Item 1.01 Entry into a Material Definitive Agreement.
Consulting Agreement
During the term of the Consulting Agreement, the Company will provide Prophase
Labs with such regular and customary consulting advice as is reasonably
requested by the Prophase Labs. The Company's duties will also include, among
other things, (i) identifying and introducing Prophase Labs to new opportunities
in the medical technology and testing fields, (ii) assisting and advising
Prophase Labs in acquiring one or more Clinical Laboratory Improvement
Amendments (CLIA) accredited labs suitable for COVID-19 and other testing ("
The compensation to be paid to the Company under the Consulting Agreement will be based on the following milestones:
† At such time as Prophase Labs completes the acquisition of its first
† At such time as Prophase Labs has processed 50,000 Test Kits from a source
introduced to Prophase Labs by the Company, the Company will receive a
consulting fee of
† At such time as Prophase Labs has processed 50,000 Test Kits from a second
source introduced by the Company (i.e., a source other than the source
contemplated by the bullet immediately above) the Company will receive a
consulting fee of
† The Company will receive consulting fees equal to 5% of the net revenues
Prophase Labs generates from processing Test Kits in the
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All compensation earned by the Company under the Consulting Agreement will first
be applied to the acceleration and prepayment of all sums due to ProPhase,
including but not limited to sums due pursuant to the New Note described below.
Under the terms of the Consulting Agreement, the Company will not be entitled to
receive any payments pursuant to the Consulting Agreement unless and until the
New Note has been paid in full. The total compensation that the Company will be
entitled to earn or to receive under the Consulting Agreement (inclusive of
amounts credited against the New Note) will be capped at
The foregoing description of the Consulting Agreement is qualified in its entirety by reference to the full text of the Consulting Agreement, a copy of which is filed as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated by reference herein in its entirety.
Amended and Restated Promissory Note and Security Agreement
On
The New Note amends and restates in its entirety (i) that certain Promissory
Note and Security Agreement, dated
The New Note will bear interest at a rate of 15% per annum from and including the Restatement Effective Date until the principal amount is repaid in full plus any Principal Increases (as defined below) together with any accrued interest that has not been capitalized; provided, however, that upon the occurrence and during an Event of Default (as defined in the New Note), the interest rate payable under the New Note will automatically increase to 9% above the rate of interest then applicable to the New Note.
Interest under the New Note will be payable monthly in arrears on the first day
of each month for the prior monthly period, as well as at maturity (whether upon
demand, by acceleration or otherwise) (each such date, a "Payment Date");
provided, however, that prior to
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The entire remaining unpaid principal amount of the New Note, together
with all accrued and unpaid interest thereon and all other amounts payable under
the New Note, will be due and payable, if not sooner paid, on
otherwise. The New Note may be prepaid in full or in part at any time without penalty or premium.
The New Note contains customary representation and warranties and customary events of default. If a default occurs and is not cured within the applicable cure period or is not waived, any outstanding obligations under the New Note may be accelerated.
In addition, in order to secure the Company's obligations under the New Note, the Company granted to Prophase Labs a continuing security interest in its accounts and certain property and assets, related to the Company's COVID-19 testing business.
The foregoing description of the New Note is qualified in its entirety by reference to the full text of the New Note, a copy of which is filed as Exhibit 10.2 to this Current Report on Form 8-K and is incorporated by reference herein in its entirety.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits No. Description 10.1 Consulting Agreement, datedSeptember 25, 2020 , by and between ProPhase Labs, Inc. andPredictive Labs, Inc. 10.2 Amended and Restated Promissory Note and Security Agreement, datedSeptember 25, 2020 , by and between ProPhase Labs, Inc. andPredictive Labs, Inc.
Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Predictive Technology Group, Inc.
Date:
By: /s/Bradley Robinson Bradley Robinson Director /Chief Executive Officer -4-
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