By Laura Lutz
Des Moines, Sept. 4 - Digital Angel Corp., a subsidiary of Applied Digital Solutions, Inc., closed a $6 million revolving asset-based debt financing.
The investor was Kallina Corp., a wholly owned subsidiary of Laurus Master Fund, Ltd., the company's senior secured lender.
In connection with the financing, Kallina received warrants for 967,742 shares of Digital Angel. The warrants are exercisable at $1.69 per share until Aug. 31, 2014.
Under the agreement, Digital Angel may, from time to time, borrow the lesser of the amount of availability under the borrowing base and $6 million. The borrowing base is equal to a percentage of the total amount of eligible accounts and inventory owned by Digital Angel and its eligible subsidiaries.
The amounts 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 proceeds to pay off all of its obligations to Greater Bay Business Funding. The rest will be used for working capital.
Based in South St. Paul, Minn., Digital Angel produces radio-frequency identification technologies.
Issuer: | Digital Angel Corp.
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Issue: | Revolving debt facility
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Amount: | $6 million
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Coupon: | Prime plus 200 bps, capped at 10%
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Price: | Par
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Warrants: | For 967,742 shares
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Warrant expiration: | Aug. 31, 2014
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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 symbol: | Amex: DOC
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Stock price: | $1.54 at close Aug. 31
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