Item 1.02 Termination of a Material Definitive Agreement.
On June 10, 2021, the Third Amended and Restated Credit Facility Agreement dated
August 31, 2020 (the "Credit Facility") by and among Flux Power, Inc., a
wholly-owned subsidiary of the Registrant (the "Company"), Esenjay Investments,
LLC (an entity that owns more than 10% of the Registrant's outstanding common
stock, which is owned and controlled by Michael Johnson, a director of the
Registrant), Cleveland Capital, L.P., Otto Candies, Jr., Paul Candies, Brett
Candies, Winn Interest, Ltd., Tabone Family Partnership (as assignee to the
interests, rights and obligations of Helen M. Tabone) and additional lenders who
became a party to such agreement pursuant to Section 15 thereof (collectively,
the "Lenders"); and the related Second Amended and Restated Security Agreement
dated August 31, 2020 by and among the Company and the Lenders (the "Security
Agreement") were terminated. Under the Credit Facility, the Company could borrow
up to $12 million under a revolving line of credit, with such advance subject to
discretion of the Lenders. Pursuant to the Security Agreement, advances and
obligations under the Credit Facility were secured by a security interest in
collateral of the Company.
As there was no outstanding balance under the Credit Facility and the Company
determined it will not be making further draws under the revolving line of
credit, the Credit Facility was terminated. As of the termination date, all
payments due under the related notes have been made in full and all obligations
under such notes and the Credit Facility have been paid or discharged in full.
In addition, Company did not incur any early termination penalties in connection
with the termination of the Credit Facility or Security Agreement.
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