(PRWEB) February 3, 2011
DayStar Technologies, Inc. (Nasdaq: DSTI), a developer of solar photovoltaic products based on CIGS thin-film deposition technology, today announced it has entered into a $5 million securities purchase agreement with Socius CG II, Ltd., a subsidiary of Socius Capital Group (“Socius”). Daystar also announced the additional extinguishment of debt in exchange for shares of common stock as the company continues to restructure its balance sheet and pursue a strategic partnership.
DayStar’s CEO, Magnus Ryde commented, “This flexible financing arrangement, with a proven partner in Socius Captial, will strengthen our balance sheet and will better position us as we continue our discussions with potential strategic partners. The partnerships we are pursuing, if consummated, could include joint ventures, licensing agreements, contract manufacturing agreements, a reverse merger with or an acquisition of DayStar.”
Under the agreement, Daystar has the right over a term of two years, subject to certain conditions, to require Socius to purchase up to $5 million of redeemable Series B Preferred Stock (the “Preferred Stock”). With each purchase, Socius will receive two-year warrants to purchase shares of the company's common stock valued at 35% of the Preferred Stock amount. The exercise price of the warrants will equal the closing bid price of the company's common stock on the preceding day. In addition, Socius will be entitled to exercise an additional investment right for 60 days after each sale of Preferred Stock to purchase common stock valued at 100% of the amount of the Preferred Stock, at a per share price equal to the exercise price of the warrants associated with the sale of Preferred Stock.
DayStar also announced that it has extinguished an additional $3.6 million in debt from its balance sheet through the conversion to equity of certain convertible notes payable, as well as agreements with vendors to settle their liabilities in exchange for shares of DayStar’s common stock. DayStar CEO, Magnus Ryde, commented, “We are pleased to have eliminated another $3.6 million in debt from our balance sheet. We appreciate the continued support of our vendors and other stakeholders. We have nearly completed our balance sheet restructuring and other activities to enhance our ability to pursue strategic transactions.”
Details of the agreements with vendors, note holders, and the securities purchase agreement are set forth in Current Reports on Form 8-K filed with the SEC.
About DayStar Technologies, Inc.
DayStar Technologies, Inc. is engaged in the development, manufacturing and marketing of solar photovoltaic products based upon CIGS thin film deposition technology. For more information, visit the DayStar website at http://www.daystartech.com.
This press release contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Any statements in this release regarding DayStar's business that are not historical facts may be considered "forward-looking statements," including statements concerning DayStar’s expectations regarding potential strategic transactions and its ability to enhance shareholder value. The forward-looking statements in this news release are based on information available at the time the statements are made and/or management's belief as of that time with respect to future events and involve substantial risks and uncertainties that could cause actual results and outcomes to be materially different. Forward-looking statements are based on management's current preliminary expectations and are subject to risks and uncertainties, which may cause DayStar's results to differ materially and adversely from the statements contained herein. Some of the potential risks and uncertainties include DayStar’s ability to successfully complete a strategic transaction and other risks detailed in DayStar's annual report on Form 10-K for the year ended December 31, 2009 and other filings made with the Securities and Exchange Commission. Undue reliance should not be placed on forward-looking statements, which speak only as of the date they are made. DayStar undertakes no obligation to update any forward-looking statements to reflect new information, events or circumstances after the date they are made, or to reflect the occurrence of unanticipated events.
DayStar Technologies, Inc.
Christopher T. Lail
Chief Financial Officer