US$1m Credit Facility and US$1.15m Issue of Equity (4376O)

TIDMADID TIDMADIS

RNS Number : 4376O

Armor Designs, Inc.

19 September 2011

 
 Press Release   19 September 2011 
 

Armor Designs Inc.

("Armor Designs" or "the Company" or "ADI")

US$1 million Domestic Inventory Credit Facility

With A Conditional US$1.15 million Issue of Equity

Further to the announcement of 15 March 2011 Armor Designs Inc., (AIM: ADID, ADIS), the knowledge-based designer, developer and manufacturer of next generation composite protective products, is pleased to announce that GBC International Bank ("GBCIB") has, extended to ADI, a US$1 million credit facility in the form of a "transaction specific" domestic inventory and working capital term loan (the "Facility").

The Facility is to be used for the fulfillment of domestic purchase orders and for domestic accounts receivables. GBCIB is a an international trade bank, located in Monterey Park, California, and is a "Preferred Lender" for the U.S. Small Business Administration ("SBA") and ranks fifth in the U.S.A. as a "Delegated Authority Lender" for the U.S. Export Import Bank ("EXIM").

On 15 March 2011 ADI announced that GBCIB had issued ADI with a "transaction specific" international purchase order line of credit to be used in fulfillment of international purchase orders and international accounts receivables. The announcement also made reference to ongoing discussions with GBCIB for a domestic inventory credit facility. Today's announcement confirms that both credit facilities are now in place and operational.

Under the terms of the Facility Armor Designs is extended a five-year US$1 million term loan. The type and purpose of the Facility is a "transaction specific" domestic inventory and working capital term loan. The US$1 million government-backed loan guarantees will be provided by the SBA, but future loan guarantees may also come from the EXIM loan guarantee program, depending on the type of "transaction".

Other conditions of the Facility are an advance rate of 100% for domestic inventory raw material acquisitions and a requirement of an additional infusion of a minimum of US$1 million equity capital, to be used to support future transaction overhead requirements. Advances on the term loan will bear interest at a fixed rate of 7.5%. During the first six months the loan will be interest only and after six months the loan will be principle and interest. As a form of collateral, GBCIB and the SBA/EXIM government agencies require a first security interest in the assets of ADI. In addition, GBCIB and SBA require ADI and Hawthorne & York International, Ltd. (parent company of ADI) to be corporate guarantors. The loan will have typical SBA loan fees, reporting requirements, audit requirements, and other standard banking requirements that are common in the industry and common for all SBA/EXIM guaranteed loan programs. In fulfillment of the condition to infuse additional equity capital to support future transaction overhead requirements, ADI is pleased to announce that it has today closed a fundraising by which the Company has raised US$1.15 million, before expenses, through a placing with investors of 76,667 new common stock shares of US$0.001 each in the Company ("Placing Shares"). The closing has been completed at a price of US$15 per Placing Share (the "Placing Price"). As part of the closing the Company has agreed with the investor that in the event the Company issues any shares in the capital of the Company as part of a further fundraising at a price less than the Placing Price (the "Lower Price") prior to 31 December 2017, the investor will have an option to subscribe at par (being US$0.001 per share), for such a number of additional shares as they would had received had the subscription price per share at Closing been at a 75% discount to the Lower Price rather than the Placing Price.

James A. St. Ville, CEO, commented "Signing of the domestic inventory facility, along with the previously announced international purchase order line of credit, allows ADI to commence fulfillment of both types of sales orders and to expand its domestic and worldwide presence."

Application will be made for the Placing Shares to be admitted to trading on the London Stock Exchange's AIM market. Dealings in the Placing Shares are expected to commence on AIM on 30 September 2011.

Following this admission the Company's share capital and Total Voting Rights comprises 27,131,803 Ordinary Shares of US$0.001each. Consequently, 27,131,803 is the figure which may be used by shareholders as the denominator for the calculation by which they will determine if they are required to notify their interest in, or a change to their interest in, Armor under the FSA's Disclosure and Transparency Rules.

For further information please contact:

 
 Armor Designs, Inc. 
 James A. St. Ville, President, CEO,COB   Tel: [phone] 
 [e-mail]          www.armordesigns.com 
 

Shore Capital and Corporate Ltd.

Anita Ghanekar

Edward Mansfield Tel: [phone]

Notes to editors

GBCIB is a "Preferred Lender" of the SBA for both their Export Express Program and the Export Working Capital Program. As a result of the passing of the $30,000,000,000 USD Small Business Job Act, GBCIB is now approved to extend their SBA working capital loans up to a limit of $5,000,000 USD per borrower. In addition, as a "Delegated Authority Lender" of the EXIM bank, GBCIB has been granted authority to approve its EXIM loan guarantees up to a limit of $5 million per transaction. With the designations, of "Preferred Lender" and "Delegated Authority Lender", GBCIB is enabled to approve, activate, and increase lines of credit in a more expeditious manner to further support U.S. exports.

Armor Designs, Inc. ("ADI") is a knowledge-based company specializing in next-generation composite material design, manufacture, prototyping and testing for applications and products for the armor industry. ADI uses a proprietary design and manufacturing process called VCM to rapidly develop new composite armor products of superior ballistic, weight and flexibility. The VCM process is protected by patents and trade secrets licensed to ADI in perpetuity for use in field of armor.

For more information on Armor Designs, Inc., please go to www.armordesigns.com

This information is provided by RNS

The company news service from the London Stock Exchange

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