Debt financing – Agapes GR http://agapesgr.org/ Sat, 19 Nov 2022 18:41:39 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://agapesgr.org/wp-content/uploads/2021/06/icon-2021-06-25T194407.031-150x150.png Debt financing – Agapes GR http://agapesgr.org/ 32 32 Iveric Bio pounces on FDA breakthrough status for eye disease candidate https://agapesgr.org/iveric-bio-pounces-on-fda-breakthrough-status-for-eye-disease-candidate/ Sat, 19 Nov 2022 15:40:44 +0000 https://agapesgr.org/iveric-bio-pounces-on-fda-breakthrough-status-for-eye-disease-candidate/ US biopharmaceutical company Iveric Bio (Nasdaq:ISEE) received a boost on Friday after its lead treatment candidate won breakthrough therapy designation from the US regulator, sending its shares soaring more than 25% to $21.65. The U.S. Food and Drug Administration (FDA) has granted Breakthrough Therapy Designation to Iveric’s Zimura (avacincaptad pegol; ACP), an investigational new C5 […]]]>

US biopharmaceutical company Iveric Bio (Nasdaq:ISEE) received a boost on Friday after its lead treatment candidate won breakthrough therapy designation from the US regulator, sending its shares soaring more than 25% to $21.65.

The U.S. Food and Drug Administration (FDA) has granted Breakthrough Therapy Designation to Iveric’s Zimura (avacincaptad pegol; ACP), an investigational new C5 complement inhibitor for the treatment of secondary geographic atrophy (GA) …

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Alvotech obtains financing facilities of approximately $136 million https://agapesgr.org/alvotech-obtains-financing-facilities-of-approximately-136-million/ Thu, 17 Nov 2022 04:33:13 +0000 https://agapesgr.org/alvotech-obtains-financing-facilities-of-approximately-136-million/ Existing senior bonds increased by $70 million with additional investment from a consortium of institutional investors Alvotech Acquires Reykjavik Manufacturing Facility, Previously Used Under Long-Term Lease, and Secures Approximately $16 Million, at Current Exchange Rates, in Gross Loan Proceeds Through Facility Refinancing guaranteed loan Alvotech Secures $50 Million in Subordinated Unsecured Loan […]]]>

  • Existing senior bonds increased by $70 million with additional investment from a consortium of institutional investors
  • Alvotech Acquires Reykjavik Manufacturing Facility, Previously Used Under Long-Term Lease, and Secures Approximately $16 Million, at Current Exchange Rates, in Gross Loan Proceeds Through Facility Refinancing guaranteed loan
  • Alvotech Secures $50 Million in Subordinated Unsecured Loan Financing from Alvogen

REYKJAVIK, Iceland, Nov. 16, 2022 (GLOBE NEWSWIRE) — Alvotech (NASDAQ: ALVO), a global biotechnology company focused on developing and manufacturing biosimilar medicines for patients worldwide, today announced financing facilities securing gross proceeds of approximately $136 million, to current exchange rates. “These financing facilities are designed to provide flexibility and additional resources to advance the company’s growing portfolio of biosimilars,” said Joel Morales, Chief Financial Officer of Alvotech.

Alvotech has increased its existing $70 million senior bond (“First Lien Facility”) with additional investments from Farallon Capital Management, Sculptor Capital Management, Oaktree Capital Management, Lodbrok Capital and Morgan Stanley. Under the expanded First Link Facility, bondholders are entitled to purchase warrants representing up to 2.5% of Alvotech’s ordinary share capital, unless Alvotech raises additional capital in accordance with the terms of the first link facility.

Separately, Alvotech has obtained from Alvogen, a majority shareholder, an additional $50 million in the form of an unsecured subordinated loan (“Alvogen Facility”), which also provides the right to acquire warrants representing up to to 4.0% of the ordinary share capital of Alvotech, unless Alvotech does not use the proceeds of the Alvogen facility and replaces the Alvogen facility with new financing, under certain commercial conditions, by December 15, 2022.

Ownership of the previously leased manufacturing facility will be transferred to Alvotech by a subsidiary of Aztiq, a majority shareholder, in exchange for an unsecured subordinated convertible bond in the principal amount of $80 million. As part of the acquisition of the production plant in Reykjavik, Alvotech entered into a secured loan agreement with Landsbankinn hf. to provide approximately $16 million, at current exchange rates, in gross loan proceeds to Alvotech.

Further information regarding the additional financing arrangements will be set forth in the report on Form 6-K which will be filed by the Company with the Securities and Exchange Commission and made available at https://investors.alvotech.com/publicfilings, to which shall be attached in parts the agreements described herein. The contents of this press release and the description of the funding agreements reflected herein are qualified in their entirety by the final form of such agreements.

About Alvotech
Alvotech is a biotechnology company, founded by Robert Wessman, which is solely focused on developing and manufacturing biosimilar drugs for patients worldwide. Alvotech seeks to be a global leader in the biosimilars space by providing high-quality, cost-effective products and services enabled by a fully integrated approach and extensive in-house capabilities. Alvotech’s current pipeline contains eight biosimilar candidates for the treatment of autoimmune disorders, ocular disorders, osteoporosis, respiratory diseases and cancer. Alvotech has formed a network of strategic business partnerships to provide global reach and leverage local expertise in markets including the United States, Europe, Japan, China and other Asian countries and major parts from South America, Africa and the Middle East. Alvotech’s business partners include Teva Pharmaceuticals, a US subsidiary of Teva Pharmaceutical Industries Ltd. (USA), STADA Arzneimittel AG (EU), Fuji Pharma Co., Ltd (Japan), Cipla/Cipla Gulf/Cipla Med Pro (Australia, New Zealand, South Africa/Africa), JAMP Pharma Corporation (Canada ), Yangtze River Pharmaceutical (Group) Co., Ltd. (China), DKSH (Taiwan, Hong Kong, Cambodia, Malaysia, Singapore, Indonesia, India, Bangladesh and Pakistan), YAS Holding LLC (Middle East and North Africa), Abdi Ibrahim (Turkey), Kamada Ltd. (Israel), Mega Labs, Stein, Libbs, Tutor and Saval (Latin America) and Lotus Pharmaceuticals Co., Ltd. (Thailand, Vietnam, Philippines and South Korea). Each business partnership covers a unique set of product(s) and territories. Except as otherwise provided herein, Alvotech is not responsible for the content of periodic filings, disclosures and other reports made available by its partners. For more information, please visit www.alvotech.com. None of the information on Alvotech’s website should be considered part of this press release.

Forward-looking statements
Certain statements contained in this communication may be considered “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements generally relate to future events or the future financial operating performance of Alvotech and may include, for example, Alvotech’s expectations regarding capitalization through equity or debt financing, future growth, operating results, lease obligation reductions and cash savings, cash flow, use of support financing with Alvogen, performance, future capital and other expenditures, including the development of critical infrastructure for global healthcare markets, competitive advantages, business prospects and opportunities, including ongoing product development, future plans and intentions, results, level of activities, performance, objectives or achievements or other future events. In some cases, you can identify forward-looking statements by words such as “may”, “should”, “expect”, “intend”, “will”, “estimate”, “anticipate”, “believe”, “predict”, “potential”, “aim” or “continue”, or the negative terms of these terms or variations thereof or similar terminology. These forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. These forward-looking statements are based on estimates and assumptions which, although believed to be reasonable by Alvotech and its management, are inherently uncertain and are inherently subject to risks, variability and contingencies, many of which are beyond Alvotech’s control. Alvotech. Factors that could cause actual results to differ materially from current expectations include, but are not limited to: (1) the outcome of any legal proceedings that may be brought against Alvotech or others as a result of the business combination between Alvotech Holdings SA, Oaktree Acquisition Corp. II and Alvotech; (2) the ability to close financing facilities and meet the requirements of such agreements; (3) the ability to maintain stock exchange listing standards; (4) changes in applicable laws or regulations; (5) the possibility that Alvotech may be adversely affected by other economic, business and/or competitive factors; (6) Estimates of Alvotech’s expenses and profitability; (7) Alvotech’s ability to develop, manufacture and commercialize the products and product candidates in its pipeline; (8) actions of regulatory authorities, which may affect the initiation, timing and progress of clinical studies or future regulatory approvals or marketing authorizations; (9) the ability of Alvotech or its partners to recruit and retain patients in clinical studies; (10) the ability of Alvotech or its partners to obtain regulatory approvals for planned clinical studies, study plans or sites; (11) the ability of Alvotech’s partners to conduct, supervise and monitor existing and potential future clinical studies, which may impact development schedules and plans; (12) Alvotech’s ability to obtain and maintain regulatory approvals or clearances for its products, including the timing or likelihood of expansion into additional markets or geographies; (13) the success of Alvotech’s current and future collaborations, joint ventures, partnerships or licensing agreements; (14) Alvotech’s ability, and that of its business partners, to execute their strategy to commercialize approved products; (15) Alvotech’s ability to manufacture a sufficient commercial supply of its approved products; (16) the outcome of pending and future litigation regarding Alvotech’s products and product candidates; (17) the potential impact of the ongoing COVID-19 pandemic on FDA review timelines, including its ability to conduct timely inspection of manufacturing sites; (18) the impact of deteriorating macroeconomic conditions, including rising inflation and interest rates and general market conditions, the war in Ukraine and global geopolitical tensions, as well as the COVID pandemic -19 ongoing and evolving on the Company’s business, financial condition, strategy and planned milestones; and (19) other risks and uncertainties set forth in the sections titled “Risk Factors” and “Caution Regarding Forward-Looking Statements” in documents that Alvotech may from time to time file with or provide to the SEC. There may be additional risks that Alvotech is not currently aware of or that Alvotech currently believes to be immaterial that could also cause actual results to differ from those contained in the forward-looking statements. Nothing in this communication should be taken as a representation by anyone that the forward-looking statements set forth herein will be realized or that any of the results contemplated by such forward-looking statements will be achieved. You should not place undue reliance on forward-looking statements, which speak only as of the date they are made. Alvotech undertakes no obligation to update these forward-looking statements or to notify the recipient of any matter of which either becomes aware that may affect any matter referred to in this communication. Alvotech disclaims all liability for any loss or damage (whether foreseeable or not) suffered or incurred by any person or entity as a result of anything contained or omitted in this communication and such liability is expressly disclaimed. The recipient agrees not to seek to sue or otherwise hold Alvotech or any of its directors, officers, employees, affiliates, agents, advisers or representatives liable in any respect for the provision of this communication, information contained in this communication, or the omission of any information from this communication.

