ERBA Diagnostics, Inc. has a secured, revolving credit facility of up to $5,000,000 from Citibank, N.A., pursuant to those certain Business Loan Agreement (the Loan Agreement), Promissory Note (as amended and restated from time to time), and Commercial Security Agreements (each a Security Agreement) with Citibank, N.A. (Citibank). On March 7, 2017 and April 25, 2017, the United States Internal Revenue Service established federal tax liens against Diamedix Corporation for unpaid medical excise taxes, penalties and interest in the aggregate amount of $512,839.46 for the tax periods 2013 through 2015. On May 18, 2017, the company received a reservation of rights letter from Citibank. The letter stated, among other things, that the tax liens against Diamedix constitute an Event of Default under the Security Agreement to which Diamedix is a party, and that Citibank is reserving any rights it has or may have in the future, including, without limitation, the right of Citibank to demand immediate payment of all sums owing under the Loan Agreement. As of May 18, 2017, the outstanding principal balance under the secured, revolving credit facility was approximately $4,850,000.