23 February 2003
23 February 2003
Zoltek Companies have completed a refinancing package that includes an amendment of its bank credit facilities and subordinated convertible debt financing.
Under the refinancing package, Southwest Bank has extended and amended its existing credit facilities, and a group of individuals including Zoltek Chairman and Chief Executive Officer Zsolt Rumy and three other Zoltek board members, has invested a total of $8 million in Zoltek in a private placement of convertible subordinated debentures. The debentures mature in five years and are convertible by the holders into an aggregate of 2,285,000 shares of common stock at a conversion price of $3.50 a share. As part of the financing transaction, the Company issued to the investors five-year warrants to purchase an aggregate of 400,000 shares of common stock at an exercise price of $5.00 per share. The closing price of Zoltek's common stock on the Nasdaq National Market System today was $1.61 per share.
""There are two important points to be made about the refinancing package,"" Rumy said. ""First, the infusion of new capital represents a vote of confidence in the future of Zoltek and our mission from several of our directors and other sophisticated investors, as we pursue the commercialization of high-performance carbon fibers as an affordable, mass-market material. Second, the refinancing, combined with improvements in our financial results over the past several quarters, means that Zoltek should have the working capital it needs over approximately the next two years to continue to invest in major application developments in the automotive, wind energy and other fields. Although we have much more work to do as we seek further improvement in our financial performance, we are optimistic that this will be a sufficient timeframe for us to begin reaping the benefits of the new markets and applications we have been developing in the past few years. These are investments in future, as opposed to current, streams of earnings and they are at the core of our mission and strategy.""
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