CONTACTS

Alvotech Investor Relations and Global Communications
Benedikt Stefansson

alvotech.ir[at]alvotech.com


main logo

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Hudson closes transit-focused development bringing 203 new mixed-income housing units to Port Chester https://agapesgr.org/hudson-closes-transit-focused-development-bringing-203-new-mixed-income-housing-units-to-port-chester/ Fri, 11 Nov 2022 05:02:39 +0000 https://agapesgr.org/hudson-closes-transit-focused-development-bringing-203-new-mixed-income-housing-units-to-port-chester/ The Hudson Companies (Hudson) announced today that it has completed the acquisition of a fully licensed development parcel at 27-45 N. Main Street and 28 Adee Street in the Village of Port Chester. The site plans provide for a mix of rental housing, commercial space and community facilities. Total expected capitalization for the development is […]]]>

The Hudson Companies (Hudson) announced today that it has completed the acquisition of a fully licensed development parcel at 27-45 N. Main Street and 28 Adee Street in the Village of Port Chester. The site plans provide for a mix of rental housing, commercial space and community facilities.

Total expected capitalization for the development is $89.2 million and financing of $11.4 million for the acquisition has been provided by Provident Bank. The majority of the project’s equity is invested through Hudson’s partnership with the New York City Employees’ Retirement System and the New York City Teachers’ Retirement System. Last year, Hudson announced its joint venture with Retirement Systems, which would invest up to $250 million in development projects, with a focus on mixed-income and environmentally friendly buildings. in the greater New York area. Cushman and Wakefield negotiated the sale as well as the debt financing. The site’s sellers – Connecticut-based Ivy Realty – have retained a minority investment in the project.

“As we continue to face a statewide housing crisis, now more than ever, we are focused on expanding our reach into undersupplied markets to provide quality housing in places wanted,” said Joe Riggs, Director of the Hudson Companies. “Through our innovative partnership with two of New York City’s largest retirement systems, we are thrilled to provide 203 quality housing, retail and community spaces for Port Chester residents.

The development – which has yet to be officially named – will offer a range of studios, one and two bedroom homes as well as parking to charge electric vehicles, nearly 10,000 square feet of space ground floor retail and a brand new facility for the Westchester Human Development Department, a non-profit social service organization. Part of the houses will be made affordable for families earning 60% of the regional median income (AMI). Facilities will include a fitness center and outdoor courtyards. The project is designed by Fogarty Finger and will be built by Broadway Builders, Hudson’s affiliate general contractor.

“Hudson is a great partner to bring Ivy’s vision to life; they have a proven track record of building first-class communities throughout the New York metropolitan area. Ivy is delighted to continue as a minority partner with them and continues to believe in the rebirth of Port Chester,” said David Archibald, Chief Investment Officer of Ivy Realty.

In addition to aiming for LEED Gold certification and conducting feasibility studies for rooftop solar power generation, Hudson plans to pursue full building electrification. The site is conveniently located just one block from the Port Chester Metro North station, providing direct access to Grand Central Terminal in less than 40 minutes and further reducing future residents’ reliance on cars. As Hudson expanded its reach outside of New York’s five boroughs, it focused on providing housing along the region’s transit-rich corridors. He recently opened another multi-family project in the nearby village of Pelham.

“We were drawn to Port Chester not only by its public transport links to New York, White Plains and Greenwich, but also by its vibrancy,” said Laszlo Syrop, Director of Acquisitions at Hudson. “Port Chester is home to a diverse community and a beautiful, walkable downtown with plenty of dining and nightlife options. We see that even outside the big cities, people are increasingly looking for opportunities to settle in places like this.

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UNIQUE FABRICATING, INC. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Form 10-Q) https://agapesgr.org/unique-fabricating-inc-managements-discussion-and-analysis-of-financial-condition-and-results-of-operations-form-10-q/ Tue, 08 Nov 2022 22:11:09 +0000 https://agapesgr.org/unique-fabricating-inc-managements-discussion-and-analysis-of-financial-condition-and-results-of-operations-form-10-q/ This Management's Discussion and Analysis of Financial Condition and Results of Operation is intended to provide a reader of our financial statements with a narrative from the perspective of our management on our financial condition, results of operations, liquidity, and certain other factors that may affect our future results. You should read the following discussion […]]]>
This Management's Discussion and Analysis of Financial Condition and Results of
Operation is intended to provide a reader of our financial statements with a
narrative from the perspective of our management on our financial condition,
results of operations, liquidity, and certain other factors that may affect our
future results. You should read the following discussion and analysis of our
financial condition and results of operations in conjunction with the
accompanying unaudited condensed consolidated financial statements and the
related notes to unaudited condensed consolidated financial statements included
elsewhere in this document as well as the consolidated financial statements and
the related notes to consolidated financial statements for the year ended
December 31, 2021 included in our Annual Report on Form 10-K filed with the
Securities and Exchange Commission (the "SEC"). Our actual results and the
timing of events could differ materially from those discussed in forward-looking
statements contained herein. Factors that could cause or contribute to these
differences include those discussed below as well as in our Annual Report on
Form 10-K and in other filings by us with the SEC, particularly in "Risk
Factors" and "Special Note Regarding Forward-Looking Statements." We make no
guarantees regarding outcomes, and assume no obligation to update the
forward-looking statements herein, except as may be required by law.

Forward-looking statements


The following discussion contains "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995 that are subject
to risks and uncertainties. These statements are based on management's beliefs
and assumptions and on information currently available to us. These statements
relate to future events or to our future financial performance and involve known
and unknown risks, uncertainties, and other factors that may cause our or our
industry's 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 statements. When used in this
document the words "anticipate," "believe," "continue," "could," "seek,"
"might," "estimate," "expect," "intend," "may," "plan," "potential," "predict,"
"approximately," "project," "should," "will," "would," or the negative or plural
of these words or similar expressions, as they relate to our company, business
and management, are intended to identify forward-looking statements. In light of
these risks and uncertainties, the future events and circumstances discussed may
not occur, and actual results could differ materially from those anticipated or
implied in the forward-looking statements, including those discussed in our
Annual Report on Form 10-K and in particular the section entitled "Risk Factors"
of the Annual Report on Form 10-K and in other filings by us with the SEC.

Forward-looking statements speak only as of the date of this Form 10-Q filing.
Except as required by law, we assume no obligation to publicly update or revise
any forward-looking statement to reflect actual results, changes in assumptions
based on new information, future events or otherwise. If we update one or more
forward-looking statements, no inference should be drawn that we will make
additional updates with respect to those or other forward-looking statements.

presentation basis


The Company's operations are classified in one reportable business segment.
Although we have expanded the products that we manufacture and sell to include
components used in the appliance, medical and consumer/off-road markets,
products for these industries are manufactured at facilities that also
manufacture or are capable of manufacturing products for the automotive
industries. Our manufacturing locations have capabilities to produce diverse
products utilizing multiple processes to serve various markets. The
manufacturing operations for our transportation, appliance, medical and
consumer/off-road products share management and labor forces and use common
personnel and strategies for new product development, marketing and the sourcing
of raw materials.

Overview

Unique Fabricating, Inc. (the "Company" or "Unique") engineers and manufactures
components for customers in the transportation, appliance, medical, and
consumer/off-road markets. The Company's solutions are comprised of
multi-material foam, rubber, and plastic components and utilized in NVH
management, acoustical management, water and air sealing, decorative and other
functional applications. The Company leverages proprietary manufacturing
processes, including die cutting, thermoforming, compression molding, fusion
molding, and reaction injection molding to manufacture a wide range of products
including air management products, HVAC, seals, fender stuffers, air ducts,
acoustical insulation, door water shields, gas tank pads, light gaskets, topper
pads, mirror gaskets, glove box liners, personal protection equipment, and
packaging. The Company is headquartered in Auburn Hills, Michigan.

