WAIVER December 31, 2016
Exhibit 10.25
December
31, 2016
Advanced
Environmental Recycling Technologies, Inc.
914 X.
Xxxxxxxxx
Springdale,
Arkansas 72764
Attention:
Chief Executive Officer
Ladies
and Gentlemen:
Reference hereby is
made to that certain Credit Agreement, dated as of March 18, 2011,
as amended by that certain First Amendment to Credit Agreement,
dated as of May 23, 2011, and as further amended by that certain
Second Amendment to Credit Agreement, dated as of October 20, 2011,
and as further amended by that certain Third Amendment to Credit
Agreement, dated as of November 15, 2012, and as further amended by
that certain Fourth Amendment to Credit Agreement, dated as of
October 15, 2015, (as further amended, restated, supplemented, or
otherwise modified from time to time, the “Credit Agreement”), by
and among Advanced Environmental Recycling Technologies, Inc., a
Delaware corporation (“Borrower”), the lenders
from time to time parties hereto (the “Lenders”), H.I.G. AERT,
LLC, as the administrative agent for the Lenders (in such capacity,
together with its successors and assigns in such capacity,
“Agent”; and together with the Lenders, collectively, the
“Lender
Group”).
Capitalized terms used herein and not otherwise defined or limited
herein shall have the meanings ascribed to such terms in the Credit
Agreement.
As you
are aware, Xxxxxxxx has failed to perform obligations owed to the
Lender Group under the terms and conditions of the Credit Agreement
as a result of Borrower’s
failure to comply with Sections 2.12(a),
2.12(b) and 7.01(b) which
requires Borrower to begin paying cash interest on the Series A
Term Loan beginning March 17, 2013, and cash interest on the Series
B Term Loan respectively (collectively, the
“Specified Events of
Default”).
As a
result of the Specified Events of Default, Events of Default have
occurred and are currently continuing under the Credit Agreement.
You have requested that the Lender Group waive the Specified Events
of Default until March 31, 2017, at which time all interest on the
Series A Term Loan will bear cash interest at 7.25% per annum
(collectively, the “Series A Interest Rate”) and the
Series B Term Loan will bear cash interest at 4.0% per annum
(collectively, the “Series B Interest Rate”). This
letter (this “Waiver”) is to advise you
that the Lender Group hereby waives the Specified Events of Default
and their rights and remedies under the Credit Agreement arising as
a result of the Specified Events of Default.
Notwithstanding the
foregoing, such waiver shall not waive any other requirement or
hinder, restrict or otherwise modify the rights and remedies of the
Lender Group following the occurrence of any other Event of Default
under the Credit Agreement. Except as otherwise expressed herein,
the text of the Credit Agreement and the other Credit Documents
shall remain in full force and effect, and the Lender Group hereby
reserves its rights to require strict compliance in the future with
all terms and conditions of the Credit Agreement and the other
Credit Documents. Borrower hereby reaffirms its obligations under
each Credit Document to which it is a party. Borrower hereby
further ratifies and reaffirms the validity and enforceability of
all of the Liens heretofore granted, pursuant to and in connection
with the Security Agreement or any other Credit Document, to Agent,
on behalf and for the benefit of each member of the Lender Group,
as collateral security for the Obligations under the Credit
Documents in accordance with their respective terms, and
acknowledges that all of the Liens, and all Collateral heretofore
pledged as security for the Obligations, continues to be and remain
Collateral for the Obligations from and after the date hereof.
Borrower hereby restates, ratifies and reaffirms each and every
term and condition set forth in the Credit Agreement and the Credit
Documents effective as of the date hereof.
This
Waiver may be executed in multiple counterparts, each of which
(including any counterpart delivered by facsimile or other
electronic method of transmission) shall be deemed to be an
original and all of which, taken together, shall constitute one and
the same agreement, and this Waiver shall be deemed to be made
under, and for all purposes shall be construed in accordance with,
the laws of the State of New York. This Waiver shall be effective
as of the date set forth above when and only when, Agent shall have
received a counterpart of this Waiver duly executed by Xxxxxxxx and
the Lenders.
This
Waiver shall constitute a Credit Document for all
purposes.
[remainder of page
intentionally left blank]
IN WITNESS WHEREOF, the parties hereto
have caused this Waiver to be executed and delivered as of the date
first above written.
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H.I.G. AERT, LLC,
as
Administrative Agent and Lender
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By:
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/s/
Xxxxx
Xxxxx
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Name: |
Xxxxx
Xxxxx
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Title: |
Authorized
Signatory
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Acknowledged
and agreed to
as of
the date first written above:
ADVANCED
ENVIRONMENTAL
RECYCLING TECHNOLOGIES,
INC.,
a
Delaware corporation
By:
/s/ J.R. Xxxxx
Xxxxx
Name:
J. R. Xxxxx
Xxxxx
Title:
Chief Financial
Officer
Waiver
(H.I.G. LOAN Agreement)
