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S&W Seed Company (NASDAQ:SANW) announced a series of significant developments Monday, including the termination of its Chief Executive Officer, new financing arrangements, and a substantial reduction in its workforce, according to a press release statement based on a recent SEC filing.
On June 18, the company’s Board of Directors terminated Mark Herrmann as President and CEO, effective immediately, and appointed Chief Financial Officer Vanessa Baughman as Interim CEO. The company stated that no new compensatory arrangements have been made in connection with Baughman's appointment.
Also on June 18, S&W Seed and its lenders entered into a letter agreement amending the company’s existing credit facility with ABL OPCO LLC (Mountain Ridge). Under the amended agreement, lenders advanced an additional $1.08 million in revolving loans to cover payroll, legal services, and insurance expenses. These loans are secured by company collateral. The agreement also allows for daily advances of $6,500 to cover payroll for key employees, subject to lender cancellation with 24 hours’ notice. In consideration for the new loans, S&W will pay a $1.08 million funding fee, due at maturity, acceleration, or upon certain asset sales.
The amended credit agreement sets an enhanced interest rate of 18% per annum on obligations exceeding the borrowing base. As of June 17, S&W Seed received a notice of default from Mountain Ridge for exceeding its borrowing base by approximately $180,000. As a result, all other obligations under the facility now bear interest at a default rate, and Mountain Ridge may declare all outstanding obligations—about $20.9 million as of the filing—immediately due and payable.
The default under the Mountain Ridge agreement also triggered a cross-default on a separate $4.3 million term loan from AgAmerica Lending LLC, secured by company-owned land in Texas. AgAmerica now has the right to declare all obligations under that loan immediately due.
In addition, S&W Seed terminated all non-essential employees on June 18, leaving seven key employees remaining. The company cited cost reduction efforts and ongoing liquidity challenges, and said it continues to explore strategic alternatives, including asset sales, dissolution, or seeking relief under bankruptcy laws.
All information is based on a press release statement and the company’s Form 8-K filed with the SEC.
In other recent news, S&W Seed Company reported a slight increase in revenue for the third quarter of 2025, reaching $9.5 million, up from $9.4 million in the previous year. The company achieved a significant improvement in its gross profit margin, which rose to 37.7% from 24.6% the previous year. Additionally, S&W Seed reported a positive adjusted EBITDA of $244,000, marking the first positive quarter in many years. However, the company revised its full-year revenue guidance downward to $29-31 million from a previous estimate of $34.5-38 million. This revision reflects challenges such as export disruptions due to tariffs, particularly affecting the Chinese market, and increased sorghum inventories leading to lower farm gate prices. Despite these challenges, S&W Seed plans to continue its international expansion through partnerships and the launch of new sorghum traits. CEO Mark Herman expressed confidence in the company's long-term prospects, emphasizing the value of S&W's high-value traits for farmers. The company also continues to explore strategic alternatives to enhance shareholder value.
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