Item 2.04 Triggering Events that Accelerate or Increase a Direct Financial
Obligation or an Obligation under an Off-Balance Sheet Arrangement.
On May 4, 2023, iMedia Brands, Inc. (the "Company") received a Notice of
Acceleration and Demand for Payment (the "Synacor Notice") from Synacor, Inc.
("Synacor") dated May 4, 2023, with respect to the following documents
(collectively, the "Synacor Documents"): (i) the Secured Promissory Note dated
July 30, 2021, by the Company's wholly-owned subsidiary, Portal Acquisition
Company ("Portal"), in favor of Synacor in the original principal amount of
$10,000,000 (the "Note"), which includes the guarantee of the Company in favor
of Synacor (the "Guarantee"), (ii) the Asset Purchase Agreement dated July 30,
2021, among Portal, Synacor, and the Company (the "Asset Purchase Agreement"),
(iii) the extension letter dated April 14, 2023, between Portal and Synacor (the
"Extension Letter"), and (iv) all other guarantees, documents, and agreements
executed and/or delivered in connection therewith or related thereto.
The Synacor Notice informed the Company that events of default have occurred
under the Synacor Documents due to Portal's failure to pay the sum of the
quarterly payment, accrued interest, and extension fee by April 28, 2023, and
that, pursuant to the terms of the Note, Synacor has elected to accelerate the
maturity of all of the obligations owed by Portal and the Company and has
demanded payment by May 11, 2023, of all obligations owed by Portal and the
Company under the Synacor Documents plus accrued and unpaid interest, attorney
fees, expenses and other costs of collection, minus offsets totaling
approximately $3,845,039.81. The Company is working with Synacor to address this
matter in order to, among other things, reach an agreement on recission of the
acceleration in the near term.
The events giving rise to the Synacor Notice also constitutes an event of
default under the Loan and Security Agreement dated July 30, 2021 (as amended,
the "Loan and Security Agreement"), by and among the Company, as the lead
borrower, certain of its subsidiaries party thereto as borrowers, Siena Lending
Group LLC ("Siena") and the other financial institutions party thereto from time
to time as lenders, Siena, as agent, and certain additional subsidiaries of the
Company, as guarantors thereunder. As previously reported in the Company's
Current Report on Form 8-K filed on April 12, 2023, the Company entered into
a Forbearance Agreement, Tenth Amendment to Loan and Security Agreement and
Amendment to Fee Letter (the "Amendment") on April 10, 2023, which amended the
Loan and Security Agreement and provided that the lenders agreed to forbear from
exercising rights and remedies available as a result of certain existing events
of default under the Loan and Security Agreement for a specified period of time.
However, the events giving rise to the Synacor Notice caused a forbearance
termination under the Forbearance Agreement.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
The following exhibit is being filed with this Current Report on Form 8-K:
Exhibit No. Description Method of Filing
10.1 Tenth Amendment to Loan and Incorporated by reference to the
Security Agreement, dated April 10, Current Report on Form 8-K filed by
2023, by and among the iMedia iMedia Brands, Inc. with the SEC on
Brands, Inc., as the lead borrower, April 12, 2023.
certain of its subsidiaries party
thereto as borrowers, Siena Lending
Group LLC and the other financial
institutions party thereto from
time to time, Siena Lending Group
LLC, as agent, and VVI Fulfillment
Center, Inc., EP Properties, LLC
and Portal Acquisition Company, as
guarantors
104 Cover Page Interactive Data File Filed herewith.
(embedded within the Inline XBRL
document)
Forward-Looking Statements
This document may contain certain "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995. Any statements
contained herein that are not statements of historical fact, including
statements regarding anticipated timing of filings with the Securities and
Exchange Commission are forwardlooking. The Company often use words such as
anticipates, believes, estimates, expects, intends, seeks, predicts, hopes,
should, plans, will, or the negative of these terms and similar expressions to
identify forward-looking statements, although not all forward looking-statements
contain these words. These statements are based on management's current
expectations and accordingly are subject to uncertainty and changes in
circumstances. Actual results may vary materially from the expectations
contained herein due to various important factors, including (but not limited
to), the Company's ability to resolve the foregoing matters involving its
indebtedness. Investors are cautioned not to place undue reliance on
forward-looking statements, which speak only as of the date of this
announcement. The Company is under no obligation (and expressly disclaims any
such obligation) to update or alter its forward-looking statements whether as a
result of new information, future events or otherwise.
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