Devcon settles with investor
BOCA RATON, Fla.--A major Devcon investor, who objected to a March debt restructuring agreement, has dropped a lawsuit and settled with the security company, according to an Aug. 16 SEC filing.
The investor was the only one of three investors who did not favor conditions of a forbearance agreement with investors to restructure the company's debt (search "Devcon deconstructs" at www.securitysystemsnews.com). In early April that investor transmitted a notice of redemption for Devcon stock with a face value of $7 million, which represents roughly one-third of the company's current market cap.
The company had maintained that the investor did not have a case because the majority of the three investors did favor the forbearance agreement.
Under the Aug. 17 agreement, the investor will be paid $7.1 million, plus accrued interest, and will return all shares of the company's Series A Convertible Preferred Stock to the company.
Robert Farenhem, Devcon president, confirmed to Security Systems News the terms of the settlement.