Pursuant to the terms of the securities purchase agreement, the Company will issue 869,840 shares of common stock, convertible debentures in the aggregate principal amount of approximately $6.8 million and warrants to purchase up to 1,080,000 shares of common stock for an aggregate purchase price of $9 million. The warrants have an exercise price of $3.00 per share and will be exercisable for five (5) years following the date of issuance.
The unsecured convertible debentures will be issued in the principal amount of approximately $6.8 million. The convertible debentures will bear interest, payable in cash or in Series B preferred stock at the discretion of the Company, at a rate of 4.0% per annum and will mature on the fifth anniversary of its date of issuance, unless repaid or converted earlier. The principal amount of the convertible debentures will be convertible into Series B preferred stock of the Company. The Series B preferred stock is non-voting and is convertible into the Company's common stock at an initial conversion price of $2.50 per share. The convertible debentures will automatically convert into the Company's Series B preferred stock upon receipt of approval by the Company's stockholders at an upcoming shareholders meeting ("Stockholder Approval") pursuant to Nasdaq rules. Certain restrictions on exercise of the warrants will cease following receipt of ...
