Softbrands Completes Acquisition of Hotel Information Systems

MINNEAPOLIS, Aug. 15 /PRNewswire-FirstCall/ — SoftBrands, Inc., a global supplier of enterprise application software, has completed its acquisition of MAI Systems Corporation and its subsidiary Hotel Information Systems (HIS).

SoftBrands has completed its financing and has executed a credit agreement providing $21 million to finance the acquisition under a term loan maturing in seven years. The principal amount of the term loan is repayable in 78 equal monthly installments, commencing March 2007. The Credit Agreement also provides for a revolving line of credit under which SoftBrands may borrow up to $9 million, subject to certain conditions.

orrowings bear interest, payable monthly, ranging from 1.0% to 1.75% over the lenders’ prime rate, or from 2.0% to 2.75% over the London Inter Bank Offered Rate, depending on certain levels of earnings of SoftBrands for the twelve months preceding the monthly calculation date.

SoftBrands also closed on the sale of 5,000 shares of its Series D Convertible Preferred Stock and warrants to purchase 333,333 shares of common stock for gross proceeds of $5 million. An additional 1,673 shares of Series D Stock and warrants to purchase 111,534 shares of common stock for gross proceeds of $1.7 million may be purchased by certain current shareholders through early September 2006. The warrants are priced at $1.84 per share. The Series D Stock carries an 8% dividend and converts to common stock at a price of $1.67 per share.

As a condition to such sale, SoftBrands also exchanged 18,000 shares of its Series C Convertible Preferred Stock on a share-for-share basis, with 18,000 shares of Series C-1 Convertible Preferred Stock on substantially the same terms as the Series C Stock with the exception of a dividend rate of 8%.

Hotel Information Systems, the makers of the epitome(TM) hotel property management systems and core central reservations system, serves more than 2,300 hotel properties, primarily in the Americas and Asia.

Leave a Reply

Your email address will not be published. Required fields are marked *