TX Holdings Inc. Borrows New Business Loan

Rhea-AI Summary

TX Holdings Inc. secures a new business loan with a revolving line of credit agreement from a credit union, with an initial interest rate of 8.950%. The loan is guaranteed by the CEO and used to pay off a previous loan, with the remaining balance allocated for business operations.

Positive

• Securing a new business loan provides TX Holdings Inc. with additional financial flexibility and liquidity.
• The revolving line of credit agreement allows the company to access funds as needed within the specified time frame.
• The loan being guaranteed by the CEO demonstrates confidence in the company's ability to meet its financial obligations.
• Using part of the loan to pay off a previous balance and accrued interest can help reduce overall debt burden and interest expenses.
• Allocating the remaining balance for business operations can support growth and expansion initiatives.

Negative

• None.

Ashland, Ky, April 15, 2024 (GLOBE NEWSWIRE) -- In March 2024, the company obtained a revolving line of credit agreement from a credit union. The loan agreement is effective on March 13, 2024, and will continue in full force until such time as the loan is paid in full, all related expenses paid, or until March 15, 2025, at which time the line of credit can be renewed. The line of credit was secured by all shares and deposits in all joint and individual accounts the company has with the lender. The loan has a variable interest rate indexed to the Wall Street Journal rate and will be a rate of 0.450 percentage points over the index, the effective initial interest rate is 8.950%. The loan is to be paid by the company in one payment on March 15, 2025, at which time the line of credit can be renewed and interest to be paid on regular monthly payments, beginning April 15,2024. The loan has a number of positive and negative covenants and conditions outlining the rights and responsibilities of the company and lender.

The loan is guaranteed by the Chief Executive Officer, William Shrewsbury, to the amount of $500,000.

Proceeds of the loan in the amount of $176,004.51were used to pay-off the balance of a previous loan and accrued interest and, the remaining new loan balance of $323,995.49 to be used in the business operation.

FAQ

What type of loan did TX Holdings Inc. secure?

TX Holdings Inc. secured a revolving line of credit agreement from a credit union.

What is the initial interest rate on the loan?

The initial interest rate on the loan is 8.950%.

Who guaranteed the loan for TX Holdings Inc.?

The loan is guaranteed by the Chief Executive Officer, William Shrewsbury.

How were the proceeds of the loan used?

The proceeds of the loan were used to pay off the balance of a previous loan and accrued interest, with the remaining balance allocated for business operations.

When is the loan to be paid in full?

The loan is to be paid in one payment on March 15, 2025.