The Company serves the North American transportation market, which includes
automotive and heavy-duty trucks, as well as the appliance, medical, and
consumer markets. Sales are conducted directly to major automotive and
heavy-duty truck, appliance, water heater and HVAC manufacturers, referred
throughout this report as OEMs, or indirectly through the Tier 1 suppliers of
these OEMs. The Company has its principal executive offices in Auburn Hills,
Michigan and has sales, engineering and production facilities in Auburn Hills,
Michigan; Concord, Michigan; LaFayette, Georgia; Louisville, Kentucky;
Monterrey, Mexico; Querétaro, Mexico; and London, Ontario.

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The Company derives most of its net sales from the sales of foam, rubber
plastic, and tape adhesive related automotive products. These products are
produced by a variety of manufacturing processes including die cutting,
compression molding, thermoforming, reaction injection molding and fusion
molding. We believe the Company has a broader array of processes and materials
utilized than any of its direct competitors, based on our product offerings. By
sealing out air, noise and water intrusion, and by providing sound absorption
and blocking, the Company's products improve the interior comfort of a vehicle,
increasing perceived vehicle quality and the overall experience of its
passengers. The Company's products perform similar functions for appliances,
medical, and consumer/off-road systems, improving thermal characteristics,
reducing noise and prolonging equipment life. We primarily operate within the
highly competitive and cyclical automotive parts industry.

The Company's condensed consolidated financial statements are prepared in
accordance with U.S. generally accepted accounting principles applicable to a
going concern, which contemplates the realization of assets and the satisfaction
of liabilities in the normal course of business.

RECENT DEVELOPMENTS

Coronavirus


The COVID-19 pandemic's adverse impact on the global economy has persisted
through 2022. The supply chain constraints, increasing raw material costs, and
limited labor availability have continued to hinder the results of our
operations, cash flows, and financial position. While the COVID-19 pandemics
effects on the global economy are not expected to be permanent, the duration of
the lingering consequences cannot be accurately estimated.

The Company continues to follow guidelines with respect to operating during the
COVID-19 pandemic provided by the various governmental entities in the
jurisdictions where we operate and is taking additional measures to protect our
employees.

Goodwill Impairments

The Company experienced a sustained decline in market capitalization through the
second quarter of 2022 representing a potential indicator of impairment.
Furthermore, the Company continues to experience repercussions from the global
semiconductor shortage, the most impactful being the decline in sales to our
automotive customers, as North American automotive production volumes have been
lower than pre-pandemic levels. The Company identified these circumstances and
concluded it was more likely than not that the fair value of its reporting unit
is less than its carrying amount, and performed an interim quantitative
assessment. The quantitative assessment was performed as of June 30, 2022,
utilizing the income approach. The analysis required the comparison of the
Company's carrying value with its fair value, with an impairment recorded for
any excess of carrying value over the fair value. As a result, the Company
recorded a $12.2 million impairment charge for the three months ended June 30,
2022.

During three months ended September 30, 2022, the Company experienced another
sharp decline in market capitalization representing another potential indicator
of impairment. The repercussions from the global semiconductor shortage have
continued, the most impactful being the sustained depressed sales volume to our
automotive customers. The Company concluded it was more likely than not that the
fair value of its reporting unit is less than its carrying amount, and performed
another interim quantitative assessment. This quantitative assessment was
performed as of September 30, 2022, utilizing the income approach. As a result,
the Company recorded a total of $17.0 million impairment charges on the
condensed consolidated statement of operations for the nine months ended
September 30, 2022, including the $12.2 million impairment charge for the three
months ended June 30, 2022, and a $4.8 million impairment charge for the three
months ended September 30, 2022.

Employee retention credit


During the second quarter of 2022, the Company recognized an Employee Retention
Credit ("ERC") of $3.0 million on the Company's condensed consolidated
statements of operations. In order to qualify for this COVID pandemic related
relief, the Company had to satisfy certain financial and head count
requirements. During the third quarter of 2021, the Company recorded gross
receipts that represented a 24% decline compared to the same period in 2019.
This decline qualifies the Company for the ERC for wages incurred in the third
quarter of 2021, in accordance with the amendments to the ERC program in the
American Rescue Plan Act. In calculating the qualifying wages, the Company also
determined eligibility to include wages paid to employees providing services and
not providing services. An amendment to the ERC in the Relief Act of 2021 made
this possible if an entity had, on average, 500 or fewer full-time employees in
2019. Considering the two preceding requirements, and with the help of a
professional services firm, the Company confirmed its eligibility for the
benefit during the second quarter of 2022.

Debt financing


The Company completed an offering of $4 million aggregate principal amount in
notes, in two series, bearing pay-in-kind interest at the rate of 12% per annum
on October 7, 2022. Investors in the notes also received warrants for up to an
aggregate of 120,000 shares at an exercise price of $0.52 per share, the closing
sales price of the Company's common stock on the date of

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Contents


the closing of the first tranche of the notes offering on October 4, 2022.
Investors will receive warrants to purchase in the aggregate an additional
280,000.00 shares if the notes are not repaid within 12 months. Interest on the
notes through the end of 2022 will be convertible at the holders' option into
common stock at a price equal to the warrant exercise price. The notes are
secured by and will be paid from the expected receipt of the Company's Employee
Retention Credits and any proceeds from the sale of a non-operational financial
asset; one series in the aggregate principal amount of $2,500,000 has a first
priority security interest in the financial asset, and a series in the aggregate
principal amount of $1,500,000 has a first priority security interest the
Company's Employee Retention Credit. The terms of the two series are otherwise
identical. The proceeds of this financing have been used to: reduce by $750,000
the outstanding principal amount of the Company's bank term loans; $1,228,125 to
prepay the December 31, 2022, term loan principal payment; and to reduce by
$2,021,875 outstanding borrowings under the Company's revolving line of credit,
which amount remains available to be reborrowed, subject to the Credit
Agreement.

Taglich Brothers, Inc. served as placement agent for the offering of Notes and
will receive 192,308 shares of the Company's common stock as a placement fee. An
investor also received 38,461 shares of the Company's common stock.

Waiver and Ninth Amendment to Credit Agreement


On November 7, 2022, the Company entered into the Waiver and Ninth Amendment to
Credit Agreement ("Ninth Amendment"). As of December 31, 2020, and March 31,
2021, the Company was in violation of certain of its financial covenants (the
"Specified Defaults"), as defined in the Credit Agreement. As of September 30,
2021, the Company was also in violation of the required Minimum Consolidated
EBITDA covenant, as amended by the Second Amendment to the Forbearance Agreement
dated September 21, 2021 (the "Specified Forbearance Termination Event"). The
Lenders in the Ninth Amendment, among other things, agreed to grant a permanent
waiver of the Specified Defaults and the Specified Forbearance Termination Event
that have occurred prior to the effectiveness of the Ninth Amendment and of any
right the Lenders may have to exercise any of their rights against the Company
as a result.

The Ninth Amendment also requires that the Company repay the outstanding
principal balance of the Loans under the Credit Agreement and all accrued and
unpaid interest thereon on or before February 3, 2023 (subject to extension to
not later than February 28, 2023 if the Company complies with certain conditions
(the "Repayment Date" )). The Company also is required to deliver to the Lenders
by December 9, 2022, non-binding indications of interest from one or more
potential counterparties to one or more refinancing transactions which aggregate
sufficient net proceeds to result in repayment in full of the Loans and other
Indebtedness on or before the Repayment Date (the "Refinancing Transaction").
The Company is further required to deliver by January 16, 2023, at least one
fully executed term sheet with respect to a Refinancing Transaction with a
counterparty that satisfies certain qualifications specified in the Ninth
Amendment. If the Company fails to meet these milestone dates or repay the Loans
or other Indebtedness in full on or before the Repayment Date it will constitute
an event of default under the Credit Agreement.

The Company is also required to arrange for its Mexican subsidiary to grant as security for the repayment of the Loans, in December 8, 2022a first lien, subject only to authorized liens, enforceable under Mexican law over the accounts receivable of such subsidiary.



Comparison of Results of Operations for the Three Months Ended September 30,
2022 and September 30, 2021

Net Sales

                                                         Three Months Ended         Three Months Ended
                                                         September 30, 2022         September 30, 2021
                                                                    (dollars in thousands)
Net sales                                               $          34,503          $          29,909


Net sales for the three months ended September 30, 2022 were approximately $34.5
million compared to $29.9 million for the three months ended September 30, 2021,
representing a increase of 15.4%. The net sales increase was driven by increased
demand for our products from transportation customers as a result of higher
North American light vehicle production and the impact of our increased cost
recovery efforts to pass a portion of our higher manufacturing costs to our
customers. The increase in sales volume in the third quarter of 2022 was
partially offset by the impact of the end of certain customer programs, which
more than offset the impact of new business awards.

