Mennen Trust Makes New $2,000,000 Investment in Global Technovations, Inc.
17 January 2001
Mennen Trust Makes New $2,000,000 Investment in Global Technovations, Inc.
PALM BEACH GARDENS, Fla.--Jan. 17, 2001--Global Technovations, Inc. ("GTI" or the "Company") (AMEX:GTN) today announced that the Mennen Trust has purchased $2 million of 10% Series C Convertible Preferred Stock, increasing the total Mennen investment in the Company to $17.5 million. As consideration for this purchase, the Mennen Trust received 200,000 warrants at a strike price of $.4375. The Company can redeem the stock at a 15% premium until June 30, 2001 and 20% premium thereafter. Registration is required by January 1, 2002. Under the terms of the purchase agreement, the Mennen Trust can convert the preferred stock to common stock at a 25% discount to market. However, the conversion price cannot be below $.4375 per share. G. Jeff Mennen, a trustee for the Mennen Trust, is a director of the Company.
In addition, the Mennen Trust has again delayed registration of its $3.5 million in 9% Series B Convertible Preferred Stock Series until January 1, 2002. In return, the Mennen Trust received 25,000 warrants at a strike price of $0.4375. The Series B Convertible Preferred Stock cannot be converted prior to January 1, 2002, without the written consent of the Company, and the Company retained its 15% redemption rights.
Finally, in the event the Company experiences a cash shortfall during fiscal 2001, Mr. Mennen has agreed to infuse up to a maximum of $2,000,000 in additional funding. As consideration for this standby commitment, the Mennen Trust received 400,000 warrants at a strike price of $.6875. In the event the Company draws on this commitment, the Company will issue to the Mennen Trust Series D Convertible Preferred with a stated value equal to the amount paid to the Company, convertible at a 30% discount to market and redeemable at a 15% premium until six months after funding, and a 20% premium thereafter. The standby commitment, if not utilized by the Company, expires on September 30, 2001.
"This additional investment and commitment demonstrate Jeff Mennen's confidence in the Company's future," said Will Willis, Chairman and CEO of Global Technovations. "At the same time, they increase liquidity and allow the Company to maintain shareholder value, while we continue to aggressively develop our OSA business."
Global Technovations, Inc., develops, assembles, and markets the patented MotorCheck(TM) and TruckCheck(TM) On-Site Analyzer, "an oil analysis mini-lab in a box", the spectroscopic instruments marketed under the name of SpecTrace(TM) liquid petroleum marker systems, the PetroAnalytics(TM) line of diesel fuel and gasoline properties analyzers for the automotive, truck and heavy-duty equipment service markets, and it also manufactures, assembles and distributes audio speakers for the automotive industry through its Onkyo America subsidiary, which is one of the largest manufacturers and distributors of audio speakers in North America. For more information, visit www.GlobalTechnovations.com.