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Axesstel repays $4 million in convertible notes
By Sheri Kasprzak
Atlanta, April 5 - Axesstel Inc. said Tuesday it has repaid the outstanding balances on $4 million in secured convertible term notes it issued in March 2004 and August 2004.
On March 16, 2004, Axesstel issued a $3 million convertible promissory note to Laurus Master Fund Ltd. The three-year note bore interest at Prime rate plus 300 basis points, with a 7% floor and a 10% ceiling, and was convertible into common shares at $3.16 each.
On Aug. 19, 2004, Axesstel issued a $1 million convertible promissory note to Laurus. That note also bore interest at Prime rate plus 300 basis points, with a 7% floor and a 10% ceiling, and was convertible into common shares at $3.16 each.
Axesstel redeemed the remaining balances due under the note and all outstanding balances on the August 2004 note for $1.5 million.
The redeemed amount represents 115% of the principal under the March 2004 note and 120% of the principal under the August 2004 note, plus interest.
Laurus also converted $2.37 million in principal on the March 2004 note into 750,000 shares.
"We're pleased that we have paid off the balance of our secured indebtedness through the partial use of proceeds from our recent secondary equity offering," said Mike Kwon, the company's chief executive officer and chairman, in a statement. "The redemption of the Laurus notes and the removal of the general security interest in our assets will give Axesstel increased flexibility to pursue other short-term and long-term financing arrangements from time to time."
Based in San Diego, Axesstel designs, develops and markets fixed wireless voice and data products.
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