Loan Amendment and Consent Agreement, dated November 26. 2024, by and among Venus Concept Inc., Venus Concept Canada Corp., Venus Concept USA Inc., Venus Concept Ltd., Madryn Health Partners, LP and Madryn Health Partners (Cayman Master), LP

WHEREAS, in connection with the Loan, Venus Concept and Venus Canada have previously issued a Guaranty of Payment and Performance, originally dated as of December 8, 2020, in favor of the Lender (as amended, restated, amended and restated, supplemented or otherwise modified from time to time prior to the date hereof, the “Main Street Guaranty”);

WHEREAS, in connection with the Loan, (i) the Borrower, each Lender and CNB entered into that certain Subordination of Debt Agreement, dated as of December 8, 2020 (as amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Borrower Main Street Subordination Agreement”), (ii) Venus Concept, each Lender and CNB entered into that certain Subordination of Debt Agreement, dated as of December 8, 2020 (as amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Venus Concept. Main Street Subordination Agreement”), (iii) Venus Canada, each Lender and CNB entered into that certain Subordination of Debt Agreement, dated as of December 8, 2020 (as amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Canada Main Street Subordination Agreement”), and (iv) the Venus Israel, each Lender and CNB entered into that certain Subordination of Debt Agreement, dated as of October 4, 2023 (as amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Israeli Main Street Subordination Agreement” and, together with the Borrower Main Street Subordination Agreement, the Venus Concept Main Street Subordination Agreement and the Canada Main Street Subordination Agreement, the “Madryn Main Street Subordination Agreements” and each, a “Madryn Main Street Subordination Agreement”);

WHEREAS, pursuant to that certain Main Street Loan – Venus Concept – Sale and Assignment Agreement, dated as of April 23, 2024, between CNB and the Lenders, CNB assigned, transferred, and conveyed all of its rights, title, and interest in and to the Loan, Note, the Loan Agreement, the Main Street Guaranty, the Madryn Main Street Subordination Agreements, all other Loan Documents and any related documents to the Lenders;

WHEREAS, pursuant to that certain Exchange Agreement, dated as of May 24, 2024, and made among the Borrower, Venus Concept, and the Lenders, the Lenders exchanged the Original Note for (a) two new promissory notes issued by the Borrower to each of Madryn Health and Madryn Cayman (as amended, amended and restated, supplemented, waived, exchanged or otherwise modified from time to time, collectively, the “May 2024 Notes”) and (b) shares of preferred stock of Venus Concept;

WHEREAS, pursuant to that certain Exchange Agreement, dated as of September 26, 2024, and made among the Borrower, Venus Concept, and the Lenders, the Lenders exchanged the May 2024 Notes for (a) two new promissory notes issued by the Borrower to each of Madryn Health and Madryn Cayman (as amended, amended and restated, supplemented, waived, exchanged or otherwise modified from time to time, collectively, the “Notes” and each, a “Note”) and (b) shares of preferred stock of Venus Concept;

WHEREAS, the Borrower will be required to pay to the Lenders accrued interest on the Notes on December 8, 2024 (such interest, the “December 2024 Interest”);

WHEREAS, the Borrower has requested that in lieu of paying the December 2024 Interest in cash, the Lenders consent to the payment by the Borrower of the December 2024 Interest by adding such interest to the outstanding principal amount of the Loan effective as of December 8, 2024 (such payment, the “December 2024 PIK Interest Payment”);

WHEREAS, the Borrower has requested relief from the obligation to comply with the requirements of Section 7(a) of the Loan Agreement (“Liquidity”) in respect of the Borrower’s minimum liquidity amounts (“Requested Minimum Liquidity Consent”); and

WHEREAS, the Lenders are willing to consent to the December 2024 PIK Interest Payment and the Requested Minimum Liquidity Consent, subject to the terms and conditions hereof;

NOW, THEREFORE, in consideration of the premises and the mutual covenants contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

(ii)      The Borrower and the Lenders acknowledge and agree that in lieu of making cash payment of the December 2024 Interest, the Borrower will pay such interest to the Lenders on December 8, 2024 by adding such interest to the outstanding principal amount of the Loan on such date. Any and all such paid-in-kind interest so added to the principal amount of the Loan shall constitute and increase the principal amount of the Loans for all purposes under this Agreement and shall bear interest in accordance with the provisions of the Loan Agreement and Notes.

