WOOD DALE, Ill., December 16, 2021 (GLOBE NEWSWIRE) – Power Solutions International, Inc. (the “Company” or “PSI”) (OTC Pink: PSIX), a leader in design, engineering and manufacturing emission-certified engines and fuel systems, today announced that it has entered into an additional shareholder loan agreement with its majority shareholder, Weichai America Corp. (“Weichai”), dated December 10, 2021 (the “Third Shareholder Loan Agreement”). The third shareholder loan agreement, which expires on November 30, 2022, gives the Company access to credit of up to $ 50 million at Weichai’s discretion to supplement the Company’s working capital. The third shareholder loan agreement is subordinate in all respects to the existing $ 130 million senior secured revolving credit facility with Standard Chartered Bank (which was fully borrowed as of December 16, 2021).
Borrowings under the Third Party Shareholder Loan Agreement will bear interest at the applicable London Interbank Offer (“LIBOR”) rate plus 4.5% per annum. As of December 16, 2021, PSI had borrowed $ 25 million under the third shareholder loan agreement.
Lance Arnett, Chairman and CEO, said: “We are delighted to improve our liquidity with this additional loan agreement. We appreciate Weichai’s continued support at PSI and look forward to implementing our strategic collaboration together. “
The Company has previously entered into loan agreements with Weichai, which include an amended and restated $ 130 million first shareholder loan agreement (“the first shareholder loan agreement”) and a shareholder loan agreement. additional $ 25 million (the “Second Shareholder Loan Agreement”). As of December 16, 2021, PSI had no borrowings under the first shareholder loan agreement and $ 25 million in borrowings under the second shareholder loan agreement.
Additional details on the shareholder loan agreement can be found in the company’s current report on Form 8-K filed with the Securities and Exchange Commission on December 16, 2021.
About Power Solutions International, Inc.
Power Solutions International, Inc. (PSI) is a leader in the design, engineering and manufacture of a wide range of advanced and emission certified engines and power systems. PSI provides integrated turnkey solutions to the world’s leading original equipment manufacturers and end users in the energy, industrial and transportation end markets. The company’s unique in-house design, prototyping, engineering and testing capabilities allow PSI to customize clean, high-performance engines using a fuel-independent strategy to operate on a wide variety of fuels, including gas. natural, propane, gasoline, diesel and biofuels.
PSI develops and supplies complete power systems that are used worldwide in stationary and mobile power generation applications supporting standby, starting, demand response, micro-grid and cogeneration (CHP); and industrial applications which include forklifts, agriculture and turf, arbor maintenance, industrial sweepers, aerial work platforms, irrigation pumps, ground support and construction equipment. In addition, PSI develops and supplies powertrains specially designed for medium-duty trucks and buses, including school and transit buses, work trucks, terminal tractors and various other professional vehicles. For more information about PSI, visit www.psiengines.com.
Caution regarding forward-looking statements
This press release contains forward-looking statements regarding the Company’s current expectations regarding its prospects and opportunities. These forward-looking statements are covered by the safe harbor provisions of Section 21E of the Securities Exchange Act of 1934.
The Company has attempted to identify these forward-looking statements by using words such as “anticipate”, “believe”, “budgeted”, “contemplate”, “estimate”, “expect”, “anticipate”, “direction”, “May”, “perspective”, “plan”, “projection”, “should”, “target”, “will”, “”, “,” or similar expressions, but these words are not the exclusive means of identify such statements. These statements are subject to a number of risks, uncertainties and assumptions which may cause actual results, performance or achievements to differ materially from those expressed or implied by these statements.
The Company cautions that the risks, uncertainties and other factors that could cause its actual results to differ materially from those expressed or implied by forward-looking statements, include, but are not limited to: the impact of the COVID pandemic -19 in progress could have on the activities and financial results of the Company; the Company’s ability to continue operating; the Company’s ability to raise additional capital when needed and its liquidity; uncertainties regarding the Company’s ability to meet the financing conditions under its financing agreements and access to capital under them; the potential acceleration in maturity at any time of loans under the Company’s uncommitted senior secured revolving credit facility through the exercise by Standard Chartered Bank of its right of demand; the timing of completion of steps to address, and the inability to address and correct, significant weaknesses; the identification of additional material weaknesses or significant deficiencies; risks associated with complying with the terms and conditions of regulations with the Securities and Exchange Commission (the “SEC”) and the United States Attorney’s Office for the Northern District of Illinois (the “USAO”); non-recurring expenditure variances; risks related to substantial costs and distraction of staff attention and resources deployed to deal with internal control issues; the obligations of the Company to indemnify past and present directors and officers and certain current and former employees with respect to investigations conducted by the SEC and the Criminal Division of the USAO, which will be funded by the Company with its resources from existing cash flow due to the exhaustion of the historical insurance coverage of its directors and senior officers; the Company’s ability to accurately forecast sales and the extent to which sales result in recorded revenue; changes in customer demand for the Company’s products; volatility in oil and gas prices; the impact of US tariffs on imports from China on the Company’s supply chain; disruptions to the Company’s supply chain; the impact of increased warranty costs and the Company’s ability to mitigate these costs; any delay and difficulty in recruiting key employees in accordance with the Company’s plans; any negative impact of the delisting of the par value of the Company’s common shares of $ 0.001 from the NASDAQ stock market and any delay and difficulty in obtaining re-listing on a stock exchange; and the risks and uncertainties described in reports filed by the Company with the SEC, including, without limitation, its annual report on Form 10-K for the year ended December 31, 2020 and subsequent filings of the Company with the SEC. The Company’s forward-looking statements are made as of the date hereof. Except as required by law, the Company expressly disclaims any intention or obligation to revise or update any forward-looking statement, whether as a result of new information, future events or otherwise.
Power Solutions International, Inc.
Director of Investor Relations
+1 (630) 451-5402