Updates to Previously Announced $100 Million Debt Restructuring Activities
ALLENTOWN, PA / ACCESSWIRE / November 13, 2019 / Iota Communications, Inc., a wireless network carrier and software service company that provides Internet of Things solutions which optimize energy efficiency, sustainability and operations for commercial facilities, today announced an update on the status of its balance sheet enhancement initiative.
In May 2019, the company began an aggressive balance sheet enhancement initiative with an ambitious goal of removing $100 million of debt during fiscal year 2020. This strategic initiative creates a more sound, long-term financial foundation for Iota Communications’ business, lowering the cost of capital and ultimately facilitating the company’s objective to meet the listing requirements for the major US exchanges.
On October 30, 2019 we entered into a settlement agreement with our main tower site vendor that extends our existing tower license agreements for 186 sites throughout the US for an additional seven years via the grant of new license agreements on or prior to January 31, 2020. This agreement along with other debt settlements since August 31, 2019 will result in a reduction of approximately $12 million from both accounts payable and accrued expenses, or 60%, of the balance reported as of August 31, 2019.
Spectrum Partner Program
We launched Iota Spectrum Partners, LP in July 2019 for the purpose of owning the FCC spectrum licensees that we currently lease as well as to hold the Company’s spectrum licenses. This investment program was designed to allow investors to participate in the ownership of our crown jewel asset, our FCC-licensed 800 MHz spectrum portfolio. Lessors exchange their licenses and leases for limited partnership units, which results in a reduction in the revenue-based notes obligation. Under GAAP accounting, the previous leaseback provision for the investors resulted in a revenue-based note liability of about $78.9 million as of August 31, 2019. To date, we have received executed exchange agreements representing approximately $59 million, or approximately 75%, which represents the amount of liability reduction associated with this account.
“We are excited to announce that we have taken a large step forward in our ongoing efforts to improve our balance sheet,” stated Terrence DeFranco, President & CEO of iotaComm™. “These balance sheet improvements of over $70 million provide us a clearer path to a potential uplisting on a major exchange and a stronger foundation for our proposed network, purpose built for the Internet of Things. I am proud of our team’s persistence and appreciate the support of our spectrum partners. Although it is important to settle and pay down liabilities, we are equally focused on our goal of driving high margin revenue growth and efficiently managing operating expenses that will maintain a strong financial footing. As we continue our network buildout, a stronger balance sheet will allow us to raise additional capital and accelerate the execution of these plans and invest further in business development initiatives.”
About Iota Communications, Inc.
Iota Communications is a wireless network carrier system and software applications platform dedicated to the Internet of Things. iotaComm sells recurring-revenue solutions that optimize energy usage, sustainability and operations for commercial and industrial facilities both directly and via third-party relationships. iotaComm also offers important ancillary products and services which facilitate the adoption of its subscription-based services, including solar energy, LED lighting, and HVAC implementation services.
This press release may contain “forward-looking statement” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such statements include, but are not limited to, any statements relating to our growth strategy and product development programs and any other statements that are not historical facts. Forward-looking statements are based on management’s current expectations and are subject to risks and uncertainties that could negatively affect our business, operating results, financial condition and stock price. Factors that could cause actual results to differ materially from those currently anticipated include, but are not limited to,: risks related to the acquisition and integration of the assets we acquired from Solbright Group, Inc., risks related to our growth strategy; risks relating to the results of research and development activities; our ability to obtain, perform under and maintain financing and strategic agreements and relationships; our dependence on third-party suppliers; our ability to attract, integrate, and retain key personnel; the early stage of products under development; our need for substantial additional funds; government regulation; patent and intellectual property matters; competition; as well as other risks described in our SEC filings. We expressly disclaim any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in our expectations or any changes in events, conditions or circumstances on which any such statement is based, except as required by law.
Iota Communications, Inc.
645 Hamilton Street
Allentown, PA 18101
Public Relations Contact:
Greg Lutowsky, SVP, Corporate Communications
SOURCE: Iota Communications, Inc.
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