SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Item 1.01. Entry into a Material Definitive Agreement.
Amendment to Existing Credit Facility
On December 16, 2020 (the “Amendment Date”), Misonix, Inc. (the “Company”) and Solsys Medical, LLC, its wholly owned subsidiary (“Solsys”), entered into a third amendment (the “Third Amendment”) to their existing credit agreement with SWK Funding LLC, pursuant to which, among other things, such credit agreement (as so amended, the “Amended Credit Agreement”) was amended to reduce the interest payable under certain conditions thereunder, extend the interest only period, extend the maturity date, extend the prepayment penalty period and increase the exit fee by one percent, each as further described below. On the Amendment Date, the outstanding principal balance of the term loans under the Amended SWK Credit Agreement was $30,095,761.
The term loans under the Amended Credit Agreement accrue interest at a variable rate of the greater of 2.0% or the three-month LIBOR, with a maximum variable rate of 3%, plus a margin of between 7.5% and 10.25% depending on the Company’s earnings before interest, taxes, depreciation and amortization or market capitalization, payable quarterly. Under the Amended Credit Agreement, the Company and Solsys are required to make quarterly principal payments beginning in May, 2022 of $1,250,000 plus accrued interest, with all remaining principal and unpaid accrued interest due June 30, 2024. The period during which the Company is obligated to pay a 1% prepayment penalty was extended from September 2022, to March 2023 under the Amended Credit Agreement. Upon termination of the Amended Credit Agreement, the Company is required to pay an exit fee equal to 2.0% of the principal amount of all loans advanced to the Company under the Amended Credit Agreement
The obligations under the Amended SWK Credit Agreement are (i) guaranteed by Misonix OpCo, Inc. (“Misonix OpCo”), a wholly owned subsidiary of the Company, and (ii) secured by a first lien on substantially all assets of the Company, Solsys and Misonix OpCo (other than accounts receivable and inventory) and a second lien on accounts receivable and inventory of the same entities.
The foregoing description of the Third Amendment does not purport to be complete and is qualified in its entirety by reference to the full text of the Third Amendment, which is attached as Exhibit 10.1 to this Form 8-K and 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 under Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
Third Amendment to Amended and Restated Credit Agreement dated as of December 16, 2020 by and Among Solsys Medical, LLC and Misonix, Inc. as borrowers, each of the financial institutions signatories thereto and SWK Funding LLC, as administrative agent
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Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
|Dated: December 17, 2020|
|By:||/s/ Joseph P. Dwyer|
|Joseph P. Dwyer|
|Chief Financial Officer|