UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 16, 2018
PRO-DEX, INC.
(Exact name of registrant as specified in its charter)
COLORADO |
0-14942 |
84-1261240 |
(State or other jurisdiction of incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification Number) |
2361 McGaw Avenue
Irvine, California 92614
(Address of principal executive offices, zip code)
(949) 769-3200
(Registrants telephone number including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨ |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ¨ |
|
If an emerging growth company, indicate by checkmark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Item 1.01
Entry into a Material Definitive Agreement.
Extension of Business Loan Agreement
As previously disclosed in the Companys Current Report on Form 8-K filed with the Securities and Exchange Commission (SEC) on April 21, 2017, the Company previously entered into a Business Loan Agreement (the Loan Agreement), dated effective March 28, 2017, with Farmers & Merchants Bank of Long Beach (FMB) providing for a $500,000 revolving loan facility (the Revolving Loan Facility). The Revolving Loan Facility is secured by substantially all of the assets of the Company. The Loan Agreement expired pursuant to its terms on March 28, 2018 and no principal amounts had been borrowed during the initial term of the Revolving Loan Facility.
On April 16, 2018, the Company and FMB entered into a Change in Terms Agreement and an Amendment #1 to Business Loan Agreement, each dated effective April 6, 2018 (collectively, the Loan Amendments), which extend the maturity date of the Revolving Loan Facility to March 28, 2019 and contain other amendments and provisions customary for a loan facility of this type.
A copy of the Loan Amendments are attached as Exhibits 10.1 and 10.2, respectively, to this Current Report on Form 8-K and a copy of the original Loan Agreement (prior to giving effect to the Loan Amendments) is attached as Exhibit 10.1 to the Companys Current Report on Form 8-K filed with the SEC on April 21, 2017. The above descriptions are qualified by reference to the complete text of the Loan Agreement and Loan Amendments, provided that the representations and warranties contained in the Loan Agreement and Loan Amendments are not intended for investors and the public to obtain factual information about the Company. Rather, investors and the public should look to disclosures contained in the Companys reports under the Securities Exchange Act of 1934, as amended.
Item 2.03
Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The disclosures contained in Item 1.01 above are incorporated into this Item 2.03 by this reference.
Item 9.01
Financial Statements and Exhibits.
(d) Exhibits.
Exhibit 10.1 |
|
|
Exhibit 10.2 |
|
SIGNATURES
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.
Date: April 17, 2018 |
PRO-DEX, I NC . |
|
|
|
|
|
|
|
|
By: |
/s/ Alisha K. Charlton |
|
|
Alisha K. Charlton |
|
|
Chief Financial Officer |
INDEX TO EXHIBITS
Exhibit
|
|
Description |
Exhibit 10.1 |
|
|
Exhibit 10.2 |
|
Exhibit 10.1
CHANGE IN TERMS AGREEMENT
Principal |
Loan Date |
Maturity |
Loan No |
Call / Coll |
Account |
Officer |
Initials |
$500,000.00 |
03-28-2017 |
03-28-2019 |
90-102-0892-3 |
TC3 |
TC |
References in the boxes above are for Lender's use only and do not limit the applicability of this document to any particular loan or item. Any item above containing "***" has been omitted due to text length limitations.
Borrower: |
PRO-DEX, INC. 2361 MCGAW AVENUE IRVINE, CA 92614 |
Lender: |
Farmers and Merchants Bank of Long Beach, a CA Corp Lake Forest Office 23772 Rockfield Boulevard Lake Forest, CA 92630 |
|
|
|
|
Principal Amount: $500,000.00 |
Date of Agreement: April 6, 2018 |
DESCRIPTION OF EXISTING INDEBTEDNESS. A loan evidenced by a promissory note dated 03-28-2017, in the original amount of $500,000.00 and referencing loan number 90-102-0892-3 (Note). The outstanding principal balance due under the Note, as of the date of this Agreement, is $0.00. The principal balance remaining undisbursed is $500,000.00.
DESCRIPTION OF COLLATERAL. A security interest in certain assets of Borrower described in that certain Commercial Security Agreement dated 03-28-2017 and executed by Borrower in favor of Lender (Security Instrument).
DESCRIPTION OF CHANGE IN TERMS. Effective as of the date of this Agreement, the Note is hereby modified as follows:
(1)
The date on which all outstanding principal is due and payable (together with any accrued but unpaid interest thereon) (Maturity Date) is hereby extended to 03-28-2019.
(2)
The payment schedule reflected in the Payment paragraph of the Note is amended to require continuing monthly payments of interest only until the Maturity Date as extended above.
