Crossroads Systems Announces $8.6 Million Private Placement
AUSTIN, TX -- (Marketwire) -- 03/25/13 -- Crossroads Systems, Inc.
(NASDAQ: CRDS), a global provider of data archive solutions, today
announced that it has entered into a securities purchase agreement
with certain accredited investors for a private placement of
4,231,654 shares of Crossroads' newly designated 5.0% Series F
Convertible Preferred Stock ("Convertible Preferred") and warrants to
purchase 2,115,829 shares of its common stock. The Convertible
Preferred and warrants will be sold in units, with each unit
consisting of (i) one share of Convertible Preferred; and (ii)
warrants to purchase shares of Crossroads' common stock equal to
one-half of the number of shares of Convertible Preferred purchased.
Each unit will be sold at a price of $2.0625 per unit, resulting in
proceeds to Crossroads of approximately $8.6 million, before
deducting placement agent fees.
The Convertible Preferred is convertible to common stock at an
initial conversion price of $2.0625 per share, subject to certain
ownership limitations and anti-dilution adjustments. The dividend
rate on the Convertible Preferred is 5% per annum, subject to certain
registration conditions, payable semi-annually, at Crossroads' option
in cash, common stock or a combination of both.
Subject to certain ownership limitations, the warrants are
exercisable for a period starting on the date that is the later of
(a) six months following the closing date of the private placement or
(b) the date of the next annual meeting of the stockholders of
Crossroads, and will expire on the fifth anniversary of the closing
date of the private placement. The warrants have an initial exercise
price of $2.00 and are subject to certain anti-dilution adjustments.
The private placement is expected to close on or about Monday, March
25, 2013, subject to the satisfaction of customary closing
conditions. The Company will use the net proceeds for general working
The securities offered in the private placement have not been
registered under the Securities Act of 1933, as amended (the
"Securities Act"), or applicable state securities laws. Accordingly,
the securities may not be offered or sold in the United States except
pursuant to an effective registration statement or an applicable
exemption from the registration requirements of the Securities Act
and such applicable state securities laws. The securities were
offered only to accredited investors.
This press release does not constitute an offer to sell or the
solicitation of an offer to buy the securities, nor shall there be
any sale of the securities in any state in which such offer,
solicitation or sale would be unlawful prior to the registration or
qualification under the securities laws of such state.
About Crossroads Systems
Crossroads Systems, Inc. (NASDAQ: CRDS) is
a global provider of data archive solutions. Through the innovative
use of new technologies, Crossroads delivers customer-driven
solutions that enable proactive data security, advanced data
archiving, optimized performance and significant cost-savings.
Founded in 1996 and headquartered in Austin, TX, Crossroads holds
more than 100 patents and has been honored with numerous industry
awards for data archiving, storage and protection. Visit
Important Cautions Regarding Forward-Looking Statements
release includes forward-looking statements that relate to the
business and future events or future performance of Crossroads
Systems, Inc. and involve known and unknown risks, uncertainties and
other factors that may cause its actual results, levels of activity,
performance or achievements to differ materially from any future
results, levels of activity, performance or achievements expressed or
implied by these forward-looking statements. Words such as, but not
limited to, "believe," "expect," "anticipate," "estimate," "intend,"
"plan," "targets," "likely," "will," "would," "could," and similar
expressions or phrases identify forward-looking statements.
Forward-looking statements include, but are not limited to,
statements about Crossroads Systems' ability to implement its
business strategy, including the transition from a hardware storage
company to a software solutions and services provider, its ability to
expand its distribution channels, its ability to maintain or broaden
relationships with existing distribution channels and strategic
alliances and develop new industry relationships, the performance of
third parties in its distribution channels and of its strategic
alliances, uncertainties relating to product development and
commercialization, the ability to obtain, maintain or protect patent
and other proprietary intellectual property rights, technological
change in its industry, market acceptance of its products and
services, future capital requirements, regulatory actions or delays,
competition in general and other factors that may cause actual
results to be materially different from those described herein.
Forward-looking statements in this press release are based on
management's beliefs and opinions at the time the statements are
made. Crossroads Systems does not intend, and undertakes no duty, to
update this information to reflect future events or circumstances.
Copyright2013 Crossroads Systems, Inc. Crossroads and Crossroads
Systems are registered trademarks of Crossroads Systems, Inc. All
trademarks are the property of their respective owners. All
specifications are subject to change without notice.
512.928.6897 or 800.643.7148
Zintel Public Relations
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