Item 1.01 Entry into a Material Definitive Agreement.
Corporate Facility Amendment
On August 21, 2020, On Deck Capital, Inc. (the "Company") entered into an
amendment (the "Amendment") to further modify the Credit Agreement (the
"Corporate Facility Agreement"), dated as of January 28, 2019, among the
Company, as borrower, the lenders party thereto and Truist Bank, as
Administrative Agent and Collateral Agent.
Pursuant to the Amendment, the required monthly principal repayment amount will
be $13.125 million until the loans under the Corporate Facility Agreement are
repaid in full. The total outstanding principal balance of the loans as of the
date of the Amendment is $65.625 million. In addition, the lenders have agreed
to waive the increased monthly principal repayments of $21 million triggered by
the Asset Performance Payout Event ("APPE") (Level 2) that occurred on June 17,
2020, including the previously deferred incremental principal amounts totaling
$15.75 million that would have otherwise been payable on July 17, 2020 and
August 17, 2020. The Amendment also modifies the borrowing base calculation to
include eligible equipment finance loans at an advance rate of 70% and does not
result in any changes to the current interest rate or the January 2021 maturity
date. Other modifications under the Amendment include, among other things,
certain mandatory prepayment requirements, additional reporting requirements,
revisions to financial covenants, modifications to lender and borrower consent
thresholds, adjustments to certain events of default and changes to certain
covenants, including to further limit the Company's and certain subsidiaries'
ability to, among other things, incur liens and additional indebtedness, make
restricted payments, sell assets, and make investments, subject to customary
carveouts. Certain capitalized terms not defined in this section of the report
are used with the meanings ascribed to them in the Corporate Facility Agreement
as amended by prior amendments thereto and the Amendment.
The foregoing description of the Amendment does not purport to be complete and
is qualified in its entirety by reference to (i) the full text of the Amendment,
which will be filed as an exhibit to the Company's Quarterly Report on Form 10-Q
for the quarter ending September 30, 2020 and (ii) the definitive Corporate
Facility Agreement, which was filed as Exhibit 10.31 to Company's Annual Report
on Form 10-K for the year ended December 31, 2019, as modified by the Lender
Joinder Agreement, which was filed as Exhibit 10.2 to the Company's Quarterly
Report on Form 10-Q for the quarter ended September 30, 2019.
Safe Harbor Statement.
This Current Report on Form 8-K contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995 and other legal
authority. Forward-looking statements can be identified by words such as "will,"
"enables," "targets," "expects," "intends," "may," "allows," "plans,"
"continues," "believes," "anticipates," "estimates" or similar expressions.
Forward-looking statements are neither historical facts nor assurances of future
performance. They are based only on our current beliefs, expectations and
assumptions regarding the future of our business, anticipated events and trends,
the economy, the COVID-19 pandemic and other future conditions. As such, they
are subject to inherent uncertainties, risks and changes in circumstances that
are difficult to predict and in many cases outside our control. Therefore, you
should not rely on any of these forward-looking statements.
Our expected results may not be achieved, and actual results may differ
materially from our expectations. Important factors that could cause or
contribute to such differences include risks relating to: our ability to meet
the conditions of, and remain in compliance with, the terms of
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the Corporate Facility Amendment, cure deficiencies under our other debt
facilities or obtain additional waivers or amendments to avoid the risk of
default; and other risks, including those described in Part II - Item 1A. Risk
Factors in our Form 10-Q for the quarter ended March 31, 2020 and June 30, 2020,
Part I - Item 1A. Risk Factors in our Annual Report on Form 10-K for the year
ended December 31, 2019 and other documents that we file with the Securities and
Exchange Commission, or SEC, from time to time which are or will be available on
the SEC website at www.sec.gov.
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