NEWAGE, INC. : Trigger Events That Accelerate or Increase a Direct Financial Obligation or an Obligation Under an Off-Balance Sheet Arrangement (Form 8-K)

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Item 2.04 Trigger Events That Accelerate or Increase a Direct Financial Obligation or an Obligation Under an Off-Balance Sheet Arrangement.

On August 8, 2022, NewAge, Inc. (the “Company”) has received a letter (“Notice of Default Letter”) from Eastern West Bank containing a notice of alleged events of default under the loan and security agreement between the company as borrower and Eastern West Bank as lender (“Lender”) as of March 11, 2022
(“Loan agreement”). According to the Default Notice Letter, the Company is in default of its obligations under the Loan Agreement due to (i) the Company’s failure to use commercially reasonable efforts to obtain the acknowledgment and subordinations of the Lessor and waivers to the Custodian pursuant to Section 3.3 (d)(i) of the Loan Agreement, (ii) the failure of the Company to provide financial statements prepared by the Company for the assessment period ending March 31, 2022pursuant to Section 6.2 (i) of the Loan Agreement, (iii) the Company’s failure to provide audit agreements regarding the Borrower’s accounts to Bank of America, and Wells Fargo pursuant to Section 6.7(a) of the Loan Agreement, and (iv) circumstances which resulted in a Material Injurious Effect pursuant to Section 8.3 of the Loan Agreement (each capitalized term as defined in the Loan Agreement). In the default notice letter, the lender also declared all of the company’s obligations under the loan agreement immediately due and payable. The Company’s current outstanding amount under the Loan Agreement is approximately $12.0 million.

The Company is in discussions with the Lender as part of the Company’s efforts to obtain additional financing. On August 9, 2022the company sent a letter to the lender asking the lender to provide a letter of payment with the usual lien release and termination provisions.

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