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GENERAL KINETICS ANNOUNCES NEW DEBT FINANCING AND AMENDMENT TO CREDIT FACILITIES

 ROCKVILLE, Md., April 16 /PRNewswire/ -- General Kinetics Incorporated (GKI) (AMEX: GKI), makes the following announcements:
 Gutzwiller and Partner, A.G., a principal investor in GKI, has provided a further $2.5 million subordinated loan to the company. This loan follows an earlier $5 million equity and debt investment by Gutzwiller at the end of 1992. The new loan is evidenced by GKI's newly-issued Series A and Series B Subordinated Debentures. The Series A Debentures, dated as of March 30, 1993, mature in one year and were issued in the aggregate face amount of $1.5 million, with proceeds to the company, net of prepaid interest, equaling $1.44 million. These Series A Debentures bear interest at 4 percent per year payable in arrears on Oct. 1, 1993; Jan. 1, 1994; and at maturity on March 30, 1994. Principal repayments are to be made as follows: $750,000 on Oct. 1, 1993; $375,000 on Jan. 1, 1994; and $375,000 at maturity. The Series B Debentures, dated as of March 30, 1993, mature in two years and were issued in the aggregate face amount of $1 million with proceeds to the company, net of prepaid interest, equaling $920,000. The Series B Debentures bear interest at 4 percent per year payable in arrears on Oct. 1, 1993; Jan. 1, April 1 and Oct. 1, 1994; and Jan. 1 and March 30, 1995. Principal repayments are to be made as follows: $250,000 on Oct. 1, 1993, and $125,000 on each of Jan. 1, April 1, July 1 and Oct. 1, 1994; and Jan. 1 and March 30, 1995.
 GKI also announces the amendment of its credit agreement with its principal bank to extend the company's existing revolving credit facility, which had been restructured in September 1992, from March 31 to June 30, 1993. Pursuant to the amendment, GKI's available revolving credit ceiling decreased to $1,350,000 through March 14, 1993, to $1,250,000 through March 30, 1993, and then from March 31, 1993, through April 29, 1993, to $1 million. The ceiling then further decreases to $750,000 through May 30, 1993, and then to $500,000 through June 30, 1993. Subject to the ceiling, the company may burrow an amount equal to the applicable borrowing base which is calculated as a percentage of eligible receivables, with certain adjustments, and which may fluctuate from time to time. Interest on the revolving credit facility will accrue at the rate of prime plus 6 percent until certain adjustments in the borrowing base have been made and the bank is satisfied that the company is fulfilling certain record-keeping requirements.
 Under the amendment, the bank waived all known defaults under the existing facility. The company is seeking to establish a new principal banking relationship.
 Under a separate agreement with its principal lender, GKI has applied a portion of the proceeds of the new Gutzwiller load to pay off the $489,000 balance of its ESOP loan and the $466,400 balance of its equipment loan.
 GKI is a designer, producer, and marketer of high-end, digital secure facsimile equipment, precision enclosures and plastic sorting and food testing equipment.
 -0- 4/16/93
 /CONTACT: David A. Shaw, president, General Kinetics Incorporated, 301-881-2044/
 (GKI)


CO: General Kinetics Incorporated ST: Maryland IN: CPR SU: FNC

DC-TW -- DC033 -- 6966 04/16/93 17:28 EDT
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Publication:PR Newswire
Date:Apr 16, 1993
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