AMENDMENT NO. 5 TO FIRST AMENDED AND RESTATED CREDIT AGREEMENT AND FIRST AMENDED AND RESTATED MANAGEMENT ADVISORY SERVICES AGREEMENT

Exhibit 6.11

 

AMENDMENT NO. 5 TO FIRST AMENDED AND RESTATED CREDIT AGREEMENT

AND FIRST AMENDED AND RESTATED MANAGEMENT ADVISORY SERVICES AGREEMENT

 

This AMENDMENT NO. 5 TO FIRST AMENDED AND RESTATED CREDIT AGREEMENT AND FIRST AMENDED AND RESTATED MANAGEMENT AGREEMENT (this “Amendment”) is made as of January 28, 2020 by and among Hylete, Inc., a Delaware corporation (“Borrower”), Black Oak-Hylete-Senior Debt, LLC, a Utah limited liability company (“First Lender”), bocm3-Hylete-Senior Debt, LLC, a Utah limited liability company (“Second Lender”), Black Oak-Hylete-Senior Debt 2, LLC, a Utah limited liability company (“Third Lender”), bocm3-Hylete-Senior Debt 2, LLC, a Utah limited liability company (“Fourth Lender” and together with the First Lender, Second Lender and Third Lender, the “Lenders”).

 

In consideration of the mutual covenants, conditions and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, it is hereby agreed that:

 

ARTICLE I.
DEFINITIONS

 

When used herein, the following terms shall have the following meanings specified:

 

1.1       “Amendment” shall mean this Amendment No. 5 to First Amended and Restated Credit Agreement.

 

1.2       “Credit Agreement” shall mean the First Amended and Restated Senior Credit Agreement, dated as of July 28, 2017, originally by and among HYLETE, Inc., a California corporation, First Lender and Second Lender, as amended by that certain Amendment No. 1 to First Amended and Restated Credit Agreement and First Amended and Restated Security Agreement, by and among Borrower, First Lender, Second Lender and Third Lender, dated as of March 28, 2018, that certain Amendment No. 2 to First Amended and Restated Credit Agreement and First Amended and Restated Security Agreement, by and among Borrower, First Lender, Second Lender and Third Lender, dated as of February 12, 2019, Amendment No. 3 to First Amended and Restated Credit Agreement, by and among Borrower, First Lender, Second Lender and Third Lender, dated as of August 1, 2019 and as further amended, modified, supplemented, extended or restated from time to time and that certain Amendment No. 4 to First Amended and Restated Credit Agreement, by and among Borrower, First Lender, Second Lender, Third Lender, and Fourth Lender, dated as of December 31, 2019.

 

1.3       “Management Agreement” shall mean the First Amended and Restated Management Agreement, dated as of July 28, 2017, originally by and among Black Oak Capital Management II, LLC, a Utah limited liability company, bocm3 LLC, a Utah limited liability company, and Hylete, Inc., a California corporation

 

1.4        Other Capitalized Terms. All capitalized terms used in this Amendment and not specifically defined herein shall have the definitions assigned to such terms in the Credit Agreement.

ARTICLE II.

AMENDMENT TO CREDIT AGREEMENT

 

2.1       Amendments. The Credit Agreement is hereby amended as follows:

 

(a)        Section 1.1. The following replaces the existing definition of such term in Section 1.1 in its entirety:

 

“Note Maturity Date” means April 1, 2021.

 

(b)        Section 2.1(f). The following Section 2.1(f) is hereby added to the Credit Agreement:

 

(f)       Borrower and Lender may agree on terms for an additional $500,000 of Loans, which shall be disbursed as agreed by Borrower and Lender, on such terms and conditions as agreed by Borrower and Lender.

 

(c)       Section 2.7. The following Section 2.7 is hereby added to the Credit Agreement:

 

 

 

 

Section 2.7 Extension Fee. Borrower shall pay a fee of $250,000 on the Note Maturity Date or earlier repayment of the Loans in full.

 

(c)       Section 5.17. The following Section 5.17 is hereby added to the Credit Agreement:

 

Section 5.17 Sale Process. If more than $3,000,000 of Loans are outstanding on December 31, 2020, Borrower shall engage a recognized investment banking firm agreed by Lender to explore strategic options for Borrower, including, without limitation, potential sales.

 

2.2       Miscellaneous Amendments. The Credit Agreement, the Notes, and all other agreements and instruments executed and delivered heretofore or hereafter pursuant to the Credit Agreement are amended hereby so that any reference therein to the Credit Agreement shall be deemed to be a reference to such agreements and instruments as amended by or pursuant to this Amendment.

 

ARTICLE III.

AMENDMENT TO MANAGEMENT AGREEMENT

 

3.1       Section 5 Amendment. The following is hereby added as the last sentence of Section 5 of the Management Agreement:

 

Hylete shall pay to bocm3 a cash consulting and management fee equal to $15,000.00 per annum, payable on a monthly basis in arrears in equal installments of $1,250.00 beginning on February 1, 2020 and the first calendar day of every month thereafter.

 

3.2     Section 6 Amendment. The date “July 29, 2019” in Section 6 of the Management Agreement shall be replaced with “April 2, 2021”.

 

ARTICLE IV.

REPRESENTATIONS AND WARRANTIES OF THE BORROWER

 

The Borrower hereby represents and warrants to the Lender that:

 

4.1       Credit Agreement. All of the representations and warranties made by the Borrower in the Credit Agreement are true and correct on the date of this Amendment, except to the extent such representation or warranty relates to a specified earlier date, in which case it continues to be true and correct as of such date. No Event of Default under the Credit Agreement has occurred and is continuing as of the date of this Amendment.

