Exhibit
10.01


 


LOAN DOCUMENT MODIFICATION
AGREEMENT


 


This Loan Document Modification Agreement
(this "Agreement") is made as of this 5th day of August, 2019, by and between Middlesex Savings Bank,
a banking corporation organized and existing under the laws of Massachusetts, of 6 Main Street, Natick, Massachusetts 01760 (the
"Lender"), and Dynasil Corporation of America of 313 Washington Street, Suite 403, Newton, Massachusetts 02458
(the "Borrower"); and Optometrics Corporation of 8 Nemco Way, Ayer, Massachusetts 01432, Radiation Monitoring
Devices, Inc. of 44 Hunt Street, Watertown, Massachusetts 02472, RMD Instruments Corp. of 44 Hunt Street, Watertown, Massachusetts
02472, Evaporated Metal Films Corp. of 239 Cherry Street, Ithaca, New York 14850, and Dynasil Biomedical Corp. of 44 Hunt Street,
Watertown, Massachusetts 02472 (collectively, the "Guarantors").


 


WHEREAS,
on May 1, 2014 Lender made a loan (the "Loan") to Borrower evidenced by a Revolving Line of Credit Note dated
May 1, 2014 from Borrower to Lender in the original principal amount of Four Million and 00/100 ($4,000,000.00) Dollars (the "LOC
Note");


 


WHEREAS,
as security for the payment and performance of Borrower's obligations under the LOC Note, Borrower and Guarantors executed and
delivered to Lender, (i) a Loan and Security Agreement dated May 1, 2014, by and between the Borrower and the Lender (the "Loan
Agreement"), (ii) UCC-1 Financing Statements covering the Collateral described in the Loan Agreement and filed with the
Secretary of State of the Commonwealth of Massachusetts, State of New York and State of Delaware (the "UCC-1 Financing
Statements"), (iii) Entity Guaranty and Security Agreements, all dated May 1, 2014 from Guarantors to Lender (the "Guaranties"),
(iv) a Stock Pledge Agreement by Borrower in favor of Lender dated May 1, 2014 (the "Stock Pledge"); and (v) a
Subordination Agreement dated as of May 1, 2014 given by Massachusetts Capital Resource Company ("MCRC") to Lender
(the "MCRC Subordination") by which all debt of Borrower to MCRC (the "Junior Debt") is subordinated
to all Obligations of Borrower to Lender. Collectively, the Loan Agreement, the UCC-1 Financing Statements, the Guaranties, the
Stock Pledge, and the MCRC Subordination are referred to, together with various other documents referred to therein, as the same
may be amended from time to time, as the "Security Instruments";


 


WHEREAS,
Borrower and Lender amended the terms of the Loan pursuant to a Loan Document Modification Agreement dated September 29, 2015,
by adding or modifying certain financial covenants by Lender, granting to Borrower consent to pay-down or pay-off certain amounts
of the Junior Debt, and by adding an option on the part of Borrower to term out a certain amount of Advances made to Borrower under
the LOC Note;


 


WHEREAS,
Borrower and Lender further amended the terms of the Loan pursuant to a Second Amendment of Loan Agreement dated December 2, 2016,
to (i) provide for Borrower to pay dividends under certain circumstances, (ii) make a distribution to Dynasil Biomedical Corp.
to invest in Xcede Technologies, and (iii) modify the debt service coverage covenant;


 






    	 		 



     


    

 


WHEREAS,
Borrower and Lender further amended the terms of the Loan pursuant to a Loan Document Modification Agreement dated May 16, 2017,
by modifying the Advance Period Termination Date as set forth therein, and providing for an equipment line of credit in favor of
the Borrower (the "Equipment Line of Credit"), as evidenced by a certain Equipment Line of Credit Master Note
(Non-Revolving) in the maximum principal amount of One Million and 00/100 ($1,000,000.00) Dollars (the "Equipment Line
of Credit Note"); and


 


WHEREAS,
the Borrower and Lender further amended the terms of the Loan pursuant to a Loan Document Modification Agreement dated August 13,
2018 for the purposes of (i) renewing and modifying the Equipment Line of Credit and replacing the Equipment Line of Credit Note,
and (ii) modifying the Maximum Funded Debt Ratio set forth in the Loan Agreement; and


 


WHEREAS,
with this Modification Agreement, the Borrower and the Lender further agree to amend the Loan Agreement Pursuant to a Loan Document
Modification Agreement dated the same, to increase the percentage of Eligible Accounts Receivable available for borrowing under
the Revolving Line of Credit Note from 80% to 85% and to eliminate Eligible Unbilled Receivables as a category for the Borrower
obtaining Advances under the Revolving Line of Credit effective April 30, 2019, and to modify the Equipment Line of Credit; and


 


WHEREAS,
pursuant to the terms set forth herein, the Loan Agreement shall be further amended to change the definitions used to
calculate the Debt Service Coverage Ratio in Section 4.9 and the Maximum Leverage
Ratio in Section 4.9A (to add back up to $750,000 of certain Go-Dark Expenses) from the twelve (12) month testing periods
ending June 30, 2019 and September 30, 2019, and to consent to new subordinated indebtedness in the maximum amount of
$2,000,000 (Section 3.2), with payments of interest and principal to be included in the calculation of the Debt Service
Coverage Ratio (Section 4.9).


