Daily News: February 25, 2014

Fifth Third Amends ISA Facility

Industrial Services of America (ISA) announced it finalized the terms of an amendment to its credit facility with Fifth Third Bank. With this amendment, ISA will reclassify $13.6 million of debt to long-term debt, improving the company’s liquidity ratios and freeing up more cash to operate the business.

The amendment extends the credit facility’s maturity date from April 30, 2014 to July 31, 2015, reduces monthly term loan payments from $105,000 to $50,000; reduces the interest rate on both the revolver and the Fifth Third term loan to LIBOR + 4.00% (from LIBOR + 5.00%) through June 30, 2014, and allows the advance rate on inventory to increase from 55% to 65%.

All of these changes provide ISA with enhanced near-term liquidity. The amendment is part of a more comprehensive refinancing which ISA expects to complete soon, and which the company anticipates will bring it current with all of its suppliers. Fifth Third waived the company’s previous defaults under the credit agreement.

In addition to amending its primary credit facility, following the filing of ISA’s Form 10-Q for the third quarter of 2013 on January 10, 2014, NASDAQ issued a letter to ISA affirming that ISA regained compliance with the NASDAQ periodic filing requirement.

Sean Garber, ISA’s president, commented, “We are pleased to have regained compliance with both Fifth Third and NASDAQ. This is the first step in a larger restructuring process that will establish a sound financial foundation and lean operating profile for ISA. We are proceeding quickly but methodically toward our goal of complete operational turnaround. Our team has pulled together and is working hard. With this collective effort, ISA will soon be properly positioned to take advantage of the numerous growth opportunities we see ahead of us.”

Louisville, KY-headquartered Industrial Services of America is a publicly traded company whose core business is buying, processing and marketing scrap metals and recyclable materials for domestic users and export markets.