Kontrol Technologies (NEO: KNR) has obtained credit from a Schedule 1 bank, enabling it to repay certain debentures due in October. The funding is said to consist of up to $50 million in senior secured credit facilities.
The facilities consist of a term loan facility of up to $20 million, as well as a revolving credit facility of up to $10 million, and and accordion of up to $20 million. The revolver is said to be based on borrowing base requirements, which is based on eligible receivables. The debt is slated to bear interest monthly at prime plus a margin of between 1.25% and 2.00%, with repayments of 1.25% of the total loan payable quarterly.
Kontrol has indicated that the funds are marked to be used to settle its outstanding line of credit, as well as to refinance debentures coming due in October. The revolver is slated to be used for working capital while the accordion is to be used for M&A.
The company currently expects to draw $6.0 million on the term loan initially. Within the firms most recently reported financing, Kontrol had an outstanding operating line of $4.9 million, versus a cash position of just $1.3 million. That draw on the term loan meanwhile will likely double in October, when the firm has roughly $5.7 million in unsecured debentures coming due.
Kontrol Technologies last traded at $1.25 on the Neo.
Information for this briefing was found via Sedar and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
