Quantum gets $20 million in incremental liquidity, more flexibility

By Sarah Lizee

Olympia, Wash., June 16 – Quantum Corp. agreed to amend its revolving and term loan credit facilities, securing an additional $20 million in incremental liquidity and negotiating more flexible loan terms and conditions, according to a press release.

The facilities, which expire Dec. 27, 2023, can be used to finance working capital and other general corporate purposes.

Among other terms, the amended credit facilities provide a holiday period for some financial covenants through March 31, 2021, and the term loan credit facility contains a more favorable equity claw back feature.

The terms of the 2020 term loan credit agreement as amended are substantially similar to the terms of the existing term loan, including in relation to maturity, security and pricing.

As of May 31, borrowings outstanding under the amended term loan were $165.2 million and $9.5 million under the amended revolver.

“In response to addressing the financial pressures from Covid-19 on our business, these agreements underscore confidence from our lenders and provides us with increased access to capital and incremental flexibility to manage our balance sheet in a manner that is strategically aligned with the on-going rationalization of our business and changing macroenvironment conditions,” Mike Dodson, Quantum's chief financial officer, said in the release.

In addition to customary closing and amendment fees, Quantum issued 3.4 million warrants with a strike price of $3.00 to its term loan lenders.

Quantum is a San Jose, Calif.-based storage company that provides backup, recovery and archive solutions for customers ranging from small businesses to multinational enterprises.

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