Attached files
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| EX-10.1 - LOAN AGREEMENT - Sanara MedTech Inc. | smti_ex101.htm |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________________________________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of
Report (Date of earliest event reported): January 15, 2021
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SANARA MEDTECH INC.
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(Exact
name of registrant as specified in its charter)
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Texas
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001-39678
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59-2219994
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(State
or other jurisdiction of
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(Commission File
Number)
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(IRS
Employer
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incorporation)
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Identification
No.)
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1200 Summit Avenue, Suite 414
Fort Worth, Texas
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76102
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(Address
of principal executive offices)
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(Zip
Code)
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Registrant’s
telephone number, including area code: (817) 529-2300
(Former
name or former address, if changed since last report)
Not Applicable
Check
the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant
under any of the following provisions (see General Instruction A.2.
below):
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☐
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Written
communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
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☐
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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☐
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR 240.14d-2(b))
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☐
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR 240.13e-4(c))
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Securities
registered pursuant to Section 12(b) of the Act:
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Title of each class
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Trading
Symbol(s)
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Name of each exchange on which registered
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Common
Stock, $0.001 par value
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SMTI
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The
Nasdaq Capital Market
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Indicate
by check mark whether the registrant is an emerging growth company
as defined in Rule 405 of the Securities Act of 1933 (§230.405
of this chapter) or Rule 12b-2 of the Securities Exchange Act of
1934 (§240.12b-2 of this chapter).
Emerging growth
company
☐
If an
emerging growth company, indicate by check mark if the registrant
has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided
pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01 Entry into a Material Definitive Agreement.
On
January 15, 2021, Sanara MedTech Inc. (the “Company”)
entered into a Loan Agreement (the “Loan Agreement”)
with Cadence Bank, N.A. (“Cadence”), providing for a
$2.5 million revolving line of credit. The revolving line of credit
matures on January 13, 2023, and is secured by substantially all of
the Company’s assets. Any amounts outstanding will bear
interest of 0.75% plus the “Prime Rate” designated in
the “Money Rates” section of the Wall Street Journal.
Proceeds from the line of credit are to be used to provide the
Company with additional working capital in support of current
assets and for other general corporate purposes and may not be used
for acquisitions.
The
line of credit contains customary representations and warranties
and requires the Company to maintain compliance with certain
financial covenants, including, among others, a minimum liquidity
of $1,000,000 as of December 31, 2020 and March 31, 2021, a
minimum Tangible Net Worth (as defined in the Loan Agreement) of
$1,000,000 and, beginning with the fiscal quarter ending June 30,
2021, a minimum Interest Coverage Ratio (as defined in the Loan
Agreement) of 1.5 to 1.0. In addition, the Loan Agreement requires
the Company to cause its shareholders or other persons approved by
Cadence to make an equity investment in the Company of at least
$7,500,000 by March 31, 2021. The Loan Agreement also contains
customary events of default. If such an event of default occurs,
Cadence would be entitled to take various actions, including the
acceleration of amounts due under the Loan Agreement. The Company
generally may (and must, under certain circumstances) prepay all or
a portion of the principal outstanding on the revolving line of
credit prior to its contractual maturity.
The
foregoing description of the Loan Agreement is not complete and is
qualified in its entirety by reference to the Loan Agreement, a
copy of which is attached hereto as Exhibit 10.1 and incorporated
herein by reference.
Item 2.03 Creation of a Direct Financial Obligation or an
Obligation under an Off-Balance Sheet Arrangement of a
Registrant.
The
information set forth in Item 1.01 of this Current Report on Form
8-K is incorporated herein by reference.
Item 8.01 Other Events.
On
January 18, 2021, the Company entered into an Equity Exchange
Agreement (the “Exchange Agreement”), effective as of
January 14, 2021, with two individuals who each owned 50% of the
outstanding equity interests in Woundyne Medical, LLC
(“Woundyne”). Pursuant to the Exchange Agreement, the
Company acquired 100% of the issued and outstanding equity
interests of Woundyne in exchange for the issuance of an aggregate
of 29,536 shares of the Company’s common stock. The primary
asset acquired by the Company is the Woundyne software platform
which allows data related to chronic and surgical wounds to be
tracked, monitored, and interfaced with the software user’s
electronic medical records. Woundyne has no other material assets,
liabilities, or revenues.
The
sale of the shares of the Company’s common stock was exempt
from registration under the Securities Act of 1933, as amended (the
“Securities Act”), pursuant to the exemption provided
in Section 4(a)(2) of the Securities Act and Rule 506(b)
promulgated thereunder as a sale to accredited investors with whom
the Company had a pre-existing relationship.
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Item 9.01
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Financial
Statements and Exhibits.
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(d) Exhibits
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Exhibit No.
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Description
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Loan
Agreement, dated January 15, 2021, between the Company, as
Borrower, and Cadence Bank, N.A, as Lender.
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SIGNATURES
Pursuant to the
requirements of the Securities Exchange Act of 1934, the registrant
has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
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Date:
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January 22, 2021
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Sanara MedTech Inc.
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By:
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/s/
Michael D.
McNeil
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Name:
Michael D. McNeil
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Title:
Chief Financial Officer
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