Item 1.01. Entry into a Material Definitive Agreement.
Revolving Credit Agreement
On April 26, 2022, Appgate Cybersecurity, Inc. ("Legacy Appgate"), a
wholly-owned subsidiary of Appgate, Inc. ("Appgate"), entered into a Revolving
Credit Agreement (the "Revolving Credit Agreement"), by and among Legacy
Appgate, as borrower, Appgate, as a guarantor, certain subsidiaries of Legacy
Appgate party thereto, as guarantors, and SIS Holdings, L.P., as lender ("SIS
Holdings").
The Revolving Credit Agreement provides for a $50.0 million unsecured, revolving
credit facility and will mature on the earlier to occur of (a) June 30, 2023,
(b) the closing of a registered offering of Capital Stock (as defined in the
Revolving Credit Agreement) of Appgate in an aggregate amount equal to $50.0
million or more or (c) the date of which the Loans (as defined in the Revolving
Credit Agreement) are accelerated upon an Event of Default (as defined in the
Revolving Credit Agreement). Interest will accrue on amounts drawn under the
Revolving Credit Agreement at a rate of 10.0% per annum, payable in cash on the
Final Maturity Date (as defined in the Revolving Credit Agreement). The
Revolving Credit Agreement is subordinated to Legacy Appgate's Convertible
Senior Notes issued under that certain Note Issuance Agreement, dated as of
February 8, 2021, by and between Legacy Appgate, the guarantors party thereto
and Magnetar Financial LLC. All obligations under the Revolving Credit Agreement
are guaranteed by Appgate and Legacy Appgate's domestic subsidiaries.
The Revolving Credit Agreement contains provisions requiring Legacy Appgate to
maintain compliance with certain customary covenants, including that Legacy
Appgate will not permit Liquidity (as defined in the Revolving Credit Agreement)
to be less than $10.0 million as of the last day of any calendar month. The
Revolving Credit Agreement also contains certain customary events of default,
including non-payment of principal or interest, violation of covenants, cross
default to other indebtedness, invalidity of loan documents, material judgments,
bankruptcy and insolvency events, subject, in certain instances, to cure
periods. Upon the occurrence of an event of default, SIS Holdings may elect to
declare amounts outstanding under the Revolving Credit Agreement immediately due
and payable.
The foregoing description of the Revolving Credit Agreement is only a summary
and is qualified in its entirety by reference to the full text of the Revolving
Credit Agreement, which is filed herewith as Exhibit 10.1 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.
Please see the discussion set forth in Item 1.01, "Entry into a Material
Definitive Agreement," of this Form 8-K under the caption "Revolving Credit
Agreement," which discussion is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
10.1* Revolving Credit Agreement, dated April 26, 2022, by and among Appgate
Cybersecurity, Inc., the guarantors party thereto and SIS Holdings,
L.P.
104 Cover Page Interactive Data File
* The schedules to this Exhibit have been omitted in accordance with Regulation
S-K Item 601(a)(5). Appgate agrees to furnish supplementally a copy of any
omitted schedule to the Securities and Exchange Commission upon its request.
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