Qumu closed a $10 million credit agreement with ESW Capital on January 12, 2018. The new agreement replaces the company’s existing $8 million term loan credit agreement with Hale Capital Partners, the outstanding balance of which was paid with proceeds from the new term loan.
The credit agreement provides a $10 million term loan drawn at close, with principal due on January 10, 2020 and PIK interest set at prime plus 4.0% compounding monthly. In connection with the agreement, the company issued a 10-year warrant to purchase 925,000 shares of its common stock at an exercise price of $1.96 per share.
After the repayment of the prior term loan, Qumu intends to use the remaining funds for general corporate purposes.
“This credit agreement strengthens our balance sheet with a facility that has a lower interest rate and an extended maturity date. Additionally, the deferral of covenants for the first twelve months enables senior management to stay focused on executing our business plan,” said Vern Hanzlik, president and CEO of Qumu.
Qumu provides software to create, manage and share video—live streaming and on demand—turning video to companies worldwide.
