Daktronics, Inc. (NASDAQ-DAKT) (the “Company” or “Daktronics”) today announced it has enhanced its financial position by closing on a new 3-year $75 million senior secured credit facility (the “New Senior Debt Facility”) with JPMorgan Chase (“JPMorgan Chase”) maturing on May 11, 2026. In addition, Daktronics announced it has closed a $25 million convertible debt financing agreement (the “Junior Capital Financing”) with major shareholder Alta Fox Capital Management, LLC (together with its affiliates, “Alta Fox”). Daktronics’ Board of Directors (the “Board”) believes the completion of these transactions provides the Company with the working capital and liquidity needed to continue executing its business plan and growth strategy.
JPMorgan Chase’s $75 million New Senior Debt Facility has replaced the Company’s $35 million credit facility with U. S. Bank National Association (“U.S. Bank”). As a result, JPMorgan Chase is now the Company’s primary commercial bank. At close, all obligations to U.S. Bank under the previous credit arrangement were repaid; the Company did not need to borrow under the New Senior Debt Facility to fund the repayment.
Howard I. Atkins, Chair of the Daktronics Board’s Strategy and Financing Review Committee (the “Committee”) said:
“We are pleased to have delivered on our commitment to identify attractive financing for the Company, which was the result of a comprehensive process. The Committee is confident we and our advisors thoroughly explored all alternatives and obtained the best possible outcome in terms of flexibility and overall cost of capital. The New Senior Debt Facility and the Junior Capital Financing provide the Company the financial resources to serve our customers and build long-term value for our shareholders.”
Reece Kurtenbach, Daktronics’ Chairman and CEO, added:
“Daktronics continues to make positive progress on several fronts. In addition to the financial flexibility these new sources of capital provide, the management team continues to implement operational and productivity improvement initiatives intended to increase the Company’s profit margins and generate additional cash from operations. We appreciate and are looking forward to developing our new primary banking relationship with JPMorgan Chase, a leading financial services firm with unmatched global capabilities and deep expertise in corporate finance. We also appreciate that Alta Fox has demonstrated its confidence in Daktronics’ path forward by committing additional capital to the Company. Alta Fox has been a collaborative partner and we thank them for their support.”
Connor Haley, Founder and Managing Partner at Alta Fox, added, “We are pleased to be able to provide capital to Daktronics to help support the Company’s promising future. We originally invested in Daktronics because we believe the Company has a leading position in an industry with significant secular tailwinds and meaningful earnings growth. With the Company’s financial position now significantly improved, we look forward to continuing to work constructively with the Board and management team to unlock meaningful value for all Daktronics stakeholders.”
Jefferies LLC served as financial advisor, and Vinson & Elkins LLP and Winthrop & Weinstine, P.A. served as legal counsel to Daktronics throughout the process.
