Item 1.01. Entry into a Material Definitive Agreement. OnFebruary 9, 2021 ,RealNetworks, Inc. (the "Company") and one of its wholly owned subsidiaries entered into the Fifth Amendment to Loan and Security Agreement (the "Amendment") withWestern Alliance Bank (the "Bank"). This Amendment, along with prior amendments, modifies the Loan and Security Agreement (the "Loan Agreement") that was entered into onAugust 1, 2019 , by and amongRealNetworks, Inc. ,Rhapsody International Inc. ("Napster"), which was then a majority-owned subsidiary of the Company, andRealNetworks Digital Music of California, Inc. , a wholly owned subsidiary of the Company, and the Bank. Following the sale of Napster to a third party inDecember 2020 , the Loan Agreement, as amended, removes Napster as a borrower under the loan facility and extends the maturity date toAugust 1, 2022 . Under the terms of the Loan Agreement, as amended, the loan facility is a revolving line of credit up to$6.5 million , from which the Company may request advances dependent upon a borrowing base that comprises accounts receivable and direct-to-consumer subscription deposits. The proceeds of any loans made under this loan facility will be used for working capital and general corporate purposes. As of the date of this Current Report on Form 8-K, the Company has not requested a draw on the revolving line of credit, though may do so in future. Borrowings under the Loan Agreement, as amended, are secured by a first-priority security interest in the assets of the Company. Advances bear interest at a rate equal to one-half of one percent point (0.50%) above the prime rate (as defined), with monthly payments of interest only and principal due at the end of the remaining term. The Loan Agreement, as amended, contains customary covenants for credit facilities of this nature, including financial covenants and minimum EBITDA levels. The foregoing summary of the terms of the Amendment is a general description only. It does not purport to be complete and is qualified in its entirety by reference to the Fifth Amendment to Loan and Security Agreement, a copy of which is attached as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated by reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Pursuant to the rules and regulations of the
Exhibit No. Description 10.1 Fifth Amendment to Loan and Security Agreement by and amongWestern Alliance Bank ,RealNetworks Digital Music of California, Inc. , andRealNetworks, Inc. datedFebruary 9, 2021 .
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