Strip Tinning Holdings (AIM:STG), a specialist supplier of connection systems to the automotive sector, said its subsidiary Strip Tinning has entered into a £250,000 unsecured short-term loan agreement with GPIM Limited.
The board said it reviewed a range of funding options and judged the loan the most flexible short-term solution available.
The loan carries an initial six-month term and can be repaid for £275,000 within the first three months, rising to £290,000 if settled at the full term. Strip Tinning has the option to extend the facility for a further three months, paying an additional finance return of 1.5% per month during that period. No security or personal guarantees back the loan.
Proceeds will support working capital as the company ramps up production volumes and continues its grant-funded investment programme.
GPIM is a substantial shareholder in Strip Tinning, making the loan a related party transaction under AIM Rule 13.
The company's directors, all considered independent of GPIM, concluded the terms are fair and reasonable to shareholders after consulting with nominated adviser Singer Capital Markets.
