LM Funding America Enters Loan Agreement

TL;DR

LMFA just signed a new loan agreement, potentially boosting their cash flow.

AI Summary

On August 6, 2024, LM Funding America, Inc. entered into a material definitive agreement, specifically a loan and security agreement with an unnamed lender. This agreement creates a direct financial obligation for the company. The filing also touches upon the company's results of operations and financial condition, though specific details are not provided in this excerpt.

Why It Matters

This filing indicates LM Funding America has secured new financing, which could impact its operational capacity and financial leverage.

Risk Assessment

Risk Level: medium — The company has entered into a new financial obligation, the terms and impact of which are not fully detailed, introducing some uncertainty.

Key Players & Entities

• LM Funding America, Inc. (company) — Registrant
• August 06, 2024 (date) — Date of earliest event reported
• 1200 West Platt Street Suite 100 (address) — Principal Executive Offices
• Tampa, Florida (location) — Principal Executive Offices City and State
• 33606 (zip_code) — Principal Executive Offices Zip Code

FAQ

Key Financial Figures

• $0.001 — ich registered Common Stock par value $0.001 per share LMFA The Nasdaq Stock Mar
• $5,000,000 — nior secured term loan in the amount of $5,000,000 (the "Loan") as evidenced by a Promisso
• $50,000 — thly interest payments in the amount of $50,000 on the last business day of each month
• $5.0 million — posed senior secured term loan of up to $5.0 million to be made by Lender to fund the Compan
• $5 million — t funding. The loan would be secured by $5 million of bitcoin collateral and substantially

Filing Documents

• lmfa-20240806.htm (8-K) — 56KB
• lmfa-ex4_1.htm (EX-4.1) — 27KB
• lmfa-ex10_1.htm (EX-10.1) — 178KB
• lmfa-ex10_2.htm (EX-10.2) — 104KB
• lmfa-ex10_3.htm (EX-10.3) — 57KB
• lmfa-ex10_4.htm (EX-10.4) — 69KB
• lmfa-ex10_5.htm (EX-10.5) — 61KB
• lmfa-ex10_6.htm (EX-10.6) — 104KB
• lmfa-ex10_7.htm (EX-10.7) — 103KB
• lmfa-ex99_1.htm (EX-99.1) — 45KB
• img17863145_0.jpg (GRAPHIC) — 5KB
• 0000950170-24-095086.txt ( ) — 1043KB
• lmfa-20240806.xsd (EX-101.SCH) — 24KB
• lmfa-20240806_htm.xml (XML) — 5KB

01 Entry into a Material Definitive Agreement

Item 1.01 Entry into a Material Definitive Agreement. On August 6, 2024, LM Funding America, Inc. (the "Company") entered into a Loan Agreement, dated August 6, 2024 (the "Loan Agreement"), by and among the Company, as borrower, each of LM Funding, LLC and US Digital Mining and Hosting Co., LLC (subsidiaries of the Company), as guarantors (jointly and severally, the "Guarantors"), and SE & AJ Liebel Limited Partnership, as lender (the "Lender"). Pursuant to the Loan Agreement, Lender made to the Company a senior secured term loan in the amount of $5,000,000 (the "Loan") as evidenced by a Promissory Note, dated August 6, 2024 (the "Note"). The Note is secured by (i) a Pledge Agreement, dated August 6, 2024, by and between the Company and Lender, pursuant to which Borrower has pledged certain Bitcoin with a fair market value equal to no less than $5,000,000 (the "Pledge Agreement"); (ii) a Security Agreement, dated August 6, 2024 (the "Security Agreement"), by the Company in favor of Lender, pursuant to which the Company has granted to Lender a first perfected security interest in substantially all the assets of the Company, including but not limited to approximately 11,100 Bitmain S21 Antminers (the "Miners"); and (iii) certain commercial guarantees and security agreements executed by the Guarantors pursuant to which each Guarantor guaranteed the Loan and granted a first priority perfected security interest in substantially all the assets of such Guarantor (the "Subsidiary Guaranty and Security Agreements"). Further, in connection with the Loan and the Loan Agreement, the Company entered into an Intercreditor Agreement, dated August 6, 2024 (the "Intercreditor Agreement"), with Brown Family Enterprises LLC, holder of the Second Lien Obligations (as defined in the Intercreditor Agreement), pursuant to which the First Lien Obligations (as defined in the Intercreditor Agreement) and the Second Lien Obligations are subject to customary intercreditor arrangements.

