Wireless security company AirIQ Inc. says it is in discussions with its lender to amend its credit facility.
“The credit facility is currently a $10 million 364-day non-revolving credit facility and funds drawn on the facility bear interest at varying margins based on the lender’s Canadian prime rate, United States base rate or banker’s acceptance reference rate,” AirIQ said in a release late Friday.
The funds, it added, are secured by a general security agreement and first priority mortgage over all of the assets of AirIQ.
AirIQ also disclosed that it was not in compliance with two financial covenants in the current credit agreement.
“The referenced financial covenants relate to the three-month period ended Nov. 30, 2005 which figures were required to be reported to the lender on Jan. 3, 2006,” the company said.
AirIQ said it expects that its lender will waive the requirement to have complied with these covenants for the period ended Nov. 30, 2005.
AirIQ, headquartered in Pickering, Ont., operates as a wireless Internet applications service provider specializing in Telematics – the name given to information and control messages that are sent wirelessly to and from vehicles and vessels.
Its shares lost half a cent to close at 29.5 cents each on the Toronto Stock Exchange.