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Boomerang Systems, Inc. Announces Exchange Offer

Companies mentioned in this article: Boomerang Systems, Inc.

FLORHAM PARK, N.J., July 14, 2014 /PRNewswire/ -- Boomerang Systems, Inc. (OTCQB: BMER, the "Company"), today announced that it has commenced an offer to exchange outstanding unsecured convertible promissory notes ("unsecured notes") and warrants to purchase common stock issued under three private placements in 2011 and 2012 ("warrants") for the issuance of common stock at the rate of $2.15 per share in exchange for the entire balance (principal and interest) of the unsecured note and warrants (the "Offer"). The holders of the following securities (collectively, the "Eligible Securities") are eligible to participate in the Offer:

    --  First Tranche Units consisting of $100,000 principal amount of First
        Tranche Eligible Note and First Tranche Eligible Warrants to purchase
        25,126 shares of common stock of the Company, or a pro-rata portion
        thereof.  The "First Tranche Eligible Notes" consist of an aggregate of
        $9,349,520, $1,350,000 and $925,000 principal amount 6% Convertible
        Promissory Notes due November 1, 2016, November 18, 2016 and December 9,
        2016 respectively, convertible at a price of $3.98 per share (after
        giving effect to anti-dilution adjustments to the initial conversion
        price of $4.25 per share).  The "First Tranche Eligible Warrants"
        consist of warrants to purchase an aggregate of 2,349,142, 339,200 and
        232,416 shares of common stock of the Company expiring on November 1,
        2016, November 18, 2016 and December 9, 2016 respectively, exercisable
        at a price of $3.98 per share (after giving effect to anti-dilution
        adjustments to the initial exercise price of $4.25 per share).  The
        First Tranche Eligible Notes and the First Tranche Eligible Warrants
        were issued by the Company on November 1, 2011, November 18, 2011 and
        December 9, 2011 and are referred to as the "First Tranche Eligible
        Securities."  The Company will accept an exchange of partial First
        Tranche Units, provided that the number of First Tranche Eligible Notes
        and First Tranche Eligible Warrants included in such partial First
        Tranche Unit bears the same ratio as the number of First Tranche
        Eligible Notes and First Tranche Eligible Warrants in a First Tranche
        Unit;


    --  Second Tranche Units consisting of $100,000 principal amount of Second
        Tranche Eligible Note and Second Tranche Eligible Warrants to purchase
        21,552 shares of common stock of the Company, or a pro-rata portion
        thereof.  The "Second Tranche Eligible Notes" consist of an aggregate of
        $5,000,000 and $1,200,000 principal amount 6% Convertible Promissory
        Notes due June 14, 2017, convertible at a price of $4.64 per share
        (after giving effect to anti-dilution adjustments to the initial
        conversion price of $5.00 per share).  The "Second Tranche Eligible
        Warrants" consist of warrants to purchase an aggregate of 1,077,596 and
        258,624 shares of common stock of the Company expiring on June 14, 2017,
        exercisable at a price of $4.64 per share (after giving effect to
        anti-dilution adjustments to the initial exercise price of $5.00 per
        share).  The Second Tranche Eligible Notes and the Second Tranche
        Eligible Warrants were issued by the Company on June 14, 2012 and July
        13, 2012 and are referred to as the "Second Tranche Eligible
        Securities."  The Company will accept an exchange of partial Second
        Tranche Units, provided that the number of Second Tranche Eligible Notes
        and Second Tranche Eligible Warrants included in such partial Second
        Tranche Unit bears the same ratio as the number of Second Tranche
        Eligible Notes and Second Tranche Eligible Warrants in a Second Tranche
        Unit;

