Rocky Mountain Chocolate Factory Secures $6M Credit Facility for Growth
Rocky Mountain Chocolate Factory Secures New Credit Facility
Rocky Mountain Chocolate Factory Inc. (Nasdaq: RMCF), known for its premium chocolate and confectionery products, has entered into a new three-year $6 million credit agreement with RMC Credit Facility, LLC. This special investment entity is affiliated with one of the company’s board members, Steve Craig.
Strategic Use of the Credit Facility
Interim CEO Jeff Geygan highlighted the importance of this credit facility, stating it significantly bolsters the company’s capital structure. It allows Rocky Mountain Chocolate Factory to invest in crucial equipment and machinery while fueling ongoing growth initiatives. According to Geygan, the strengthened balance sheet and improved liquidity position the company favorably to implement its strategic plans effectively.
Loan Details and Future Plans
The new credit facility features interest-only payments leading up to the maturity date on September 30, 2027. Borrowings under this agreement will incur a 12% annual interest rate, creating a structured financial foundation for the company.
Retirement of Existing Debt
The proceeds from this new facility were utilized to retire an existing $4 million revolving credit line, which had an outstanding balance of $3.45 million as of the end of September 2024. The company plans to allocate the remaining funds from this agreement to enhance capital investments and support working capital requirements.
Company Overview and Market Position
Rocky Mountain Chocolate Factory, Inc. is recognized for not only franchising premium chocolate stores but also for producing a diverse range of delightful products, including gourmet caramel apples. The company has gained notable recognition recently, being included in both the Franchise 500 list by Entrepreneur Magazine and the Franchise 400 by Franchise Times for the year 2024.
Store Operations and Growth
Headquartered in Durango, Colorado, the company boasts over 260 Rocky Mountain Chocolate stores across the United States, in addition to several international locations. Its common stock is traded on the Nasdaq Global Market under the ticker symbol RMCF, presenting opportunities for investors interested in the confectionery sector.
Investor Relations and Contact Information
For those looking to connect regarding investment opportunities or inquiries about the company’s operations, Sean Mansouri, CFA, can be reached at Elevate IR at 720-330-2829 or via email.
Frequently Asked Questions
What is the primary purpose of the new credit facility?
The new credit facility will enable Rocky Mountain Chocolate Factory to invest in essential equipment and machinery, supporting their growth initiatives.
Who is the credit facility affiliated with?
The credit facility is linked to RMC Credit Facility, LLC, an investment entity associated with board member Steve Craig.
What are the terms of the loan from the credit facility?
The facility features interest-only payments until its maturity date on September 30, 2027, with an interest rate of 12% per annum.
How has the company used the proceeds from the credit facility?
Rocky Mountain Chocolate Factory utilized the proceeds to retire its existing revolving credit facility and will use the remaining funds for capital investments and working capital needs.
What market recognition has Rocky Mountain Chocolate Factory received?
In 2024, the company was ranked in the Franchise 500 by Entrepreneur Magazine and the Franchise 400 by Franchise Times, showcasing its strong market position.
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