BASI Bioanalytical Systems Inc

Item 1.01 Entry into a Material Definitive Agreement

On June 23, 2017, Bioanalytical Systems, Inc. (the “Company”) entered into a Credit Agreement (the “Credit Agreement”) with First Internet Bank of Indiana (the “Lender”). The Credit Agreement provides the Company with (i) a term loan (the “Term Loan”) in the amount of $4,500,000, which was used to satisfy the Company’s outstanding indebtedness with The Huntington Bank, and (ii) a revolving line of credit of up to $2,000,000 (the “Facility”), which the Company may borrow from time to time, subject to the terms of the Credit Agreement. The Term Loan and the Facility mature June 23, 2022 and June 23, 2019, respectively.

Amounts outstanding under the Term Loan bear interest at a fixed per annum rate of 3.99%, while interest accrues on the principal balance of the Facility at a floating per annum rate equal to the Prime Rate (generally defined as the highest rate identified as the “Prime Rate” in The Wall Street Journal “Money Rates” column on the date the interest rate is to be determined, or if that date is not a publication date, on the publication date immediately preceding) less Twenty-five (25) Basis Points (0.25%). The Term Loan requires monthly principal payments of $25,000 plus interest. The Company must also pay accrued and unpaid interest on the outstanding balance under the Facility on a monthly basis.

The Company’s obligations under the Credit Agreement are guaranteed by BAS Evansville, Inc., the Company’s wholly owned subsidiary (“ BASEV”). The Company’s obligations under the Credit Agreement and BASEV’s obligations under the Guaranty are secured by first priority security interests in substantially all of the assets of the Company and BASEV, respectively, as well as mortgages on the Company’s and BASEV’s facilities in West Lafayette, Indiana and Evansville, Indiana, respectively.

The Credit Agreement contains various restrictive covenants, including restrictions on the Company’s ability to dispose of assets, make acquisitions or investments, incur debt or liens, make distributions to shareholders or repurchase outstanding stock, enter into related party transactions and make capital expenditures, other than upon satisfaction of the conditions set forth in the Credit Agreement. The Company is also required to comply with certain financial and non-financial covenants, including a minimum debt service coverage ratio and a debt to equity ratio. Upon an event of default, which includes certain customary events such as, among other things, a failure to make required payments when due, a failure to comply with covenants, certain bankruptcy and insolvency events, and defaults under other material indebtedness, the Lender may cease advancing funds, increase the interest rate on outstanding balances, accelerate amounts outstanding, terminate the agreement and foreclose on all collateral.

The foregoing general description of the Credit Agreement is qualified in its entirety by reference to the full text of the Credit Agreement, a copy of which will be filed with the Company’s Form 10-Q for the period ending June 30, 2017.