Item 1.01 Entry into a Material Definitive Agreement.
Amendment to Centurion Commitment Letter
On
amending agreement (the “Amending Agreement”) to its commitment letter dated
investment trust managed by
respect of the Company’s previously disclosed
“Credit Facility”) with Centurion comprised on a
(the “Senior Term Loan”), funded in two tranches of
and a
the Senior Term Loan and the Revolving Loan were previously funded in
The Credit Facility, including the Commitment Letter and the related Debenture
dated
9, 2021
the Company’s Current Report on Form 8-K as filed with the Commission on
16, 2021
The Amending Agreement amended the terms of the second tranche of the Senior
Term Loan. Previously, the Commitment Letter had provided that the Company
could only access the second tranche of the Senior Term Loan solely for funding
certain acquisition transactions. As amended, the Company may now access the
second tranche of the Senior Term Loan of up to
initiatives and general working capital purposes. Further, the Amending
Agreement clarified the Company’s reporting requirements in relation to the
“Borrowing Base” which had previously been left undefined. Under the Amending
Agreement, the Company will (i) continue to provide Centurion monthly financial
reporting of its detailed aging account receivable balances along with
supporting details, (ii) update the monthly reporting information to include any
and all new subsidiaries that are to be formed for the Company’s business to
ensure the reports capture all invoicing, billings and collections for the
consolidated business for purposes of determining the “Borrowing Base”, and
(iii) the “Borrowing Base” covenant, which was previously undefined, is defined
as combined advances under the Credit Facility (both tranches combined,
“Combined Advances”) are not to exceed the Borrowing Base, which is defined as
75% of accounts receivable under 240 day less priority payables. A monthly
Borrowing Base covenant calculation is to be provided to Centurion within 25
days of month end. If for any reason whatsoever, the aggregate outstanding
principal amount of Combined Advances shall, at any time, exceed the Borrowing
Base (any such amount of the excess at any time, an “Excess Amount”), then
promptly on demand from Centurion, the Company shall repay in an amount equal to
or greater than the Excess Amount so as to reduce the Excess Amount at the time
of repayment to zero.
The Amending Agreement also provides for certain conditions precedent, including
completion of a concurrent
on
Centurion. The Amending Agreement contains several conditions subsequent
including delivery of (i) an updated financial model, (ii) an updated accounts
receivable as of
confirmation of additional security registrations and (v) such additional
information as Centurion may request in its analysis of the above items.
The Amending Agreement provides that each of the Debenture, Guarantee, Security
Agreement and Contract Assignment are deemed to have been amended, effective the
same date as the Amending Agreement, to the extent necessary to give effects to
the amendments in the Amending Agreement, with formal amendments to occur with
90 days of the date of the Amending Agreement or such longer period as the
parties may agree.
The above summary of the material terms of the Amending Agreement is qualified
in its entirety by the Amending Agreement which is filed as Exhibit 10.1 to this
Current Report on Form 8-K and is incorporated herein by reference.
Management Private Placement
On
securities purchase agreements (the “Securities Purchase Agreement”) with
certain of its officers, directors, employees and consultants (the “Investors”)
pursuant to which the Company sold and issued to the Investors an aggregate of
70,300 shares of common stock of the Company, par value
issue price of
Private Placement”). The Shares were issued to the investors for cash pursuant
to Rule 506(b) of Regulation D under the United States Securities Act of 1933,
as amended (the “
to the representations and warranties of the Investors. The purchase price per
Share was determined based on the closing bid price of the Company’s Shares on
the Nasdaq Capital Market on
the date the Company and the Investors entered into binding agreements in
relation to the Management Private Placement.
The above summary of the material terms of the Securities Purchase Agreement is
qualified in its entirety by the form of Securities Purchase Agreement which is
filed as Exhibit 10.2 to this Current Report on Form 8-K and is incorporated
herein by reference.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
The disclosure set forth in Item 1.01 regarding the Amending Agreement is
incorporated herein by reference. On
Amending Agreement and the satisfaction of the conditions precedent thereunder,
the Company drew upon the second tranche of the Senior Term Loan in the full
amount of
Item 3.02 Unregistered Sale of
The disclosure set forth in Item 1.01 of this Current Report on Form 8-K related
to the Management Private Placement is incorporated herein by reference. In
connection with the Management Private Placement, the Company issued the Shares
to the Investors on
Item 9.01 Exhibits Exhibit No.Name
10.1 Amending Agreement, dated
10.2* Form of Securities Purchase Agreement
104Cover Page Interactive Data File (formatted in Inline XBRL and included as
Exhibit 101).
* Certain schedules have been omitted pursuant to Item 601(b)(2) of Regulation
S-K, but a copy will be furnished supplementally to the
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