AMENDMENT AGREEMENT between Conrent Invest S.A. acting on behalf of its compartment “Safety 2” as Lender and Track Group, Inc. as Borrower relating to the facility agreement dated 30 December 2013 as amended and restated on 30 June 2015 19 July 2018
Exhibit
10.1
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between
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Conrent Invest S.A.
acting on behalf of its compartment “Safety
2”
as
Lender
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and
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as
Borrower
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relating
to
the
facility agreement dated 30 December 2013 as amended and restated
on 30 June
2015
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19 July
2018
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TABLE OF CONTENTS
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Section
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Page
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1.
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3
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2.
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3.
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6.
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7.
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8.
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9.
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10.
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11.
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12.
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Schedule 1
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A-1
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THIS AMENDMENT AGREEMENT is dated 19 July 2018 and is
made
BETWEEN
(1)
Conrent Invest S.A., a public limited
liability company (société anonyme),
incorporated under the laws of the Grand Duchy of Luxembourg and
having its registered office at 283, Route d’Xxxxx, X-0000
Xxxxxxxx, Xxxxx-Xxxxx of Luxembourg, registered with the Luxembourg
trade and companies register under number B 170.360 (the
“Company”),
acting on behalf of its Compartment “Safety2”, (the
“Lender”);
AND
(2)
Track Group, Inc. (formerly known as SecureAlert, Inc.), a
Delaware corporation, having its registered office at business
office at 000 Xxxx 0xx Xxxxxx, Xxxxx 000, Xxxxxxxxxx, Xxxxxxxx
00000, Xxxxxx Xxxxxx of America (the “Borrower”).
Each of
the Finance Party and the Borrower will be individually referred to
hereinafter as a “Party” and collectively as the
“Parties”.
WHEREAS:
(B)
By a transfer
certificate dated 10 January 2014, the Original Lender transferred
by novation all its rights and obligations under the Original
Agreement to the Lender.
(C)
By a letter dated
10 June 2015, the Borrower requested the Lender, inter alia, (i) to
increase the amount of the Facility granted under the Original
Agreement from USD 25,000,000 (twenty-five million U.S. Dollars) to
USD 30,400,000 (thirty million four hundred thousand U.S. Dollars)
and (ii) to extend the maturity of the Original Agreement through
31 July 2018.
(D)
The Lender has
issued debt securities to investors (the “Noteholders”) in order to finance
the loans provided under the Original Agreement.
(E)
After having
received the written consent from its then existing Noteholders,
the Lender agreed to amend the Original Agreement and have such
Original Agreement amended and restated.
(F)
As a consequence
thereof, the Parties entered into an amended and restated facility
agreement effective 30 June 2015 (Original Agreement, as amended
and restated, the “Facility
Agreement”). As of the date of the Facility Agreement,
and due to the amendments and restatements effective as of 30 June
2015, (i) the aggregate amount of the Facility is USD 30,400,000
(thirty million four hundred thousand U.S. Dollars) and (ii) the
maturity of the Facility is 31 July 2018.
(G)
The Outstanding
Principal Amount (as defined in the Facility Agreement) of the
Facility as of the date of this Agreement is USD 30,400,000 (thirty
million four hundred thousand U.S. Dollars).
(H)
(a) As of 30 June
2018, accrued and unpaid interest on the Outstanding Principal
Amount equals USD 5,951,644.44 (five million nine hundred fifty one
thousand six hundred forty four and forty four cents U.S. Dollars)
(the “Unpaid
Interest”) and (b) the Borrower is currently exploring
alternatives to refinance the Outstanding Principal Amount, which
matures on 31 July 2018 under the terms of the Facility
Agreement.
(I)
The Borrower
requested the Lender for a further extension of the maturity of the
Facility Agreement from 31 July 2018 to 1 April 2019 (the
“Extension”) by
a letter dated 26 February 2018. The Extension does not affect the
terms of the Facility Agreement and this Agreement only reflects
the understanding of the Parties regarding the specific terms
applying to the Extension.
