Company Completes Recapitalization Process
PHOENIX, AZ, Oct. 22, 2020 (GLOBE NEWSWIRE) -- Taronis Fuels, Inc., (“Taronis” or the “Company”) (OTCQB: TRNF), a global producer of renewable and socially responsible fuel products, today announced the closing of a $10 million senior, secured line of credit with Tech Capital, LLC (“Tech Capital”). Tech Capital is a wholly-owned subsidiary of Technology Credit Union in San Jose, California. Tech Capital primarily lends to businesses in the software, IT services, and renewable and cleantech industry verticals. The credit facility has an initial term of 12 months and is priced at the WSJ Prime Rate, currently 3.25%, plus 2.75% for an annual interest rate of 6.0%.
Availability under the credit facility is governed by a formula that combines advances under existing accounts receivables, plus advances using existing inventory on hand. Based on the most recent internal Company financial information, the line should provide an immediate borrowing availability of $4.5 million to $5.0 million on an ongoing basis and is recalculated monthly. Availability on the line of credit is expected to gradually increase as the Company grows its working capital assets. The credit facility requires monthly interest payments only, and there are no amortization requirements.
“We are pleased to partner with Tech Capital to further enhance our working capital and overall liquidity position,” commented Scott Mahoney, CEO of Taronis Fuels. “The equity private placement completed last week significantly reduced our overall leverage with the elimination of $6.95 million in convertible, secured debt. The combined equity injection and debt reduction greatly improved the Company’s ability to swiftly complete this transaction, which had been in process for some time.”
“With the Tech Capital credit facility, we now have a scalable source of low-cost working capital to support our organic growth plans. Our lender is also highly supportive of our current mergers and acquisitions pipeline and is willing to augment our borrowing base capacity periodically to facilitate opportunistic investments as needed.”
“Our wholesale gas division is currently expanding into Sacramento, San Francisco, San Jose, and Houston. Our retail division is launching our Phoenix store in October and has plans to launch new locations in Houston, Dallas, and Fort Meyers during the fourth quarter. All of these locations are expected to accelerate revenue growth over the next several quarters, expanding our working capital assets. With Tech Capital as a partner, we now have a clear source of low-cost growth capital to support our business expansion plan objectives,” concluded Mr. Mahoney.
About Taronis Fuels, Inc.
Taronis Fuels, Inc. is a global producer of renewable and socially responsible fuel products. Our goal is to deliver environmentally sustainable, technology driven alternatives to traditional fossil fuel and carbon-based economy products. We believe our products offer a vastly cleaner solution to legacy acetylene and propane alternatives.
Taronis is also dedicated to providing fundamentally safer solutions to meet the industrial, commercial and residential needs of tomorrow’s global economy. Our products have been rigorously tested and independently validated by global gas authorities as vastly safer than acetylene, the most dangerous industrial gas in use today.
Lastly, we strive to deliver products that offer significant functional superiority at a reduced cost to the end consumer. Through these efforts, we support 9 of the 17 United Nations Sustainable Development Goals. For more information, please visit our website at www.taronisfuels.com/
FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements as defined within Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements relate to future events, including our ability to raise capital, or to our future financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance, or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. You should not place undue reliance on forward-looking statements since they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond our control and which could, and likely will, materially affect actual results, levels of activity, performance or achievements. Any forward-looking statement reflects our current views with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to our operations, results of operations, growth strategy and liquidity. We assume no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.
For a discussion of these risks and uncertainties, please see our filings with the Securities and Exchange Commission. Our public filings with the SEC are available from commercial document retrieval services and at the website maintained by the SEC at http://www.sec.gov.
Investor Contacts:
Michael Khorassani
IR@Taronisfuels.com