UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13
or 15(d)
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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:
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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).
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| Item 1.01 | Entry into a Material Definitive Agreement. |
On November 2, 2022, 908 Devices Inc. (the “Company”) entered into a Loan and Security Agreement (the “Loan Agreement”), by and between, the Company, as borrower, and Silicon Valley Bank, as lender (the “Lender”). The Loan Agreement provides for a revolving line of credit of up to $35.0 million.
The Loan Agreement replaced the Company’s previous $25.0 million revolving line of credit (the “Prior Loan Agreement”), entered into on March 11, 2021, by and between the Company, as borrower, and Signature Bank, as lender. The Company’s obligations under the Prior Loan Agreement were satisfied in full and the Prior Loan Agreement was terminated in connection with the entrance into the Loan Agreement.
The outstanding principal amount of any advance shall accrue interest at a floating rate per annum equal to the greater of (i) three and one-half percent (3.50%) and (ii) the “prime rate” as published in The Wall Street Journal for the relevant period minus one-half percent (0.50%). The Company’s obligations under the Loan Agreement are secured by substantially all of the Company’s assets, excluding its intellectual property, which is subject to a negative pledge. The revolving line of credit under the Loan Agreement terminates on November 2, 2025. As of November 2, 2022, no amounts were outstanding under the Loan Agreement.
The Loan Agreement also contains certain financial covenants, including a requirement that the amount of unrestricted and unencumbered cash minus advances under the Loan Agreement, is not less than the amount equal to the greater of (i) $10.0 million or (ii) nine (9) months of cash burn. The Loan Agreement contains customary representations and warranties, as well as certain non-financial covenants, including limitations on, among other things, the Company’s ability to change the principal nature of its business, dispose of the Company’s business or property, engage in any change of control transaction, merge or consolidate with any other entity or to acquire all or substantially all the capital stock or property of another entity, incur additional indebtedness or liens, pay dividends or make other distributions on capital stock, redeem the Company’s capital stock, engage in transactions with affiliates or otherwise encumber the Company’s intellectual property, in each case, subject to customary exceptions.
The foregoing description of the Loan Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Loan Agreement, which is attached hereto as Exhibit 10.1 and incorporated by reference herein.
| Item 1.02 | Termination of a Material Definitive Agreement. |
On November 2, 2022, the Company voluntarily terminated the Prior Loan Agreement. The Company did not incur any early termination penalties in connection with the termination of the Prior Loan Agreement.
The Prior Loan Agreement had provided for a revolving line of credit of up to $25.0 million. Borrowings under the Prior Loan Agreement accrued interest at an annual rate equal to the greater of (i) one-half percent (0.50%) above the prime rate or (ii) four percent (4.00%), and were secured by substantially all of the Company’s assets, excluding its intellectual property, which was subject to a negative pledge. Upon the termination of the Prior Loan Agreement, all security interests granted to the secured parties thereunder were terminated and released. The Prior Loan Agreement also contained certain financial covenants, including an unrestricted minimum cash level of $10.0 million. As of November 2, 2022, no amounts were outstanding under the Prior Loan Agreement.
The information set forth in Item 1.01 of this Form 8-K above regarding the Prior Loan Agreement is incorporated by reference in response to this Item 1.02.
| 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 Form 8-K above regarding the Loan Agreement is incorporated by reference in response to this Item 2.03.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits:
| Exhibit No. |
Description | |
| 10.1 | Loan and Security Agreement, dated as of November 2, 2022, by and between 908 Devices Inc. and Silicon Valley Bank | |
| 104 | Cover Page Interactive Data File (embedded within the inline XBRL document) |
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.
| Date: November 8, 2022 | 908 Devices Inc. | |
| By: | /s/ Michael S. Turner | |
| Name: Michael S. Turner | ||
| Title: VP, General Counsel | ||