Cost of sales


The major components of cost of sales are raw materials purchased from third
parties, direct labor and benefits, and manufacturing overhead, including
facility costs, utilities, supplies, repairs and maintenance, insurance, freight
costs of products shipped to customers, and depreciation. Cost of sales consists
of the following major components:

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  Table of Contents

                                     Three Months Ended September 30, 2022               Three Months Ended September 30, 2021
                                       Amount               As % of net sales              Amount               As % of net sales
                                                                      (dollars in thousands)
Materials                        $         19,102                      55.4  %       $         15,932                      53.3  %
Direct labor and benefits                   6,243                      18.1  %                  5,369                      18.0  %
Manufacturing overhead                      5,316                      15.4  %                  4,577                      15.3  %
Sub-total                                  30,661                      88.9  %                 25,878                      86.5  %
Depreciation                                  793                       2.3  %                    751                       2.5  %
Cost of Sales                    $         31,454                      91.2  %       $         26,629                      89.0  %
Gross Profit                     $          3,049                       8.8  %       $          3,280                      11.0  %


Cost of sales as a percentage of net sales for the three months ended September
30, 2022 increased compared to the three months ended September 30, 2021. The
increase in cost of sales was primarily the result of increased material costs
due to inflation.

Gross Profit

Gross profit as a percentage of net sales, or gross margin, for the three months
ended September 30, 2022 was 8.8% compared to 11.0% for the three months ended
September 30, 2021. Gross profit and gross margin in the three months ended
September 30, 2022, were both negatively impacted by higher raw material costs
as compared to the three months ended September 30, 2021.

Selling, general and administrative expenses

                                                               Three Months Ended             Three Months Ended
                                                               September 30, 2022             September 30, 2021
                                                                           

(in thousands of dollars) Selling, general and administrative expenses, excluding depreciation and amortization expenses

                      $           4,132              $           5,173
Depreciation and amortization                                             301                            568
Selling, general, and administrative expenses               $           4,433              $           5,741

Selling, general and administrative expenses as a percentage of net sales

                                                  12.8      %                    19.2      %


Selling, general, and administrative expenses for the three months ended
September 30, 2022 decreased $1.3 million to $4.4 million compared to $5.7
million for the three months ended September 30, 2021. The decrease in selling,
general, and administrative expenses during the three months ended September 30,
2022 was driven by decreased salary and healthcare expenses as a result of our
2021 cost reduction activities and lower intangible asset amortization as
certain assets became fully amortized.

Operating loss


Operating loss for the three months ended September 30, 2022 was $6.2 million,
or 18.0% of net sales, compared to an operating loss of $7.6 million, or 25.3%
of net sales, for the three months ended September 30, 2021. The decrease in
operating loss was primarily attributable to the lower selling, general, and
administrative costs discussed above and less goodwill impairment during the
three months ended September 30, 2022.

Other income (expenses), net


Other income (expense), net for the three months ended September 30, 2022 was an
expense of $0.6 million compared to income of $5.2 million for the three months
ended September 30, 2021. The increase in expense as compared to the three
months ended September 30, 2021 was related to the Company's gain on debt
extinguishment due to the forgiveness of the PPP loan, which was fully forgiven,
including accrued interest, during the three months ended September 30, 2021.

Loss before income taxes


As a result of the foregoing factors, our net loss before income taxes increased
$4.5 million to a loss of $6.8 million for the three months ended September 30,
2022 compared to a loss of $2.4 million during the three months ended September
30, 2021.

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Provision for income tax


During the three months ended September 30, 2022, income tax expense was $3.7
million, and the effective income tax rate was (54)%, compared to income tax
benefit of $0.5 million for the three months ended September 30, 2021. The
differences between the effective tax rate and the statutory tax rate of 21%
were primarily related to valuation allowances in Canada and Mexico, recognized
during the three months ended September 30, 2022.

Net loss


Net loss for the three months ended September 30, 2022 was $10.6 million
compared to a net loss of $1.9 million for the three months ended September 30,
2021. The increase in net loss is attributable to the benefit from PPP loan
forgiveness during the three months ended September 30, 2021 and the income tax
expense recognized for the valuation allowances realized in Canada and Mexico
during the three months ended September 30, 2022, slightly offset by decreased
selling, general, and administrative costs.


Comparison of Results of Operations for the Nine Months Ended September 30, 2022
and September 30, 2021

Net Sales
                                                         Nine Months Ended         Nine Months Ended
                                                        September 30, 2022         September 30, 2021
                                                                    (dollars in thousands)
Net sales                                               $        104,847          $          95,603


Net sales for the nine months ended September 30, 2022 were approximately $104.8
million compared to $95.6 million for the nine months ended September 30, 2021,
representing an increase of 9.7%. The increase in net sales for the nine months
ended September 30, 2022 was primarily caused by increased demand for our
products from transportation customers as a result of higher North American
light vehicle production and the impact of our increased cost recovery efforts
to pass higher manufacturing costs to our customers compared to the same period
in 2021.

Cost of Sales

The major components of cost of sales are raw materials purchased from third
parties, direct labor and benefits, and manufacturing overhead, including
facility costs, utilities, supplies, repairs and maintenance, insurance, freight
costs of products shipped to customers, and depreciation. Cost of sales consists
of the following major components:

                                       Nine Months Ended September 30, 2022               Nine Months Ended September 30, 2021
                                         Amount              As % of net sales              Amount              As % of net sales
                                                                       (dollars in thousands)
Materials                          $        57,128                      54.5  %       $        50,065                      52.4  %
Direct labor and benefits                   16,156                      15.4  %                15,300                      16.0  %
Manufacturing overhead                      16,182                      15.4  %                14,326                      15.0  %
Sub-total                                   89,466                      85.3  %                79,691                      83.4  %
Depreciation                                 2,311                       2.2  %                 2,154                       2.3  %
Cost of Sales                      $        91,777                      87.5  %       $        81,845                      85.6  %
Gross Profit                       $        13,070                      12.5  %       $        13,758                      14.4  %


Cost of sales as a percentage of net sales for the nine months ended September
30, 2022 increased to 87.5% from 85.6% for the nine months ended September 30,
2021. The increase in cost of sales was primarily caused by higher raw material
and freight costs driven by price increases from our vendors. Equipment and
labor related operational issues in the LaFayette, Georgia facility also
contributed to the increased cost of sales. These cost increases were partially
offset by the ERC benefit of $2.2 million.

Gross profit


Gross profit for the nine months ended September 30, 2022 decreased $0.7 million
to $13.1 million compared to $13.8 million for the nine months ended
September 30, 2021. Gross profit and gross margin in the nine months ended
September 30, 2022, were both negatively impacted by higher raw material costs
as compared to the nine months ended September 30, 2021.

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Selling, general and administrative expenses

                                                              Nine Months Ended            Nine Months Ended
                                                              September 30, 2022           September 30, 2021
                                                                         

(in thousands of dollars) Selling, general and administrative expenses, excluding depreciation and amortization expenses

                      $         12,524             $         15,519
Depreciation and amortization                                          1,122                        2,117
Selling, general, and administrative expenses               $         13,646             $         17,636

Selling, general and administrative expenses as a percentage of net sales

                                                 13.0     %                   18.4     %


Selling, general, and administrative expenses for the nine months ended
September 30, 2022 decreased $4.0 million to $13.6 million compared to $17.6
million for the nine months ended September 30, 2021. This decrease is primarily
related to reduced salary and healthcare expenses as a result of our 2021 cost
reduction activities, the completion of amortization of certain customer
relationships and of non-patented technology, and the $0.5 million impact of the
ERC benefit. These were partially offset by higher insurance and travel
expenses.

Operating loss


Operating loss for the nine months ended September 30, 2022 was $17.6 million,
or 16.8% of net sales compared to an operating loss of $9.0 million, or 9.4% of
net sales for the nine months ended September 30, 2021. The increased operating
loss in the current year is primarily driven by the total goodwill impairment
charge of $17.0 million recorded during the second quarter and third quarter of
2022, partially offset by the benefits recognized from the ERC credits, and
lower salary and healthcare costs, and amortization.

Other income (expenses), net


Other income (expense), net for the nine months ended September 30, 2022 was an
expense of $1.7 million compared to income of $3.8 million for the nine months
ended September 30, 2021. Non-operating expenses were higher in the nine months
ended September 30, 2022 as compared to the nine months ended September 30,
2021, due to the Company's gain on debt extinguishment due to the PPP loan,
which was fully forgiven, including accrued interest, and more favorable
mark-to-market adjustments on our interest rate swap.

Loss before income taxes

Due to the above factors, our loss before income taxes increased
$14.1 million at $19.3 million for the nine months ended September 30, 2022
compared to a loss of $5.2 million in 2021.

Provision for income tax


During the nine months ended September 30, 2022, income tax expense was $2.5
million, and the effective income tax rate was (13)%, compared to an income tax
expense of $0.2 million and an effective income tax rate of 4% during the nine
months ended September 30, 2021. The differences between the effective tax rate
and the statutory tax rate of 21% were primarily related to valuation allowances
in Canada and Mexico, recognized during the nine months ended September 30,
2022. Also contributing to the difference was the U.S. valuation allowance as no
tax benefit is recorded for incurred losses, including the U.S. allocated
portion of the goodwill impairment.

