Vuzix Corp., which has struggled with a growing loss and shrinking availability of cash, has signed an agreement for access to more cash.
The Henrietta seller of video eyewear announced Friday it has entered into a loan agreement with LC Capital Master Fund Ltd., a senior lender. Under the agreement, LC Capital will extend a line of credit of up to $500,000 to Vuzix.
The agreement states the loan may be drawn in multiple advances of no less than $100,000 until June 15. The loan will bear an interest rate of 10 percent a year for the first three months and an interest rate of 15 percent per year on and after Nov. 15, when the principal amount of the loan is payable in full.
Vuzix has granted the lender a security interest in substantially all of the assets of Vuzix.
This is not the first time Vuzix has borrowed from LC Capital. In its annual report, Vuzix announced LC Capital had entered into a supplemental agreement to defer scheduled principal loan repayments totaling more than $420,000 until maturity in December 2014.
In its most recent financial report, Vuzix reported its net loss for the first-quarter had doubled to more than $840,000, while revenues declined 30 percent to $2.9 million.
The figures followed a bigger fourth-quarter net loss and decreased revenues, which led Paul Travers, president of Vuzix, to say that the company’s ability to grow remained limited.
Vuzix’s stock closed at 4 cents a share Thursday, its lowest mark since late November. It was unchanged mid-morning Friday.
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