PRO DEX INC 8-K

What Happened

• On February 9, 2026 Pro‑Dex, Inc. (PDEX) completed the acquisition of Advanced Precision Machining LLC (APM), a California manufacturer of machined components (including some of Pro‑Dex’s sub‑assemblies). The aggregate purchase price was approximately $8,650,000: about $6,650,000 paid in cash at closing and $2,000,000 issued as a 63‑month subordinated promissory note to the seller bearing simple interest at 8% per year. Pro‑Dex also agreed to engage seller representative Sean McCaig as a consultant through the end of 2026.
• To fund the cash portion, on February 9, 2026 Pro‑Dex entered into a Second Amended and Restated Credit and Security Agreement with UMB Bank, N.A., which added Term Note D for $6,650,000 and extended the maturity of the company’s revolving credit from December 29, 2026 to December 29, 2027.

Key Details

• Purchase price: ~$8,650,000 (cash $6,650,000 + $2,000,000 subordinated promissory note).
• Seller Promissory Note: 63 months, 8% simple interest, 21 equal quarterly payments of $117,569.54; subordinated to UMB borrowings.
• UMB financing: Term Note D $6,650,000 (matures Feb 1, 2031; interest = max(4.5%, SOFR+2.5%)); existing Term Notes A ($7,525,000) and B ($1,000,000) (fixed 3.84%, mature Nov 1, 2027) and Term Note C ($5,000,000, matures Aug 1, 2029, interest = max(5%, SOFR+2.5%)) remain in place.
• Revolving Note: $11,000,000 capacity, maturity extended to Dec 29, 2027; no amounts outstanding on the revolver as of the 8‑K filing. Company paid origination and extension fees of $16,625 and $15,000, respectively.
• R&W insurance: Pro‑Dex will obtain a $2,000,000 representations & warranties insurance policy as part of the purchase agreement.

Why It Matters

• The acquisition brings a machining supplier into Pro‑Dex’s ownership, which could help secure supply of key machined components and support production continuity for medical and aerospace customers. That is a strategic integration of a supplier that already manufactures some of Pro‑Dex’s sub‑assemblies.
• The deal increases Pro‑Dex’s debt load and introduces a subordinated seller note. Investors should note the new $6.65M Term Note D, the $2M subordinated note (8% interest), the extended revolver maturity, and related covenants/default provisions — all of which affect leverage, interest expense, and liquidity. Monitor future disclosures for integration progress and any impact on cash flow and covenant compliance.