Net loss


Net loss for the nine months ended September 30, 2022 was $21.8 million compared
to a net loss of $5.4 million during the nine months ended September 30, 2021.
The increase in net loss was primarily attributable to the increased goodwill
impairment charge of $12.2 million in 2022 and the Company's gain on debt
extinguishment of $6.1 million due to the PPP loan, which was fully forgiven,
including accrued interest during the nine months ended September 30, 2021,
which were partially offset by the increased impact of the ERC benefit of
$2.7 million recognized in the second quarter of 2022.

Cash and capital resources


Our principal sources of liquidity are cash flows from operations and borrowings
under our Credit Agreement from our senior lenders. Our primary uses of cash are
payment of vendors, payroll, operating costs, capital expenditures and debt
service. As of September 30, 2022 and December 31, 2021, we had a cash balance
of $0.5 million and $0.7 million, respectively. As of September 30, 2022 and
December 31, 2021, we had $1.3 million and $2.2 million, respectively, available
to be borrowed under our revolving credit facility. Our ability to borrow,
however, under the revolving line of credit is dependent on the Forbearance
Agreement, which expires November 7, 2022, including our compliance with its
terms.

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Our debt


The Company's financial results for the six months ended December 31, 2020 and
the nine months ended March 31, 2021 resulted in violations of one or more of
the following financial covenants: (1) Maximum Total Leverage Ratio; (2) Minimum
Debt Service Coverage Ratio; and (3) Minimum Consolidated EBITDA; each as
defined in the Company's Amended and Restated Credit Agreement. The Company
entered into a Forbearance Agreement, providing for a period initially
commencing on April 9, 2021 and through and including June 15, 2021, during
which the Company was able to borrow on its Revolving line of credit, subject to
the terms and conditions to making a revolving credit advance, including
availability, and the Lenders agreed, subject to the terms of the Forbearance
Agreement, to forbear from enforcing their rights or seeking to collect payment
of the Company's debt or disposing of the collateral securing the debt.

On June 14, 2021, the Company entered into the First Amendment to the
Forbearance Agreement, which among other things, extended the forbearance period
from June 15, 2021 to February 28, 2022, and waived the testing of the Maximum
Total Leverage Ratio and Minimum Debt Service Coverage ratios for the duration
of the Forbearance Period. The First Amendment also substituted Minimum
Liquidity and Minimum Consolidated EBITDA requirements, which were tested
monthly beginning with the month ending July 31, 2021.

On September 21, 2021, the Company entered into the Second Amendment to the
Forbearance Agreement, which, among other things, made changes to the
calculations of financial covenants, contained revised requirements for Minimum
Liquidity and Minimum Consolidated EBITDA, as defined, for the monthly periods
through and including February 28, 2022, and revised the Revolving Credit
Aggregate Commitment from $30 million to $27 million.

On December 9, 2021, the Company entered into the Third Amendment to the
Forbearance Agreement. The Lenders in the Third Amendment to the Forbearance
Agreement, among other things, agreed to forbear with respect to a Minimum
Consolidated EBITDA covenant violation as of September 30, 2021, and to suspend
compliance with the Minimum Consolidated EBITDA covenant during the remainder of
the forbearance period. The Third Amendment included a new covenant which has
been tested weekly on a rolling basis, beginning December 15, 2021, and requires
that the Company's actual cumulative total cash disbursements for the period
being tested to not exceed total cash disbursements projected by the Company for
the same period by more than 15% at any time during the forbearance period. The
Third Amendment also reduced the maximum amount that may be borrowed under the
revolving line of credit to $25 million from $27 million.

As of December 31, 2021, the Company was in violation of the required Minimum
Liquidity covenant, as provided in the Second Amendment to the Forbearance
Agreement, dated September 21, 2021. As a result, on February 4, 2022, the
Company entered into the Fourth Amendment to Forbearance Agreement. The Lenders
in the Fourth Amendment agreed to waive the Minimum Liquidity covenant
violation. The Company did have the required Minimum Liquidity by the conclusion
of the first week of 2022.

Between February 25, 2022, and September 9, 2022, the Company entered into six
forbearance agreement amendments, each of these amendments extended the
Forbearance Period. The Fifth Amendment to Forbearance Agreement (entered into
February 25, 2022) extended the Forbearance Period from February 28, 2022 to
March 11, 2022. The Sixth Amendment to Forbearance Agreement (entered into March
11, 2022) extended the Forbearance Period from March 11, 2022 to May 30, 2022.
The Seventh Amendment to Forbearance Agreement (entered into May 26, 2022)
extended the Forbearance Period from May 30, 2022 to June 13, 2022. The Eighth
Amendment to Forbearance Agreement (entered into June 13, 2022) extended the
Forbearance Period from June 13, 2022 to July 14, 2022. The Ninth Amendment to
Forbearance Agreement (entered into July 14, 2022) extended the Forbearance
Period from July 14, 2022 to September 12, 2022. The Tenth Amendment to
Forbearance Agreement (entered into September 9, 2022) extended the Forbearance
Period from September 12, 2022 to October 24, 2022.

The Eighth Amendment to the Forbearance Agreement also provided for the
termination of LIBOR based interest rates on borrowings under the Credit
Agreement: (1) as of the effective date of the amendment, June 13, 2022, with
respect to any advances under the Credit Agreement after the amendment's
effective date, and (2) the expiration of any then current LIBOR interest period
applicable to then outstanding advances with a LIBOR based interest rate. The
Eighth Amendment substituted SOFR for LIBOR, the amendment also defined "SOFR"
as a rate equal to the secured overnight financing rate published on the website
of the SOFR administrator or any successor source identified as such by the
administrator. The Company does not expect this change in the basis for
calculating the interest rate on its bank borrowings to have a material effect
on its interest expense.

On October 4, 2022, the Company entered into the Eleventh Amendment to
Forbearance Agreement, which extended the Forbearance Period from October 24,
2022 to November 7, 2022. The Eleventh Amendment includes certain amendments to
the Credit Agreement and permitted the Company to raise up to $4 million of debt
financing, the terms of which are further described in   Note 18  . The Eleventh
Amendment also amends several financial covenants including: an amendment to the
weekly minimum liquidity covenant, an amendment to the minimum sales covenant
for the two month period ending September 30, 2022 and an amendment to the
weekly cash disbursement covenant.

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Contents


During the extended Forbearance Period, the Company expects it will continue to
be able to borrow under the revolving line of credit, subject to availability
and satisfaction of certain other conditions. The Company has used and intends
to use the forbearance period to continue negotiations with the Lenders to enter
into an amendment and waiver to cure the defaults, extend, if possible, the
maturity of the Credit Agreement and to investigate other sources of financing,
including to augment availability under the Credit Agreement. There can be no
assurance that the Company will be successful in these efforts. During the
forbearance period, the Company may not make any payment, transfer, or
distribution out of the ordinary course of business or payments, including
salary or compensation or distributions to or for the benefit of any member,
owner, or director, other than normal and customary employment salaries which do
not exceed sums paid for similar positions in the Company's marketplace.

Capital expenditure

In 2022, we currently plan to spend approximately $1.3 million in capital expenditure, of which $1.0 million was spent through September 30, 2022primarily to add new production equipment as we expand our production capabilities, upgrade existing equipment, and upgrade our computer hardware throughout our facilities.

Dividends


Our payment of dividends on our common stock in the future will be determined by
our board of directors in its sole discretion and will depend on business
conditions, our financial condition, earnings, liquidity, and capital
requirements. Our Credit Agreement currently prohibits payment of dividends and
contains financial covenants which may have the effect of precluding or limiting
the amounts that we can pay as dividends.

Cash flow data

The following table presents the cash flow data for the periods presented:

                                                          Nine Months Ended          Nine Months Ended
                                                          September 30, 2022         September 30, 2021
                                                                     (dollars in thousands)
Cash flows provided by (used in):
Operating activities                                     $           1,764          $          (3,603)
Investing activities                                     $          (1,048)         $          (2,332)
Financing activities                                     $            (978)         $           6,321


Operating Activities

Cash provided by operating activities consists of: net income adjusted for
non-cash items including depreciation and amortization; gain or loss on sale of
assets; inventory reserve; goodwill impairment; loan forgiveness; gain or loss
on derivative instruments; bad debt adjustments; stock option expense; changes
in deferred income taxes; accrued and other liabilities; prepaid expenses and
other assets; and the effect of working capital changes. The primary factor
affecting cash inflows and outflows was the change in inventory, as the Company
continued to make inventory reduction efforts.

During the nine months ended September 30, 2022, net cash provided by operating
activities was $1.8 million, compared to net cash used by operating activities
of $3.6 million for the nine months ended September 30, 2021. The increase in
cash provided by operating activities was primarily attributable to an increased
focus on managing our working capital levels to be more closely aligned with our
customer release schedules and our expectation of near-term demand for our
products based on available third-party data.

Investing activities

Cash flows from or used in investing activities consist primarily of the purchase and sale of property, plant and equipment.


During the nine months ended September 30, 2022 and September 30, 2021, we made
capital expenditures of $1.0 million and $2.4 million, respectively. We
currently plan to spend a total of approximately $1.3 million in capital
expenditures during 2022, including the $1.0 million spent through September 30,
2022.