    --  Third Tranche Units consisting of $100,000 principal amount of Third
        Tranche Eligible Note and Third Tranche Eligible Warrants to purchase
        21,368 shares of common stock of the Company, or a pro-rata portion
        thereof.  The "Third Tranche Eligible Notes" consist of an aggregate of
        $3,075,000 principal amount 6% Convertible Promissory Notes due December
        31, 2017, convertible at a price of $4.68 per share (after giving effect
        to anti-dilution adjustments to the initial conversion price of $5.00
        per share).  The "Third Tranche Eligible Warrants" consist of warrants
        to purchase an aggregate of 657,061 shares of common stock of the
        Company expiring on December 31, 2017, exercisable at a price of $4.68
        per share (after giving effect to anti-dilution adjustments to the
        initial exercise price of $5.00 per share).  The Third Tranche Eligible
        Notes and the Third Tranche Eligible Warrants were issued by the Company
        on December 28, 2012 and are referred to as the "Third Tranche Eligible
        Securities."  The Company will accept an exchange of partial Third
        Tranche Units, provided that the number of Third Tranche Eligible Notes
        and Third Tranche Eligible Warrants included in such partial Third
        Tranche Unit bears the same ratio as the number of Third Tranche
        Eligible Notes and Third Tranche Eligible Warrants in a Third Tranche
        Unit;

"We believe that the exchange offer is mutually beneficial for the unsecured note and warrant holders and Boomerang Systems," said Mark Patterson, Chief Executive Officer of the Company. "We are making this Offer to settle the balances of the Eligible Notes and give the holders of the Eligible Securities common stock of the Company. The exchange under the Offer provides an opportunity for the Company to relieve some of the outstanding debt as we believe we will need to raise additional funds in the near future to fund operations, and we do not believe we will be able to raise additional equity capital unless we exchange all or a substantial portion of the Eligible Securities."

Important Notice

This press release is for informational purposes only and is neither an offer to exchange nor a solicitation of an offer to exchange any of the company's securities. The offer to exchange will be made only pursuant to the Offer, the related election to participate and other materials that are being mailed shortly to holders of securities eligible to be exchanged in the offer and have been filed with the Securities and Exchange Commission. Holders of securities eligible to be exchanged in the offer should read those materials and the documents incorporated therein by reference carefully because they will contain important information, including the various terms of, and conditions to, the exchange offer. The Company has filed a Tender Offer Statement on Schedule TO with the Securities and Exchange Commission, which includes the Offer to Exchange, the related election to participate and other materials, and is available at no charge at the Securities and Exchange Commission's website at www.sec.gov, or from the Company at 30 A Vreeland Road, Florham Park, NJ 07932, telephone (973) 387-8514. Holders of securities eligible to be exchanged in the offer are urged to read those materials carefully prior to making any decisions with respect to the exchange offer.

About Boomerang Systems, Inc.

Headquartered in Florham Park, New Jersey, with research, design, testing and production facilities in Logan, Utah, Boomerang Systems, Inc. (www.boomerangsystems.com) is in the business of marketing, designing, engineering, manufacturing, installing and servicing its RoboticValet® automated parking systems.

The Company is the developer and sole provider of the patent-pending Boomerang RoboticValet® automated parking system, which differs from legacy mono-path automated parking systems in that it uses omni-directional, battery-powered robots, and a proprietary software and robotics guidance system, to carry vehicles parked on self-supporting steel trays to and from storage spaces by driving directly on a concrete slab surface, without the use of a rail or track.

Safe Harbor Statement

Safe Harbor Statements under the Private Securities Litigation Reform Act of 1995: The Material contained in this press release may include statements that are not historical facts and are considered "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect Boomerang Systems, Inc.'s current views about future events, financial performances, and project development. These "forward-looking" statements are identified by the use of terms and phrases such as "will," "believe," "expect," "plan," "anticipate," and similar expressions identifying forward-looking statements. Investors should not rely on forward-looking statements because they are subject to a variety of risks, uncertainties, and other factors that could cause actual results to differ materially from Boomerang's expectations. These risk factors include, but are not limited to, the risks and uncertainties identified by Boomerang Systems, Inc. under the headings "Risk Factors" in its latest Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q. These factors are elaborated upon and other factors may be disclosed from time to time in Boomerang Systems, Inc.'s filings with the Securities and Exchange Commission. Boomerang expressly does not undertake any duty to update forward-looking statements.

SOURCE Boomerang Systems, Inc.