Houston, Texas — Lapolla Industries has secured a $15m line of credit with the Bank of America after reducing debt by $5.9m in the first half of 2016. Over a year it will be able to reduce interest costs by 78% saving $936,000/year.
Douglas Kramer, cfo said the amount of interest his firm would have to pay will fall by "$373,000 on an annual basis. We have also amended our loan and security agreement with the Bank of America which now provides the company with a $15 m line of credit that has a substantially lower interest rate and very favourable terms."
He added Lapolla has used the funding to pay off more expensive debt and "reduced our average cost of capital from 9.7 to 3%, resulting in a further interest savings of $583,000 on an annual basis."
Kramer put the overall interest savings at around $936,000/year which will be used to improve cash flow and strengthen the balance sheet.