AudioEye adjusts EBITDA and buyback limits in bank loan
AudioEye amends its loan agreement to adjust EBITDA definitions for certain litigation costs and reset multi-year limits on stock repurchases.
Rhea-AI Filing Summary
AudioEye, Inc. (AEYE) amended its credit facility with Western Alliance Bank through a Fourth Loan Modification Agreement effective September 18, 2026. The amendment revises the definitions of Adjusted EBIDA and Adjusted EBITDA to allow adding back certain litigation expenses that are not part of ongoing operations and are reasonably acceptable to the bank, up to $5.0 million on a trailing twelve‑month basis through December 31, 2026, and up to $3.0 million on a trailing twelve‑month basis from January 1, 2027 through December 31, 2027.
The amendment also changes the “Permitted Stock Buyback Amount,” replacing separate annual limits for fiscal years 2025, 2026, and 2027—previously totaling $7.0 million—with a single aggregate cap of $7.0 million across those three years, and maintains an annual stock repurchase limit of $2.0 million for fiscal year 2028 and each fiscal year thereafter.
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8-K Event Classification
3 items: 1.01, 2.03, 9.01
3 items
Item 1.01
Entry into a Material Definitive Agreement
Business
The company signed a significant contract such as a merger agreement, credit facility, or major partnership.
Item 2.03
Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement
Financial
The company incurred a new significant debt or off-balance-sheet obligation.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, or exhibit attachments filed with this report.
Key Figures
Litigation addback limit through 2026: $5.0 million
Litigation addback limit for 2027: $3.0 million
Aggregate stock buyback cap 2025–2027: $7.0 million
+2 more
5 metrics
Litigation addback limit through 2026
$5.0 million
Maximum litigation expenses that may be added back to Adjusted EBIDA/EBITDA on a trailing twelve‑month basis through December 31, 2026
Litigation addback limit for 2027
$3.0 million
Maximum litigation expenses that may be added back on a trailing twelve‑month basis from January 1, 2027 through December 31, 2027
Aggregate stock buyback cap 2025–2027
$7.0 million
Revised Permitted Stock Buyback Amount for fiscal years 2025, 2026, and 2027 combined
Annual stock buyback limit from 2028
$2.0 million per year
Permitted Stock Buyback Amount for fiscal year 2028 and each fiscal year thereafter
Form type
8-K
Current report describing the Fourth Loan Modification Agreement
Key Terms
Adjusted EBIDA, Adjusted EBITDA, Permitted Stock Buyback Amount, Loan and Security Agreement, +1 more
5 terms
Adjusted EBIDA financial
"modifies the definitions of “Adjusted EBIDA” and “Adjusted EBITDA” in the Loan"
Adjusted EBITDA is a company’s operating profit measure that starts with earnings before interest, taxes, depreciation and amortization and then removes one-time, irregular or non-cash items to show recurring cash performance. Think of it as the company’s “everyday” profit before financing and accounting quirks, which helps investors compare underlying business health across periods and peers without distortion from short-term events or different accounting choices.
Adjusted EBITDA financial
"modifies the definitions of “Adjusted EBIDA” and “Adjusted EBITDA” in the Loan"
Adjusted EBITDA is a way companies measure how much money they make from their core operations, like running a business, by removing certain costs or income that aren’t part of regular business activities. It helps investors see how well a company is doing without distractions from unusual expenses or gains, making it easier to compare companies or track performance over time.
Permitted Stock Buyback Amount financial
"amends the definition of “Permitted Stock Buyback Amount” to replace annual"
Loan and Security Agreement financial
"Loan and Security Agreement, dated as of March 31, 2025, by and among"
A loan and security agreement is a legal contract that sets out the amount, repayment schedule, interest and the rules a borrower must follow, and it names specific assets a lender can claim if the borrower fails to pay. Think of it like a mortgage or car loan where the lender holds a claim on collateral until the debt is repaid. Investors care because it determines a company’s repayment priorities, borrowing costs, operational limits and how easily creditors can seize assets in distress, all of which affect equity value and credit risk.
Emerging growth company regulatory
"Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). Emerging growth company"
An emerging growth company is a recently public or smaller public firm that qualifies for temporary, lighter regulatory and disclosure rules to reduce the cost and effort of being public. For investors, it means the company may provide less historical financial detail and face fewer reporting requirements than larger firms, so it can grow more quickly but also carries higher uncertainty—like buying a promising early-stage product with fewer user reviews.
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
What loan agreement change did AudioEye (AEYE) announce on September 18, 2026?
AudioEye entered into a Fourth Loan Modification Agreement with Western Alliance Bank, amending its Loan and Security Agreement to revise definitions of Adjusted EBIDA, Adjusted EBITDA, and the Permitted Stock Buyback Amount.
How does the AEYE amendment affect Adjusted EBITDA calculations?
AudioEye may now add back certain litigation expenses, determined in good faith and reasonably acceptable to the bank, up to $5.0 million on a trailing twelve‑month basis through December 31, 2026, and up to $3.0 million on a trailing twelve‑month basis during 2027.
What are the new limits on AudioEye (AEYE) stock buybacks under the loan agreement?
For fiscal years 2025–2027, stock repurchases are capped at an aggregate $7.0 million. The amendment also keeps an annual stock buyback limit of $2.0 million for fiscal year 2028 and for each fiscal year thereafter.
Did AudioEye (AEYE) change its overall borrowing or just definitions in the loan?
The disclosure describes changes to definitions and limits in the Loan and Security Agreement—specifically Adjusted EBIDA, Adjusted EBITDA, and Permitted Stock Buyback Amount—rather than changes to overall borrowing amounts.
Which bank is AudioEye’s counterparty in this Fourth Loan Modification Agreement?
The counterparty is Western Alliance Bank, which is party to AudioEye’s Loan and Security Agreement originally dated March 31, 2025, and previously amended three times before this Fourth Loan Modification Agreement.
AI-generated analysis. How Rhea-AI works. Not financial advice.
