On September 21, 2018, Vicon Industries, Inc. entered into a $5.6 million term loan agreement with NIL Funding Corporation (NIL) to replace the $5.8 million outstanding balance on its existing revolving line of credit agreement with a term loan. Upon closing, $5.6 million of outstanding borrowings under its revolving credit agreement were converted to a term loan while the remaining $200,000 of outstanding borrowings were repaid to NIL. The Agreement requires monthly payments of accrued interest beginning on October 1, 2018. In addition, the Agreement requires equal monthly principal payments of $25,000, plus accrued interest, beginning on April 1, 2019 until the loan maturity date of March 30, 2020, at which point the full outstanding balance of the loan and accrued interest are due. The Agreement provides for a formula that limits outstanding indebtedness based upon eligible accounts receivable and is secured by a first priority security interest in substantially all of the Company’s assets. Borrowings under the Agreement bear interest at a rate of 8.85% per annum. The Agreement also provides for an initial commitment fee of $56,000, which was paid at closing. The Agreement includes provisions that are customarily found in similar financing agreements, including a financial covenant which requires the Company to maintain a minimum level of inventory and liquid assets as defined in the Agreement.