Applied Energetics issues stock in exchange for convertible preferreds

By Susanna Moon

Chicago, Nov. 4 - Applied Energetics, Inc. said it entered into agreements with six shareholders on Monday and Tuesday to issue 5,051,000 common shares in exchange for 505,100 shares of its series A redeemable convertible preferred stock.

After conversion, the company said it had 86,154,499 common shares outstanding and 145,572 convertible preferreds outstanding.

The preferreds provide for cumulative dividends at 6.5% per year and a conversion price of $12 per share. Dividends are payable in cash, common shares or a combination.

"This exchange significantly reduces our company's outstanding preferred shares and reduces future dilution or cash drain related to dividend obligations," Dana Marshall, chairman, president and chief executive officer of Applied Energetics, said in a press release.

Applied Energetics, formerly Ionatron, Inc., is a Tucson-based developer and manufacturer of applied energy systems, primarily for military applications.

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