(J)
On 26 April 2018,
the Lender convened its existing Noteholders to Noteholders
meetings for the purpose of, inter alia, considering and, if
thought fit, approving the request for the Extension and the
subsequent extension of the maturity of the debt securities issued
by the Lender to the Noteholders from 31 July 2018 to 1 April 2019
or any alternative restructuring solution that the Lender and the
Noteholders present at such meetings may discuss and deem fit (the
“Meetings”).
(K)
The Meetings of the
Noteholders approved and authorized the Extension, subject to the
satisfaction of certain conditions by the Borrower set forth in the
resolutions of the Noteholders (the “Noteholders’
Conditions”).
(L)
On 11 May 2018, the
Borrower reimbursed the Lender an amount of EUR 12,090.90 (twelve
thousand ninety Euro and ninety cents) for expenses associated with
the Meeting of the Noteholders held on 26 April 2018.
(M)
By a letter dated
18 May 2018, the Borrower provided responses and explanations to
the Noteholders’ Conditions, as set out in Schedule 1 of this
Agreement (the “Borrower
Letter”).
(N)
By a letter dated
14 June 2018, the Lender informed the Borrower that it notified the
Noteholders by separate notices dated 1 June 2018 with respect to
the Borrower Letter and that, as of 14 June 2018, none of the
Noteholders raised further queries with regards to the Borrower
Letter. As a consequence thereof, in the reasonable opinion of the
Lender, the Borrower Letter is satisfactory to fulfill the
Noteholders’ Conditions and the Lender will proceed with the
implementation of the Extension.
(O)
On 2 July 2018, the
Borrower paid to the Lender an amount of EUR 46,250 (forty-six
thousand two hundred and fifty Euro) as part of the agreed upon
budget for costs and expenses incurred by the Lender in connection
with the Extension (the “Budget”).
IT IS AGREED AS FOLLOWS:
1.
RECITALS, DEFINITIONS AND INTERPRETATION
1.1
Recitals (A)
through (P) are an integral part hereof.
1.2
Definitions
Unless
otherwise defined herein or where the context requires otherwise,
words or expressions defined in the Facility Agreement shall have
the same meanings in this Agreement (including in the preamble and
recitals hereto) and this construction shall survive the
termination of this Agreement and of the Facility
Agreement.
In
addition the following definitions will apply:
“Agreement” means this amendment
agreement.
“Effective Date” means 19 July
2018.
1.3
Interpretation
(a)
Section headings
are inserted for convenience of reference only and shall be ignored
in the construction of this Agreement.
(b)
Words importing the
singular shall include the plural and vice-versa.
(c)
References to a
document in this Agreement are references to such document as it
may be amended, novated, supplemented, extended or restated from
time to time.
(d)
References to a
person in this Agreement include its successors, transferees,
assignees or novated parties.
2.
AMENDMENTS TO THE FACILITY AGREEMENT
2.1
The Parties hereby
agree to extend the Facility until the Maturity Date to enable the
Borrower to repay the Outstanding Principal Amount, the Unpaid
Interest and any accrued interest after 30 June 2018 under the
Facility. The Extension does not affect the terms of the Facility
Agreement and this Agreement only reflects the understanding of the
Parties regarding the specific terms applying to the
Extension.
2.2
With effect as of
the Effective Date, the definition of “Interest Payment
Date” under the Facility Agreement shall read as
follows:
““Interest
Payment Date” means each of the following dates: (i)
31 January 2019 and (ii) the Maturity Date.”
2.3
With effect as of
the Effective Date, the definition of “Maturity Date”
under the Facility Agreement shall read as follows:
““Maturity
Date” means the earlier of the following dates: (i) 1
April 2019 and (ii) the date the Outstanding Principal Amount is
fully repaid by the Borrower pursuant to Section 3.7 (Change of Control).”
