Qumu Corporation announced that it closed a $10 million credit agreement with ESW Capital, LLC. The new agreement replaces the Company's existing $8.0 million term loan credit agreement with Hale Capital Partners, LP, the outstanding balance of which was paid with proceeds from the new term loan.

The credit agreement provides a $10 million term loan drawn at close, with principal due on January 10, 2020 and PIK interest set at prime plus 4.0% compounding monthly. In connection with the credit agreement, the Company issued a 10-year warrant to purchase 925,000 shares of the Company's common stock at an exercise price of $1.96 per share. The Company intends to use the funds remaining after repayment of the prior term loan to fund general corporate purposes.

"This credit agreement strengthens our balance sheet with a facility that has a lower interest rate and an extended maturity date. Additionally, the deferral of covenants for the first twelve months enables senior management to stay focused on executing our business plan," said Vern Hanzlik, president and CEO of Qumu.

The foregoing description of the credit agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Credit Agreement, which is included as Exhibit 10.1 to the Form 8-K to be filed by the Company.