Kaspien Amends Credit Facility to Support Future Growth

Rhea-AI Summary

Kaspien Holdings Inc. (NASDAQ: KSPN) announced an amended loan agreement with Eclipse Business Capital, extending the maturity date of its $25 million credit facility to February 20, 2024. Key updates include a reduction of the LIBOR floor to 1.00% and the ability to pursue up to $4 million in acquisitions without consent. CEO Kunal Chopra highlighted this as a favorable financing structure that aligns with their growth goals. Additionally, a subordinated loan agreement was extended to March 31, 2024. For further details, refer to their recent Form 8-K filing.

Positive

• Amended loan agreement provides greater flexibility for business initiatives.
• Credit facility maturity extended to February 20, 2024, enhancing financial stability.
• Reduction of LIBOR floor to 1.00% lowers borrowing costs.
• Ability to pursue up to $4 million in acquisitions without consent supports growth strategy.

Negative

• None.

SPOKANE, Wash. , Sept. 22, 2021 /PRNewswire/ -- Kaspien Holdings Inc. (NASDAQ: KSPN) ("Kaspien" or the "Company"), a leading e-commerce marketplace growth platform, announced that it has entered into an amended loan agreement with Eclipse Business Capital LLC ("Eclipse," f/k/a Encina Business Credit, LLC or "Encina"). On February 20, 2020, the Company previously entered into a loan agreement with Encina for up to $25 million in loans under a three-year, secured revolving credit facility.

Under the terms of the amended agreement, Kaspien will have additional flexibility to execute on its long-term business initiatives. Updated terms include but are not limited to extending the credit facility maturity date to February 20, 2024 with early termination fees being reset, reducing the LIBOR floor to 1.00%, allowing up to $4.0 million in acquisitions without consent, assuming certain preconditions are met, and allowing up to $5.6 million in aggregate principal amount of subordinated indebtedness to be prepaid.

In conjunction with the amendment to the loan agreement, the Company amended its subordinated loan agreement to extend the maturity date to March 31, 2024.

"This amended credit facility provides us with a more favorable financing structure that better aligns our capital sources with our growth goals," said Kaspien CEO Kunal Chopra. "We are committed to helping businesses of all sizes grow online, and to using our comprehensive platform of software and tech-enabled services to guide our partners through the increasingly complex landscape of digital marketplaces. Across our business, we will continue to offer the software, technology, and know-how to support more marketplaces, expand to new geographies, and layer new business models on top of our existing platform. We appreciate Eclipse's support in recognizing our improved financial condition and their flexibility to update this loan agreement."

For additional details regarding the amended agreement, please reference the Form 8-K filed with the U.S. Securities and Exchange Commission on September 20, 2021.

About Kaspien
Kaspien Holdings Inc. (f/k/a Trans World Entertainment Corporation) (NASDAQ: KSPN) is a leading e-commerce marketplace growth platform, offering an expanding suite of software and services to help brands grow on Amazon, Walmart, Target, eBay, and other online marketplaces. Founded in 1972 as a brick-and-mortar retailer and rebranded as Kaspien in 2020, the Company has spent the last decade building and utilizing proprietary technologies for brand protection, marketing optimization, and fulfillment efficiency to generate rapid revenue growth for its partners. Through innovative strategies and best-in-class technologies, Kaspien has earned the trust of many leading brands, including 3M, Strider Bikes, and ZippyPaws. For more information, visit kaspien.com.

Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Certain statements in this communication are forward-looking statements. The statements contained herein that are not statements of historical fact may include forward-looking statements that involve a number of risks and uncertainties.

We have used the words "anticipate", "believe", "could", "estimate", "expect", "intend", "may", "plan", "predict", "project", and similar terms and phrases, including references to assumptions, in this document to identify forward-looking statements. These forward-looking statements are made based on management's expectations and beliefs concerning future events and are subject to uncertainties and factors that could cause actual results to differ materially from the results expressed in the statements. The following factors are among those that may cause actual results to differ materially from the Company's forward-looking statements:  risk of disruption of current plans and operations of Kaspien and the potential difficulties in customer, supplier and employee retention; the outcome of any legal proceedings that may be instituted against the Company; the Company's level of debt and related restrictions and limitations, unexpected costs, charges, expenses, or liabilities; the Company's ability to operate as a going-concern; deteriorating economic conditions and macroeconomic factors; the impact of the COVID-19 pandemic; and other risks described in the Company's filings with the SEC, such as its Quarterly Reports on Form 10-Q and Annual Reports on Form 10-K.

The reader should keep in mind that any forward-looking statement made by us in this document, or elsewhere, pertains only as of the date on which we make it. New risks and uncertainties come up from time-to-time and it's impossible for us to predict these events or how they may affect us. In light of these risks and uncertainties, you should keep in mind that any forward-looking statements made in this document or elsewhere might not occur.

Company Contact
Ed Sapienza
Chief Financial Officer
(509) 202-4261
esapienza@kaspien.com

Investor Relations Contact
Gateway Investor Relations
Matt Glover and Tom Colton
(949) 574-3860
KSPN@gatewayir.com

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SOURCE Kaspien Holdings Inc.

FAQ

What is the recent loan agreement amendment for Kaspien Holdings (KSPN)?

Kaspien Holdings amended its loan agreement with Eclipse Business Capital, extending the maturity date to February 20, 2024.

How does the amended loan agreement benefit Kaspien Holdings (KSPN)?

The amendment provides increased flexibility for business initiatives and lowers the LIBOR floor to 1.00%, reducing borrowing costs.

When will Kaspien's credit facility mature after the amendment?

The maturity date for Kaspien's credit facility is now extended to February 20, 2024.

What financial changes were made in Kaspien's loan agreement?

The amended agreement allows up to $4 million in acquisitions without consent and extends the maturity of subordinated loans.