2.4
With effect as of
the Effective Date, a new Section 3.7 “Change of
Control” should be added to the Facility Agreement and shall
read as follows:
“3.7 Change
of Control
If any
person acquires at least 51% of the voting rights or the power to
direct or cause the direction of the management and policies of the
Borrower, whether through the ownership of voting securities, or by
contract, or otherwise (any
such event being referred to as a “Change of Control”):
(a)
the board of
directors of the Borrower shall promptly notify the Lender upon
becoming aware of that event;
(b)
the Lender will
immediately cancel the Facility and declare the Outstanding
Principal Amount, together with the Unpaid Interest and accrued
interest after 30 June 2018, immediately due and payable, whereupon
the Outstanding Principal Amount, together with the Unpaid Interest
and accrued interest after 30 June 2018, will become immediately
due and payable;
(c)
the Borrower
undertakes to provide in any contract for a Change of Control that
the acquiring person (i) pay or cause the Borrower to pay to the
Lender all amounts referred to in Section 3.7(b) above (ii) will
agree to terminate the Facility upon payment of all amounts
referred to in Section 3.7(b), thereby releasing the parties
thereto from any further obligations under this Agreement and (iii)
fully cooperate with the Borrower and the Lender with regards to
the settlement of the Outstanding Principal Amount, together with
the Unpaid Interest and accrued interest after 30 June 2018, under
this Agreement. Any such payments shall occur promptly and at the
latest within 3 (three) Business Days as from the occurrence of the
Change of Control; and
(d)
In this respect,
promptly upon receipt of notice of the Change of Control in
accordance with Section 3.7(a) above, the Lender will provide the
Borrower with a statement of the Outstanding Principal Amount,
together with accrued interest, and all other amounts accrued under
the Facility and any Finance Documents which remain due to it and
the bank account into which the buyer(s) shall direct the
payment.
This
Section 3.7 does not apply to ETS Limited and ADS Securities LLC
(together, the “Controlling
Shareholders”), so long as the Controlling
Shareholders either alone or collectively, directly or indirectly,
own less than 75% of the voting rights of the
Borrower.”
2.5
With effect as of
the Effective Date:
(a)
Section “3.7
Taxes” of the Facility Agreement should be renumbered as
Section “3.8 Taxes”; and
(b)
Section “3.8
Change of Law” of the Facility Agreement should be renumbered
as Section “3.9 Change of Law”.
2.6
The Parties hereby
agree and the Borrower expressly accepts that except for any
amendment to the Facility Agreement made pursuant to this
Agreement, all terms and conditions of the Facility Agreement will
continue in full force and effect in accordance with its provisions
on the date of this Agreement.
2.7
Any references in
the Facility Agreement to “this Agreement” shall be
read and construed as, and refer to, the Facility Agreement as
amended by this Agreement.
2.8
The agreement and
acceptance to the amendments in the Facility Agreement by the
Lender is without prejudice to, and
leaves unaffected, the rights of the Lender under the Facility
Agreement other than as directly related to this
Agreement.
3.
REPRESENTATIONS AND
WARRANTIES
3.1
The Borrower hereby
represents and warrants to the Lender that on the date of this
Agreement that all necessary corporate action has been taken to
authorize the entry into, execution and delivery of this Agreement,
and the performance of its obligations thereunder.
3.2
The Borrower hereby
represents and warrants to the Lender that the representations and
warranties under Section 5 (Representations and Warranties) of the
Facility Agreement are true and correct in all material respects as
if made as of the Effective Date (except to the extent that any
such representation and warranty expressly speaks as of an earlier
date, in which case such representation and warranty shall be true
and correct in all material respects as of such earlier
date).
4.
The
Extension and the Waiver are subject to the satisfaction or, at the
Lender’s discretion, the waiver (in whole or in part) of the
following conditions precedent:
(a)
this Agreement
shall have been duly authorized, executed and delivered by the
Borrower and shall be in full force and effect; and
(b)
the Borrower shall
have delivered to the Lender at the latest on the Effective Date
the Borrower’s board of directors’ resolution(s)
approving the entry into, execution and performance by the Borrower
of its obligations under this Agreement.
5.
FEES
On or
within 2 (two) Business Days after the execution of this Agreement,
the Borrower shall pay to the Lender a final amount of EUR 46,250
(forty-six thousand two hundred and fifty Euro) constituting the
remainder of the Budget for all costs and expenses incurred by the
Lender in connection with the Extension.
6.
