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Telkonet to repay $9.9 million in convertible notes following alleged default
By Sheri Kasprzak
New York, Aug. 16 - Telkonet, Inc. has agreed to repay $9,910,392 in outstanding senior convertible notes.
The agreement comes after one of the noteholders alleged that the company failed to meet the minimum revenue test for the period ended June 30 as specified in the terms of the notes, thus constituting a default.
The company will pay $6.5 million of the debt in cash received through a draw on a letter of credit, and the remaining $3,410,392 will be paid through the issuance of shares at a price equal to the lower of $5.00 each or 92.5% of the average of the weighted average price for the 20 trading days beginning Wednesday.
The holders will also receive warrants for an undisclosed number of shares, exercisable at the lower of $5.00 apiece or 92.5% of the average trading price for the 20 trading days beginning Wednesday.
Based in Germantown, Md., Telkonet develops high-speed voice, video and data communications over existing electrical wiring.
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