Business
Phoenix Footwear Completes $1.0 Million Capital Raise
Phoenix Footwear Completes $1.0 Million Capital Raise.
About this update from Phoenix Footwear Group, Inc.
[{"type":"text","content":"Phoenix Footwear Completes $1,000,000 Capital Raise CARLSBAD, Calif., July 27, 2011 -- Phoenix Footwear Group, Inc. (OTCMarkets.com: PXFG) Phoenix Footwear Complete $1,000,000 Capital Raise Carlsbad, California, July 27, 2011. Phoenix Footwear Group, Inc. (Pink Sheets: PXFG) (the “Company”) today reported that on July 21, 2011 it completed the sale of $1.0 million of subordinated secured 1% convertible notes (the “Notes”) to two affiliated institutional investors (collectively, the “Investors”). The Notes are initially convertible into 2,994,011 shares of the Company’s common stock. The Company plans to use the additional capital for working capital and growth initiatives. The net proceeds of the sale, after deducting estimated financing expenses, are expected to be $925,000. \"We are pleased with the financial support provided and look forward to the continued growth and success of our company and products,\" added James Riedman, President and CEO of Phoenix Footwear. The Notes are due July 30, 2014 and bear interest at the rate of 1.0% per year. The interest is payable in cash semi-annually in arrears on October 31 and April 30 of each year, commencing October 31, 2011. The obligation under the Notes is secured by a pledge of substantially all of the Company’s assets, including its intellectual property assets and the stock of its wholly-owned subsidiary, Penobscot Shoe Co. The security interest of the Investors is subordinated to the rights of Gibraltar Business Capital, LLC, and Westran Industrial Loan Co., the Company’s first lien and second lien lenders, under its $5.75 million credit facility from November 2010. As part of the transaction, the parties entered into a Voting Agreement with James Riedman and Riedman Corporation (the “Riedman Shareholders”), to provide, among other things, for the Investors and the Riedman Shareholders to each elect one member to the board of directors. The partie...