Towerstream Corporation (NASDAQ: TWER), a 4G and Small Cell Rooftop Tower company, closed a $35m debt capital transaction with affiliates of Melody Capital Partners, LP.
The debt matures in full on October 16, 2019 and bears interest at 12% annually, of which 8% is payable in cash on a quarterly basis and 4% is deferred until maturity. In connection with the loan, Towerstream will issue 3,600,000 warrants to purchase common stock with one-third of the warrants exercisable at $0.01 and two-thirds exercisable at $1.26.
According to a note, the transaction aims to strengthen the company’s financial position while avoiding significant dilution to its existing shareholders.
Originally founded in 2000 and led by Jeff Thompson, Chief Executive Officer and President, Towerstream owns, operates, and leases Wi-Fi and Small Cell rooftop tower locations to cellular phone operators, tower, Internet and cable companies and hosts a variety of customers on its network. The company offers broadband services in 12 urban markets including New York City, Boston, Los Angeles, Chicago, Philadelphia, the San Francisco Bay area, Miami, Seattle, Dallas-Fort Worth, Houston, Las Vegas-Reno, and the greater Providence area.