IRVINE, Calif., Aug. 29, 2013 (GLOBE NEWSWIRE) -- AllDigital Holdings, Inc. (OTCBB:ADGL) offered and sold an aggregate of $1.325 million in Convertible Promissory Notes ("Notes") to an aggregate of 6 individual and institutional investors. The Notes closed on August 26, 2013. An additional $155,000 in Notes is expected to close over the next week.
The Notes bear interest at a rate of 9% per annum from and after December 1, 2013, and are due on August 1, 2014. Absent an event of default, the Notes will automatically convert shares of common stock of AllDigital or Broadcast International Inc. (OTCBB:BCST) ("Broadcast") prior to the due date for the Notes.
"This financing provides AllDigital with immediate capital to scale its sales and marketing efforts, technology development, capital equipment, and general working capital," said Paul Summers, AllDigital's CEO. "As part of our efforts to scale AllDigital into a global brand, we also are pleased to announce the recent hires of Greg Siefkin as our VP of Sales and Kristin Davis as our Director of Marketing. Mr. Siefkin has over 16 years of strategic sales and major account management experience holding VP roles at digital media firms such as Ascent Media and Technicolor. Ms. Davis brings over 10 years of marketing experience with an extensive background in driving both product and corporate marketing programs in the cloud technology space. We are excited about these additions to our team here in Irvine."
If the proposed merger between AllDigital and Broadcast (the "Merger") closes prior to November 30, 2013, amounts owed under the Notes will automatically convert into shares of Broadcast common stock at a conversion price equal to the lesser of (a) the lowest price per share at which Broadcast common stock is sold in an offering of capital stock for cash by Broadcast that closes, or in which firm commitments are received, on or about the closing date of the Merger, and (b) the quotient of (i) $15,000,000, divided by (ii) the number of shares of Broadcast common stock issued and outstanding immediately following the Merger closing (assuming the exercise or conversion of all options or warrants to purchase, and all instruments convertible into, Broadcast common stock, other than the Notes and related agreements). Broadcast is a party to the Notes in order to facilitate these conversion provisions.
If the Merger has not closed by November 30, 2013 or the merger agreement is earlier terminated without closing (such earlier date being the "Merger Termination Date"), amounts owed under the Notes automatically convert into shares of AllDigital common stock at a conversion price equal to the lesser of (i) the lowest price per share at which AllDigital's common stock is sold in an offering of capital stock for cash by AllDigital that closes, or in which firm commitments are received, after the date of the Notes and prior to the Merger Termination Date, and (ii) the quotient of (A) $6,750,000, divided by (B) number of shares of AllDigital common stock issued and outstanding on the Merger Termination Date (assuming the exercise or conversion of all options or warrants to purchase, and all instruments convertible into, AllDigital common stock, other than the Notes and agreements on substantially similar terms).
About AllDigital:
Our unified digital broadcasting platform branded as AllDigital Cloud provides a scalable, flexible and secure architecture where various types of digital media (live events, video-on-demand, digital services and applications) can reach a global audience across mobile, desktop and digital televisions. We also provide related integration services including maintenance, service and support to power global deployments of digital media services.
AllDigital Cloud is based on our proprietary modular and grid computing based architecture that provides a unified digital broadcasting experience across the three screens.
Forward-Looking Statements
In addition to historical information, this release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements encompass AllDigital's beliefs, expectations, hopes or intentions regarding future events. Words such as "expects," "intends," "believes," "anticipates," "should," "likely", "will" and similar expressions identify forward-looking statements. All forward-looking statements included in this release are made as of the date hereof and are based on information available to AllDigital as of such date. AllDigital assumes no obligation to update any forward-looking statement. Readers should note that many factors could affect the proposed combination AllDigital and Broadcast, as well as the future operating and financial results of AllDigital and/or Broadcast, and could cause actual results to vary materially from those expressed in forward-looking statements set forth in this release. These factors include, but are not limited to, the risk that the transaction contemplated by the merger agreement will not close; the risk that, if the proposed merger does close, the operations of AllDigital and Broadcast will not be integrated successfully or at all; the risk that the parties will be unable to successfully implement a combined business strategy; the risk that the combined company will not realize potential synergies and other anticipated marketing and financial impacts of the proposed merger; the risk that future financial and operating results of the combined company will not be as anticipated or suggested; the risks that the shareholders of either AllDigital or Broadcast will not approve the proposed merger; and the risk that the various conditions to closing of the proposed merger will not be satisfied. Additional risk factors, cautionary statements and other conditions which could cause actual results to differ from management's current expectations are contained in the filings of AllDigital with the Securities and Exchange Commission, including the risk factors identified in its most recent Annual Report on Form 10-K.
Additional Information and Where to Find It
This information pertains to this document and all related documents linked from this one. Broadcast intends to file with the SEC a joint proxy statement/information statement/prospectus and other relevant materials in connection with the merger. The joint proxy statement/information statement/prospectus will be mailed to the shareholders of AllDigital and Broadcast. Investors and security holders of AllDigital and Broadcast are urged to read the joint proxy statement/information statement/prospectus and the other relevant materials when they become available because they will contain important information about AllDigital, Broadcast and the merger. The joint proxy statement/information statement/prospectus and other relevant materials (when they become available), and any other documents filed by AllDigital or Broadcast with the SEC, may be obtained free of charge at the SEC's web site at www.sec.gov. In addition, investors and security holders may obtain free copies of the documents filed with the SEC by AllDigital by contacting Stephanie Hargis via email at ir@alldigital.com, or by phone 949-250-0701, x100. Investors and security holders are urged to read the joint proxy statement/information statement/prospectus and the other relevant materials when they become available before making any voting or investment decision with respect to the merger.
Paul Summers, AllDigital's Chairman of the Board and Chief Executive Officer, John Walpuck, AllDigital's Chief Financial Officer, and certain of AllDigital's other executive officers and directors may be deemed to be participants in the solicitation of proxies from the shareholders of AllDigital and Broadcast in favor of the merger. The other executive officers and directors of AllDigital who may be participants in the solicitation of proxies in connection with the merger have not been determined as of the date of this filing. A description of the interests of Mr. Summers, Mr. Walpuck and AllDigital's other executive officers and directors in AllDigital is set forth in the AllDigital's Annual Report on Form 10-K for the fiscal year ended December 31, 2012, which was filed with the SEC on April 1, 2013. Investors and security holders may obtain more detailed information regarding the direct and indirect interests of Mr. Summers, Mr. Walpuck and AllDigital's other executive officers and directors in the merger by reading the joint proxy statement/information statement/prospectus when it becomes available.
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