EX-10.2 3 bridgebankmodification.htm EXHIBIT
B USINESS FINANC I NG MODIFICATION AGREEMENT
Th is Business Fina n c in g Modification Ag r eement i s ente r ed into as of Oct ober 9, 2014, by and between Inu vo, Inc., a Nevada corporation ("Parent"), Babytobee, LL C, a New York limit ed liabilit y com pany ("Babytobee"), Kowabunga Marketing, In c., a Michigan corporation ("Kowabunga "), Vertro , I nc., a De l aware corporation ("Ve rtr o"), and A l o t, In c., a Delaware corpo rati on ("Alot" and t ogether w i th Parent, Babytobee, Kowabunga and Vertro, eac h a "Borrower" and co llecti ve l y, "Borrowers") and Bridge Bank, National Associa tion ("Lender").
I. DESCRIPTION OF Existing indebtedness: Amon g other i ndebtedness whic h may b e owing by Borrower to Lender, Borrower i s i nd ebted t o Lender pursuant to, among o th er d ocume nt s, a Business Financing Ag r eemen t, dated March I , 2012, by and between Borrower a nd L e nd e r, as may be amended from time to time (the "B u siness Financing Agreeme nt"). Capitalized terms u sed wi th ou t definition h erein s hall have the meanings ass i gned to them in the Busines s Financing Ag reement.
Hereinafter , all indeb t ed ne ss owing by Borrower to L ender s hall be referred to as the "Indebtedness" and th e Business Financing Agreement and any and a ll othe r documents execu t ed by Borrower in fa vo r of Lender sha ll be referred t o as the "Existing Document s."

2. | DE SCRIPTION OF CHANGE IN TERMS.

A. | Modification(s) to Busine ss Financing Agreement:

i) | Section 4.15 of t h e Bus i nes s Financing Agreement is hereby amended and r estated in it s e ntirety to read a s follows:

4.15 Ma in ta in B o rr owers' consolidated financial condition as follows u s in g generally accepted accounting principle s co n sis t en tly applied and used consistent l y with pr i o r practices (excep t to the extent m od ifi ed by the defini t ions herein):
(a) Asset Coverage Ratio, measured monthly , of not l ess than (i) 1 .2 5 to 1.00 f or the month e nded August 31 , 2014 and September 30, 20 14; (ii) 1.15 to 1.00 for the
month ending October 31 , 20 1 4, November 30, 20 14, and December 31, 2014, and (iii)
1.25 to 1.00 for the m onth ending J anuary 3 1, 20 1 5 a n d each month t her eafte r.
(b) Debt Service Cove ra ge Ratio, measured monthly o n a trailing 3-month basis, of not les s than I.75 to 1.00 for th e A u g u st 2014 mea s urin g period , and each monthly measuring period thereafter.
(c) For the August 2014 and September 2014 m easuri ng periods , Borrowers sha ll n o t negati vely d eviate more t h an 20% from the approval l r eve n ue and adjusted EB I TA as ca lcul ate d in t h e pro j ected p l an m os t recently s ubmi tted and accepted by Lender in it s sole discreti o n.

ii) | The following defi n ed term se t fo r th in Sect i o n 1 2. 1 of the Business F i nancing Agreeme nt

i s hereby amended and restated in its e ntiret y, as f o ll ows:
"Debt Service Cove ra ge Ratio" means, (i) for t he months ended Augu s t 31, 20 14 and Septe m ber 30, 2014, the ratio of Operating Profit to the s um of the curre nt p ortion of Borrowers ' l ong term indebtednes s for th e period being mea s ur ed; and (i i) for the mont h e nding October 31, 20 1 4 and each monthly period thereafter, the rat i o of Ope r ating Pr ofi t minu s B o rr owers' capitalized labor expenses to t he s u m of the c urr ent portion of B o rro we r s' lo n g t erm indebtedne ss plus all i nterest payments on all indebtednes s during s u c h pe ri o d.
3.CONS I STENT CHANGES. The Existing Do c ument s are each her eby a mended wherever ne cessa ry to refl ec t th e c h anges de scr ibed abo ve.

4. | INTENTIONALLY OMITTED .

