WILMINGTON, DE--(Marketwired - Feb 21, 2017) - Acorn Energy, Inc. (OTCQB: ACFN), a provider of machine-to-machine, Internet of Things remote monitoring and control systems and services, announced today that it has secured commitments for $1.9 million in funding from members of the Company's Board of Directors, including $900,000 already received by the Company. Acorn expects to repay the loans, which mature at the end of April 2018 and accrue interest at the rate of 12.5% (16.5% after February 15, 2018) payable at maturity with proceeds from an intended sale of its 41.2% ownership in DSIT Solutions Ltd. (a developer of sonar and acoustic systems and software for defense, HLS, energy and commercial markets).
The funding is for working capital requirements and to support the growth of Acorn's OmniMetrix™ remote monitoring systems business. A potential second tranche of loans totaling $1.0 million has been committed for funding in July 2017 in the event the Company has not secured alternative sources of cash.
Jan Loeb, CEO of Acorn, commented, "These director loans represent an attractive, non-dilutive and low-risk approach to solving Acorn's near-term funding needs. I am grateful for the Board's support as this loan structure represented the lowest cost source of capital among all that we considered.
"Importantly, our OmniMetrix remote monitoring business continues to deliver solid growth and improving bottom-line performance, and we remain focused on scaling this business both organically and through possible acquisitions. DSIT is also executing well on its growth strategy and financial performance. This progress supports our efforts to monetize our DSIT ownership to fund Acorn's growth goals."
DSIT revenue increased 18% to $11.9 million in the first nine months of 2016, versus $10.1 million in 2015. The growth was largely due to continuing revenue from a $15.4 million project first announced in the first quarter of 2015 for Hull Mounted Sonar ("HMS") systems and an Anti-Submarine Warfare Trainer as well as a $7.1 million project secured in the second quarter of 2016 for Blackfish HMS Systems, along with increased revenue from non-Naval projects.
The Company also announced that effective January 8, 2017, Acorn has extended its consulting agreement with Jan Loeb pursuant to which Mr. Loeb will continue to serve as President and CEO of the Company, on the same terms as their prior agreement.
About Acorn (www.acornenergy.com)
Acorn Energy, Inc. is a holding company with investments in two portfolio companies:
OmniMetrix™, Inc. (www.omnimetrix.net) -- is a leader and pioneer in machine-to-machine (M2M) wireless remote monitoring and control for stand-by generators, pipelines, cell towers, medical facilities, data centers, public transportation systems, and other critical equipment, including at federal, state and municipal government facilities. OmniMetrix is a proven solution for making critical systems more reliable, with over 19 years of experience and thousands of monitored assets. Acorn has an 80% equity stake in OmniMetrix and consolidates its assets and results of operations.
DSIT Solutions Ltd. (www.dsit.co.il) -- develops and produces sonar applications for defense, HLS, energy and commercial markets. DSIT employs a world-class multi-disciplinary professional team skilled in the latest sonar and real-time technologies. Products include: The Shield family of Diver Detection Sonars, Anti-Submarine Warfare and Hull Mounted Sonar systems, Portable Acoustic Ranges, Underwater Acoustic Signal Analysis applications and sonar simulators and trainers. Acorn has a 41.2% equity stake in DSIT that it accounts for under the equity method.
Safe Harbor Statement
This press release includes forward-looking statements, which are subject to risks and uncertainties. There is no assurance that Acorn will be successful in growing its business; reaching profitability; or maximizing the value of its operating companies and other assets. A complete discussion of the risks and uncertainties which may affect Acorn Energy's business, including the businesses of its subsidiaries is included in "Risk Factors" in the Company's most recent Annual Report on Form 10-K as filed by the Company with the Securities and Exchange Commission.