ROANOKE, VA - Luna Innovations (NASDAQ:LUNA) Incorporated (NASDAQ:LUNA), a company specializing in commercial physical and biological research services, has amended its existing loan agreement, resulting in an additional $15 million in term loans, the company disclosed in a recent SEC filing.
This increase brings the total term loan commitment to $30 million, intended for working capital and general corporate purposes.
On Monday, Luna Innovations entered into the First Amendment to the Loan Agreement with White Hat Capital Partners LP and its affiliates. The amendment extends the maturity date of the loan to June 30, 2025, with provisions for further extension depending on the company's progress with a potential Sale Transaction, as outlined in the agreement.
The interest rate on the loan is set at the Secured Overnight Financing Rate plus a 12% margin, payable monthly.
In conjunction with this amendment, Luna Innovations and PNC Bank, National Association, agreed to a Fifth Amendment to their existing Loan Agreement, allowing for the new term loans. Additionally, a Subordination Agreement Amendment was established between Luna Innovations, the lenders, the agent, and PNC Bank to clarify the rights and priorities of each party.
Simultaneously, Luna Innovations reached an agreement with holders of its Series B Convertible Preferred Stock. The holders consented to the new loan terms and agreed to purchase additional shares of Series B Convertible Preferred Stock, totaling 3,000 shares at par value.
This private placement was conducted under the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933.
This information is based on a press release statement.
In other recent news, Luna Innovations Incorporated has been facing significant changes. The company has appointed William L. Phelan as Chief Financial Officer and Chief Accounting Officer, succeeding John Roiko. Phelan brings over 25 years of financial and accounting leadership experience, and is expected to contribute to Luna's growth strategy in the fiber optic technology market.
Simultaneously, Luna Innovations is grappling with potential delisting from the Nasdaq Stock Market due to non-compliance with filing requirements. The company has failed to file its Annual Report for 2023 and Quarterly Reports for the first two quarters of 2024, despite being granted extensions to regain compliance.
In addition to these developments, Luna Innovations has witnessed significant changes in its board. Richard Roedel, the Interim Executive Chairman and Interim President, resigned due to health reasons, with Warren B. Phelps III assuming the role of non-executive Chair of the Board.
These are the recent developments for Luna Innovations.
InvestingPro Insights
Luna Innovations' recent financial moves, including the amended loan agreement and additional term loans, align with the company's current market position and financial outlook. According to InvestingPro data, Luna Innovations has a market capitalization of $63.5 million, reflecting its status as a small-cap company in the research services sector.
InvestingPro Tips indicate that Luna's net income is expected to grow this year, and analysts predict the company will be profitable. These projections suggest that the additional $15 million in term loans could potentially support the company's growth initiatives and working capital needs.
However, it's worth noting that Luna's stock has faced challenges recently. The company's share price has fallen significantly over the last year, with a 1-year price total return of -67.21% as of the latest data. This decline is reflected in the current stock price of $1.81, which is only 22.85% of its 52-week high.
Despite these challenges, InvestingPro's fair value estimate for Luna stands at $3.33, suggesting potential upside from the current price levels. Investors interested in a more comprehensive analysis can access additional InvestingPro Tips, with 7 more tips available for Luna Innovations on the platform.
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