iBroadband misses June, July 2007 payments on $5 million loan

By Sheri Kasprzak

New York, July 23 - iBroadband, Inc. said Monday it received notice from Laurus Master Fund, Ltd. that iBroadband missed the June and July payments on its $5 million secured loan issued Nov. 7, 2006.

The company, according to an 8-K filed Monday with the Securities and Exchange Commission, missed an $18,603.42 payment for June and a $99,508.79 payment for July.

Laurus has since sent the company a Notice of Past Due Payment, according to the 8-K.

The company has contended that it should not be paying interest on funds from the loan deposited to a restricted account. Earlier this month, Laurus determined that iBroadband should not have been paying interest on the funds in the restricted account and applied the accrued interest against the company's May and June principal and interest payments, leaving a balance owed of $18,603.42.

Also according to the 8-K, the company and Laurus have been negotiating since April the release of funds from the restricted account to allow the company to acquire another company in Kansas City, Mo. The company is negotiating with Laurus to forbear collecting the principal for the past due debt for 45 days from the date the agreement is signed during which time the company will raise another $400,000 of equity capital and its principal shareholder will agree to increase his guaranty of the Laurus loan to $1.5 million. The negotiations are still under way.

The loan was made to iBroadband in November 2006. Of the $5 million from the loan, half was placed in a restricted account.

The notes mature Nov. 7, 2009 and bear interest at Prime rate plus 200 basis points with a 10% floor and 14% ceiling.

Located in Farmers Branch, Texas, iBroadband provides high-speed wireless services to small- and medium-sized companies in the Southwest.

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