Kind 10-Q Venture Source Carrying Corp. Revolving Credit Center

Questionnaire [Sections 13 or 15(d)]

6. Records Payable

Revolving Credit Score Rating Establishment

On August 5, 2020, QRHC and particular of its domestic subsidiaries entered into a Loan, protection and Guaranty contract (the “BBVA mortgage Agreement”) with BBVA USA, as a loan provider, and also as administrative broker, security agent, and providing financial, that provides for a credit establishment (the “ABL Facility”) containing the annotated following:

An asset-based revolving credit score rating premises into the maximum main amount of $15.0 million with a sublimit for issuance of emails of credit score rating of up to 10per cent associated with the optimal primary level of the revolving credit center. Each loan beneath the revolving credit score rating premises holds interest, at individuals’ solution, at either the Base speed, as well as the relevant Margin, or perhaps the LIBOR Lending speed the Interest years in essence, as well as the Applicable Margin, in each case as defined from inside the BBVA financing arrangement. The readiness date from the revolving credit establishment was August 5, 2025. The revolving credit score rating center includes an accordion ability permitting the revolving credit score rating establishment to get increasing by to $10 million.

a gear loan facility when you look at the maximum primary level of $2.0 million. Financing according to the machines mortgage establishment could be requested anytime until August 5, 2023. Each financing under the devices mortgage facility carries interest, in the borrowers’ option, at either the Base rates, plus 1.75%, and/or LIBOR financing price for all the Interest years in place, plus 2.75per cent. The readiness time from the devices financing center is actually August 5, 2025.

Particular of QRHC’s domestic subsidiaries include individuals within the BBVA mortgage contract. QRHC and another of its residential subsidiaries are guarantors beneath the BBVA mortgage Agreement. As security for the obligations on the individuals beneath the BBVA financing Agreement, (i) the borrowers underneath the BBVA financing Agreement need awarded a primary priority lien on significantly their concrete and intangible personal house, including a pledge of the capital inventory and account passions, as appropriate, of particular of QRHC’s drive and secondary subsidiaries, and (ii) the guarantors underneath the BBVA Loan contract has provided an initial consideration lien in the capital stock and membership appeal, as appropriate, of certain of QRHC’s immediate and indirect home-based subsidiaries.

The BBVA financing Agreement consists of certain economic covenants, such as the very least fixed fee coverage proportion. In addition, the BBVA financing Agreement contains adverse covenants limiting, on top of other things, extra indebtedness, transactions with associates, extra liens, product sales of property, dividends, expenditures and progress, prepayments of loans, mergers and acquisitions, and various other issue typically restricted this kind of agreements. The BBVA Loan Agreement also includes customary happenings of standard, including repayment non-payments, breaches of representations and guarantees, covenant non-payments, activities of bankruptcy proceeding and insolvency, change of regulation, and problem of any guaranty or safety document giving support to the BBVA financing arrangement to stay in full power and effects. Upon the incident of a meeting of standard, the exceptional duties in BBVA Loan Agreement may be expidited and start to become immediately because of and payable.

The ABL center holds interest, at all of our choice, at either the beds base price, as described when you look at the BBVA financing contract, plus a margin including 0.75% to 1.25percent (3.0per cent as of September 30, 2020), and/or LIBOR credit rates when it comes down to interest stage ultimately, plus a margin including 1.75percent to 2.25per cent (no borrowings since September 30, 2020).

In connection with the ABL establishment, we paid BBVA United States Of America a charge of $50,000 and incurred more drive outlay of approximately $166,877, which have been getting amortized during the life of the ABL premises.

The BBVA Loan arrangement changed all of our mortgage, protection and Guaranty contract, outdated by March 24, 2017, with people Bank, nationwide organization (the “Citizens mortgage Agreement”), that was paid down and ended efficient August 5, 2020. We recorded $167,964 in loss on extinguishment of loans in connection with this financing termination, such as the write-off of the unamortized portion of debt issuance outlay and charge right from the mortgage compensation.