SWMX Retools Debt, Explores Sale
October 10, 2007 at 5:17 PM (PT)
SWMX and its SOFTWARE MEDIA EXCHANGE subsidiary have retooled their debt to BLUECREST CAPITAL FINANCE, LP, with BLUECREST waiving prior events of default and setting up a revolving loan of up to $3.5 million, allowing SWMX to pay only interest on on both the new revolving loan and the existing term loan of $3 million. Both loans expire on JANUARY 31st.
In order to make the new deal, SWMX gave BLUECREST warrants to purchase 48,750,000 shares of its common stock at an exercise price of 6 cents/share and amended its prior warrant agreement with BLUECREST to modify the number of shares subject to the warrant as well as the exercise price to 12,500,000 shares and 6 cents/share, respectively, with the warrant agreements expiring on OCTOBER 3rd, 2017.
BLUECREST "continues to be supportive and has expressed confidence in our objective of becoming the leading marketplace for buying and selling traditional media," said SWMX CEO JOSH WEXLER. "While 2007 has been a challenging year for the Company from a financial perspective, we have continued to make significant progress in enhancing the scope and quality of our marketplace technology and refining our business model to best position the Company for the future."
Company Looks At Sale Or Merger Possibilities
SWMX also announced that it is in the process of "exploring various strategic alternatives to best enable the organization to effectively execute on its strategy and enhance value for its customers and stakeholders," which may include a sale of the business. WEXLER said, "In recent months, the SWMX Board of Directors has been actively pursuing and evaluating possible strategic alternatives to enhance the Company’s underlying capital structure, liquidity and competitive position. As part of that process, the Company has engaged a team of advisors to assist the Board and management team in this process.
The Company is currently in discussions with a number of potential partners, and scenarios under consideration include, but are not limited to, the sale of the Company, a partnership through equity investment, a merger with a strategically aligned organization, and other related transactions. We are working through this orderly process to explore all available strategic alternatives to ensure the realization of benefits to the Company’s customers and to best enhance stakeholder value."