Financing Activities

Cash flows provided by or used in financing activities consists primarily of
borrowings and payments under our credit facilities, proceeds from the issuance
of common stock, debt issuance costs, proceeds from any exercise of stock
options and warrants, and distribution of cash dividends.

In the nine months ended September 30, 2022we had net cash used by the financing activities of $1.0 million compared to $6.3 million cash provided by financing activities during the nine months ended September 30, 2021. The increase in cash

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Contents


outflows during the nine months ended September 30, 2022 was driven by increased
repayments of borrowings under the Company's line of credit and the proceeds
from the issuance of common stock and warrants during the nine months ended
September 30, 2021.

Off-balance sheet arrangements


We do not have any off balance sheet arrangements that have or are reasonably
likely to have a current or future effect on our financial condition, changes in
financial condition, sales or expenses, results of operations, liquidity or
capital expenditures, or capital resources that are material to an investment in
our securities.

Indemnification Agreements

In the normal course of business, we provide customers with indemnification
provisions of varying scope against claims of intellectual property infringement
by third parties arising from the use of our products. Historically, costs
related to these indemnification provisions have not been significant and we are
unable to estimate the maximum potential impact of these indemnification
provisions on our future results of operations. In addition, we have entered
into indemnification agreements with directors and certain officers and
employees that will require us, among other things, to indemnify them against
certain liabilities that may arise by reason of their status or service as
directors, officers or employees. No demands have been made upon us to provide
indemnification under such agreements and there are no claims that we are aware
of that could have a material effect on our condensed consolidated balance
sheets, condensed consolidated statements of operations, condensed consolidated
statements of stockholders' equity or condensed consolidated cash flows.

Significant Accounting Policies and Estimates


Our discussion and analysis of our financial condition and results of operations
is based upon our condensed consolidated financial statements which have been
prepared in accordance with GAAP. The preparation of these condensed
consolidated financial statements requires us to make estimates and judgments
that affect amounts reported in those statements. We have made our best
estimates of certain amounts contained in our consolidated financial statements.
We base our estimates on historical experience and on various other assumptions
that we believe are reasonable under the circumstances, the results of which
form the basis for making judgments about the carrying value of assets and
liabilities. However, application of our accounting policies involves the
exercise of judgment and use of assumptions as to future uncertainties and, as a
result, actual results could differ materially from these estimates. Management
believes that the estimates, assumptions, and judgments involved in the
accounting policies that have the most significant impact on our consolidated
financial statements are discussed in the Critical Accounting Policies section
of Management's Discussion and Analysis of Financial Condition and Results of
Operations in the Annual Report on Form 10-K for the year ended December 31,
2021. There have been no material changes to our critical accounting policies or
uses of estimates since the date of our Annual Report on Form 10-K.

Recently issued accounting pronouncements

See Note 2 to the Condensed Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report on Form 10-Q.

© Edgar Online, source Previews

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Is Cineworld a penny stock on track for an explosive recovery in 2023? https://agapesgr.org/is-cineworld-a-penny-stock-on-track-for-an-explosive-recovery-in-2023/ Sat, 05 Nov 2022 07:39:00 +0000 https://agapesgr.org/is-cineworld-a-penny-stock-on-track-for-an-explosive-recovery-in-2023/ Middle-aged white man pulling an aggrieved face while looking at a screen The Penny Stock cineworld (LSE:CINE) has taken its shareholders on a roller coaster ride in recent years. After the pandemic decimated its business model, the cinema operator struggled to find the cash to pay off its huge debt. Couple that with a botched […]]]>

Middle-aged white man pulling an aggrieved face while looking at a screen

The Penny Stock cineworld (LSE:CINE) has taken its shareholders on a roller coaster ride in recent years.

After the pandemic decimated its business model, the cinema operator struggled to find the cash to pay off its huge debt. Couple that with a botched takeover that turned into a legal battle that the group lost, and it all culminated in a U.S. Chapter 11 bankruptcy filing in September.

As a result, the stock price since the start of 2020 has crashed over 98%, leaving many investors with a sour taste in their mouths. But just earlier this week, the stock price exploded, jumping more than 180% in a single day.

What happened? And is this business finally making its long-awaited comeback?

Understanding Cineworld Penny Stock Behavior

Seeing single-day triple-digit moves in a stock’s price is rare for most companies. Yet this type of volatility is not too uncommon in the land of penny stocks.

There are undoubtedly many factors at play, particularly on the short selling side of the equation. But the main catalyst for this recent upward trajectory has been news that management has reached an agreement with its owners and lenders.

Without going into too much detail, the group is accessing additional debt financing of $150 million. It was also able to erase $1 billion from its existing pile of loan obligations. In exchange, management agreed to pay $20 million in monthly rent, opened the door to possible buyout offers and invited its creditors to comment on its business strategy going forward.

In other words, Cineworld might not be going down the drain after all. Considering the fierce number of objections at the start of this bankruptcy saga, this is quite a surprising outcome. Nevertheless, this is great news for the shareholders of this penny stock.

Time to buy?

As encouraging as this week’s announcement was, there’s still a long way to go for this company. And it’s not quite out of the woods.

Even after eliminating $1 billion in debt, that still leaves about $8 billion worth of loan equivalents on its books. And with interest rates in the US and UK still being raised by central banks to fight inflation, it may need additional help and cooperation from its creditors.

This short-term uncertainty will likely create intense volatility in both directions over the coming months. And even in 2023, a clear path to recovery may not have emerged for this penny stock. Moreover, its weak financial situation potentially opens the door for its healthier competitors seeking to gain market share as the next line of blockbuster titles emerges.

All things considered, Cineworld has undoubtedly taken a step in the right direction. But today there are much better low-risk investment opportunities elsewhere.

The post office Is Cineworld a penny stock on track for an explosive recovery in 2023? appeared first on The Motley Fool United Kingdom.

More reading

Zaven Boyrazian has no position in any of the stocks mentioned. The Motley Fool UK has no position in any of the stocks mentioned. The opinions expressed on the companies mentioned in this article are those of the author and may therefore differ from the official recommendations we give in our subscription services such as Share Advisor, Hidden Winners and Pro. At The Motley Fool, we believe that considering a wide range of ideas makes us better investors.

Motley Fool United Kingdom 2022

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Dogecoin surges 35% as Musk finalizes Twitter deal https://agapesgr.org/dogecoin-surges-35-as-musk-finalizes-twitter-deal/ Sun, 30 Oct 2022 22:35:37 +0000 https://agapesgr.org/dogecoin-surges-35-as-musk-finalizes-twitter-deal/ Dogecoin jumped over 35% when news Elon Musk was likely to finalize the Twitter deal by the end of the weekly broadcast. The cryptocurrency had been stagnating for weeks. Musk reportedly met with co-investors via video conference on Monday, where he announced his desire to reach the finish line by Oct. 28. Some of the […]]]>

Dogecoin jumped over 35% when news Elon Musk was likely to finalize the Twitter deal by the end of the weekly broadcast. The cryptocurrency had been stagnating for weeks.

Musk reportedly met with co-investors via video conference on Monday, where he announced his desire to reach the finish line by Oct. 28. Some of the more prominent Wall Street names he came across included Qatar Investment Authority, Sequoia Capital, and crypto exchange Binance. Those absent from the meeting received the funding pledge from Musk’s attorneys.

Earlier this month, the Delaware court judge who heard the Elon Must-Twitter takeover story granted the billionaire until 5 p.m. on October 28 to complete the acquisition. Bloomberg reports that all banks committed to backing Musk’s acquisition of the social media giant have completed the debt financing arrangement and are finalizing relevant documents.

Musk promised to close the deal on Monday at an initial price of $54.20 per share, meaning he will maintain his previous commitment to provide $46.5 billion in equity and debt financing for the acquisition. . This sum will pay the $44 billion price tag and additional transaction fees.

Dogecoin charging north…$1 coming?

With the closing of the acquisition putting to bed months of rumors that the quirky entrepreneur would walk away from the deal, Twitter shares jumped nearly 4% on Tuesday to 52.81 before the opening bell of Wednesday. The announcement also energized Dogecoin supporters, pushing prices higher after weeks of lackluster volatility.

Dogecoin was the only significant cryptocurrency in Musk’s acquisition of Twitter. In April, after expressing interest in acquiring the social network, the CEO of Tesla announced his intention to decentralize it.

The concept included adding Dogecoin as a payment option. Along with garnering overwhelming support from other billionaires, the crypto community thinks its goals are extremely likely due to its previous endeavors with the meme coin.

Musk’s companies, including Tesla, The Boring Company and SpaceX, began accepting Doge as payment over the past year, with Burnt Hair perfume being the most recent.

In the meantime, crypto enthusiasts predict that the completion of the Twitter acquisition will benefit the price of Dogecoin. DOGE was trading at the $0.07 resistance line at press time, gaining almost 13% in the previous 24 hours. A break and subsequent close above this level could push the price higher to $0.78 and then to $0.88.