 

4.2       Authorization; Enforceability. The making, execution and delivery of this Amendment and performance of and compliance with the terms of this Amendment and the terms of the Credit Agreement, as amended hereby, has been duly authorized by all necessary company action by the Borrower. This Amendment is the valid and binding obligation of the Borrower, enforceable against the Borrower in accordance with its terms subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.

 

4.3       Absence of Conflicting Obligations. The making, execution and delivery of this Amendment and performance of and compliance with the terms of this Amendment and the terms of the Credit Agreement, as amended hereby, do not violate any presently existing provision of law or the articles or certificate of formation, certificate of organization or operating agreement of Borrower or any agreement to which a Borrower is a party or by which it or any of its assets is bound.

 

4.4       Absence of Other Long-Term Obligations. Other than the Loans and trade indebtedness, Borrower has no liabilities that are required to be repaid prior to the Note Maturity Date.

 

 

 

 

ARTICLE V.

MISCELLANEOUS

 

5.1       Continuance of Credit Agreement. Except as specifically amended by this Amendment and the Credit Agreement shall remain in full force and effect.

 

5.2       Survival. All agreements, representations and warranties made in this Amendment or in any documents delivered pursuant to this Amendment shall survive the execution of this Amendment and the delivery of any such document.

 

5.3       Governing Law. This Amendment shall be governed by, and construed and interpreted in accordance with, the laws of the State of Utah applicable to agreements made and wholly performed within such state. The parties hereto acknowledge that this Amendment was negotiated with the assistance of counsel and, accordingly, such laws shall be applied without reference to any rules of construction regarding the draftsman hereof.

 

5.4       Counterparts; Headings. This Amendment may be executed in several counterparts, each of which shall be deemed an original, but such counterparts shall together constitute but one and the same agreement. Article and section headings in this Amendment are inserted for convenience of reference only and shall not constitute a part hereof.

 

5.5       Severability. Any provision of this Amendment which 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 of this Amendment in such jurisdiction or affecting the validity or enforceability of any provision in any other jurisdiction.

 

5.6       Conditions. The effectiveness of this Amendment is subject to the Lender having received from the Borrower such documents and other materials as the Lender shall request, in form and substance satisfactory to the Lender and its counsel, including without limitation duly executed copies of this Amendment, and the payment of all fees and expenses pursuant to Section 5.9 of this Amendment.

 

5.7       Course of Dealing; Consent. Borrower acknowledges that neither previous waivers, extensions, and amendments granted to the Borrower by the Lender, nor the amendments and waivers granted herein, create any course of dealing or expectation with respect to any further waivers, extensions, or amendments, and Borrower further acknowledges that the Lender has no obligation whatsoever to grant any additional waivers, extensions, amendments, or forbearance.

 

5.8       No Defenses. Each Borrower acknowledges it has no defenses, rights of setoff, or rights of recoupment to the enforceability or payment of any of its obligations under the Credit Agreement as amended hereby.

 

5.9       Expenses and Attorneys’ Fees. The Borrower shall pay (a) all fees and expenses (including attorney’s fees) incurred by each Lender in connection with the preparation, execution, and delivery of this Amendment, and all prior legal fees and expenses (including attorney’s fees) incurred by each Lender in connection with the Credit Agreement and (b) all fees and expenses (including attorney’s fees) incurred by the Borrower in connection with the preparation, execution, and delivery of this Amendment on the date hereof.

 

5.10    Further Assurances. Borrower shall promptly execute and deliver or cause to be executed and delivered to Lenders within a reasonable time following a Lender’s request, and at the expense of Borrower, such other documents or instruments as a Lender may reasonably require to in order to give effect to the intent and purposes of this Amendment.

 

[Signature page follows]

 

 

 

 

IN WITNESS WHEREOF, the parties hereto have executed this Amendment No. 5 to First Amended and Restated Credit Agreement and First Amended and Restated Management Agreement as of the day and year first written above.

 

HYLETE, INC.     By: /s/ ▇▇▇ ▇▇▇▇▇▇ Name: ▇▇▇ ▇▇▇▇▇▇ Title:  CEO     BLACK OAK-HYLETE-SENIOR DEBT, LLC   By: /s/ ▇▇▇▇ ▇▇▇▇▇ Name: ▇▇▇▇ ▇▇▇▇▇ Title: Manager     BOCM3-HYLETE-SENIOR DEBT, LLC   By: /s/ ▇▇▇▇ ▇▇▇▇▇ Name: ▇▇▇▇ ▇▇▇▇▇ Title: Manager     BLACK OAK-HYLETE-SENIOR DEBT 2, LLC   By: /s/ ▇▇▇▇ ▇▇▇▇▇ Name: ▇▇▇▇ ▇▇▇▇▇ Title: Manager     BOCM3-HYLETE-SENIOR DEBT 2 , LLC   By: /s/ ▇▇▇▇ ▇▇▇▇▇ Name: ▇▇▇▇ ▇▇▇▇▇ Title: Manager     BOCM3, LLC   By: /s/ ▇▇▇▇ ▇▇▇▇▇ Name: ▇▇▇▇ ▇▇▇▇▇ Title: Manager

 

  

[Signature page to Amendment No. 5 to First Amended and Restated Credit Agreement and First Amended and Restated Management Agreement]