26th Jan 2015 15:41
LONDON (Alliance News) - Messaging International PLC Monday said it has signed a USD1.0 million "venture lending loan" for its subsidiary TeleMessage from Israel's Mizrahi Tefahot Bank Ltd.
The loan will be used for general working capital and the development of new products and services.
Under the terms of the agreement, TeleMessage can access the debt facility and will withdraw the full amount until June 31, with repayments in 36 instalments. The interest rate on the loan is the London Interbank Offered Rate plus 6%.
The new loan replaces a previous loan signed in June 2012, with the balance on the 2012 loan of about USD150,000 to be repaid.
In addition, as part of the agreement, the company will grant 4.5 million warrants to Mizrahi. The warrants can be exercised at any time from the date they are granted to January 24, 2020. The warrants are exercisable at a price of 0.91 pence per share, representing the average closing price of an ordinary share in the company during the 30 days prior to signing the warrant deal.
The company has also extended the exercise period of the 3.9 million warrants granted to Mizrahi under the agreement signed in June 2012, to January 24, 2020, from from June 17, 2017. All previous 15.1 million warrants granted to Mizrahi in 2008 expired in August last year.
"These additional funds will assist us in improving our business mobile messaging solutions, and bolster our sales and marketing efforts in order to leverage our presence in the enterprise messaging space," Guy Levit, chief executive, said in a statement.
"This growth potential has clearly been recognised by Mizrahi through the thorough due diligence it conducted on the company. Gaining the continuous support of such a well-established bank is testament to the quality of products and business that we have developed at Messaging International," Levit added.
Messaging International shares were up 4.9% at 0.970 pence on Monday.
By Samuel Agini; [email protected]; @samuelagini
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