PHOENIX, AZ, July 2, 2012 /CNW/ - GWR Global Water Resources Corp. (TSX: GWR) and Global Water Resources, Inc. (Global Water or the Company) today announced that Global Water has secured $25,000,000 of financing to retire certain obligations. The financing consists of $7,625,000 of tax-exempt revenue bonds (the "tax-exempt bonds"), $6,375,000 taxable revenue bonds (the "taxable bonds") and an $11,000,000 term loan (the "term loan"). With the proceeds from these financings Global Water will retire the $7,000,000 term loan with Regions Bank, the $9,400,000 term loan with a shareholder and director of Global Water, and the approximately $4,345,000 in loans with the Water Infrastructure Finance Authority of Arizona. The remaining net proceeds provide Global Water with more than $1,500,000 for general working capital purposes, after the establishment of appropriate debt reserve funds.
"This transaction allowed us to consolidate our debt at a more attractive interest rate and reduce the rate at which the previous loans amortized, which reduces our interest costs and improves our cash flow. At the current market rates and amortization, the new terms represent a $4.5 million reduction in payments in the first year," said Cindy Liles, Executive Vice President and Chief Financial Officer of Global Water. "We appreciate the support of Regions Bank throughout the process, which now holds the consolidated debt position."
The financings amortize annually and mature in December 2021. The tax-exempt bonds accrue interest at a rate of 65% of LIBOR plus 242 or 292 basis points ("bps") depending on debt service coverage ratios and the taxable bonds accrue interest at a rate of LIBOR plus 250 or 300 bps. The bonds were issued by the Industrial Development Authority of the County of Pima, Arizona through a private placement. The term loan accrues interest at a rate of LIBOR plus 325 bps.
About GWR Global Water Resources Corp and Global Water
GWR Global Water Resources Corp. owns an approximate 48.1% interest in Global Water, a leading water resource management and technology company that owns and operates water, wastewater and recycled water utilities, and provides technology-enabled services through its unique platform, FATHOMTM Utility-to-Utility ("U2U™") Solutions. Initially developed by Global Water to support and optimize its own utilities, FATHOMTM OS is a cloud-based geo-spatial integrated suite of utility-to-utility solutions proven to increase utility revenue, decrease operating costs and improve customer service. FATHOM™ puts water management tools in customers' hands.
Certain statements in this press release constitute "forward-looking" statements that involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance, objectives or achievements of the Company, or industry results, to be materially different from any future results, performance, objectives or achievements expressed or implied by such forward-looking statements. These statements reflect The Company's current views regarding future events and operating performance, are based on information currently available to GWR Global Water Resources, and speak only as of the date of this press release. These forward-looking statements involve a number of risks, uncertainties and assumptions and should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such performance or results will be achieved. Those assumptions and risks include, but are not limited to, the Company's ability to continue to secure and attract future strategic and investment capital. Many factors could cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including factors described in this press release and those discussed in its publicly available disclosure documents, as filed by GWR Global Water Resources on SEDAR (www.sedar.com) except as updated herein. Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements prove incorrect, actual results may vary materially from those described in this press release as intended, planned, anticipated, believed, estimated or expected. Unless required by applicable securities law, the Company does not intend and does not assume any obligation to update these forward-looking statements.
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