News

ATM ISO Access to Money restructures debt

September 7, 2010

Access to Money, Inc., a Cherry Hill, N.J.-based ATM independent sales organization, yesterday announced that it refinanced its existing higher-interest debt with a $5.5 million lower-interest rate loan from Sovereign/Santander Bank, which is based in Madrid, Spain.

Access to Money used the loan’s proceeds together with $2 million available cash to repay $7.5 million principal of its existing $11 million, 13 percent note to LC Capital Master Fund, Ltd. and Cadence Special Holdings ll, LLC. Sovereign/Santander is charging Access to Money a 6.81 percent interest rate on the senior debt.

The ATM ISO's $3.5 million balance due on the note owed to LC Capital Master Fund and Cadence Special Holdings and the company’s $9.8 million note payable to Douglas Falcone, Access to Money’s executive vice president and chief operating officer, also  were restructured. In April 2008, when Falcone was Access to Money’s president and CEO, he sold the company to TRM Corp., a Portland, Ore.-based ATM ISO headed by Richard Stern. TRM changed its name to Access to Money and moved its operations to Cherry Hill near Philadelphia.

The terms of the $3.5 million outstanding balance to LC Capital Master Fund and Cadence Holdings were restructured to be junior debt to the Sovereign/Santander loan. The debt will mature in 61 months and provide for an annual interest rate of 7 percent in cash or 10 percent payment in kind at Access to Money’s option.

The amended note to Falcone will be subordinated to both Sovereign/Santander, LC Capital Master Fund and Cadence Special Holdings and provide an initial rate of 7 percent cash or 10 percent payment in kind at Access to Money’s option.

Access to Money also issued additional stock to lenders. Investors yesterday sold the company’s stock for 25 cents per share.

“In exchange for restructuring the note and terminating outstanding warrants to purchase 15 million shares of common stock, the company issued more than 10.6 million shares of common stock to its current lenders,” Access to Money said in a press release.
Restructuring the company’s debt has been a high priority, said Stern, Access To Money president and CEO.

“This new financing and restructuring of our existing debt will significantly reduce our cost of debt and the reduction in interest will allow us to use our cash on hand to reduce our overall debt balance. Both of which will lead to increased cash flow,” he said. As a result of its new loan and refinancing agreements, Access to Money expects to reduce its debt costs by more than $500,000 annually, the company said.

The restructuring also enables the company to focus on its core business, institute operational enhancements and exploit growth opportunities, Stern said.

“Moreover by eliminating a substantial number of outstanding warrants, we have further improved our balance sheet, which should afford investors greater clarity when evaluating Access to Money,” he said. Calls to Stern were not returned.

Access to Money operates approximately 12,000 ATMs nationwide.