Applied Visual Sciences Announces Debenture Restructuring and Strategic Investor
19 Ottobre 2010 - 3:39PM
Marketwired
Applied Visual Sciences (OTCBB: APVS) announced today that, on
October 15, 2010, it entered into an agreement with the holders of
the company's outstanding Series A 10% Senior Convertible
Debentures due November 7, 2008, that extends the maturity date of
the debentures, provides that the debentures will be non-interest
bearing through the date of maturity, and for certain other
amendments to the terms of the debentures and related agreements.
Under the terms of the agreement, the convertible debenture
holders have agreed to extend the maturity of the notes to June 30,
2011. The debenture holders agreed to waive payment of
approximately $638,163 of accrued but unpaid interest, late fees,
mandatory default penalties totaling $2,496,149 and other amounts
due under the debentures, in consideration of which the company
agreed to issue an aggregate of 2,552,653 shares. Also, the
debenture holders have agreed to waive prior breaches and defaults
under the debentures and related debenture transaction documents
and to release the company from related claims. The remaining
principal amount of the amended debentures is $1,688,205 and will
be non-interest bearing through the maturity date. Subject to the
company's stock satisfying certain price and volume requirements,
the holders have agreed to a provision permitting the company to
force a conversion of the debentures. The holders have also agreed
that the company is no longer required to register under the
Securities Act the resale of the shares underlying their debentures
and related warrants. Currently, the debentures are convertible at
a price of $0.25. The agreement contains certain other amendments,
representations and warranties of the parties and conditions to
closing.
In addition, the company has been advised that, in March 2010, a
strategic investor in the company, Dr. Joshua P. Prager, purchased
approximately $838,205 in principal amount of the outstanding
convertible debentures and certain related stock warrants from
three of the original institutional investors in the company's 2006
debenture offering.
"This debenture restructuring is a major achievement for Applied
Visual Sciences, and it comes at a critical time for the company,"
said Michael W. Trudnak, Chairman and CEO of Applied Visual
Sciences. "With the recent corporate announcements and expectation
of a transformational 2010 fourth quarter, it is imperative that
Applied Visual Sciences maintains a strong financial profile. We
appreciate the continued commitment from our legacy debenture
holder and the additional commitment of our strategic
investor."
In addition to this restructuring, the company has further
reduced its outstanding liabilities through the equity conversion
of outstanding notes payable and deferred executive salaries in the
amounts of approximately $754,667 and $1,267,706, respectively. The
total reduction in liabilities from all transactions is
approximately $5,156,685, which represents an approximately 32%
reduction from the liabilities balance reported for the quarter
ended June 30, 2010.
The securities have not been registered under the Securities Act
of 1933 and may not be offered or sold in the United States absent
registration or an applicable exemption from registration
requirements. For further information regarding the foregoing,
please refer to the company's Form 8-K to be filed with the
Securities and Exchange Commission and related exhibits.
Applied Visual Sciences, Inc. Applied Visual Sciences, Inc., is
the holding company and IT development organization for
subsidiaries specializing in high-performance imaging analysis
technologies and advanced analytics for automated recognition of
targets of interest. Applied Visual Sciences' subsidiaries include
Guardian Technologies International, Inc., a homeland
security/defense technology entity, and Signature Mapping Medical
Sciences, Inc., a healthcare technology entity. The company is
quoted on the OTC Bulletin Board under the symbol APVS.
Safe Harbor statement under the Private Securities Litigation
Reform Act of 1995: Statements in this news release looking forward
in time involve risks and uncertainties, including the risks
associated with the effect of changing economic conditions, capital
raising activities, trends in the markets, variations in the
company's cash flow, competition, business development efforts,
technology availability and cost of materials and other risk
factors. Factors that could cause actual results to differ
materially are discussed in the Company's most recent filings with
the Securities and Exchange Commission.
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CONTACT: For Applied Visual Sciences: Michael Trudnak +1
703-464-5495 Media: Julie Shepherd of Accentuate PR +1 815-479-1833
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