Avitar, Inc. exchanges unsecured promissory notes for convertible preferred stock.NORTH HAVEN North Haven, town (1990 pop. 22,249), New Haven co., S Conn., on the Quinnipiac River; settled c.1650, set off from New Haven 1786. Chiefly residential, it has some manufactures, such as aircraft parts, tools, chemicals, and machinery. , Conn--(BUSINESS WIRE)--Nov. 14, 1995--Avitar, Inc. ("the Company") (Nasdaq SmallCap Market: AVIT AVIT Aarupadai Veedu Institute of Technology AVIT Audiovisual Instructional Technology (Common Stock); AVITW (Warrants)) today announced it has exchanged $1,090,000 in principal amount out of its outstanding principal amount of $1,240,000 unsecured promissory bridge notes, plus accrued interest Accrued Interest The interest that has accumulated on a bond since the last interest payment up to but not including the settlement date. There are two methods for calculating accrued interest: 1) 360-day year method, used for corporate and municipal bonds. thereon, for 1,147,958 shares of newly issued Series A Redeemable Convertible Preferred Stock Convertible Preferred Stock Preferred stock that includes an option for the holder to convert the preferred shares into a fixed number of common shares, usually anytime after a predetermined date. Also known as "convertible preferred shares". ("Preferred Stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. "). Each share of Preferred Stock is convertible, at any time, at the option of the holder, into three shares of Avitar Common Stock, subject to certain anti-dilution provisions. The Preferred Stock is redeemable, in whole or in part, at a price of $1.00 per share at the Company's option upon ten days written notice if the average of the last sales prices of its Common Stock equals or exceeds $3.00 per share or more for any consecutive 30 trading day period prior to the redemption notice. The holders of the Preferred Stock have certain registration rights. The Company notes that Phildius, Kenyon & Scott, two of whose partners are officers and directors of the Company, and such partners, individually, held bridge notes in the aggregate principal amount of $485,000 and converted such notes into Preferred Stock. According to Peter Phildius, Chairman of the Board of Avitar, "This exchange significantly strengthens our financial position by converting short-term debt Short-term debt Debt obligations, recorded as current liabilities, requiring payment within the year. into equity. Additionally, we have eliminated interest expense because holders of the Preferred Stock only receive dividends if dividends are paid to holders of Avitar's Common Stock and there is no present intent to do so." Avitar, Inc. designs, develops, manufactures and markets healthcare products and services including Hydrasorb(TM) a proprietary line of polyurethane wound care dressings. Avitar also provides healthcare cost containment cost containment, n the features of a dental benefits program or of the administration of the program designed to reduce or eliminate certain charges to the plan. services to employers and third-party payors. CONTACT: Peter Phildius, Chairman of the Board (617) 821-2440 or Jay Leatherman, Chief Financial Officer (203) 234-7737 |
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