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FalconStor Software Secures Financing Commitment From Hale Capital
FalconStor Software Secures Financing Commitment From Hale Capital.
About this update from Falconstor Software, Inc.
[{"type":"text","content":"\n\n MELVILLE, N.Y., Nov. 17, 2017 (GLOBE NEWSWIRE) -- FalconStor Software, Inc. (OTCMKTS:FALC) (“FalconStor” or the “Company”), today announced that the Company has secured a commitment (the “Commitment”) from HCP-FVA, LLC, an affiliate of Hale Capital Partners, LP (together, “Hale Capital”), to purchase up to $3 million worth of units from the Company in a proposed private placement of units which will be offered to certain eligible stockholders of the Company existing on the date hereof (the “Proposed Offering”). The units would be issued as part of an approximately $14.08 million offering of units, which assumes year end closing with each unit consisting of senior secured debt, nominal warrants and shares of the Company’s Series A Redeemable Preferred Stock (the “Series A Preferred Stock”) held by Hale Capital. Also today, the Company announced it has entered into a short-term secured term loan with Hale Capital in the principal amount $500,000 (the “Short Term Loan”), which may be satisfied through the issuance by the Company of units in the Proposed Offering. As previously disclosed in the Company’s filings, the Company was actively seeking financing in order to meet the Company’s operating cash flow needs. Hale Capital is the Company’s largest stockholder through its ownership of Series A Preferred Stock and an affiliate of FalconStor director, Martin Hale.\n The Short Term Loan is secured by all of the assets of the Company and guaranteed by each of the Company’s domestic subsidiaries.  The Short Term Loan bears interest at a rate equal to the prime rate plus 0.75% and will be due and payable on May 17, 2018, unless satisfied through the issuance by the Company of units in the Proposed Offering, which units would consist of senior secured debt in the aggregate principal amount of the Short Term Loan and nominal warrants to purchase approximately 61,165,134 shares of the Company’s common stock.  Hale Capital has committed, subject to the terms and conditions of the Commitment, to purchase 75% of the total number of units to be issued in the Proposed Offering to ensure the Company receives at least $3 million of total offering proceeds, inclusive of the units issuable upon conversion of the Shor...