Modtech Holdings Inc. Announces Pending Equity Infusion
24 June 2005 - 3:55AM
Business Wire
Modtech Holdings, Inc. (Modtech) (Nasdaq:MODTE) has executed a
non-binding term sheet for a private placement of equity securities
in the aggregate amount of $11.7 million. Modtech will use the
proceeds to strengthen its balance sheet and to offset the recent
losses on the Heritage High School project. Pursuant to the term
sheet, the investors will purchase shares of Modtech's common stock
at $5.67 per share, based on 85% of the average of closing prices
for the period from May 26, 2005, through June 2, 2005. Also
included are five-year warrants to purchase additional shares equal
to one-half the number of shares initially sold. The warrants will
have an exercise price of $8.00 per share. The financing is
expected to close in early July 2005 but is still subject to
further negotiation and the completion and execution of a
definitive purchase agreement. The investors include Peninsula
Capital Management, Inc.; Peninsula Catalyst Management, Inc.;
Gruber & McBaine Capital Management; other institutional
investors; and certain members of Modtech's management and board of
directors. About Modtech Holdings, Inc. Modtech(TM) is a leading
national designer and manufacturer of modular buildings, both
permanent and relocatable. In the school industry, the Company has
advanced typical modular building technology to greater dimensions
of flexibility and architectural integrity. Modtech(TM) has
substantial product and geographic diversification throughout the
southwestern states and a growing presence in Florida and Texas.
Modtech's commercial and industrial buildings are sold to a diverse
end-user market and may be leased through national, regional, and
local dealers. The Company also designs and manufactures modular
buildings to customer specifications for a wide variety of uses.
Some statements in this press release may constitute
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. Such forward-looking
statements involve known and unknown risks, uncertainties and other
factors that may cause the actual results, performance or
achievements of the company to be materially different from any
future results, performance or achievements expressed or implied by
forward-looking statements. Refer to the Company's filings with the
Securities and Exchange Commission for further discussion of such
factors. The forward-looking statements are made as of the date of
this press release and the Company assumes no obligation to update
such statements.
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