Stonepath Group Completes New $25 Million Financing; New Financing Positions Company for Future Growth
September 09 2005 - 4:30PM
Business Wire
Stonepath Group (AMEX: STG), a global logistics services
organization, today announced that it has completed a new domestic
credit facility with Laurus Master Fund, Ltd ("Laurus"). The new
$25 million secured domestic revolving credit facility includes a
$10 million note convertible into Stonepath's common stock at a
price of $1.08 per share, and a revolving note, which is not
convertible into any securities. In the event the convertible note,
and any subsequent convertible note, has been fully converted
during the three year period of the credit facility, a new $10
million note will be issued which is convertible into Stonepath's
common stock at a price of 115% of the average market price of
Stonepath's common stock for the ten trading days prior to the
issuance of such note. Additionally, Stonepath issued Laurus a
warrant to purchase up to 2.5 million shares of the Company's
common stock for a period of five years, at an exercise price which
varies with the number of shares purchased under the Warrant, for
prices ranging from $1.13 to $7.52. Dennis Pelino, Stonepath's
Chairman, remarked, "This financing agreement provides Stonepath
with the financial flexibility to support our ongoing expansion and
future growth. With our restructuring initiatives complete and
financial performance improving, Stonepath is well positioned to
achieve our long-term objective of becoming a leading logistics and
supply chain provider with the ability to capitalize on global
market opportunities." Proceeds from the financing agreement will
be used to prepay Stonepath's prior credit facility with an
affiliate of Patriarch Partners, LLC and will be used in the future
for general corporate purposes. Further details on the financing
agreements are available in the Company's Form 8-K, filed with the
Securities and Exchange Commission on September 7, 2005. Laurus
Master Fund, Ltd. is a private equity fund that specializes in
providing financing to emerging small and mid capitalization
companies. About Stonepath Group (AMEX:STG) Stonepath
(www.stonepath.com) is a global, third-party logistics organization
providing a full range of transportation and distribution solutions
to multinational and local businesses. Through an aggressive
acquisition strategy and strong organic growth, the Company has
expanded rapidly, establishing a network of owned operations
throughout the U.S., the Asia-Pacific region and Latin America.
Stonepath provides a full-range of time-definite transportation and
distribution solutions to a diverse client mix of retail leaders,
automotive and technology concerns, government agencies, and
defense contractors. For more information about the Company, please
contact John Brine at (212) 254-8280. This Press Release includes
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933 as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended, regarding future
results, levels of activity, events, trends or plans. We have based
these forward-looking statements on our current expectations and
projections about such future results, levels of activity, events,
trends or plans. These forward-looking statements are not
guarantees and are subject to known and unknown risks,
uncertainties and assumptions about us that may cause our actual
results, levels of activity, events, trends or plans to be
materially different from any future results, levels of activity,
events, trends or plans expressed or implied by such
forward-looking statements. In some cases, you can identify
forward-looking statements by terminology such as "guidance,"
"may," "will," "should," "could," "would," "expect," "plan,"
"anticipate," "believe," "estimate," "continue" or the negative of
such terms or other similar expressions. While it is impossible to
identify all of the factors that may cause our actual results,
levels of activity, events, trends or plans to differ materially
from those set forth in such forward-looking statements, such
factors include the inherent risks associated with: (i) our ability
to sustain an annual growth rate in revenue consistent with recent
results, (ii) our ability to achieve our targeted operating
margins, (iii) our ability to compute our restructuring efforts
within the costs we now expect, (iv) our ability to realize the
planned benefits from our restructuring efforts, (v) our dependence
on certain large customers, (vi) our dependence upon certain key
personnel, (vii) an unexpected adverse result in any legal
proceeding, (viii) competition in the freight forwarding, logistics
and supply chain management industry, (ix) the impact of current
and future laws affecting the Company's operations, (x) adverse
changes in general economic conditions as well as economic
conditions affecting the specific industries and customers we
serve, and (xi) regional disruptions in transportation. Other
factors that might cause or contribute to such a discrepancy
between expected and actual results include, but are not limited
to, those factors identified in our Securities and Exchange
Commission filings (including our Annual Report on Form 10-K for
2004), other public documents and recent press releases, which can
be found on our corporate web site, www.stonepath.com. Readers are
cautioned not to place undue reliance on forward-looking
statements, which speak only as of the date made. We undertake no
obligation to publicly release the result of any revision of these
forward-looking statements to reflect events or circumstances after
the date they are made or to reflect the occurrence of
unanticipated events.
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