Select Comfort gets more funding
By Furniture Today Staff -- Furniture Today, October 14, 2001
MINNEAPOLIS — Airbed manufacturer-retailer Select Comfort has secured $5 million in additional funding from Medallion Capital.
The senior debt financing was provided under the terms of the company's $11 million convertible notes issued June 7.
Select Comfort said it didn't expect to need additional capital for operating purposes in the foreseeable future.
Bill McLaughlin, Select Comfort's president and chief executive officer, said the additional financing was not critical to meeting near-term objectives, but that it provided "added flexibility to pursue business-building opportunities, and shores up our cash reserves during these times of economic uncertainty."
In June, Select Comfort completed a private placement of $11 million of convertible notes and warrants to purchase 4.4 million shares. The convertible notes bear an 8% annual rate for a term of five years.
The most recent financing was a $5 million senior note with a 12% annual rate, along with warrants to purchase an aggregate of 922,819 shares at $1.02 per share. The note matures over five years and is secured by company assets.
Looking ahead, McLaughlin said the company "continues to see improvement in operating results, and is increasingly able to fund working capital needs through the generation of cash from operations."
Select Comfort plans to release its third quarter results on Oct. 16.
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