Item 1.01 Entry into a Material Definitive Agreement
On January 19, 2022 (the "Fourth Amendment Date"), CytoSorbents Corporation, a
Delaware corporation (the "Company"), along with CytoSorbents Medical, Inc., a
Delaware corporation and wholly owned subsidiary of the Company ("CytoSorbents
Medical" and, together with the Company, the "Borrower"), entered into an
amendment (the "Fourth Amendment") to the Amended and Restated Loan and Security
Agreement by and among the Borrower and Bridge Bank, a division of Western
Alliance Bank, an Arizona corporation (the "Bank"), dated as of January 19,
2022, by and among the Borrower and the Bank (as amended, supplemented, restated
or otherwise modified from time to time, the "Loan Agreement").
Under the Loan Agreement, together with the Fourth Amendment, the Bank has
agreed to loan up to $15 million. Under the Loan Agreement, the Company
previously drew down one tranche of $10 million (the "Term A Loan"), and the
Company repaid the Term A Loan in full on December 4, 2020 (the "Prior Amendment
Date"). In addition, the Company previously drew down an additional tranche of
$5 million (the "Term B Loan"), which the Company repaid in full on the Prior
Amendment Date (the "Term B Loan"). The Fourth Amendment provides a tranche of
term loans in the aggregate amount of $15 million, which are available for the
Company to draw down at its sole discretion in three tranches of $5 million each
at any time during the period commencing on the Fourth Amendment Date and ending
on the earlier of (i) December 31, 2022 and (ii) the occurrence of an Event of
Default (as defined in the Loan Agreement) (the "Term C Loan"). After repayment,
the term loans may not be re-borrowed.
Pursuant to the Amendment, the Term C Loan shall bear interest, on the
outstanding daily balance thereof, at a floating rate of the Index Rate (as
defined in the Amendment) on the last business date of the month that
immediately precedes the month in which the interest will accrue plus 1.25%.
Pursuant to the Fourth Amendment, interest on the Term C Loan is subject to an
interest rate cap of 8.00%. The Amendment, together with the Loan Agreement,
provides for a period of interest only payments on the Term C Loan until the
amortization date, which is January 1, 2024 if the I/O Extension Event (as
defined in the Amendment) does not occur or July 1, 2024 if the I/O Extension
Event occurs. Following the amortization date, the Company must make equal
monthly payments of principal and interest on the Term C Loan.
In connection with the Fourth Amendment, the Borrower paid to the Bank a
non-refundable fee equal to $18,750 on the Fourth Amendment Date (the
"Commitment Fee"). Additionally, as set forth in the Fourth Amendment Success
Fee Letter (the "Success Fee Letter"), the Borrower will pay to the Bank a
success fee equal to (i) 1% of $5 million if the Company draws down the first
tranche of the Term C Loan and is payable only if the Company's stock price
equals or exceeds $8 for five consecutive trading days; (ii) 1.5% of $5 million
if the Company draws down the second tranche of the Term C Loan and is payable
only if the Company's stock price equals or exceeds $10 for five consecutive
trading days; and (iii) 2% of $5,000,000 if the Company draws down the third
tranche of the Term C Loan and is payable only if the Company's stock price
equals or exceeds $12 for five consecutive trading days (together, the "Success
Fee"). Borrower may pay the Success Fee in cash or in shares of common stock, at
Borrower's sole discretion. The right of Bank to receive the Success Fees and
the obligation of the Borrower to pay the Success Fees hereunder shall terminate
on the date that is fifth anniversary of the funding date of the last Term C
Loans made but shall survive the termination of the Loan Agreement and any
prepayment of the Term C Loans.
The Fourth Amendment also extends the maturity date for the term loans until
December 1, 2025.
The foregoing is a summary of the material terms of the Fourth Amendment and the
Success Fee Letter and does not purport to be complete. A copy of the Fourth
Amendment is attached as Exhibit 10.1 and incorporated by reference herein. A
copy of the Success Fee Letter is attached as Exhibit 10.2 and incorporated by
reference herein.
Item 9.01 Exhibits
(d) Exhibits
Exhibit No. Description
10.1 Fourth Amendment to the Amended and Restated Loan and Security
Agreement, dated January 19, 2022
10.2 Success Fee Letter between the Borrower and the Bank, dated January
19, 2022.
104 Cover Page Interactive Data File (embedded with the Inline XBRL
document)
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