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Federal Realty: A dividend king with a preferred option (NYSE: FRT) https://agapesgr.org/federal-realty-a-dividend-king-with-a-preferred-option-nyse-frt/ Fri, 28 Oct 2022 10:26:00 +0000 https://agapesgr.org/federal-realty-a-dividend-king-with-a-preferred-option-nyse-frt/ FRT may be a king, but what is a king for his more senior titles? Nils Jacobi/iStock via Getty Images Federal Real Estate Investment Trust (New York stock market :TRF) is a fully integrated retail REIT that has been around for decades, since 1962. During that time the company has consistently increased the dividend for […]]]>

FRT may be a king, but what is a king for his more senior titles?

Nils Jacobi/iStock via Getty Images

Federal Real Estate Investment Trust (New York stock market :TRF) is a fully integrated retail REIT that has been around for decades, since 1962. During that time the company has consistently increased the dividend for 55 consecutive years, making it part of an elite group of only 37 companies who did this, known as the Dividend Kings. These are companies that have weathered the storm time and time again, decade after decade, while maintaining a growing dividend.

It is also apparently the longest record of annual dividend increases in the REIT industry.

FRT Investor Presentation: Dividend History

FRT Investor Presentation: Dividend History

So it’s good. Yet, we all know that past success is no guarantee of future success, so we should take a closer look at their portfolio.

At a high level, the company manages 105 properties with ~3100 commercial tenants, 25 million square feet, and ~3400 residential units. These properties are in what management identifies as “strategically selected first-ring suburbs of nine major metropolitan markets with high barriers.“Here’s what that translates to on a map.

Presentation to FRT investors: geography of the portfolio

Presentation to FRT investors: geography of the portfolio

These strategically selected areas have created a remarkable characteristic for FRT: their demographics. With the current inflationary environment, one challenge retail may see is lower median income households cutting back on spending. We can see that with FRT, the median household income within 3 miles of FRT properties is over $105,000 and well above its peers. Not only that, but the population density for FRT is also higher.

FRT Investor Presentation: Demographics

FRT Investor Presentation: Demographics

Given these demographic characteristics, the company may be better insulated from a decline in consumer spending. They certainly seem better positioned to overcome this scenario than any of the benchmarked peers.

We can observe that the company recorded a record quarterly FFO in the second quarter of $1.65 and an overall increase in FFO guidance suggesting 9.5% to 12.2% growth in FFO per share over 2021. From the point From a balance sheet perspective, they maintain a credit rating of BBB+ from S&P and a Baa1 rating from Moody’s. Leverage is high at 5.8x net debt to EBITDA. Based on their Q2 deposit the leverage ratio is 1.64x, which seems manageable given the growth in FFOs.

Another way to assess leverage is to compare the value of their real estate to their debt. Senior notes and debentures were $3.407 billion in the second quarter, with impaired real estate accounting for $7.058 billion. If we look at this from the perspective of loans secured by real estate, then the loans have a loan to value ratio of just 48% – this is very conservative and suggests that the value of the real estate should help support the debt .

Ninety-three percent of the debt is at fixed rates, which will also help given rising rates.

Finally, we note that their portfolio is well diversified both by category of activity and by tenant. It will also help the company weather any lingering recession.

FRT Investor Presentation: Revenue Streams

FRT Investor Presentation: Revenue Streams

FRT valuation and preferred option

This is where I hit a snag with the company. The Trust is currently priced at 2.85x P/B, which is technically below its five-year average of 3.84x. Anyway, it’s a bit rich for my taste even though FFO is growing. The forecast for 2022 FFO is $6.10-$6.25, which means that even taking the high end, the stock is trading at a P/FFO of 15.48x. I like to buy companies that are trading below their valuation; The FRT does not seem to be.

Yet there is another way to invest in this company that seems to represent a mispricing: Series C Cumulative Preferred Shares (New York stock market :FRT.PC). This is a small set of $150 million shares that are backed by equity of $2.876 billion more than nineteen times. Revenue for the first six months of this year totaled $109.642 million with net income over the past five years equaling $1.279 billion.

Despite the clear support for a full valuation of the preferred shares at face value ($25.00), the preferred shares are currently trading just off their 52-week low at $19.33. As recently as August, these stocks traded above par and generally have done so throughout the past year.

TD Ameritrade: FRT-C YTD Chart

TD Ameritrade: FRT-C YTD Chart

The downward trend is probably somewhat yield related. Even at current depressed prices, the annual dividend of $1.25 represents a yield of 6.46%. With rising interest rates, the value of that return is no longer as high as it once was. Yet, given the nature of the business, it appears to be a guaranteed return of 6.46%.

Consider that if the company does not pay a dividend on its preferred stock, it means that it is also unable to pay a dividend on its common stock. This feature ruins an established 55 year history and their base as a Dividend King stock which they clearly enjoy. I think with this reality in place, it is very likely that buying today will lock in a 6.46% return. And even if a disaster occurs and the company does not pay dividends on the preferred stock, it is a cumulative structure, which means that a dividend would still accrue to which the preferred stockholders would be entitled.

When we consider that the company has an open ATM equity program, we can also see how the company issues common stock to preferred stockholders. In the six months ended June 30, 2022, they generated $259.4 million from this program. This alone covers the total preferred stock value of 173%.

The preferred shares very recently became due and payable from 9/29/2022, so in theory the company could redeem them at any time. Historically speaking, the company has two other series of preferred shares that have been redeemed – even though they were over a decade ago. If we examine their debt financing agreements, we might find clues as to the likelihood of them being called.

Filing T2'22: Table of Debt Financing Agreements

Filing T2’22: Table of Debt Financing Agreements

The cost of financing the preferred shares is a fixed rate of 5.00%. There are only four debt agreements that are more expensive than this in the table above. This means that if the company was able to repay its debts based solely on the cost of financing, it would be in fifth place to repay.

The essential

Investors may be attracted by the Dividend King status and the current yield of 4.46% for FRT. With stocks trading at what I consider high valuations, I would say that even if the yield is hedged, the potential for capital appreciation seems minimal to me. Even if they execute and meet their 2022 FFO guidance, the stock would trade at a P/FFO of 15.48x.

Management is currently diluting common shareholders through an ATM equity program that is fueling growth, but will once again put sustained pressure on common stock over the next year.

My thinking here is that FRT’s move to their preferred stock may be a better opportunity over the next year. FRT.PC is outperforming 6.46%, pays quarterly the same as common and is currently well supported by balance sheet, business growth and equity issuance. And it’s trading at around 23% off face value, meaning there’s potential for capital appreciation.

If the preferred stock is redeemed within the next two years, we could estimate the returns. Two years of a return of 6.46% (12.92%) plus capital appreciation at face value from current prices of $19.33 (29.33%) would imply a two-year total return of 42.25%. And regardless, that 6.46% yield is tied to the company’s reputation as the king of dividends. They can’t afford not to pay this and maintain their 55 year tradition – so I think it’s highly likely that this preference will continue to pay dividends as usual and will eventually be redeemed at par.

The relevant question is when. But given the current momentum in common stocks, I think preferred stocks are poised to outperform over the next two years. So a switch can be worth it.

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Fitch downgrades the country’s IDR to “CCC+” https://agapesgr.org/fitch-downgrades-the-countrys-idr-to-ccc/ Sat, 22 Oct 2022 04:41:15 +0000 https://agapesgr.org/fitch-downgrades-the-countrys-idr-to-ccc/ CARACHI: Fitch Ratings downgraded Pakistan’s long-term foreign currency issuer (IDR) default rating to “CCC+” from “B-” on the day the Asian Development Bank (AfDB) approved $1.5 billion in financing million for the country and the Financial Action Task Force (FATF) moved Islamabad from the gray list to its white list. “The downgrade reflects a further […]]]>

CARACHI:

Fitch Ratings downgraded Pakistan’s long-term foreign currency issuer (IDR) default rating to “CCC+” from “B-” on the day the Asian Development Bank (AfDB) approved $1.5 billion in financing million for the country and the Financial Action Task Force (FATF) moved Islamabad from the gray list to its white list.

“The downgrade reflects a further deterioration in Pakistan’s external liquidity and financing conditions, as well as declining foreign exchange reserves,” the global ratings agency said in a statement on Friday.

“Fitch does not generally assign outlooks to sovereigns with a rating of ‘CCC+’ or lower,” he added.

FATF’s decision to relocate Islamabad on the whitelist is expected to improve foreign currency inflows, including from overseas investors.

Fitch announced its latest rating action after Moody’s Investors Service downgraded Pakistan’s credit rating to “Caa1” from “B3” about two weeks ago.

Finance Minister Ishaq Dar and his team had called the decision “unilateral” and said the verdict was based on “incomplete information”.

Dar and his team had updated that Pakistan was under the International Monetary Fund (IMF) loan program, while the country had comprehensive arrangements worth around $36-40 billion to repay debt. financing the current account deficit (CAD) and increasing foreign exchange reserves in FY23.

However, both rating agencies ignored the upcoming developments.

Fitch said Pakistan’s debt-to-GDP ratio was 73% for FY22, broadly in line with the current “B” median.

“We expect the debt-to-GDP ratio to fall to 70% in FY23 and continue to decline, helped by high inflation and a modest primary deficit,” the ratings agency added.

He predicted the country’s DAC would shrink to $10 billion [2.7% of GDP] in FY23, despite the hit to export earnings and import requirements after the recent floods.

