KRM22 PLC (LON:KRM) said its KRM22 Central Limited subsidiary has entered into a new five-year debt facility with Harbert European Growth Capital Fund II to support future business growth and allow it to pursue a pipeline of investment targets.
The AIM-listed technology and software investment company, focused on risk management for capital markets, said the facility is for up to €11.55mln (around £10.0mln) of which an initial £1mln will be drawn down immediately.
WATCH: 'Momentum' the key word at KRM22 as it secures new debt facility
The group added that the availability of additional drawdowns is based on the value and growth of the group's annualised recurring revenues (ARR) and drawdowns can be made until 31 December 2020.
The company said it has a strong pipeline of investment opportunities and continues to actively pursue near-term acquisition and partnership opportunities.
KRM22 pointed out that the facility is secured on certain group assets and does not include covenants based on its financial performance.
The interest rate payable on debt drawn down is 11% per annum on the initial £1% drawdown and the higher of 11% or 11% plus one year Euro Libor for additional drawdowns.
In conjunction with the facility, the company added, it has constituted warrants over a number of ordinary shares in the company to Harbert with a total value equal to a maximum of £1.0mln.
Upon the initial drawdown, it said, warrants over 495,049 new ordinary shares will be issued with an exercise price of 101p each, while additional warrants will be issued in an amount equal to 5.6% of each subsequent drawdown of the Facility - up to a maximum value of £500,000 in aggregate - calculated by reference to an exercise price of the lower of a 10% discount to the prevailing market price or 101p per new ordinary share.
Keith Todd, KRM22’s CEO and executive chairman commented: "We are delighted to partner with Harbert who look to financially support the strong acquisition pipeline and growth opportunities we have. The Facility will help us deliver our investing policy as outlined at IPO and will underpin the growth of the Global Risk Platform."
In early morning trade, shares in KRM22 held steady at 82p.
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