loan Party of this Amendment have been duly
approved by all necessary corporate action and no other corporate
proceedings are necessary to consummate such
transactions.
(b) Enforceability. This Amendment
has been duly executed and delivered by each Loan Party. This
Amendment, the Credit Agreement (as amended or modified hereby) and
each Other Document is the legal, valid and binding obligation of
each Loan Party, enforceable against each Loan Party in accordance
with its terms, and is in full force and effect.
(c) Representations and Warranties.
After giving effect to this Amendment, the representations and
warranties contained in the Credit Agreement and each Other
Document (other than any such representations or warranties that,
by their terms, are specifically made as of a date other than the
date hereof) are true and correct on and as of the date hereof as
though made on and as of the date hereof.
(d) Due Execution. The execution,
delivery and performance of this Amendment are within the power of
each Loan Party, have been duly authorized by all necessary
corporate action, have received all necessary governmental
approval, if any, and do not contravene any law or any contractual
restrictions binding on any Loan Party.
(e) No Default. No event has
occurred and is continuing that constitutes a Default or an Event
of Default after giving effect to this Amendment.
4. Payment of Expenses. Borrowers
shall pay or reimburse Agent and Lenders for their reasonable
attorneys’ fees and expenses in connection with the
preparation, negotiation and execution of this Amendment and the
documents provided for herein or related hereto.
5. Choice of Law. This Amendment
and all matters relating hereto or arising herefrom (whether
arising under contract law, tort law or otherwise) shall, in
accordance with Section 5-1401 of the General Obligations Law of
the State of New York, be governed by and construed in accordance
with the laws of the State of New York.
6. Counterparts; Facsimile
Signatures. This Amendment may be executed in any number of
and by different parties hereto on separate counterparts, all of
which, when so executed, shall be deemed an original, but all such
counterparts shall constitute one and the same agreement. Any
signature delivered by a party by facsimile or other similar form
of electronic transmission shall be deemed to be an original
signature hereto.
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7. Reference to and Effect on the Other
Documents.
(a) Upon and after the
effectiveness of this Amendment, each reference in the Credit
Agreement to “this Agreement”, “hereunder”,
“hereof” or words of like import referring to the
Credit Agreement, and each reference in the Other Documents to
“the Credit Agreement”, “thereof” or words
of like import referring to the Credit Agreement, shall mean and be
a reference to the Credit Agreement as modified and amended
hereby.
(b) Except as
specifically amended above, the Credit Agreement and all Other
Documents, are and shall continue to be in full force and effect
and are hereby in all respects restated, ratified and confirmed and
shall constitute the legal, valid, binding and enforceable
obligations of each Loan Party to Agent and the
Lenders.
(c) The execution,
delivery and effectiveness of this Amendment shall not, except as
expressly provided herein, operate as a waiver of any right, power
or remedy of the Agent and/or the Lenders under the Credit
Agreement or any of the Other Documents, nor constitute a waiver of
any provision of the Credit Agreement or any of the Other
Documents.
(d) To the extent that
any terms and conditions in any of the Other Documents shall
contradict or be in conflict with any terms or conditions of the
Credit Agreement, after giving effect to this Amendment, such terms
and conditions are hereby deemed modified or amended accordingly to
reflect the terms and conditions of the Credit Agreement as
modified or amended hereby.
8. Estoppel. To induce Agent and
the Lenders to enter into this Amendment and to continue to make
advances to Borrowers under the Credit Agreement, each Loan Party
hereby acknowledges and agrees that, as of the date hereof, there
exists no right of offset, defense, counterclaim or objection in
favor of any Borrower or other Loan Party as against Agent, any
Lender or any other Secured Party with respect to the Obligations,
the Credit Agreement or any Other Document.
9. Integration. This Amendment,
together with the Credit Agreement and the Other Documents,
incorporates all negotiations of the parties hereto with respect to
the subject matter hereof and is the final expression and agreement
of the parties hereto with respect to the subject matter
hereof.
10. Severability. If any part of
this Amendment is contrary to, prohibited by, or deemed invalid
under Applicable Laws, such provision shall be inapplicable and
deemed 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.
11. Guarantors’
Acknowledgment. With respect to the amendments to the Credit
Agreement effected by this Amendment, each Guarantor hereby
acknowledges and agrees to this Amendment and confirms and agrees
that its Guaranty (as modified and supplemented in connection with
this Amendment) is and shall continue to be, in full force and
effect and is hereby ratified and confirmed in all respects except
that, upon the effectiveness of, and on and after the date of this
Amendment, each reference in such Guaranty to the Credit Agreement,
“thereunder”, “thereof” or words of like
import referring to the Credit Agreement, shall mean and be a
reference to the Credit Agreement as amended or modified by this
Amendment. Although Agent and the Lenders have informed the
Guarantors of the matters set forth above, and each Guarantor has
acknowledged the same, each Guarantor understands and agrees that
neither Agent nor any Lender has any duty under the Credit
Agreement, the Guaranty or any other agreement with any Guarantor
to so notify any Guarantor or to seek such an acknowledgement, and
nothing contained herein is intended to or shall create such a duty
as to any transaction hereafter.
[signature
pages follow]
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IN
WITNESS WHEREOF, the parties have entered into this Amendment as of
the date first above written.
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BORROWER:
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By:
/s/
Xxxxx X. Xxxxxx
Name:
Xxxxx X. Xxxxxx
Title:
Executive Vice President, Chief Legal Officer and
Secretary
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GUARANTORS:
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XXX.XXX,
INC.
By: /s/ Xxxxx X.
Xxxxxx
Name:
Xxxxx X. Xxxxxx
Title:
Executive Vice President, Chief Legal Officer and
Secretary
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AUTOBYTEL,
INC.
By: /s/ Xxxxx X.
Xxxxxx
Name:
Xxxxx X. Xxxxxx
Title:
Executive Vice President, Chief Legal Officer and
Secretary
AW GUA
USA, INC.
By: /s/ Xxxxx X.
Xxxxxx
Name:
Xxxxx X. Xxxxxx
Title:
Executive Vice President, Chief Legal Officer and
Secretary
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074658.19022/122103356v.5
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PNC BANK, NATIONAL ASSOCIATION,
as
Agent and Lender
By: /s/ Xxxxx X.
Xxxxxxxxx
Name:
Xxxxx X. Xxxxxxxxx
Title:
Senior Vice President
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074658.19022/122103356v.5
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