Las Vegas, NV & Hong Kong, April 25, 2019 (GLOBE NEWSWIRE) -- 12 ReTech Corporation (OTC: RETC) announced today that it has evolved to the point where the Company and its subsidiaries now have access to more traditional financing than the convertible debt instruments that it has relied on previously.
With the acquisition of Red Wire Group, the Company now has access to a $50,000 traditional secured revolving bank-line of credit (RLOC) with Red Wire Group’s local Utah based bank. This credit line functions as an overdraft tied to Red Wire’s checking account and has an annual interest rate of Prime plus 2.5%
Rune NYC, LLC has just executed a $1.5 million dollars revolving factoring credit line with Florida based Capital Funding Solutions (“CFS”). Factoring is a standard form of financing in the Fashion Industry and the amount offered is indicative of the faith that CFS has in the growth of Rune NYC, 12 ReTech’s newest subsidiary.
12 ReTech itself has executed a PIPE (Private Investment in a Public Entity) funding agreement with an institutional and accredited investor whereby the investor will provide funding to the Company with up to $500,000 by purchasing preferred shares that are convertible at a later date into common shares in a no discount to the market formula (see Form 8-K dated March 20, 2019). The Company has already drawn down $115,000 under this arrangement.
Angelo Ponzetta the Company’s CEO commented, “We are very pleased with the progress our Company is making on many fronts. With our recent acquisitions we are now generating significant revenues and the traditional finance industry is beginning to recognize our improved footing.”
Emily Santamore, manager of Rune NYC stated, “Working with the team at 12 ReTech has been awesome. The factoring credit line with CFS really allows us to “put the pedal to the metal” as far as growth is concerned. Combined with the cost savings that we receive through Red Wire Group’s manufacturing operations, we are able to do business with many additional retail customers as we are now able to deliver against their purchase orders in a timely fashion.”
Greg Porter, a principal of CFS said, “We really took the time to underwrite Rune NYC to understand where we could help Rune achieve its goals. We found the management team at both Rune and 12 ReTech to be very transparent and easy to work with. We are looking forward to a long-term relationship with both teams.”
Mr. Ponzetta concluded, “These new funding arrangements will allow our subsidiaries to grow and will reduce management’s reliance on convertible note financing to fund our technology and public entity expenses in the foreseeable future. This should over time reduce the ongoing effect of the dilution we have experienced and going forward, we hope to begin building shareholder value. We are continuing to pursue the completion of our Form S-1 to register shares for our $12 million Equity Line of Credit which is our long-term financing solution.”
