IEC Electronics amended its credit facility with M&T Bank, adding an equipment line of credit of up to $1.5 million.
According to a related 8-K filing, M&T has agreed to make equipment line advances to the company from time to time in amounts outstanding at any time not exceeding $1.5 million. The obligations of the company are secured by the capital equipment the proceeds of said facility is used to purchase, as well as the collateral securing the facility generally. Up to $750,000 of the facility availability was permitted to finance equipment purchased prior to closing of the facility and availability under the facility may be re-borrowed.
Equipment line advances will be used to finance the purchase of capital equipment and are limited to 80% of the invoice cost of purchased equipment. No more than four such advances may be outstanding at any one time. The advances will be interest only for a period of six months at which point or earlier upon the company’s election, the company will repay the equipment line advance and any accrued interest in full. At that time, providing all conditions to conversion have been met, the company will pay in full all accrued interest and convert the equipment line advance to a term loan with level monthly principal payments plus interest.
