Polar Power received $5.2 million in connection with the sale of certain accounts receivable to Citibank to support the company’s working capital needs.
Under the agreement, the company may from time to time offer to sell to Citibank certain of the company’s accounts receivable relating to invoiced sales made by the company to its largest tier-1 telecom customer and its affiliates. This credit facility provides the company with the ability to receive 100% of the value of the accounts receivable invoiced, less the applicable discount charge of approximately 0.84% of the face value of the invoice. The company receives payment from Citibank within 48 hours of Citibank’s acceptance of the invoice.
Citibank may change the pricing terms at any time in its sole discretion upon at least 30 days prior written notice to the company. In addition, either party may terminate the agreement upon 30 business days prior written notice to the other party, provided that either party may terminate the agreement upon five business days prior written notice if the other party is in breach of, or fails to perform any of its material obligations under the agreement.
“We believe this credit facility is a complementary addition to our existing capital resources and provides us with low-cost means to increase our liquidity and flexibility in addressing our short term working capital needs,” said Luis Zavala, Polar Power’s CFO. “We expect this facility to be a long-term component of our capital structure.”
Gardena, CA-based Polar Power designs, manufactures and sells direct current (DC) power systems and lithium battery powered hybrid solar systems.
