AVCT Announces Senior Secured Convertible Note Agreement
April 15 2022 - 8:46AM
American Virtual Cloud Technologies, Inc. (Nasdaq: AVCT) (the
“Company”) today announced that it has entered into a securities
purchase agreement for the sale of a new series of senior secured
convertible notes (the “Notes”) to an institutional investor,
subject to customary closing conditions. The proceeds, after
original issue discount, will total $10 million, before payment of
commissions and expenses.
Provided no Event of Default (as defined in the Notes) has
occurred, the Notes will not accrue interest, and the Company will
be required to redeem $800,000 of the outstanding amounts under the
Notes each month commencing August 1, 2022, until the maturity date
of October 1, 2023, at which time all outstanding amounts
remaining, if any, will be due and payable in full.
At the Company’s option, each redemption payment can be made in
cash or stock at a discount to the then-current closing bid price
at the time of the redemption.
The investor will also have the right to an accelerated
conversion of any or all of the outstanding balance of the Notes
into stock at a conversion price of $0.99 per share.
The Notes will be secured by substantially all assets of the
Company and will rank superior to all outstanding and future
indebtedness of the Company.
The Company expects to use the proceeds from the sale of the
Notes to strengthen the balance sheet of the Company and help in
the execution of its newly focused “pure-play” converged
communications strategy in the wake of the previously completed
divestiture of its Computex business.
Northland Capital Markets served as sole placement agent in the
transaction.
About American Virtual Cloud Technologies,
Inc.American Virtual Cloud Technologies, Inc. (Nasdaq:
AVCT) is a premier global cloud communications offering proprietary
UCaaS, CPaaS, and CCaaS capabilities. Our mission is to provide
global technology solutions with a superior customer experience.
For more information, visit https://www.avctechnologies.com.
About KandyKandy is a cloud-based, real-time
communications platform offering proprietary UCaaS, CPaaS, CCaaS,
Microsoft Teams Direct Routing as a Service, and SIP Trunking as a
Service capabilities. Kandy enables service providers, enterprises,
software vendors, systems integrators, partners, and developers to
enrich their applications and services with real-time contextual
communications, providing a more engaging user experience. With
Kandy, companies of all sizes and types can quickly embed real-time
communications capabilities into their existing applications and
business processes. For more information visit kandy.io
Caution Regarding Forward-Looking
StatementsThis press release includes certain statements
that are not historical facts but are forward-looking statements
for purposes of the safe harbor provisions under the United States
Private Securities Litigation Reform Act of 1995. Forward-looking
statements generally are accompanied by words such as “believe,”
“may,” “will,” “estimate,” “continue,” “anticipate,” “intend,”
“expect,” “should,” “would,” “plan,” “predict,” “potential,”
“seem,” “seek,” “future,” “outlook,” and similar expressions that
predict or indicate future events or trends or that are not
statements of historical matters. These forward-looking statements
include, but are not limited to, statements regarding projections,
estimates and forecasts of revenue and other financial and
performance metrics, the Company’s plans to identify and/or
complete suitable acquisitions, the consummation of the financing
contemplated by the securities purchase agreement dated April 14,
2022, and planned future growth. The Company’s actual results or
outcomes and the timing of certain events may differ significantly
from those discussed in any forward-looking statements, including
as a result of the uncertainty associated with being able to
satisfy the closing conditions to the sale of the Notes, to
identify, evaluate and complete any strategic transaction, the
impact of any strategic transaction that may be pursued on the
Company’s business, including its financial and operating results
and its employees and clients. These statements are based on
various assumptions and on the current expectations of the
Company’s management and are not predictions of actual performance.
These forward-looking statements are provided for illustrative
purposes only and are not intended to serve as, and must not be
relied on by any investor as, a guarantee, an assurance, a
prediction or a definitive statement of fact or probability.
Actual events and circumstances are difficult or impossible to
predict and will differ from assumptions. Many actual events and
circumstances are beyond the control of the Company. These
forward-looking statements are subject to a number of risks and
uncertainties, including changes in the Company’s clients’
preferences, prospects and the competitive conditions prevailing in
the industries in which the Company operates; risks associated with
the potential effects of COVID-19 on the Company’s business; risks
that the recently-acquired Kandy Communications business will not
be integrated successfully; ability to retain key personnel; the
potential impact of consummation of the Kandy Communications
acquisition on relationships with third parties, including
customers, employees and competitors; conditions in the capital
markets; and those factors discussed in the Company’s amended
annual report on Form 10-K filed with the SEC on May 14,
2021 under the heading “Risk Factors,” and other documents of the
Company filed, or to be filed, with the SEC. If the risks
materialize or assumptions prove incorrect, actual results could
differ materially from the results implied by these forward-looking
statements. There may be additional risks that the Company
presently does not know or that the Company currently believes are
immaterial that could also cause actual results to differ from
those contained in the forward-looking statements. In addition,
forward-looking statements reflect the Company’s expectations,
plans or forecasts of future events and views as of the date of
this report. The Company anticipates that subsequent events and
developments will cause its assessments to change. However, while
the Company may elect to update these forward-looking statements at
some point in the future, the Company specifically disclaims any
obligation to do so. These forward-looking statements should not be
relied upon as representing the Company’s assessments as of any
date subsequent to the date of this document. Accordingly, undue
reliance should not be placed upon the forward-looking
statements.
Contactinfo@avctechnologies.com+1 (404)
239-2863
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