Fitch said his decision was partly the result of widespread flooding, which would undermine Pakistan’s efforts to rein in fiscal and current account deficits.

“The downgrade also reflects our view of heightened policy risks that could undermine the IMF program and official financial support for Pakistan,” Fitch’s statement said.

Pakistan’s external public debt maturities in FY23 exceed $21 billion, mostly to bilateral and multilateral creditors, “which mitigates refinancing risks, and there are already agreements to refinance some of between them”.

“Reserves were depleted to $7.6 billion during the week ended October 14, 2022, equivalent to just over a month of import payments and debt repayments. They amounted to to $20 billion by the end of August 2021,” he said.

The rating agency said Pakistan had recently received funding commitments of $2.5 billion from the World Bank and AfDB, according to authorities, although it understood that much of this amount had been reallocated from ongoing programs.

“It remains unclear to what extent the IMF will be able to relax Pakistan’s program targets or increase [the country’s] access under the EFF [Extended Fund Facility]“, we read in the press release.

Fitch assumed that Pakistan would continue to receive disbursements under its IMF program, but the risks in this regard had increased.

“Falling fuel prices [in local markets] October 1, 2022 may not be compatible with commitments to the IMF. A quarterly electricity price adjustment scheduled for October has not yet taken place,” Fitch added.

The new Minister of Finance has reaffirmed his commitment to the program, but prefers a “strong exchange rate, and could review the amended SBP law in early 2022 to grant the [central bank] greater autonomy, as previously agreed with the IMF,” Fitch said in support of his decision to downgrade the country’s credit rating.

He also expects the country’s budget deficit to narrow to 6.2% of GDP (about 5 trillion rupees or $23 billion) in FY23, due to some restriction. spending and higher taxes from 7.9% of GDP (over Rs 5 trillion) in FY22.

Fitch said it saw gross domestic product (GDP) growth slow to around 2% in FY23 from 6% in FY22, “amid fiscal and monetary tightening, high imported inflation, weak external demand prospects and flood-related disruptions.

This is broadly in line with government forecasts, down from its initial target of 5% and a forecast of 3.5% in the IMF program.

The 2010-2011 floods contributed to Pakistan’s weak recovery from the global financial crisis.

Authorities estimate flood damage at $10 billion to $30 billion, but reconstruction costs are likely to be lower, as will the impact on Pakistan’s twin deficits.

The rating agency said growing political instability could lead to policy slippages once the IMF’s ongoing $6.5 billion program ends in June 2023.

He said former prime minister Imran Khan, who was ousted in a no-confidence vote on April 10, continued to exert political pressure on the government, staging protests across the country calling for elections. anticipated.

Imran’s party, the PTI, won by-elections in the key province of Punjab in July, beating the incumbent PML-N.

The PTI won more national and provincial seats in the October 17 by-elections.

“Regular elections are scheduled for October 2023, which creates the risk of political slippage after the conclusion of the IMF program expected in June,” Fitch noted.

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Tricida Announces $125 Million Credit Facility with Hercules Capital https://agapesgr.org/tricida-announces-125-million-credit-facility-with-hercules-capital/ Wed, 19 Oct 2022 20:05:00 +0000 https://agapesgr.org/tricida-announces-125-million-credit-facility-with-hercules-capital/ SOUTH SAN FRANCISCO, Calif.–(BUSINESS WIRE)–Tricida, Inc. (Nasdaq: TCDA) today announced that it has entered into a credit facility with Hercules Capital, Inc. (NYSE: HTGC), a leader in customizing debt financing for businesses in the life science and related technology markets. The aggregate amount of the credit facility is $125 million, of which $100 million may […]]]>

SOUTH SAN FRANCISCO, Calif.–(BUSINESS WIRE)–Tricida, Inc. (Nasdaq: TCDA) today announced that it has entered into a credit facility with Hercules Capital, Inc. (NYSE: HTGC), a leader in customizing debt financing for businesses in the life science and related technology markets. The aggregate amount of the credit facility is $125 million, of which $100 million may be drawn at Tricida’s option subject to the achievement of certain milestones.

“As we prepare to release key results from the VALOR-CKD renal outcome trial this month, we want to ensure that we are positioned both financially and strategically to move forward with a potential new NDA submission. , potential FDA approval and subsequent commercialization of veverimer,” said Geoff Parker, Chief Operating Officer and Chief Financial Officer of Tricida. “This credit facility gives us additional flexibility in our future financing plans.”

Under the terms of the credit facility, $25 million may be drawn until December 31, 2022, subject to the announcement of positive data from the VALOR-CKD trial. An additional $25 million will be available for drawdown until the first of ten business days after the NDA is filed for November 15, 2023. An additional $50 million will be available for drawdown until first of ten business days following FDA approval. de veverimer and on February 15, 2024. An additional amount of $25 million may be drawn until December 15, 2024, subject to the approval of the Hercules investment committee.

Under the loan agreement, the loans bear interest at a variable annual interest rate equal to the greater of 8.75% or the lesser of 8.75% plus the prime rate published in the Wall Street Journal less 6 .25% and 10.25%.

The loan repayment schedule provides for interest-only payments through August 1, 2024. The interest-only period date may be extended to November 1, 2026, following FDA approval of the verimer. The final maturity date of the loan agreement is November 1, 2025. Subject to certain conditions being met, the final maturity date may be extended for up to two additional years.

“Hercules is delighted to enter into this funding partnership with Tricida at this important juncture as it continues to advance veverimer to address a significant unmet medical need,” said Scott Bluestein, CEO and Chief Investment Officer of Hercules. “This structured investment in Tricida provides the Company with additional non-dilutive capital as it pursues the development of veverimer, which has the potential to address a significant unmet medical need in the treatment of patients with metabolic acidosis and metabolic acidosis. ‘IRC. We are delighted to once again partner with the Tricida management team. »

About Tricida

Tricida, Inc. is a pharmaceutical company focused on the development and commercialization of its investigational drug candidate, veverimer, an unabsorbed orally administered polymer designed to slow the progression of CKD in patients with metabolic acidosis and IRC. Tricida recently completed a renal outcome clinical trial, VALOR-CKD, to determine whether veverimer slows the progression of CKD in patients with CKD-associated metabolic acidosis. Metabolic acidosis is a common condition caused by CKD and is thought to accelerate the progression of kidney deterioration. It is estimated to pose a health risk to approximately 4.3 million CKD patients in the United States. There are currently no FDA-approved treatments to slow the progression of kidney disease by correcting chronic metabolic acidosis in patients with CKD.

For more information on Tricida, please visit Tricida.com.

Caution Regarding Forward-Looking Statements

This press release contains forward-looking statements, including, for example, statements regarding the company’s plans and expectations regarding the estimated timeline for receipt of frontline data from the VALOR-CKD trial and the possibility of a resubmission of an NDA for veverimer, the possibility of FDA approval of veverimer, if any, potential commercialization of veverimer, and its expectations regarding future financial requirements. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those discussed in such forward-looking statements. These risks and uncertainties include, but are not limited to, risks related to the ability of the VALOR-CKD trial to meet its primary endpoint and that the data from this trial are sufficient to support the resubmission and /or NDA approval; the time and cost required to obtain regulatory approvals for the veverimer; Tricida’s ability to obtain veverimer approval through the traditional approval process; costs associated with delays in regulatory approval and resubmission of Tricida’s NDA, and any increased costs associated with raising capital in light of such delays; and risks associated with the Company’s business prospects, financial results and business activities.

These and other factors that could affect the Company’s future results of operations are identified and further described in our filings with the Securities and Exchange Commission (the “SEC”). You should not place undue reliance on these forward-looking statements. The forward-looking statements contained in this press release reflect Tricida’s current views with respect to future events, and Tricida does not undertake and specifically disclaims any obligation to update any forward-looking statements.

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Columbia River Partners Announces Investment in TiniFiber | https://agapesgr.org/columbia-river-partners-announces-investment-in-tinifiber/ Mon, 17 Oct 2022 17:36:00 +0000 https://agapesgr.org/columbia-river-partners-announces-investment-in-tinifiber/ SEATTLE, October 17, 2022 /PRNewswire/ — Columbia River Partners (“CRP”) is proud to announce its investment in TiniFiber Holdings, LLC (“TiniFiber”), a manufacturer of custom fiber optic assemblies and cables. Columbia River Partners (“CRP”) is a lower mid-market private equity firm focused on investments in business services, industrial and information technology platforms in North America. […]]]>

SEATTLE, October 17, 2022 /PRNewswire/ — Columbia River Partners (“CRP”) is proud to announce its investment in TiniFiber Holdings, LLC (“TiniFiber”), a manufacturer of custom fiber optic assemblies and cables. Columbia River Partners (“CRP”) is a lower mid-market private equity firm focused on investments in business services, industrial and information technology platforms in North America.

Based at Farmingdale, NY, TiniFiber will continue to capitalize on strong long-term FTTx trends by demonstrating the superior value of its product to customers across the country. TiniFiber’s products are smaller, stronger and lighter than the competition, resulting in substantial savings for contractors and end users through reduced labor and transportation costs.

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