5.NO DEFENSES OF B ORROWER/GENERAL RELEASE. Borr o wer agrees that , as of thi s date, it has n o d e f e n ses against the ob li gatio n s to pay an y amounts under th e Ind ebtedness. Eac h o f B orrower a nd Guarantor (eac h, a "R eleas in g Part y") acknowle d ges that Lender would n ot e nt e r int o this Business Financing Modification Agreement wi th out R e l easing Part y's a ss uran ce that it has n o cla im s aga in s t Lender or any of Lender 's office r s, directors, employees or agents. Except for the obligation s arisi n g hereafter under thi s Bu s ine ss Finan c in g Modification Ag r eeme nt , each Relea s in g Party re lea ses L ender, and eac h of Lender 's and entity 's officers, directors and emp l oyees from any known o r unknown claims that R e leasing Party now ha s against L e nd e r of a n y nature , including an y c la ims th at R e l easing P arty, it s s u ccesso r s, co unsel , and ad v i so r s ma y in the futur e di scove r they would ha ve now h ad if t h ey had known fac t s not n ow known to them, w h e ther founded in contrac t, in tort o r pur s u a nt to any o th e r theory of liabil it y, includin g but n o t limited to any claims arising o ut of o r rela t ed t o the Agreement or th e tra n sactio n s contempla ted th e r eby. R e leasing Part y wa i ves the provisi o ns of California Civil Co de sec ti on 154 2, which s tate s:
A GENERAL RELEASE DOES NOT EXTEND TO CLAlMS WHICH THE CRED!TOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUT I NG THE REL EASE, WHIC H IF KNOWN BY HIM OR HER, MUST H AVE MATERIALLY AFFECT E D HIS OR HER SETTLEMENT WITH THE DEBTOR.
T he provi s i o n s, waive r s and r e lea ses se t forth in thi s sec ti o n are binding upon eac h Releasing Party and it s shareholders , agents, employees, assigns and s u ccessors in intere s t. The provi s ion s, waive rs and relea ses of this section s hall inur e t o the b e nefi t of Lender and it s a ge nt s, em plo yees, officers, director s, a ss i g n s and s u ccessors in in t erest. The pro v i s i ons o f thi s sec tion s hall s ur v ive payment in full of the Ob li gatio n s, full performanc e of a ll th e terms of thi s Bu s ine ss Finan c in g Modification Agreeme nt and the Agreement, and/or Lender 's ac ti ons to exe r c i se any r e med y a v ai l able under th e A gree m e nt o r otherw i se.
6.CONTINUIN G VAL I DITY. Borrower und ers t a nd s and agrees t h at in modifying the ex 1 s tmg [indebtedness, L ende r i s rel y in g upon B o rrower 's repr ese ntation s, warra nti es, and ag r ee ments, as se t f o rth in the Exi s tin g Do c um ents. Ex cep t as exp r essly modified p ur s uant to this Busin ess F i nancing Modifi ca tion A g r eement , th e tem1 s of th e Exi st in g D oc uments r e main un c hanged and in full forc e a nd effec t. Lender 's a g reem e nt to modifica ti ons t o the ex i s tin g Indebt e dn ess pur s uant to thi s Busin ess Fin anc ing Modifi catio n Agreement in n o way s hall o bli gate L e nd e r t o make any futur e m o dification s to th e Indebtedne ss. Nothing in thi s Bu siness F in anc in g M o dificati o n Agreement s hall co n s t i tut e a sa tisfa c tion of th e Ind eb tedn ess. It is t h e intenti on of Lender a nd Borrow er to r e tain a s liabl e parti es a ll mak e rs and e nd orse r s of Ex i st in g Docum e n t s, un l e ss the party is express l y r e l eased by Lender in wri tin g. No mak e r, e n dorser, o r g u a rantor w i ll be r e l ease d by virtue o f thi s Business Financin g Modifi cat ion A g r eeme nt. The t erms of thi s pa r agra ph app l y not o nly to thi s B u s in ess Financing Modifi cat ion A g reement, but a l so t o any s ubsequent Bu s ine ss F in a n ci ng modifi c ation agreement s.
7.INTENTIONALLY OM ITTED.
8.NOTICE OF FINAL AGREEMENT. BY S I GNING THIS DO CUMENT EACH PAR T Y REPRE SENTS AND AGREES THAT : (A) THIS WR ITT EN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTI ES, (B) THER E ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PART I ES, AND (C) THI S WRITTEN AGREEMENT MAY NOT BE CONTRADICTED BY EVIDEN CE OF ANY PRIOR , CONTEMPORANEOUS , OR SUBSEQUENT ORAL AGREEMENTS OR UNDERSTANDINGS OF THE PARTIES.
9.COUNTE R S IGNATURE. Th i s Busine ss Finan c in g Mod ifi cation Agreement s hall b eco me ef f ec ti ve o nl y w h e n exec ut ed b y Lend e r a nd B o rr ower.

BORROWER:
INUVO, INC.
B y:
Name:
Titl e:
BABYTOBEE , L LC
B y:
Name: -------------------
T i t l e:
KOW ABUNGA MARKETING, IN C.
B y:
Name: ----------------
Titl e:
VERTRO, INC.
By:
Name:

LE N DER:
BRIDGE BANK , NATIONAL ASSOCIAT I ON
By:
Name: -----------------------
T itl e:
Tit l e:
A L OT, INC.
B y:
Name:
Tit l e: