Westport, CT, September 9--IWT Tesoro Corp., a wholesale provider of hard and soft floor and wall covering materials, today announced the closing of a $5 million revolving credit facility arrangement with Laurus Master Fund Ltd.
This agreement provides for an additional asset-based line subordinate to IWT Tesoro Corporation's primary lender, Bank of America. The $5 million facility consists of a $3 million minimum borrowing note and a $2 million revolving line of credit.
The financing is convertible into shares of IWTT common stock at $2.74 per share. In addition, IWTT granted Laurus a five year warrant to purchase up to 511,883 shares of common stock at an exercise price of $3.15 per share. Laurus must exercise the warrants for cash. IWTT also agreed to issue Laurus a five-year option to purchase up to 1,170,110 shares of common stock at an exercise price of $.001 per share. The option must be exercised by Laurus for cash, but is subject to a lock-up through August 25, 2006.
"The flexibility afforded to IWTT by the Laurus transaction will allow us to continue to expand product offerings and geographic presence," said Henry J. Boucher, president and CEO of IWT Tesoro Corporation. "We believe that the access to capital for acquisitions, as well as the equity that this relationship affords us, will help us build our shareholder value,"
The facility bears an interest rate of prime plus 1.5%, subject to reduction upon the occurrence of certain events. Complete details of the transaction are available on http://www.iwttesoro.com as contained in Form 8-K filed with the Securities and Exchange Commission on August 26, 2005.
