19. SUBSEQUENT EVENTS

On June 24, 2013, the subsidiaries of SLP entered into a $15.0 million credit facility with City National Bank (the “Credit Facility”). Certain subsidiaries of SLP are the borrowers under such facility and SLP guarantees the obligations of such subsidiaries under the credit facility (SLP and such borrower subsidiaries collectively, the “Credit Parties”). The Credit Facility is secured by certain assets of SLP and the borrower subsidiaries. The Credit Facility consists of a $7.5 million delayed draw term loan with a stated maturity date of June 24, 2025 and a $7.5 million revolving credit facility with a stated maturity date of June 21, 2019. On June 20, 2019, the Credit Parties and City National Bank entered into the Sixth Amendment to the Credit Agreement (the “Sixth Amendment”) whereby the revolving credit facility maturity date was extended until June 19, 2020.  On July 1, 2019, the Credit Parties and City National Bank entered into the Seventh Amendment to the Credit Facility (the “Seventh Amendment”) whereby, among other things, the delayed draw term loan credit facility was increased by $18 million to $25.5 million, the commitment period for the term loan was extended to July 1, 2024 and the stated maturity date therefor was extended until July 1, 2026. Additionally, the revolving credit facility was increased by $2.5 million to $10 million. The Base Rate Margin and LIBOR Rate Margin were each decreased by 0.25 percentage points to 0.25 percentage points and 2.75 percentage points, respectively. The minimum discretionary assets under management covenant was amended such that (i) if the aggregate outstanding principal balance of the term loans and revolving loans is less than $5 million, the covenant is not applicable, (ii) if the aggregate outstanding principal balance of the term loans and revolving loans is greater than or equal to $5 million, but less than $10 million, the average amount of discretionary assets under management must be at least $8 billion and (iii) if the aggregate outstanding principal balance of the term loans and revolving loans is greater than or equal to $10 million, the average amount of discretionary assets under management must be at least $11 billion. The debt incurrence covenant in the Credit Facility was also adjusted to carve out and permit earn-outs incurred under the Purchase Agreement (as defined below).  The Credit Facility and all other loan documents between the Credit Parties and City National Bank continued in full force and effect. 

The foregoing description of the Sixth Amendment is only a summary, does not purport to be complete, and is qualified in its entirety by reference to the full text of the Sixth Amendment which is attached as Exhibit 4.1 to the Form 8-K filed by Silvercrest on June 25, 2019.

The foregoing description of the Seventh Amendment is only a summary, does not purport to be complete, and is qualified in its entirety by reference to the full text of the Seventh Amendment which is attached as Exhibit 4.1 to the Form 8-K filed by Silvercrest on July 2, 2019.

On July 1, 2019, SAMG LLC (the “Purchaser”), completed the previously announced acquisition of substantially all of the assets of Cortina relating to Cortina’s business of providing investment management, investment advisory, and related services (the “Closing”). The acquisition was completed pursuant to the Purchase Agreement, dated as of April 12, 2019, by and between the Purchaser, the Company, Cortina and the Principals.

At Closing, the Company paid to Cortina an aggregate principal amount of $33,577 in cash, and SLP paid an additional $8,952 in the form of issuance and delivery to certain Principals of 662,713 Class B Units in SLP. The Purchase Agreement provides for up to an additional $26,209 to be paid 80% in cash with certain Principals receiving the remaining 20% in the form of Class B Units of Silvercrest L.P. in potential earn-out payments over the next four years.

The Company’s cash payments at Closing were funded in part by cash on hand and in part by borrowings under the Credit Facility described above.  Closing was subject to customary closing conditions.

The foregoing description of the Purchase Agreement is only a summary, does not purport to be complete, and is qualified in its entirety by reference to the full text of the Purchase Agreement, which was filed as Exhibit 2.1 to the Company’s Current Report on Form 8-K filed on April 12, 2019.