ThermoEnergy announces $4.5 million investment from warrant holders

Funds to extinguish $6 million of debt to increase shareholder equity

By Devika Patel

Knoxville, Tenn., June 27 - ThermoEnergy Corp. said its warrant holders have invested $2.9 million in the company through bridge loans and are expected to invest an additional $1.6 million for a total of $4.5 million.

The company plans to use $1.6 million of this investment to pay down debt, which will automatically trigger the conversion of $4.4 million of remaining debt into series B preferred stock and warrants. As a result of this investment, $6 million of the company's debt will be extinguished, which the company said will result in an increase in shareholder equity of about $8.9 million.

"We are excited to have completed this round of financing providing necessary working capital and the ability to pay off and convert most of our debt to equity," president and chief executive officer Cary Bullock said in a press release. "Because this transaction involves using shares that are already a part of our capital structure, this deal will be only slightly dilutive to our existing shareholders while allowing us to eliminate most of our debt. In broad strokes, we will have increased our capitalization about 8% in exchange for an equity investment, based on new funding and debt conversion, of $8.9 million."

Based in Little Rock, Ark., ThermoEnergy designs renewable energy and power-generation facilities using technologies that convert municipal and industrial wastewater into biofuel.

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