Fifth Third Bank today signed a $17 million credit facility with Global Axcess Corp., which the ATM independent sales organization will use to pay down debt and to expand its ATM and DVD kiosk businesses that are in some ways intertwined.
Global Axcess will spend $5 million to pay off loans to SunTrust and Proficio banks. The business will record a one-time, non-cash expense of approximately $60,000 related to the accelerated amortization of expenses for the loans paid on the two notes. The independent sales organization expects to record $40,000 in prepayment fees for early payment of both loans. SunTrust is based in Atlanta and Proficio has its headquarters in Salt Lake City.
Global Axcess will spend $2 million to fund DVD inventory purchases for a new unnamed grocery- store client and for anticipated clients.
The company will spend $10 million to purchase DVD kiosks after inking a deal with another unnamed grocery-store chain and to purchase an undisclosed number of ATMs.
Global Axcess owns and operates more than 4,500 ATMs and other self-service kiosks in 43 states. Global Axcess, parent company of Nationwide Money Services, has used deployment of ATMs in grocery stores to open the door to placement of DVD kiosks with the same clients, George McQuain, the company's CEO, said. Last May, Global Axcess signed a three-year contract with a grocery-store chain to install 300 new DVD kiosks. The grocery store also is a Global Axcess ATM client, McQuain said.
"We are pleased to secure this new financing partnership agreement with Fifth Third Bank, and view this as a clear vote of confidence in our business plan," Michael Loiacono, Global Axcess chief financial officer, said in a statement. Loiacono said the agreement cuts by 25 percent the cost of the company's debt over the next three years.
Global Axcess also is able to bring more than $800,000 back into its operating cash that had been restricted for payment to SunTrust, he said.
Cincinnati is Fifth Third's headquarters city.
