Tangelo Games, a developer and operator of social casino games, reached an agreement with its lenders to amend certain terms of its outstanding credit agreement. Tangelo previously completed a secured debt financing pursuant to an amended and restated credit agreement dated November 16, 2015, which amended the terms of a prior credit agreement dated January 30, 2015, as amended among the company as borrower, the subsidiaries of Tangelo as credit parties, a syndicate of lenders and the lenders’ administrative agent, Third Eye Capital (TEC).
The company and its subsidiaries have entered into a waiver and amendment to the credit agreement with TEC, on behalf of the lenders, waiving breaches by the company of certain covenants and amending the covenant thresholds for future periods. Pursuant to the amendment, Tangelo’s obligations to repay principal of $14 million on or before December 31, 2016 has been amended and the company is now obligated to pay the greater of $10 million and 90% of the proceeds of any equity or a M&A transaction completed by Tangelo on or before March 31, 2017. No other repayment of principal will be due under the credit agreement until the facility matures.
TEC also agreed to amend the current ratio, minimum cash, average daily active user and unique buyer covenants for the periods from December 31, 2016 to March 31, 2017. As consideration for these amendments, among other things, the company agreed to pay to the lenders a $200,000 fee.