AUDIOEYE, INC. (OTCMKTS:AEYE) Files An 8-K Entry into a Material Definitive Agreement

AUDIOEYE, INC. (OTCMKTS:AEYE) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01.


Loan Agreement

On August 14, 2019, the Company entered into a Loan Agreement dated as of August 14, 2019 (the “Loan Agreement”) with Sero Capital LLC, a Delaware limited liability company and significant stockholder of the Company (the “Lender”). The Loan Agreement provides the Company with an unsecured credit facility to which the Company may, from time to time during the term of the Loan Agreement and subject to the terms and conditions thereof, borrow up to the aggregate principal amount of $2,000,000. Any advances under the Loan Agreement will bear interest at a per annum rate of 10% (subject to increase in the event of a default), which will be payable monthly (subject to certain exceptions) and may, at the Company’s option, be paid either in cash or by the issuance to the Lender of shares of Common Stock. The term of the Loan Agreement extends through August 14, 2020, subject to earlier termination as provided in the Loan Agreement. The Company’s obligations under the Loan Agreement are subject to acceleration upon the occurrence of an event of default (as defined in the Loan Agreement). The Company may prepay its obligations under the Loan Agreement without penalty, but subject to certain limitations regarding the number, timing and dollar amounts of prepayments. The Loan Agreement provides for certain customary covenants, representations and events of default.

As described in Item 3.02 of this Current Report on Form 8-K (this “Form 8-K”), the Company issued certain Common Stock Warrants to the Lender in connection with the Loan Agreement.

The foregoing description of the Loan Agreement is qualified in its entirety by the text of the Loan Agreement, a copy of which is filed as Exhibit 10.3 hereto and incorporated herein by reference.


The information set forth in this Item 7.01 is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of such section, nor shall it be deemed incorporated by reference into any registration statement or other filing under the Securities Act or the Exchange Act, regardless of any general incorporation language in such filing, except as shall be expressly set forth by specific reference in such filing.