CONTINUING VALIDITY. Except as expressly changed by this Agreement, the terms of the original obligation or obligations, including all agreements as evidenced or securing the obligation(s), remain unchanged and in full force and effect. Consent by Lender to this Agreement does not waive Lenders right to strict performance of the obligation(s) as changed, nor obligate Lender to make any future change in terms. Nothing in this Agreement will constitute a satisfaction of the obligation(s). It is the intention of the Lender to retain as liable parties all makers and endorsers of the original obligation(s), including accommodation parties, unless a party is expressly released by Lender in writing. Any maker or endorser, including accommodation makers, will not be released by virtue of this Agreement. If any person who signed the original obligation does not sign this Agreement below, then all persons signing below acknowledge that this Agreement is given conditionally, based on the representation to Lender that the non-signing party consents to the changes and provisions of this Agreement or otherwise will not be released by it. This waiver applies not only to any initial extension, modification or release, but also to all such subsequent actions.
RESOLUTION, AUTHORIZATION AND/OR CERTIFICATE TO BORROW/GRANT COLLATERAL/GUARANTY ACKNOWLEDGMENT . The Undersigned hereby acknowledges that except for any changes that are reflected in any Resolutions, Authorizations and/or Certificates of even date herewith, if any, the information set forth in the existing Loan Documents, including but not limited to any Resolutions, Authorizations and/or Trust Certificates, is current and accurate as of the date of this Agreement.
DOCUMENT EXECUTED IN COUNTERPARTS. This document may be executed in counterparts, each of which when so executed and delivered shall be an original, but all of which shall together constitute one and the same instrument.
BUSINESS LOAN AGREEMENT. This change in Terms Agreement is subject to the terms and conditions as set forth in that certain Business Loan Agreement dated 03-28-2017 as modified by Amendment #1 to Business Loan Agreement of even date herewith.
PRIOR TO SIGNING THIS AGREEMENT, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS AGREEMENT. BORROWER AGREES TO THE TERMS OF THE AGREEMENT.
CHANGE IN TERMS SIGNERS:
PRO-DEX, INC.
By: |
/s/ Richard VanKirk |
|
By: |
/s/ Alisha Charlton |
RICHARD LEE VANKIRK, JR., President of
|
|
ALISHA KRISTIN CHARLTON, CFO & Secretary of
|
|
|
|
|
Exhibit 10.2
AMENDMENT #1 TO BUSINESS LOAN AGREEMENT
Principal |
Loan Date |
Maturity |
Loan No |
Call / Coll |
Account |
Officer |
Initials |
$500,000.00 |
03-28-2017 |
03-28-2019 |
90-102-0892-3 |
TC3 |
TC |
References in the boxes above are for Lender's use only and do not limit the applicability of this document to any particular loan or item. Any item above containing "***" has been omitted due to text length limitations.
Borrower: |
PRO-DEX, INC. 2361 MCGAW AVENUE IRVINE, CA 92614 |
Lender: |
Farmers and Merchants Bank of Long Beach, a CA Corp Lake Forest Office 23772 Rockfield Boulevard Lake Forest, CA 92630 |
|
|
|
|
|
The undersigned hereby acknowledges and agrees to the following amendments to that certain Business Loan Agreement between Borrower and Lender dated 03-28-2017 (Agreement).
DEFINITIONS: Capitalized terms not defined in this Amendment shall have the meaning given to such terms in the Agreement.
Effective as of 04-06-2018 the Agreement is hereby modified as follows:
(a)
Item (3) located in the Additional Requirements sub-paragraph of the Financial Statements paragraph under the Affirmative Covenants section is hereby modified as follows:
(3) As soon as available, but in no event later than 45 days after the end of each half-year, the following reports, prepared by the Borrower, in a form and substance acceptable to Lender:
(A) Accounts Receivable Aging
(B) Accounts Payable Aging
(b)
The Working Capital Requirements sub-paragraph located under the Financial Covenants and Ratios section is hereby restated in its entirety as follows:
Working Capital Requirements . Maintain Working Capital in excess of $750,000.00, to be measured after the end of each quarter.
Except as provided above, all computations made to determine compliance with the requirements contained in this paragraph shall be made in accordance with generally accepted accounting principles, applied on a consistent basis, and certified by Borrower as being true and correct.
All other provisions of the Agreement are to remain unchanged and in full force and effect.
PRIOR TO SIGNING THIS AMENDMENT, EACH BORROWER ACKNOWLEDGES THEY HAVE READ AND UNDERSTOOD ALL THE PROVISIONS THEREOF, AND EACH BORROWER AGREES TO THE TERMS OF THE AMENDMENT. THIS AMENDMENT TO BUSINESS LOAN AGREEMENT IS DATED April 6, 2018.
BORROWER:
PRO-DEX, INC.
By: |
/s/ Richard VanKirk |
|
By: |
/s/ Alisha Charlton |
RICHARD LEE VANKIRK, JR., President of
|
|
ALISHA KRISTIN CHARLTON, CFO & Secretary of
|
LENDER:
FARMERS AND MERCHANTS BANK OF LONG BEACH, A CA CORP
By: |
/s/ Tony Craig |
Tony Craig, Vice President |
|
|
|
|