Company also extends maturity of secured promissory note held by BET
By Devika Patel
Knoxville, Tenn., Oct. 8 - ImageWare Systems, Inc. extended the maturity dates of a secured promissory note held by BET Funding LLC, according to an 8-K filed Friday with the Securities and Exchange Commission. It also raised $5.5 million in financings.
On Oct. 6, the company and BET agreed to change the maturity date to Dec. 30, 2010 from Sept. 15, 2010. The company also agreed to retire the note with three installment payments to be made in October, November and December. The October installment has been paid.
The company will fund the repayment from a new $2 million two year 6% unsecured convertible note, which was purchased by Neal Goldman, a shareholder. The note is convertible into common shares at $0.50 per share. The company also issued warrants for 1 million shares, which are exercisable at $0.50.
The company also has received a commitment letter from Genoa Capital Partners, an institutional investor, for a two year $3.5 million line of credit, which will be convertible into common stock at $0.50 per share. The investor will receive warrants for 100,000 shares with a strike price of $0.50 as part of this transaction.
The strike prices and conversion prices reflect a 42.86% premium to the $0.35, Oct. 7 closing share price.
San Diego-based ImageWare provides software-based identity management services.
| Issuer: | ImageWare Systems, Inc.
|
| Issue: | Convertible unsecured notes, line of credit
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| Amount: | $5.5 million
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| Conversion price: | $0.50
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| Warrant strike price: | $0.50
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| Announcement date: | Oct. 8
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| Stock symbol: | Pink Sheets: IWSY
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| Stock price: | $0.42 at close Oct. 8
|
| Market capitalization: | $9.76 million
|
|
|
| Convertibles
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| Amount: | $2 million
|
| Maturity: | Two years
|
| Coupon: | 6%
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| Price: | Par
|
| Yield: | 6%
|
| Warrants: | For 1 million shares
|
| Investor: | Neal Goldman
|
|
|
| Line of credit
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| Amount: | $3.5 million
|
| Maturity: | Two years
|
| Warrants: | For 100,000 shares
|
| Investor: | Genoa Capital Partners
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