Blackline Safety Announces Lease Securitization Partnership
April 12 2023 - 8:15AM
Business Wire
New $50+ million lease receivables
securitization program with CWB Maxium increases financial
flexibility
Blackline Safety Corp. (“Blackline” or the "Company") (TSX:
BLN), a global leader in connected safety technology, today
announced it has completed the establishment of a new
securitization program (“Securitization Program”) with CWB Maxium
Financial, Inc. ("CWB Maxium”), to purchase receivables that stem
from the Company’s leasing program.
Blackline Safety offers flexible buying options to
customers—they can purchase, lease or rent—to enhance the
competitiveness of its offering. Customers can purchase equipment
as a capital expense, lease as an operational expense, or rent for
short-term projects like facility shutdowns and turnarounds to fit
any budget. The lease option has been popular with Blackline’s
customers and with the establishment of the Securitization Program,
the Company can elect to sell its lease receivables to CWB Maxium
within 30 days of signing a new customer contract.
The Securitization Program with CWB Maxium will have a renewable
one-year term and replaces Blackline’s requirement to fully finance
its customer lease obligations, with a new purchase facility based
on lease purchases of up to $15 million (CAD) and $35 million (USD)
for its safety wearables and area gas monitoring equipment. The new
purchase facility is expected to provide the Company increased
financial flexibility and improved liquidity as management
continues to execute its strategic plan and goal of achieving
positive Adjusted EBITDA exiting fiscal 2023.
“Our new purchase facility agreement with CWB Maxium is
transformational to our business. This facility will enhance the
cash flow profile of Blackline’s leasing program enabling us to
more actively promote leasing as an attractive alternative to
customers deploying leading edge connected safety technology,” said
Cody Slater, CEO and Chair of Blackline Safety.
“Combined with our solid cash position of $23.5 million at the
end of our fiscal first quarter, this new facility significantly
bolsters our financial flexibility and provides us with immediate,
non-dilutive liquidity while lowering our overall cost of capital
and broadening our banking relationships. We are excited to be
partnering with a Canadian financial institution that shares our
entrepreneurial spirit and desire to see Canadian businesses
succeed on the global stage. We have increased confidence in our
ability to fund the Company through our transition to generating
free cash flow and profitability as we exit fiscal 2023.”
“We are proud to be associated with Blackline, a company
dedicated to the safety and success of their customers” said Daryl
MacLellan, President and CEO of CWB Maxium. “They continue to bring
innovative products to market, and we look forward to supporting
their future growth”.
The purchase facility is subject to various conditions including
both financial and performance covenants. The option to renew on an
annual basis is subject to approval by CWB Maxium, under their sole
discretion, with a 60-day notice period.
Echelon Capital Markets acted as the exclusive financial advisor
in the arrangement of the Securitization Program.
About Blackline Safety
Blackline Safety is a technology leader driving innovation in
the industrial workforce through IoT (Internet of Things). With
connected safety devices and predictive analytics, Blackline
enables companies to drive towards zero safety incidents and
improved operational performance. Blackline provides wearable
devices, personal and area gas monitoring, cloud-connected software
and data analytics to meet demanding safety challenges and enhance
overall productivity for organizations with coverage in more than
100 countries. Armed with cellular and satellite connectivity,
Blackline provides a lifeline to tens of thousands of people,
having reported over 200 billion data-points and initiated over
five million emergency alerts. For more information, visit
BlacklineSafety.com and connect with us on Facebook, Twitter,
LinkedIn and Instagram.
About CWB Maxium
Specializing in mid-market lending since 1993, CWB Maxium
Financial, Inc. is a lender that provides creative financing
solutions to businesses across Canada. As part of the CWB Financial
Group of companies, we have robust funding capabilities and access
to capital, allowing us to help more customers in more ways. Our
straightforward decision-making process and open communication make
it easy for you to know where you stand every step of the way.
Note Regarding Forward-Looking Statements
This press release contains certain forward–looking information
and statements within the meaning of applicable securities laws.
The use of any of the words "expect", "anticipate", "continue",
"estimate", "may", "will", "project", "should", "believe", "plans",
"intends" and similar expressions are intended to identify
forward-looking information or statements. In particular, but
without limiting the forgoing, this press release contains
statements concerning the anticipated terms of the purchase
facility, that the new facility is expected to provide the Company
increased financial flexibility and improved liquidity as
management executes its strategic plan and goal of sustained
positive Adjusted EBITDA exiting fiscal 2023; the potential
benefits thereof including that it is expected to enable the
Company to more actively promote leasing as an attractive
alternative to customers deploying Blackline’s connected safety
technology without impacting its balance sheet; the Company's
expectation that it will transition to generating sustained
profitability and free cash flow as it exits fiscal 2023. Although
Blackline believes that the expectations reflected in these
forward-looking statements are reasonable, undue reliance should
not be placed on them because Blackline can give no assurance that
they will prove to be correct. Since forward-looking statements
address future events and conditions, by their very nature they
involve inherent risks and uncertainties. The amount of customers
that choose Blackline's leasing program may change, that the terms
of any leases may not qualify for funding under the new facility;
Blackline's compliance with the terms of the new facility and its
senior secured facility; defaults under the new facility or the
Company's senior credit facility. The forward looking statements
contained in this press release are made as of the date hereof and
Blackline undertakes no obligations to update publicly or revise
any forward looking statements or information, whether as a result
of new information, future events or otherwise, unless so required
by applicable securities laws.
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version on businesswire.com: https://www.businesswire.com/news/home/20230412005245/en/
INVESTOR/ANALYST CONTACT Shane Grennan, CFO
investors@blacklinesafety.com Telephone: +1 403 630 8400 MEDIA
CONTACT Christine Gillies, CPMO cgillies@blacklinesafety.com
Telephone: +1 403 629 9434
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