USA TECHNOLOGIES, INC. (NASDAQ:USAT) Files An 8-K Entry into a Material Definitive Agreement

USA TECHNOLOGIES, INC. (NASDAQ:USAT) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry into a Material Definitive Agreement.

On August 14, 2020, USA Technologies, Inc. (the “Company”) repaid all amounts outstanding under its Existing Credit Agreement (as defined below) and entered into a new credit agreement (the “Credit Agreement”) among the Company, as the borrower, its subsidiaries, as guarantors, and JPMorgan Chase Bank, N.A., as lender and administrative agent.
The Credit Agreement provides for a $5 million secured revolving credit facility (the “Revolving Facility”) and a $15 million secured term facility (the “Term Facility” and together with the Revolving Facility, the “Credit Facility”), which includes an uncommitted expansion feature that allows the Company to increase the total revolving commitments and/or add new tranches of term loans in an aggregate amount not to exceed $5 million. The proceeds of the Credit Facility may be used to refinance certain existing indebtedness of the Company and its subsidiaries, to finance the working capital needs, and for general corporate purposes (including permitted acquisitions), of the Company and its subsidiaries. The Credit Facility has a three (3) year maturity. Interest on the Credit Facility will be based, at the Company’s option, on a base rate or LIBOR plus an applicable margin tied to the Company’s total leverage ratio and having ranges of between 2.75% and 3.75% for base rate loans and between 3.75% and 4.75% for LIBOR loans; provided that until December 31, 2021 the applicable margin shall be 3.75% for base rate loans and 4.75% for LIBOR loans. In an event of default, the interest rate may be increased by 2.00%. The Credit Facility will also carry a commitment fee of 0.50% per annum on the unused portion.
The Company’s obligations under the Credit Facility are unconditionally guaranteed, jointly and severally, by the Company’s material direct and indirect wholly-owned domestic subsidiaries (the “Guarantors”). All obligations of the Company and the Guarantors under the Credit Facility are secured by first priority security interests in substantially all of the assets of the Company and the Guarantors.
The Credit Agreement includes customary representations, warranties and covenants, and acceleration, indemnity and events of default provisions, including, among other things, two financial covenants. One financial covenant requires the Company to maintain, at all times prior to December 31, 2021, an adjusted quick ratio of initially not less than 2.00 to 1.00 and increasing over time to 3.00 to 1.00. The other financial covenant requires the Company to maintain, as of the end of each of its fiscal quarters commencing with the fiscal quarter ended December 31, 2021, a total leverage ratio of not greater than 3.00 to 1.00.
The foregoing description of the Credit Agreement is qualified in its entirety by reference to the full text of such agreement, which will be filed as an exhibit to the Company\’s Annual Report on Form 10-K for the fiscal year ended June 30, 2020.

Item 1.02 Termination of a Material Definitive Agreement.
On August 14, 2020, and in connection with the consummation of the Credit Agreement, the Company paid all amounts due in respect of principal, interest, and fees, and satisfied all of its obligations under the credit agreement dated as of October 31, 2019 (the “Existing Credit Agreement”), among the Company, its subsidiaries, as guarantors, Antara Capital Master Fund LP (“Antara”), as lender, and Cortland Capital Market Services LLC, as administrative agent and collateral agent for the lender. to such payment, the Existing Credit Agreement, and all commitments of Antara thereunder, were terminated.
The information set forth under Item 1.01 of this Current Report on Form 8-K 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 information set forth under Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.
Item 7.01 Regulation FD Disclosure.
On August 17, 2020, the Company issued a press release announcing the Company’s entrance into the Credit Agreement. A copy of the press release is filed as Exhibit 99.1 to this Current Report on Form 8-K and is furnished herewith.
The press release furnished to Item 7.01 of this Form 8-K (Exhibit 99.1) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”), or otherwise subject to the liabilities under that Section. Furthermore, the press release shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Exchange Act.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits

USA TECHNOLOGIES INC Exhibit
EX-99.1 2 us20200812-ex99_1.htm PRESS RELEASE Exhibit 99.1 USA Technologies Announces New Credit Facility MALVERN,…
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About USA TECHNOLOGIES, INC. (NASDAQ:USAT)

USA Technologies, Inc. provides technology-enabled solutions and value-added services that facilitate electronic payment transactions within the unattended point of sale (POS) market. The Company is a provider in the small ticket, beverage and food vending industry and is also engaged in offering solutions and services to other unattended market segments, such as amusement, commercial laundry, kiosk and others. It has designed and marketed systems and solutions that facilitate electronic payment options, as well as telemetry and machine-to-machine (M2M) services, which include the ability to remotely monitor, control and report on the results of distributed assets containing its electronic payment solutions. The Company derives its revenues from license and transaction fees resulting from connections to, as well as services provided by, its ePort Connect service.

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