ANNAPOLIS, Md., June 26, 2013 /PRNewswire/
-- TeleCommunication Systems, Inc. (TCS) (NASDAQ: TSYS)
(the "Company"), a world leader in highly reliable and secure
mobile communication technology, together with several of its
domestic subsidiaries (collectively, the "Borrowers"), have closed
on a new Credit Agreement dated June 25,
2013 (the "Credit Agreement.") Silicon Valley Bank ("SVB")
is the administrative agent, co-lead arranger and joint bookrunner
and GE Capital Markets, Inc. ("GECM") is co-lead arranger and joint
bookrunner, General Electric Capital Corporation ("GECC") is
syndication agent. Manufacturers & Traders Trust Company
("M&T") and PNC Bank ("PNC") are additional lenders to the
facility.
TCS Chairman and CEO Maurice Tose
said: "Favorable credit market conditions led us to update for
another 5 years the Company's arrangements for access to low-cost
capital. As TCS proceeds to use its scale to address new customers
around the world with secure, highly reliable wireless technology
solutions, the strength and transparency of our balance sheet is an
important differentiator. Silicon Valley Bank has worked with our
company for more than a decade, and their focus on technology-based
businesses has helped TCS to adapt to changing conditions and
opportunities during that time, so we are pleased to continue to
work with them and the additional very high quality institutions
that have joined them in this arrangement."
The Credit Agreement provides for Senior Secured Credit
Facilities (the "Senior Credit Facilities") which include (i) a
$56.5 million term loan A facility
("Term Loan A Facility"), (ii) a $43.5
million delayed draw term loan facility ("Delayed Draw Term
Loan Facility"), and (iii) a $30
million revolving loan facility ("Revolving Loan Facility.")
The Senior Credit Facilities also include a $25 million incremental loan arrangement subject
to the company's future needs and bank approval.
The Company has borrowed $56.5
million under the Term Loan A Facility. Proceeds were used
for (i) repayment of the remaining balance under the Company's
December 31, 2009 Loan and Security
Agreement, as amended, with SVB and other lenders (the "Loan and
Security Agreement"), (ii) approximately $16
million for on-going working capital and other general
corporate purposes, and (iii) fees and expenses associated with the
new facility. Additional liquidity is available through the
undrawn $30 million Revolving Loan
Facility, to be used for the Company's on-going working capital and
other general corporate purposes, replacing the revolving line
under the 2009 Loan and Security Agreement which has been paid off
and terminated.
Loans borrowed under the Term Loan A Facility, the Revolving
Loan Facility or the Delayed Draw Term Loan Facility may be
borrowed at rates based on the Eurodollar/LIBOR (beginning at L
+3.75%) or Alternate Base Rate (ABR) (beginning at ABR + 2.75%),
which may be adjusted as provided in the Credit Agreement.
The Term Loan A Facility and the Delayed Draw Term Loan Facility
have a maturity date of March 31,
2018, unless extended as provided in the Credit Agreement,
and the Revolving Loan Facility has a termination date of
March 31, 2018, unless extended as
provided in the Credit Agreement.
The Senior Credit Facilities are secured by substantially all of
the Borrowers' tangible and intangible assets, including
intellectual property. The Credit Agreement contains customary
representations and warranties of the Borrowers and customary
covenants and events of default. Availability under the
Revolving Loan Facility and the Delayed Draw Term Loan Facility is
subject to certain conditions, including the continued accuracy of
the Borrowers' representations and warranties and compliance with
covenants.
About TeleCommunication Systems, Inc.
TeleCommunication Systems, Inc. (TCS) (NASDAQ: TSYS) is a world
leader in highly reliable and secure mobile communication
technology. TCS infrastructure forms the foundation for market
leading solutions in E9-1-1, text messaging, commercial location
and deployable wireless communications. TCS is at the forefront of
new mobile cloud computing services providing wireless applications
for navigation, hyper-local search, asset tracking, social
applications and telematics. Millions of consumers around the world
use TCS wireless apps as a fundamental part of their daily lives.
Government agencies utilize TCS' cyber security expertise,
professional services, and highly secure deployable satellite
solutions for mission-critical communications. Headquartered in
Annapolis, MD, TCS maintains
technical, service and sales offices around the world. To learn
more about emerging and innovative wireless technologies, visit
www.telecomsys.com, follow TCS @TeleComSys on Twitter or like
TCS on Facebook.
Forward-looking Statements
This announcement contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities and Exchange Act of
1934, as amended. These statements are based upon TCS'
current expectations and assumptions that are subject to a number
of risks and uncertainties that would cause actual results to
differ materially from those anticipated. The words,
"believe," "expect," "intend," "anticipate," "should," "prospect,"
and variations of such words and similar expressions identify
forward-looking statements, but their absence does not mean that
the statement is not forward-looking. Statements in this
announcement that are forward-looking include, but are not limited
to the statements made by Maurice
Tose that we will have access to low-cost capital for five
years, and that the strength and transparency of our balance sheet
is a differentiator.
Additional risks and uncertainties are described in the
company's filings with the Securities and Exchange Commission
(SEC). These include without limitation risks and
uncertainties relating to the company's financial results and the
ability of the company to (i) sustain profitability, (ii)
accurately assess impairment triggering events related to our
intangibles, including goodwill; (iii) continue to rely on its
customers and other third parties to provide additional products
and services that create a demand for its products and services,
and to do so at prices that will allow us to continue to fund our
operations, (iv) conduct its business in foreign countries, (v)
adapt and integrate new technologies into its products and
adequately expand its data centers and data delivery systems, (vi)
expand its sales and business offerings in the wireless
communications industry, (vii) develop software and provide
services without any errors or defects and with adequate security
threat protections, (viii) protect its intellectual property
rights, (ix) have sufficient capital resources to fund its
operations, (x) not incur substantial costs from product liability
and IP infringement claims and indemnification demands relating to
its software, (xi) implement its sales and marketing strategy, and
(xii) successfully integrate the assets and personnel obtained in
its acquisitions and investments. Existing and prospective
investors are cautioned not to place undue reliance on these
forward looking statements, which speak only as of the date
hereof. The company undertakes no obligation to update or
revise the information in this press release, whether as a result
of new information, future events or circumstances, or
otherwise.
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Company
Contact:
|
Investor
Relations:
|
TeleCommunication
Systems, Inc.
|
Liolios Group,
Inc.
|
Tom Brandt, SVP &
CFO
|
Scott
Liolios
|
410-280-1001
|
949-574-3860
|
tbrandt@telecomsys.com
|
info@liolios.com
|
SOURCE TeleCommunication Systems, Inc.