Loan & DebtAug 6, 2026, 05:03 PM
ProPhase Labs Obtains $2.085M Secured Convertible Loan
AI Summary
ProPhase Labs, Inc. secured a senior secured convertible loan of $2,085,000 from J.J. Astor & Co. The company received $1,500,000 in funding, with net proceeds of $1,020,000, reflecting a high factor rate of 1.39 times the loan amount. The loan, which matures on July 31, 2027, is secured by a senior lien on all company assets and includes a personal guarantee from CEO Ted Karkus. This financing occurs in the context of the company's subsidiaries being in Chapter 11 bankruptcy.
Key Highlights
- ProPhase Labs entered a Loan Agreement for a senior secured convertible loan with J.J. Astor & Co.
- The original principal amount of the loan is $2,085,000.
- The company received $1,500,000 in funding, with net proceeds of $1,020,000 after fees.
- The loan carries a factor rate of 1.39 times the funded amount.
- The loan matures on July 31, 2027, with weekly installment payments.
- Lender has conversion rights to common stock at $0.075 per share or 90% of 10-day VWAP after 12 months.
- The loan is secured by a senior priority lien on all company assets and a personal guarantee from CEO Ted Karkus.
- Subsidiaries ProPhase Diagnostics NJ, Inc., ProPhase Diagnostics NY, Inc., and ProPhase Diagnostics, Inc. are in Chapter 11 bankruptcy.
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