Brake Headquarters Announces Investment Group To Buy Debentures
15 January 1999
Brake Headquarters USA Announces LionsHead Ltd., an Investment Group, Has Agreed To Purchase Outstanding Convertible Debentures
LONG ISLAND CITY, N.Y.--Jan. 15, 1998--Other Note Holders Agree to Lock-Up
Brake Headquarters USA Inc. announced today the purchase of a substantial portion of the company's currently outstanding $2,169,560 of notes and convertible debentures.
LionsHead Ltd., a privately owned financial and investment group, located in New York, has entered into purchase agreements pursuant to which they will acquire from the current debenture holders on or before February 4, 1999, a total of approximately $691,000 of convertible debentures.
Under the terms of the agreements, investors currently holding the balance of the convertible debentures have agreed not to convert the balance of their holdings, totaling approximately $691,000, into shares of the company's common stock for a period of five months from the dates of these agreements. In addition, holders of other notes and debentures issued by the company which total $540,000, have also agreed to lock-up their holdings and not convert into shares of common stock until May 24, 1999. As of the date of this announcement, the company has a total of 9.034 million shares of common stock outstanding.
Joseph Ende, chairman and CEO of Brake Headquarters USA Inc. commented "lock-up period will provide the time required to contemplate and implement various options, with regards to the retirement of the remaining notes and convertible debentures." Ende continued, "This significantly increases our ability to move forward with our strategic plan to secure our continued long-term growth, achieve profitability, and improve overall operating efficiency. During this time we will continue to identify, along with our financial advisor, Redstone Securities Inc., alternative methods which we can pursue in order to ensure that the capital raised by the company is achieved in the most advantageous and non-dilutive manner possible."
Founded in 1976, Brake Headquarters USA Inc. is a rapidly growing manufacturer, wholesaler, and distributor of automotive brake system products and other component parts for domestic and foreign cars and light trucks.
This release contains certain forward-looking statements that involve known and unknown risks, uncertainties. The company's actual results may differ materially from the results discussed in the forward-looking statements. Factors that might cause or contribute to such differences include, but are not limited to, intense competition, the company's dependence on the automotive industry, which is cyclical, historical decreases in internal growth rates and historical losses, the company's ability to manage growth, and other risks discussed in reports filed by the company with the Securities and Exchange Commission from time to time.