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HEWA > SEC Filings for HEWA > Form 8-K on 3-Apr-2013All Recent SEC Filings

Show all filings for HEALTHWAREHOUSE.COM, INC. | Request a Trial to NEW EDGAR Online Pro

Form 8-K for HEALTHWAREHOUSE.COM, INC.


3-Apr-2013

Entry into a Material Definitive Agreement, Creation of a Direct Financ


Item 1.01 Entry Into A Material Definitive Agreement.

On March 28, 2013, HealthWarehouse.com, Inc. and its wholly-owned subsidiaries, Hwareh.com, Inc. and Hocks.com, Inc. (together, the "Company") entered into a Promissory Note (the "Note") and a Security Agreement (the "Security Agreement") with Melrose Capital Advisors, LLC, an Ohio limited liability company (the "Lender"). Under the terms of the Note, the Company borrowed $500,000 from the Lender on March 28, 2013 (the "Loan"). The proceeds of the Loan will be used by the Company for working capital purposes. The Loan bears interest at a floating rate equal to the prime rate plus 4.25% per annum. Interest is payable monthly beginning May 1, 2013. The maturity date of the Loan is March 1, 2015. Under the terms of the Security Agreement, the Company granted the Lender a first priority security interest in all of the Company's assets, in order to secure the Company's obligation to repay the Loan. The Note and Security Agreement contain customary affirmative and negative covenants, including covenants restricting the Company's ability to take certain actions without the Lender's consent, such as incurring additional indebtedness, transferring or encumbering assets, paying dividends or making certain other payments, and acquiring other businesses. The payment of the Loan may be accelerated prior to its maturity date upon certain specified events of default, including failure to pay, bankruptcy, breach of covenant, and breach of representations and warranties.

In consideration of the Loan, the Company granted the Lender a warrant to purchase 750,000 shares of HealthWarehouse.com, Inc.'s $0.001 par value common stock (the "Common Stock") at a purchase price of $0.35 per share (the "Warrant"). The Warrant may be exercised in whole or in part and from time to time for a term of five years from its grant date. The Warrant contains a cashless exercise feature and certain customary anti-dilution adjustment provisions. The Warrant is transferable in whole or in part, so long as the transfer complies with applicable securities laws. The Lender exercised the Warrant on April 1, 2013 in a "cashless" transaction, and will receive 573,826 "net" shares of Common Stock.

The foregoing description of the Note, the Security Agreement and the Warrant is not intended to be complete and is qualified in its entirety by reference to the full text of the Note, the Security Agreement and the Warrant, which are filed as Exhibits 4.1, 4.2 and 10.1 hereto and are incorporated herein by reference.



Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

See Item 1.01, which is incorporated herein by reference.



Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

4.1 Promissory Note dated March 28, 2013 in the amount of $500,000 payable by the Company to the order of Melrose Capital Advisors, LLC

4.2 Common Stock Purchase Warrant for 750,000 common shares.

10.1 Security Agreement dated March 28, 2013.

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