On June 23, 2023, Healthcare Triangle, Inc. (âHCTIâ or the âCompanyâ) received a notice of default from Seacoast Business Funding, a division of Seacoast National Bank (âSeacoastâ) with respect to the Purchasing Agreement by and between the Company and Seacoast dated May 2, 2022 (âPurchasing Agreementâ). As a result of the Event of Default, the fee payable by HCTI to Seacoast went from the Prime Rate (as defined in the Purchasing Agreement) to 18%. As of June 28, 2023, the Company has an outstanding payment balance of $2,409,437 under the Purchase Agreement.
Section 6(h) of the Purchase Agreement requires the Company to obtain the written consent of Seacoast prior to obtaining any loans or advances. On May 5, 2023, the Company entered into the Business Loan and Security Agreement among HCTI, Agile Capital Funding, LLC as collateral agent, and Agile Lending, LLC (the âLoan Agreementâ) pursuant to which the Company was advanced $1.5 million without the prior consent of Seacoast.