DUG Technology (ASX:DUG) extended its primary banking facilities with Commonwealth Bank by two years to 1 July 2024.
The software company agreed to make a principal debt repayment of US$7 million by the end of this month and further quarterly repayments of US$0.5 million from September 30 until fully repaid. Working capital facilities, including an overdraft facility of $1 million and bank guarantees of US$1 million are retained, said DUG.
DUG also said the extension gives the company flexibility to obtain funding from alternative lenders for the purchase of new equipment.
The extension is subject to legal agreement which is expected to be completed before the end of this month.
“This extension is an important step for DUG and a reflection of the bank’s confidence in our ability to perform across all business lines and to capitalise on a rapidly improving oil and gas market,” said managing director Matthew Lamont.
“The company expects to generate positive operating cash flows over the second half of the 2022 financial year following savings identified in the recent restructure.”
Shares are trading 7.8 per cent higher at 50 cents.