Ammo, Inc. Enters into Construction Loan Agreement with Hiawatha National Bank
October 20, 2021 at 05:15 pm EDT
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Ammo, Inc. entered into a Construction Loan Agreement with Hiawatha National Bank. The Loan Agreement specifies that Hiawatha may lend up to $11,625,000 to the Borrower to pay a portion of the construction costs of an approximately 160,000 square foot manufacturing facility to be constructed on the Company?s property in Manitowoc County, Wisconsin (the ?Loan?). The first advance of Loan funds by Hiawatha was made on the Effective Date in the amount of $329,843. The Borrower expects to receive further advances of Loan funds approximately every month once Borrower?s ?owner?s equity? is fully funded into the ongoing new plant construction project. The Loan is an advancing term loan and not a revolving loan so any portion of the principal repaid cannot be reborrowed. On the Effective Date, in addition to the Borrower issuing a mortgage for the benefit of Hiawatha, the Borrower issued a Promissory Note in favor of Hiawatha (the ?Note?) in the amount of up to $11,625,000 with an interest rate of four and one-half percent (4.5%). The maturity date of the Note is October 14, 2026. Starting in November 2021 through and including June 2022, the Borrower will make monthly interest only payments. Starting in July 2022, the Borrower will make monthly payments consisting of principal and unpaid interest in the expected amount of at least $265,000. The Borrower can prepay the Note in whole or in part starting in July 2022 with a prepayment premium of one percent (1%) of the principal being prepaid.
AMMO, Inc. is a vertically integrated producer of ammunition and components. The Company is the owner of GunBroker.com, which is an online marketplace serving the firearms and shooting sports industries. The Company operates through two segments: Ammunition and Marketplace. The Ammunition segment consists of the Companyâs manufacturing business. The segment is engaged in the designing, production and marketing of ammunition and ammunition component products. The Companyâs core ammunition business is vertically integrated with multi-channel distribution, including direct-to-consumer, wholesale, military and law enforcement customers. Its product offering encompasses approximately 60 items, including STREAK Visual Ammunition, a patented technology. The Marketplace segment consists of the GunBroker.com marketplace. In its role as an auction site, GunBroker.com supports the sale of firearms, ammunition and hunting/shooting accessories.