By Devika Patel
Knoxville, Tenn., Aug. 15 - Arotech Corp. completed a $5 million private placement of senior subordinated convertible notes on Aug. 14, according to an 8-K filed Friday with the Securities and Exchange Commission.
The notes mature on Aug. 15, 2011. They bear interest at 10%, payable quarterly in cash.
They are convertible at $2.24 per common share.
The company is obligated to repay the notes in installments commencing in February 2009, with the principal amount being amortized in 11 payments payable, at its option, in cash or stock, provided certain conditions are met.
The investors also received warrants for 558,036 common shares. The warrants are exercisable at $2.24 for three years.
Proceeds were used to make a $2.5 million loan to DEI Services Corp. The balance of the proceeds will be used for working capital.
Based in Auburn, Ala., Arotech makes defense and security products for the military, law enforcement and homeland security sector.
| Issuer: | Arotech Corp.
|
| Issue: | Senior subordinated convertible notes
|
| Amount: | $5 million
|
| Maturity: | Aug. 15, 2011
|
| Coupon: | 10%
|
| Price: | Par
|
| Yield: | 10%
|
| Conversion price: | $2.24
|
| Warrants: | For 558,036 shares
|
| Warrant expiration: | Three years
|
| Warrant strike price: | $2.24
|
| Settlement date: | Aug. 14
|
| Stock symbol: | Nasdaq: ARTX
|
| Stock price: | $1.68 at close Aug. 14
|
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