 


NOW, THEREFORE,
in consideration of the mutual covenants herein contained and other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, it is hereby agreed as follows:


 


1.           Section
4.9 of the Loan Agreement is hereby deleted in its entirety and the following new Section 4.9 is substituted therefor, as follows:


 


"4.9 Debt
Service Coverage. At the close of each fiscal quarter of Borrower, maintain a Debt Service Coverage ratio of at least 1.2 to
1.0 for the prior 12 month period. 'Debt Service Coverage' as used herein shall be determined for the relevant period, and
shall mean (i) EBITDA excluding non-cash and/or non-recurring expenditures, (including without limitation, up to $750,000 of certain
Go-Dark Expenditures incurred in the de-listing of certain of the Borrower’s stock from NASDAQ) for the fiscal quarters ending
June 30, 2019 and September 30, 2019 only, but effective for the subsequent three (3) fiscal quarters to give effect to the trailing
twelve (12) month testing periods for this covenant, minus unfinanced capital expenditures, minus dividends and distributions,
minus cash taxes paid for ongoing operations, divided by (ii) scheduled interest and principal payments made on all debt."


 




    	 	-2-	 



     


    

 


2.           Section
4.9A of the Loan Agreement is hereby deleted in its entirety, and the following new Section 4.9A is substituted therefor:


 


"4.9A Maximum
Leverage. At the close of each fiscal quarter of the Borrower, and on a trailing four (4) quarter basis, Borrower shall maintain
Maximum Leverage of 2.5:1. For purposes of this Section 4.9A, the following terms shall have the defined meanings:


 


'Adjusted EBITDA'
shall mean, EBITDA, excluding therefrom non-cash and/or recurring expenditures, including without limitation, up to $750,000 of
Certain Go-Dark Expenditures incurred in the de-listing of certain of the Borrower’s stock from NASDAQ for the twelve (12)
month testing periods ending June 30, 2019 and September 30, 2019 only, or gains (as permitted), and the operating income or loss
of the Xcede joint venture that is consolidated into Borrower's financial results.


 


'Maximum Leverage'
shall mean that quotient equal to (a) the sum of (i) Senior Secured Debt plus (ii) Subordinated Debt plus capital leases
and other indebtedness, if any, divided by (b) Adjusted EBITDA."


 


3.           The
Equipment Line of Credit Note is hereby amended to extend the Conversion Date to April 30, 2020 and change the Maturity Date (upon
conversion to a term loan) from April 30, 2019 to April 30, 2025.


 


4.            Borrower
and Guarantors confirm that the Security Instruments, as amended by or added to in connection with this Agreement, constitute the
valid and enforceable obligations of Borrower and Guarantors, and that neither Borrower nor Guarantors has any existing claims,
defenses or rights of setoff with respect thereto.


 


5.           Borrower
and Guarantors hereby warrant and represent that the statements set forth in the recitals above are true and correct, and that
all representations and warranties made by Borrower and Guarantors in the Security Instruments continue to be true and correct
in all material respects.


 


6.           It
is further agreed that this Agreement shall not, in any manner, release, relinquish, or otherwise affect the liens, security interests,
and rights created by or arising under the Security Instruments or its priority over other liens, charges, or encumbrances affecting
the Collateral referred to therein (except by extending such lien to secure, inter alia, any and all new obligations created hereby
and pursuant to the Equipment Line of Credit Note and the Term Note) or Borrower’s or Guarantors' liability thereunder; and
all other terms, conditions and covenants therein contained which are not hereby amended, are hereby ratified and confirmed as
previously written.


 




    	 	-3-	 



     


    

 


7.           Borrower
and Guarantors hereby acknowledge that there are and were no oral or written representations, warranties, understandings, stipulations,
agreements or promises made by any party or by any agent, employee or other representative of any party, pertaining to the subject
matter of this Agreement which have not been incorporated herein. No express or implied consent to any further modifications involving
any of the matters set forth in the Security Instruments or herein shall be inferred or implied by Lender's execution of this Agreement.
Any further modification of the Loan Agreement shall require the express written approval of Lender. No provision hereof shall
be modified or limited except by a written instrument signed by the parties hereto, expressly referring hereto and to the provision
so modified or limited.


 


8.           Except
as expressly amended and modified by this Agreement all of the terms and conditions of the Security Instruments shall remain in
full force and effect.


 


 


[Signature Page to Follow]


 




    	 	-4-	 



     


    

 


Executed under seal this 5th day of August, 2019.


 


	 	MIDDLESEX SAVINGS BANK
	 	 	 
	 	By:	/s/ Tony
    Zhang
	 	 	Tony Zhang, Senior
    Vice President
	 	 	 
	 	 	 
	 	DYNASIL CORPORATION OF AMERICA OPTOMETRICS
    CORPORATION RADIATION MONITORING DEVICES, INC. RMD INSTRUMENTS CORP. EVAPORATED METAL FILMS CORP. DYNASIL BIOMEDICAL CORP.
	 	 	 
	 	By:	/s/ Robert
    Bowdring
	 	 	Robert Bowdring,
    Chief Financial Officer of each of the above named corporations


 


 


 


 






 


 


[Signature Page to Loan Modification Agreement]


 




    	 	-5-