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Glowpoint Announces Exchange Of Series B-1 Preferred Stock For Common Stock

Stocks in this article: GLOW

Glowpoint, Inc. (NYSE MKT: GLOW), a leading provider of cloud-based video collaboration, network and support services, announced today that the Company entered into a Series B-1 Preferred Exchange Agreement (the “Agreement”), by and between the Company and GP Investment Holdings, LLC (“GPI”), whereby, the Company agreed to exchange (the “Exchange Transaction”) 95 shares (the “B-1”) of the Company’s Series B-1 Preferred Stock (the “Preferred Stock”) held by GPI for 6,333,333 shares of the Company’s common stock, par value $0.0001 per share (the “Exchange Shares”). The Exchange Transaction closed on August 9, 2013.

The 95 shares of B-1 Preferred Stock held a liquidation preference of $9,736,000 as of August 9, 2013 and were exchanged into shares of common stock at an effective conversion price of $1.54. Following the completion of the exchange transaction, GPI holds 15,276,138 shares of the Company’s common stock. This includes the 6,333,333 Exchange Shares and 8,924,805 common shares that were purchased along with the B-1 Preferred directly from Vicis Capital Master Fund in a private transaction.

“We were very pleased to execute the Exchange Transaction as we believe this benefits the Company and our common stockholders by reshaping and simplifying our capital structure, retiring $9,736,000 of liquidation preference, eliminating the dividends on this preferred stock and adding stable long term investors,” said Peter Holst, President and CEO of Glowpoint. “We are pleased to welcome GPI as an investor. GPI is an investment vehicle affiliated with Main Street Capital, a leading middle market BDC headquartered in Houston, and the Pessin family, who are highly respected value investors based in New York.”

In connection with the Agreement, the Company entered into a Registration Rights Agreement (the “Registration Agreement”), with GPI, whereby, the Company has agreed to use its best efforts to file a registration statement, covering the 6,333,333 Exchange Shares, with the Securities and Exchange Commission no later than ninety (90) days after August 9, 2013. Pursuant to the Registration Agreement, GPI has, subject to customary exceptions, agreed to a one (1) year lock-up of its shares.

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