Israel’s Electric Fuel Corporation has completed a placement of an aggregate of $3.5 million principal amount of secured convertible debenture with three institutional investors.
The investors also received 3.5 million warrants to purchase shares of Electric Fuel's common stock, that, if exercised in full, could bring the Company an additional $3.1 million in proceeds.
As of January 6, 2003 the company has a cash position of approximately five million dollars. The company also announced that the institutional investors purchased 1,625,000 of Electric Fuel shares held by the IES Group of companies controlled by Haim Geyer, from which Electric Fuel purchased its IES subsidiary last year.
The IES group also gave the purchasers an option to purchase up to an additional 1,500,000 of their shares and agreed to refrain from trading in the Company's stock for a period of nine months.
In addition the restructuring of the agreements with the IES group and the former CEO has reduced the Company's liabilities by approximately $1.1 million. Net proceeds from the private placement will be used to help ensure the successful re-positioning of Electric Fuel as a supplier of portable power solutions for the military.
The company plans to expand its military battery operations, for which it received its first $2.5 million US Army contract last month.
The convertible debentures bear interest at a rate of nine percent per annum, with a maturity date of June 30, 2005, and are convertible into shares of Electric Fuel's common stock at a conversion price of $0.75 per share, adjustable only in the event of a stock split or similar extraordinary activity. The investors also received 3.5 million warrants to purchase shares of Electric Fuel's common stock, at prices ranging from $0.84 to $0.93. — (menareport.com)
© 2003 Mena Report (www.menareport.com)
