By Sheri Kasprzak
New York, Aug. 22 - MTI Technology Corp. said it has received agreements for a $20 million private placement of series B convertible preferred stock.
The preferreds will be sold at the lesser of $19.50 each or 10 times 90% of the average closing price per share for 15 trading days before the closing date of the offering. The investors include EMC Corp. and affiliates of Advent International Corp. The investors are the same ones who purchased series A convertible preferreds on June 17, 2004.
Because of the dilution involved with the series B purchase, the investors have agreed to a reduction in the conversion price of the series A shares, but to no less than $1.95 per share.
Each series B preferred is initially convertible into 10 common shares.
The investors will also receive warrants equal to 37.5% of the shares initially issuable upon conversion. The strike price and expiry of the warrants could not be determined by press time Monday.
Based in Tustin, Calif., MTI is a data-storage technology company.
| Issuer: | MTI Technology Corp.
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| Issue: | Series B convertible preferred stock
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| Amount: | $20 million
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| Price: | The lesser of $19.50 or 10 times 90% of the average closing price per share for 15 trading days before the closing date
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| Conversion ratio: | Each preferred into 10 common shares
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| Warrants: | Equal to 37.5% of the shares initially issuable upon conversion
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| Investors: | EMC Corp., Advent International Corp.
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| Pricing date: | Aug. 19
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| Stock price: | $1.88 at close Aug. 19
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