02 Results of Operations and Financial Condition

Item 2.02 Results of Operations and Financial Condition. On August 12, 2024, the Company issued a press release providing Bitcoin production and mining updates for the one month ended July 31, 2024. The information contained in the press release is incorporated herein by reference and furnished as Exhibit 99.1. The information furnished in this Item 2.02, including Exhibit 99.1, is not deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to liability under that Section. This information will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent that the Company specifically incorporates it by reference. 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 under Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.

01 Regulation FD Disclosure

Item 7.01 Regulation FD Disclosure. On July 16, 2024, the Company announced that it had entered into a non-binding term sheet with SE & AJ Liebel Limited Partnership, a Nevada limited partnership ("Lender"), that contemplates a proposed senior secured term loan of up to $5.0 million to be made by Lender to fund the Company's purchase of additional mining machines. The loan, if consummated, is expected to have a principal maturity date of 24 months from the closing of the loan and is expected to accrue interest of 12% per annum, payable monthly, with a 1% loan fee due at funding. The loan would be secured by $5 million of bitcoin collateral and substantially all the other assets of the Company. There is no assurance that the loan transaction will be completed.

01 Financial Statements and Exhibits

Item 9.01 Financial Statements and Exhibits. (d) Exhibits Exhibit Number Description 4.1 Promissory Note, dated August 6, 2024 10.1 Loan Agreement, dated as of August 6, 2024, by and among the Company, LM Funding, LLC, US Digital Mining and Hosting Co., LLC, and SE & AJ Liebel Limited Partnership 10.2 Security Agreement, dated as of August 6, 2024, by the Company in favor of SE & AJ Liebel Limited Partnership 10.3 Pledge Agreement, dated as of August 6, 2024, by and between the Company and SE & AJ Liebel Limited Partnership 10.4 Commercial Guaranty, dated August 6, 2024, by LM Funding, LLC 10.5 Commercial Guaranty, dated August 6, 2024, by US Digital Mining and Hosting Co., LLC 10.6 Security Agreement, dated as of August 6, 2024, by LM Funding, LLC in favor of SE & AJ Liebel Limited Partnership 10.7 Security Agreement, dated as of August 6, 2024, by US Digital Mining and Hosting Co., LLC in favor of SE & AJ Liebel Limited Partnersh ip 99.1 Press release issued August 12, 2024 104 Cover Page Interactive Data File (embedded within the inline XBRL document)

Forward-Looking Statements

Forward-Looking Statements This Current Report on Form 8-K may contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainty. Words such as "anticipate," "estimate," "expect," "intend," "plan," and "project" and other similar words and expressions are intended to signify forward-looking statements. Forward-looking statements are not guarantees of future results and conditions but rather are subject to various risks and uncertainties. Such statements are based on the Company's current expectations and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Investors are cautioned that there can be no assurance actual results or business conditions will not differ materially from those projected or suggested in such forward-looking statements as a result of various risks and uncertainties. Investors should refer to the risks detailed from time to time in the reports the Company files with the SEC, including the Company's Annual Report on Form 10-K for the year ended December 31, 2023, as well as other filings on Form 10-Q and periodic filings on Form 8-K, for additional factors that could cause actual results to differ materially from those stated or implied by such forward-looking statements. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, unless required by law.

View Full Filing

View this 8-K filing on SEC EDGAR