WAIVER
As of
the Effective Date, and subject to the fulfilment of the conditions
precedent set out under Section 4 above, the Lender waives any
and all breaches or defaults under the Original Agreement and the
Facility Agreement (the “Waiver”). The Waiver shall prevent
the Lender from accelerating the Facility due to the failure by the
Borrower to pay accrued Unpaid Interest, and no Default Interest
shall be payable so long as all amounts due to the Lender under the
Facility Agreement, as amended, including the Outstanding Principal
Amount and Unpaid Interest, are paid on or before the Maturity
Date. The Waiver shall not have any force and effect if all amounts
then due to the Lender under the Facility Agreement, as amended,
are not paid on the earlier of (i) an Interest Payment Date, with
respect to accrued interests, and (ii) the Maturity Date. The
Waiver shall not affect any of the other Lender’s rights and
claims under the Facility Agreement.
7.
PARTIAL INVALIDITY
If at
any time, any one or more of the provisions hereof is or becomes
invalid, illegal or unenforceable in any respect under the law of
any relevant jurisdiction, such provision shall as to such
jurisdiction, be ineffective to the extent necessary without
affecting or impairing the validity, legality and enforceability of
the remaining provisions hereof or of such provisions in any other
jurisdiction. The invalid or unenforceable provision shall be
deemed replaced by such valid, legal or enforceable provision which
comes as close as possible to the original intent of the parties to
this Agreement and the invalid, illegal or unenforceable provision.
The aforesaid shall apply mutatis mutandis to any gap in this
Agreement.
8.
COUNTERPARTS
This
Agreement may be executed in any number of counterparts and by the
different Parties on separate counterparts each of which, when so
executed and delivered, shall be an original but all the
counterparts shall together constitute one and the same
instrument.
9.
NOTICES
9.1
All notices or
other communications under or in connection with this Agreement and
the Facility Agreement shall be given in writing, by electronic
mail or by registered letter.
9.2
All notices from
the Lender to the Borrower shall be validly made to the last known
address of the Borrower.
9.3
A notice given in
accordance with the above but received on a day that is not a
Business Day or after business hours in the place of receipt will
only be deemed to be given on the next working day in that
place.
9.4
The addresses of
each Party for all notices under or in connection with this
Agreement and the Facility Agreement are:
In
relation to the Lender:
Conrent Invest S.A.
acting
on behalf of its compartment “Safety 2”
Address: 283,
Route d’Xxxxx, X-0000 Xxxxxxxx, Xxxxx-Xxxxx xx
Xxxxxxxxxx
Attention
to:Simplex SarL, the Sole director of the Company
E-mail:
xxxxx.xxxxxxx@xxxxxxx.xx
In
relation to the Borrower:
Address: 000
Xxxx 0xx Xxxxxx, Xxxxx 000, Xxxxxxxxxx, Xxxxxxxx 00000, Xxxxxx
Xxxxxx of America
Attention to:Xxxxx
Xxxx, CFO
E-mail:
xxxxx.xxxx@xxxxxxxx.xxx
or any
other address notified by a Party for this purpose to the other
Party by not less than five Business Days’ prior
notice.
10.
GOVERNING LAW
Provisions of
Section 13 (Governing Law)
of the Facility Agreement shall apply mutatis mutandis to this
Agreement.
11.
JURISDICTION AND DISPUTE
RESOLUTION
Provisions of
Section 14 (Jurisdiction and
Dispute Resolution) of the Facility Agreement shall apply
mutatis mutandis to this
Agreement.
12.
SERVICE OF PROCESS
Provisions of
Section 15 (Service of
Process) of the Facility Agreement shall apply mutatis mutandis to this
Agreement.
This Agreement has been entered into in two (2) originals, each
Party acknowledging receipt of one, on the date stated at the
beginning by:
[Remainder of page intentionally left blank; signature page to
follow]
[Signature page of the amendment agreement]
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Conrent Invest S.A.
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acting
on behalf of its Compartment “Safety2”
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as Lender
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/s/ Xxxxxxxx
Xxxxxxxx
By:
Simplex S.à x.X.
Title:
Sole director of the Company
Represented
by: Xx. Xxxxxxxx Xxxxxxxx Xxxxxxx
Title:
Sole manager of Simplex S.à x.X.
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As Borrower
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/s/ Xxxxx
Xxxx
By:
Xxxxx Xxxx
Title:
CFO
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/s/ Xxxxx
Xxxxxxx
By:
Xxxxx Xxxxxxx
Title:
CEO
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SCHEDULE 1
A-1
