Sonic Foundry, Inc. (NASDAQ:SOFO) Files An 8-K Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
Sonic Foundry, Inc. (the “Company”) entered into a Consent, Waiver & Modification to the Loan and Security Agreement dated May 11, 2018 (the “Modification”) with Partners for Growth V, L.P. (“PFG”) on March 11, 2019. Under the Modification: PFG waived the Company’s default on the Minimum EBITDA financial covenant for the quarterly reporting period ending December 31, 2018; modifies the existing financial covenants to be as follows: (i) Minimum Coverage Ratio, which requires, as of the last day of each month on or after the closing date, the Minimum Coverage Ratio (as defined) to be equal to or greater than (x) 0.7: 1.00 for the December through May calendar months, (y) 0.9:1.00 for the June through November calendar months; (ii) Minimum Qualifying Revenue (as defined), as of the last day of any calendar month, on or after December 1, 2018, on a trailing twelve-month basis, to be less than $13,000,000; and modifies the negative covenants to be as follows: (x) shall not cause or permit (a) Japanese subsidiary indebtedness under its revolving line of credit facility to exceed at any time $1,000,000 outstanding, or (b) aggregate subsidiary indebtedness to exceed $1,200,000 at any time.
The Modification acknowledges that Silicon Valley Bank, the named “Senior Lender” in the May 11, 2018 Loan Agreement has been repaid and the related senior loan documents terminated.
The existing terms of the PFG loan in terms of amortization, interest rate, payment schedule and maturity date are unchanged.
A copy of the Modification is attached as Exhibit 10.1 to this report and the summary above is qualified by reference to the entire document.
The Note Purchase Agreement dated February 28, 2019 is subordinated to the existing PFG loan.
A copy of the Note Purchase Agreement was filed as Exhibit 10.1 to the Form 8-K filed on March 6, 2019 and is hereby incorporated by reference.
Item 9.01 Financial Statements and Exhibits.
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10.1 |
Consent, Waiver & Modification to Loan and Security Agreement between Sonic Foundry, Inc. and Partners for Growth V, L.P., dated March 11, 2019 |
EXHIBIT LIST
NUMBER DESCRIPTION
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10.1 |
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10.2 |
SONIC FOUNDRY INC Exhibit
EX-10.1 2 a2019-03x07sofowaiver.htm EXHIBIT 10.1 Exhibit CONSENT,…
To view the full exhibit click here
About Sonic Foundry, Inc. (NASDAQ:SOFO)
Sonic Foundry, Inc. is engaged in the business of providing enterprise solutions and services for the Web communications market. The Company operates in geographic regions, including the United States, Europe and Middle East, and Asia. The Company is engaged in offering video capture, management and Webcasting solutions in sectors, such as education, business and government. The Company’s Mediasite Video Platform transforms communications, training, education and events for its customers. The Company sells Mediasite recorders and server software products and related services contracts, such as customer support, installation, customization services, training, content hosting and event services. The Mediasite video platform delivers live and on-demand video on screen. The Mediasite Video Cloud provides an option for video streaming, storage and management for organizations. The Mediasite ML Recorders are designed for on-the-go Webcasting, hybrid events, guest speakers and conferences.