(b)      Requested Minimum Liquidity Consent. The Lenders, as of the date hereof, hereby approve the Requested Minimum Liquidity Consent and agree that until December 31, 2024, the failure of any of the Loan Parties to comply with the obligations of Section 7(a) of the Loan Agreement shall not constitute an Event of Default under the Loan Agreement or the Notes. The above consent shall not otherwise modify or affect the Borrower’s and the other Loan Parties’ obligations to comply fully with the terms of the Loan Agreement, the Notes or any other Loan Document in the future and is limited solely to the matters set forth in this Section 1(b). Nothing contained in this Agreement shall be deemed to constitute a waiver of any duty, term, condition or covenant contained in the Loan Agreement, the Notes or any other Loan Document in the future, or any other rights or remedies any Lender may have under the Loan Agreement, the Notes or any other Loan Documents or under applicable law.

 

2.          Amendment to Notes. Section C (Payment Terms) of each Note is hereby amended by deleting the stricken text (indicated textually in the same manner as the following example: stricken text) as follows:

Commencing on January 8, 2022, and continuing on the eighth (8th) day of each month thereafter, Borrower shall make consecutive monthly payments of accrued interest. In addition to the monthly payments of accrued interest, on December 8, 2024 (the “Principal Payment Date”), the Borrower shall make an annual payment of principal, inclusive of any capitalized or paid-in-kind interest, in an amount equal to seven and a half percent (7.5%) of the outstanding principal balance of this Note (inclusive of any capitalized or paid-in-kind interest) as of the Principal Payment Date. Unless this Note is otherwise accelerated in accordance with the terms and conditions hereof, the entire outstanding principal balance of this Note (inclusive of any capitalized or paid-in- kind interest) plus all accrued and unpaid interest shall be due and payable in full on December 8, 2025 (the “Maturity Date”). Unless otherwise expressly agreed in writing, the payments due hereunder shall be paid in cash by Borrower to Lender.

3.          Conditions Precedent. This Agreement shall be effective upon the date on which the Lenders shall have received counterparts of this Agreement duly executed by the Borrower, the Guarantors, and the Lenders.

4.          Reaffirmation. Each of the Loan Parties acknowledges and reaffirms (a) that it is bound by all of the terms of the Loan Documents to which it is a party and (b) that it is responsible for the observance and full performance of all Obligations, including without limitation, the repayment of the Loan. Furthermore, the Loan Parties acknowledge and confirm that by entering into this Agreement, the Lenders do not, except as expressly set forth herein, waive or release any term or condition of the Loan Agreement, the Notes or any of the other Loan Documents or any of their rights or remedies under such Loan Documents or any applicable law or any of the obligations of the Loan Parties thereunder.

5.            Representations and Warranties. Each Loan Party represents and warrants to the Lenders as follows:

(i)       it has read and understands the effect of the Release Provision. Each Loan Party has had the assistance of independent counsel of its own choice, or has had the opportunity to retain such independent counsel, in reviewing, discussing, and considering all the terms of the Release Provision; and if counsel was retained, counsel for such Loan Party has read and considered the Release Provision and advised such Loan Party with respect to the same. Before execution of this Agreement, each Loan Party has had adequate opportunity to make whatever investigation or inquiry it may deem necessary or desirable in connection with the subject matter of the Release Provision.

(ii)      no Loan Party is acting in reliance on any representation, understanding, or agreement not expressly set forth herein. Each Loan Party acknowledges that the Lender Group has not made any representation with respect to the Release Provision except as expressly set forth herein.

(iii)     each Loan Party has executed this Agreement and the Release Provision thereof as its free and voluntary act, without any duress, coercion, or undue influence exerted by or on behalf of any person.

(iv)     each Loan Party is the sole owner of its respective claims released by the Release Provision, and no Loan Party has heretofore conveyed or assigned any interest in any such claims to any other Person.

(c)      The Loan Parties understand that the Release Provision was a material consideration in the agreement of the Lenders to enter into this Agreement. The Release Provision shall be in addition to any right, privileges and immunities granted to the Lenders under the Loan Documents.

(a)     The Loan Agreement and the Notes, each as may be modified hereby, and the obligations of the Loan Parties thereunder and under the other Loan Documents, are hereby ratified and confirmed and shall remain in full force and effect according to their terms. This Agreement shall constitute a Loan Document under the Loan Agreement.

(b)     This Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be an original, but all of which shall constitute one and the same instrument. Delivery of an executed counterpart of this Agreement by telecopy shall be effective as an original and shall constitute a representation that an executed original shall be delivered.

(c)    THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.