Rekor Systems Fully Satisfies Outstanding Balance from Yorkville Advisors

Rhea-AI Summary

Rekor Systems (NASDAQ: REKR) has announced the complete satisfaction of its $15 million outstanding balance under the August 2024 Prepaid Advance Agreement with Yorkville Advisors Global's affiliate, as of December 31, 2024. CFO Eyal Hen emphasized that this early prepayment demonstrates the company's commitment to prudent financial management and shareholder value creation. The move strengthens Rekor's balance sheet flexibility and positions the company to better pursue strategic growth initiatives while maintaining disciplined capital allocation.

Positive

• Early repayment of $15 million debt obligation
• Improved balance sheet flexibility
• Enhanced financial position for pursuing growth initiatives

Negative

• Significant cash outlay of $15 million impacting current liquidity

Insights

Financial Analyst

The early repayment of $15 million in debt to Yorkville Advisors represents a meaningful improvement in Rekor Systems' financial position. For a company with a market cap of $155.7 million, clearing this obligation removes approximately 9.6% of debt from their balance sheet. The prepayment eliminates future interest expenses and potential dilution risks often associated with these types of financing arrangements.

The timing of this repayment, coming at year-end 2024, suggests strong cash flow management and possibly improved operational performance. For a technology company in the roadway intelligence sector, maintaining balance sheet flexibility is important for funding R&D and pursuing market expansion opportunities. This move could potentially lower the company's cost of capital for future financing needs and signals management's confidence in their cash position.

However, investors should note that while debt reduction is positive, the key focus should remain on Rekor's ability to generate sustainable revenue growth and achieve profitability in the competitive roadway intelligence market. The prepayment might indicate either strong operating cash flows or the use of existing cash reserves, which warrants attention in upcoming financial reports.

COLUMBIA, Md., Jan. 06, 2025 (GLOBE NEWSWIRE) -- Rekor Systems, Inc. (NASDAQ: REKR), a leader in developing and implementing state-of-the-art roadway intelligence technology, announced today that, as of December 31, 2024, it has fully satisfied the outstanding balance of $15 million under its August 2024 Prepaid Advance Agreement with an affiliate of Yorkville Advisors Global.

Eyal Hen, Rekor's Chief Financial Officer, commented, "This prepayment underscores our dedication to prudent financial management and shareholder value creation. By eliminating this obligation early, we have enhanced our balance sheet flexibility. This positions Rekor to better capitalize on strategic growth initiatives while maintaining a disciplined approach to capital allocation. We thank Yorkville for its partnership and appreciate its support in satisfying the Prepaid Advance Agreement ahead of schedule."

About Rekor Systems, Inc.
Rekor Systems, Inc. (NASDAQ: REKR) is a leader in developing and implementing state-of-the-art roadway intelligence systems using AI-enabled computer vision and machine learning. As a pioneer in the implementation of digital infrastructure, Rekor is collecting, connecting, and organizing the world's mobility data – laying the foundation for a digitally-enabled operating system for the roadway. With our Rekor One® Roadway Intelligence Engine at the core of our technology, we aggregate and transform trillions of data points into intelligence through proprietary computer vision, machine learning, and big data analytics that power our platforms and applications. Our solutions provide actionable insights that give governments and businesses a comprehensive picture of roadways while providing a collaborative environment that drives the world to be safer, greener, and more efficient. To learn more, please visit our website: https://rekor.ai, and follow Rekor on social media on LinkedIn, X (formerly Twitter), Threads, and Facebook.

Forward-Looking Statements
This press release and its links and attachments contain statements concerning Rekor Systems, Inc. and its future expectations, plans, and prospects that constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding the impact of Rekor's core suite of AI-powered technology and the size and shape of the global market for the Company's products and services. Such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. For this purpose, any statements that are not statements of historical fact may be deemed to be forward-looking statements. In some cases, you can identify forward-looking statements by terms such as "may," "should," "expects," "plans," "anticipates," "could," "intends," "target," "projects," "contemplates," "believes," "estimates," "predicts," "potential," or "continue," by the negative of these terms or by other similar expressions. You are cautioned that such statements are subject to many risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risk that actual circumstances, events or results may differ materially from those projected in the forward-looking statements, particularly as a result of various risks and other factors identified in our filings with the Securities and Exchange Commission. All forward-looking statements contained in this press release speak only as of the date on which they were made and are based on management's assumptions and estimates as of such date. We do not undertake any obligation to publicly update any forward-looking statements, whether as a result of the receipt of new information, the occurrence of future events, or otherwise.

Media & Investor Relations Contact:
Rekor Systems, Inc.
Charles Degliomini
ir@rekor.ai

FAQ

How much debt did Rekor Systems (REKR) repay to Yorkville Advisors?

Rekor Systems repaid $15 million, which was the full outstanding balance under its August 2024 Prepaid Advance Agreement with Yorkville Advisors Global's affiliate.

When did Rekor Systems (REKR) complete its debt repayment to Yorkville?

Rekor Systems completed the debt repayment on December 31, 2024.

What is the significance of REKR's early debt repayment to shareholders?

The early debt repayment enhances balance sheet flexibility, demonstrates prudent financial management, and positions the company better for strategic growth initiatives, potentially benefiting shareholders.

What was the original term of REKR's Prepaid Advance Agreement with Yorkville?

The Prepaid Advance Agreement was established in August 2024 with Yorkville Advisors Global's affiliate.