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CTD Holdings, Inc. 2013 Financial Report: Strategic Debt Refinancing Insights

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Form 8-K
Filed on: 2013-07-26
Source
CTD Holdings, Inc. 2013 Financial Report: Strategic Debt Refinancing Insights

Here are the key insights extracted from the financial report (Form 8-K) filed by CTD Holdings, Inc. on July 22, 2013:

  1. Company Overview:
  • Name: CTD Holdings, Inc.
  • Incorporation: Florida
  • IRS Employer Identification No.: 59-3029743
  • Principal Executive Office Address: 14120 N.W. 126th Terrace, Alachua, Florida, 32615.
  • Contact Number: (386) 418-8060
  1. Event Date: July 22, 2013 (date of the earliest event reported).
  2. Material Definitive Agreements:
  • Refinancing of Existing Indebtedness: The company refinanced its existing debts through three new loans from Region's Bank.
  1. Loan Details:
  • Mortgage Loan:
    • Amount: $578,998
    • Interest Rate: 3.99% (annual)
    • Amortization: 20 years with a balloon payment due after 10 years.
    • Monthly Payments: Approximately $3,505.
    • Prepayment Penalties: 5% to 1% during the first five years.
    • Debt Service Coverage Requirement: Minimum EBITDA to interest expense ratio of 1.3x measured annually.
  • Equipment Loan:
    • Amount: $295,890
    • Interest Rate: 3.99% (annual)
    • Maturity: July 2020.
    • Monthly Payments: Approximately $4,051.
    • Prepayment Penalty: 2% during the first five years.
    • Security: All equipment, whether now owned or later acquired.
  • Line of Credit:
    • Amount: $100,000.
    • Interest Rate: Prime rate plus 1.8%.
    • Monthly Payments: Interest only on outstanding amounts.
    • Principal and interest due on demand or by July 17, 2014.
    • Initial Drawdown: Approximately $41,694.
  1. Guarantees:
  • Loans are guaranteed by subsidiaries: Nanosonic Products, Inc., Cyclodextrin Technologies Development, Inc., and Sphingo Biotech, Inc.
  • Personal guarantees were executed by CEO C.E. Rick Strattan and his spouse.
  1. Use of Proceeds:
  • The proceeds from the loans were used to repay existing debts including:
    • Private mortgage note to Damon and Danielle Stone.
    • Equipment loan with SunState Federal Credit Union.
    • Contractor financing related to the installation of a pulse dryer and solar electric system.
    • Previous revolving line of credit with SunState Federal Credit Union.
  1. No Off-Balance Sheet Liabilities: The transactions did not involve off-balance sheet arrangements as defined by SEC regulations.

This report indicates a strategic restructuring of CTD Holdings, Inc.’s debt to improve financial stability and reduce interest obligations through refinancing, while also ensuring that the company meets necessary financial covenants going forward.