By Devika Patel
Knoxville, Tenn., Oct. 3- Digital Angel Corp. amended a revolving asset-based debt financing that settled with Kallina Corp. in August 2007, according to an 8-K filed Friday with the Securities and Exchange Commission.
The amendment was negotiated on Sept. 30 with Kallina, Laurus Master Fund, Ltd., Valens U.S. SPV I, LLC, Valens Offshore SPV I Ltd., Valens Offshore SPV II Corp. and Psource Structured Debt Ltd.
The deal, originally for $6 million, was increased to $8 million.
Under the new agreement, Valens will lend the company $2 million in exchange for a new note and 1.5 million common shares. This sale was settled Oct. 2, the filing said.
The new note accrues interest at the rate of 12% and matures on Feb. 1, 2010.
The amendments also include reductions of approximately $1.2 million in scheduled principal payments from Nov. 1, 2008 through April 1, 2009.
In connection with the original financing, Kallina received warrants for 967,742 shares. The warrants are exercisable at $1.69 per share until Aug. 31, 2014.
The amounts originally borrowed will mature on Aug. 31, 2010 and accrue interest at Prime rate plus 200 basis points, subject to a maximum interest rate of 10%.
The company used some of the original proceeds to pay off all of its obligations to Greater Bay Business Funding. The rest was used for working capital. The company intends to use the savings from the new arrangement to fund its restructuring program.
Based in South St. Paul, Minn., Digital Angel produces radio-frequency identification technologies.
| Issuer: | Digital Angel Corp.
|
| Issue: | Revolving debt facility
|
| Amount: | $8 million
|
| Stock symbol: | Nasdaq: DIGA
|
|
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| August 2007 deal
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| Amount: | $6 million
|
| Coupon: | Prime plus 200 bps, capped at 10%
|
| Price: | Par
|
| Warrants: | For 967,742 shares
|
| Warrant expiration: | Aug. 31, 2014
|
| Warrant strike price: | $1.69
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| Investor: | Kallina Corp.
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| Settlement date: | Aug. 31
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| Stock price: | $1.21 at close Aug. 31
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|
|
| 2008 deal
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| Amount: | $2million
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| Maturity: | Feb. 1, 2010
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| Coupon: | 12%
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| Price: | Par
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| Yield: | 12%
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| Warrants: | No
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| Investor: | Valens U.S. SPV I, LLC, Valens Offshore SPV I Ltd., Valens Offshore SPV II Corp.
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| Pricing date: | Sept. 30
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| Settlement date: | Oct. 2
|
| Stock price: | $0.37 at close Sept. 30
|
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